Concerned about the fate of exporters from the garments and made-ups sector who had to shift to the new incentive scheme, Remission of Duties and Taxes on Export Products (RoDTEP), from January 1 2021, the Textiles Ministry has sought details from the Commerce Ministry on the rates of reimbursement they will be entitled to, a source closely tracking the matter has said.
“Exporters of garments and made-ups are nervous as they have no idea what reimbursement rates they will get under the new RoDTEP scheme and whether they would be comparable to the earlier scheme RoSCTL. The Textiles Ministry therefore wants to find out what the rates are before they are announced so it can have some say in the matter," the official told BusinessLine.
The Commerce & Industry Ministry announced the implementation of the RoDTEP scheme for goods exports from January 1, 2021 to compensate exporters for the input taxes not reimbursed under existing schemes, including embedded levies (such as mandi tax, stamp duty etc.).
The popular Merchandise Export from India Scheme (MEIS) scheme was simultaneously withdrawn as it was ruled as a banned export subsidy by a WTO panel since the reimbursement rates were not calculated strictly on the basis of input taxes paid. As the outlay for RoDTEP is set to be much lower than the over ₹ 50,000 crore allocated for the MEIS, there are expected to be cuts in reimbursement rates.
“Exporters do not have any issues with an alternative incentive scheme as long as they are not losing out in terms of the rates. Since the Commerce Ministry is yet to announce the rates for different sectors, the discomfort is growing as exporters do not know on what basis they should price their products,” the source said.
Exporters of garments and made-ups (items stitched from any type of cloth, other than a garment such as bed-sheets, cushion covers, lamp-shades etc) are especially concerned as they had already shifted from the MEIS to a new scheme called the Rebate of State and Central Taxes and Levies (RoSCTL) scheme in 2019 to mitigate the incidence of State VAT and other State taxes (including embedded taxes) that was seen as being WTO compatible.
While they were under the impression that the reimbursement rates that were fixed at around 6 per cent of the value of exports of garments and around 8 per cent for made-ups would remain the same under RoDTEP, now they are not sure, the source said.
“Textile Ministry officials had got in touch with the G K Pillai Committee working out the RoDTEP rates to find out what it had proposed for garments and made-ups. However, they were directed to the Commerce Ministry, which has already received a draft report from the committee with the rates proposed for a number of items. The Textile Ministry has now sought information from the Commerce Ministry which hopefully it will get soon,” the source said.
Source: The Hindu Business Line
The energy cooperation between the US and India supports sustainable development, harnesses sources to meet 21st century power needs, protects national security and promotes regional and international stability, a senior official has said.
The US and India collaborate on natural gas, renewable energy, nuclear energy, clean coal technologies, smart grids, and unconventional and clean energy sources research for the benefit of our people now and in the future, State Department Spokesperson Ned Price told reporters on Monday at his daily news conference.
“When it comes to energy cooperation more broadly, I would say that the US, India energy partnership supports sustainable energy development, it harnesses energy sources to meet 21st century power needs, it protects national security and promotes regional and international stability,” he said.
Responding to a question on energy co-operation between India and the US, Price said the strategic energy partnership is strong and will continue growing even as the administration prioritises climate change issues.
”Of course, we have worked closely with India on the challenges of climate change. It was December 2015 when the Paris Agreement was consummated that the US and India worked especially closely to usher in the Paris Climate Agreement just as we did with China at that time. So, we will continue to work closely with India on the challenges of climate change,” he said.
India’s Ambassador to the US, Taranjit Singh Sandhu, has recently described the energy sector as one of the “five baskets” of the India-US collaboration.
The five baskets are cooperation in healthcare and pharma and COVID-19 management, including affordable medicines and vaccines; the digital space, including information and communication technology, innovation and start-ups; the energy sector, including LNG, renewables and solar that will allow to combat climate change; the education and knowledge partnership; and cooperation in strategic and defence areas, including in the Indo-Pacific.
In a recent op-ed in Newsweek magazine, Sandhu said India remains committed to the goals of the Paris climate accord and welcomes the return of the US to this important agreement.
”Here again India has demonstrated leadership, creating the International Solar Alliance, while being on track to surpass our voluntary commitments under the Paris Accord. Our solar energy production will reach 450GW by 2030, reducing greenhouse gas emissions by 30-35 per cent by that year (from 2005 levels),” he wrote.
India and the US already work together in renewable energy under the Strategic Energy Partnership, Sandhu said. ”We can build on these gains and accelerate a green transformation through effective technology transfers, financing and an equity-based approach that will increase access to renewable energy for a wider population, which in turn will create global low-carbon pathways, green jobs and achieve shared climate goals. “Such an approach will also ensure that India’s growth trajectory, critical to the economic empowerment of millions, will be sustained and sustainable,” Sandhu wrote.
Source: The Financial Express
China regained its position as India’s top trade partner in 2020, as New Delhi’s reliance on imported machines outweighed its efforts to curb commerce with Beijing after a bloody border conflict.
Two-way trade between the longstanding economic and strategic rivals stood at $77.7 billion last year, according to provisional data from India’s commerce ministry. Although that was lower than the previous year’s $85.5 billion total, it was enough to make China the largest commercial partner displacing the U.S. -- bilateral trade with whom came in at $75.9 billion amid muted demand for goods in the middle of a pandemic.
While Prime Minister Narendra Modi banned hundreds of Chinese apps, slowed approvals for investments from the neighbor and called for self-reliance after a deadly clash along their disputed Himalayan border, India continues to rely heavily on Chinese-made heavy machinery, telecom equipment and home appliances. As a result, the bilateral trade gap with China was at almost $40 billion in 2020, making it India’s largest.
Total imports from China at $58.7 billion were more than India’s combined purchases from the U.S. and the U.A.E, which are its second- and third-largest trade partners, respectively. Heavy machinery imports accounted for 51% of India’s purchases from its neighbor.
That said, India did manage to lower imports from its Asian neighbor amid demand disruptions caused by the coronavirus pandemic. The South Asian nation also managed to increase its exports to China by about 11% from a year ago to $19 billion last year, which makes any further worsening of ties with Beijing a threat to New Delhi’s export revenue.
The tense relations are already weighing on India’s ambitions to bolster its manufacturing capabilities. New Delhi has been slow to issue visas to Chinese engineers needed to help Taiwanese companies set up factories under a so-called production-linked incentive program, or PLI, to promote local manufacturing.
“Still a very long way to go” is how Amitendu Palit, an economist specializing in international trade and investment at the National University of Singapore, described New Delhi’s efforts to wean itself away from Beijing. “The PLI schemes will take at least four-five years to create fresh capacities in specific sectors. Till then reliance on China would continue.”
Source: The Economic Times
India’s annual exports to China crossed the $20-billion mark for the first time in 2020 with shipments rising 16.15 per cent to $20.87 billion, per data collated from Indian and Chinese agencies.
Imports from China during the last calender year shrunk 10.87 per cent to $66.78 billion resulting in the narrowing of trade deficit by 19.39 per cent to $45.91 billion, according to the data. India-China bilateral trade during the year declined 5.64 per cent to $87.65 billion.
Top exports that witnessed a steep rise include primary commodities such as iron ore as well as metals and metal products including iron & steel, aluminium and copper.
Agriculture exports to the country witnessed an increase of 58.99 per cent to $199.14 million. This rise was led by cane sugar (387.5 per cent ), soyabean oil (3050 per cent), rice (184 per cent) and vegetables fats and oils (415 per cent). But exports of mangoes and fish oil fell to nil while tea exports declined 6.94 per cent and fresh grapes by 24.1 per cent.
Value-added exports
With only a small percentage of India’s exports to China comprising manufactured items, many experts are of the view that the country has to focus on value-added exports. China has imposed several non-tariff barriers for items such as pharmaceuticals so the country needs to work around these.
In 2020, a steep rise was witnessed in India’s exports of ores (75.35 per cent), iron and steel (336 per cent), aluminium (2023 per cent). With exports of iron and steel at $2.53 billion and aluminium and its articles at $640 million, India became the fourth and fifth largest exporter of the two commodities to China respectively.
The top imports from China that posted a decline are electrical machinery and equipment (-4.53 per cent), boilers, machinery and mechanical appliances (-7.68 per cent), plastics and related articles (-21.9 per cent), articles of iron and steel (-22.38 per cent), furniture (-14.73 per cent), fertilisers (-15.15 per cent), vehicle parts and accessories, including rolling stock (-7.62 per cent), toys and sports equipment (-4.44 per cent), iron and steel (-32.27 per cent), glass and glassware(-21.41 per cent), inorganic chemicals (-15.12 per cent), miscellaneous articles of base metals (-23.88 per cent) and ceramic products (-31.25 per cent).
Source: The Hindu Business Line
Tirupur’s NIFT-TEA College of Knitwear Fashion, AIC NIFT TEA Incubation Centre for Textiles and Apparels and Textile Excellence have signed an MOU to jointly organise the twin exhibitions: DyeChem World and KnitProcess.
The event will take place in Tirupur from 22 to 24 October 2021. SDC International India has also joined hands as a co-organiser.
It is worth mentioning here that Tirupur accounts for 60 per cent of India’s knitting, processing and apparel capacity and leads the path in re-starting textile and apparel business through the pandemic because of its resilience.
As per a statement, issued by show organisers, DyeChem World will cover the entire range of textile dyes, chemicals, finishes and technologies. Being the first-of-its-kind show in southern India, DyeChem World will create a platform for interaction and knowledge sharing between the dyes and chemicals and textile industry.
On the other hand, KnitProcess exhibition will help the industry to explore and adopt latest innovations in knitting and post processing sector, covering the entire value chain of knitwear processing technologies till garmenting.
The important highlight of the events will be the CEO Summit as it will be a gathering of head honchos from the global textile and apparel, fashion brands and retail industry.
While the primary aim of the meet is to have highly interactive and candid networking for business, it would also have serious deliberations on core issues of sustainable practices, sourcing and adopting it to supply chain.
S. Perisamy, CEO, AIC NIFT TEA says, “A world class exhibition would promote entrepreneurship and innovation as well as help adoption of innovative ideas by our industry and its commercialisation to stay competitive.”
Yogesh Gaikwad, Director, SDC International, UK & India, believes Tirupur is the apt venue for an event of this stature.
Source: Apparel Online
India signed a free trade and investment agreement with Mauritius on Tuesday, the first with any country in Africa. It was also the first time since 2011 that India was signing a free trade pact with any country.
Announcing this in Port Louis, foreign minister S Jaishankar said the Comprehensive Economic Cooperation and Partnership Agreement (CECPA) “will provide a timely boost for the revival of our post-Covid economies and also enable Indian investors to use Mauritius as a launch- pad for business expansion into continental Africa helping the prospect of Mauritius emerging as a ‘hub of Africa’.” In his first visit there as foreign minister, Jaishankar also handed over another 1,00,000 doses of Covid vaccines to Mauritius Prime Minister Pravind Jugnauth. India had earlier flown over 1,00,000 doses in January.
For Mauritius, the Indian market for frozen fish, speciality sugar, biscuits, fresh fruits, juices, mineral water, soaps, bags, medical and surgical equipment, and apparel will open up. “Mauritius will get preferential access for export of 40,000 tonnes of sugar into India at an early time frame. Similarly, there will also be access for the export of 7.5 million pieces of apparel,” Jaishankar said.
In services, Jaishankar said, India has offered 95 sub-sectors from 11 broad services sectors. “Services contribute, I believe, 76% of the GDP of Mauritius, and CECPA will surely boost the dynamism of the services sector in Mauritius. The CECPA could also facilitate Indian investment in the services sector in Mauritius.”
Mauritius being a crucial security partner in the Indian Ocean region, India has leased out a Dornier aircraft and an Advanced Light Helicopter Dhruv “on a gratis basis for 2 years.” Jaishankar described India’s assistance and presence for Mauritius as “responsive, resolute and reliable.”
Source: The Economic Times
The Directorate General of GST Intelligence (DGGI) and the C-GST Commissionerates arrested 12 persons including a chartered accountant on Tuesday in connection with fake-invoices frauds. The authorities have stepped up the drive against such frauds since mid-November last year and this, along with the use of data analytics to detect tax evasion, has resulted in a sharp increases in GST collections.
GST collections came in at an impressive Rs 1.15 lakh crore in December 2020 and rose further to Rs 1.20 lakh crore in January 2021. The tax department expects similar higher collection trend to continue in the month of February 2021 as well.
The chartered accountant arrested, one Abhishek Singhal, was involved in running fake firms to issue fraudulent invoices. He is the 10th CA arrested so far who have been involved in bogus firms and/or issuance of fake invoices to fraudulently avail and pass on ITC without actual supplies of goods/services.
Sources said that out of the 329 persons arrested so far, at least four persons have been booked under Cofeposa while the GST intelligence and CGST authorities have booked more than 3,200 cases against 9600 fake GSTIN entities as of now. Also, the authorities have recovered more than Rs 1,000 crore from these fraudsters.
According to Sources, the GST authorities have been using deep data analytics, integrated data-sharing and AI & ML tools along with BIFA to unearth the input tax credit (ITC) utilisation frauds via fake invoicing and bogus firms. The technology has enabled the GST ecosystem and intelligence authorities to identify layer-by-layer activities of these fake entities and their networking without any overreach and able to pinpoint the fraudsters with specific inputs to take targeted actions and further investigations against them.
Of the 329 arrests so far there are 131 masterminds, 113 proprietors, 46 director/managing directors, 17 partners, 5 CEOs/CFOs/CMDs, 10 chartered accountants, 4 accountants and one each of company secretary, broker, and GST practitioner.
Arrested persons include fake entities operators and the end beneficiaries who connive with these fraudsters running businesses of fake invoices.
Source: The Financial Express
The facility will be built on space taken from Allcargo Logistics’ 1.8 million sq ft logistics park at Farukh Nagar. Located on Western Peripheral Expressway in Delhi, the tech-enabled STC will offer superior transit time, accuracy in cargo delivery and high locational advantage of access to all major national highways.
The STC will help Gati-KWE consolidate its logistics operations on the outskirts to decongest the city. It will have the capacity to process cargo for short-haul deliveries in North India and long-haul movements.
Gati-KWE is also working towards building competence for enabling short-haul movement from the Farukh Nagar STC to Delhi/NCR and entire North India so that its customers from south or north-east will be able to transport goods to North India quickly.
The facility has been designed to process cargo loads of almost 100 trucks a day.
Gati-KWE has plans to open four more STCs, a company statement said.
Source: The Hindu Business Line
India’s exports to China has increased by 16.15 per cent to USD 20.87 billion in 2020 from USD 17.9 billion in the previous year on account of healthy growth in the shipments of ores, iron and steel, aluminum and copper, according to the data of the commerce ministry.
Trade deficit with China has declined 19.39 per cent from USD 56.95 billion in 2019 to USD 45.91 billion in 2020 as the country’s imports from the neighbouring country contracted 10.87 per cent to USD 66.78 billion from USD 74.92 billion in 2019, the data showed.
The bilateral trade in 2020 decreased by 5.64 per cent to 87.65 billion compared to USD 92.89 billion in the previous year.
In the agriculture sector, the main export commodities which recorded healthy growth includes cane sugar, soybean oil, and vegetables fats and oils.
However, the exports of mangoes, fish oil, tea, and fresh grapes declined.
Commenting on these numbers, Federation of Indian Export Organisations (FIEO) President S K Saraf said that this is a positive sign and it reflects increasing competitiveness of domestic exporters.
Imports of goods including electrical machinery and equipment, boilers, machinery and mechanical appliances, plastics and related articles, articles of iron and steel, furniture, fertilizers, vehicle parts and accessories, toys and sports equipment, inorganic chemicals and ceramic products have recorded a decline.
Source: The Financial Express
As India aims to boost its exports, the government is looking at manufacturing containers in a big way while developing a shipping line under the Atmanirbhar Bharat programme. Containers are required to ship goods. At present, India is solely dependent on the public sector
Shipping Corporation of India NSE 8.28 %.
While the Ministry of Ports, Shipping and Waterways has already set up a committee to study the feasibility of manufacturing containers at Bhavnagar in Gujarat, sources said that other such hubs are also being looked at.
Until now, most exporters have been relying primarily on Chinese containers. But with geopolitical contours changing rapidly, shortage of containers has hit exporters, who have had bear the additional burden of freight cost hike. India has reduced its imports from China amid rising political tension.
"We need to address the issue of containers at the earliest especially as we focus on boosting exports on one hand and reducing imports on the other," Ajay Sahai, director general, Federation of Indian Export Organisation told India Narrative.
Traffic at India's major ports touched 704.82 million tonnes in 2019-20, a report by India Brand Equity Foundation (IBEF) said.
Amid the Coronavirus pandemic, India has turned into a major supplier of rice grain, meat and other agriculture produce globally.
Shortage of containers, especially in the post Covid 19 era, has been causing delays in shipment of various goods.
"The issue of non-availability of containers has been brought to the notice of the government. As exports of rice has surged, the shortage of containers has proved to be a bid handicap. Going ahead, we expect global demand for rice from India to remain high and in order increase supply, it is critical to resolve this issue," Vinod Kaul, executive director, All India Rice Exporters' Association said.
In 2020, India's farm exports rose by about 10 per cent.
The IBEF report highlighted that Indian agricultural, horticultural and processed foods are currently exported to more than 100 countries, chief among them being the Middle East, Southeast Asia, SAARC countries, the EU, and the US.
India, which already supplies over 32 per cent of the global rice needs, witnessed an 80.4 per cent increase in exports of rice both basmati and non basmati during the April-December period of the current financial year touching 11.58 million tonnes. Exports of non Basmati rice alone accounted for an increase of 129 per cent.
Besides, India has been exporting meat, sugar, dairy products, honey, pulses.
Source: The Economic Times
Ahead of the brand new foreign trade policy, trade has proposed a brand new incentive scheme for providers exports that may give larger advantages to exporters within the MSME sector.
The Services Export Promotion Council has recommended the federal government to think about a Duty Remission on Export of Services Scheme (DRESS) to refund taxes to providers exporters whereby small and micro exporters could be eligible for a 7% incentive whereas the massive ones would get 4%.
The scheme is touted as a alternative for the Service Export from India Scheme and is on the identical strains as Remission of Duties and Taxes on Exported Products (RoDTEP) for items exports.
“We have received a proposal from the council. We are studying it,” mentioned a senior official within the know of the event.
Aimed at refunding taxes already paid again to providers exporters, DRESS is proposed to incorporate all service exports created in India and exported from the nation in modes 1 and a couple of of service supply. Mode 1 refers to cross border commerce and Mode 2 means consumption overseas. The scheme proposes remission charges of seven%, 5% and 4% for micro and small, medium and huge enterprises.
These taxes embody these on worker associated bills comparable to cab providers, development providers or gas the place GST credit are prohibited, excise obligation and VAT on petroleum merchandise, electrical energy taxes and stamp duties.
“The extent of unrefunded taxes in the export chain are in the range of 5-9% of the exports value and it is proposed that these taxes be reimbursed to make the service exports competitive,” mentioned Maneck Davar, chairman, SEPC.
Source: The Pehal News
China regained its position as India’s top trade partner in 2020, as New Delhi’s reliance on imported machines outweighed its efforts to curb commerce with Beijing after a bloody border conflict.
Two-way trade between the longstanding economic and strategic rivals stood at $77.7 billion last year, according to provisional data from India’s commerce ministry. Although that was lower than the previous year’s $85.5 billion total, it was enough to make China the largest commercial partner displacing the U.S. -- bilateral trade with whom came in at $75.9 billion amid muted demand for goods in the middle of a pandemic.
While Prime Minister Narendra Modi banned hundreds of Chinese apps, slowed approvals for investments from the neighbor and called for self-reliance after a deadly clash along their disputed Himalayan border, India continues to rely heavily on Chinese-made heavy machinery, telecom equipment and home appliances. As a result, the bilateral trade gap with China was at almost $40 billion in 2020, making it India’s largest.
Total imports from China at $58.7 billion were more than India’s combined purchases from the U.S. and the U.A.E, which are its second- and third-largest trade partners, respectively.
That said, India did manage to lower imports from its Asian neighbor amid demand disruptions caused by the coronavirus pandemic. The South Asian nation also managed to increase its exports to China by about 11 per cent from a year ago to $19 billion last year, which makes any further worsening of ties with Beijing a threat to New Delhi’s export revenue.
The tense relations are already weighing on India’s ambitions to bolster its manufacturing capabilities. New Delhi has been slow to issue visas to Chinese engineers needed to help Taiwanese companies set up factories under a so-called production-linked incentive program, or PLI, to promote local manufacturing.
“Still a very long way to go” is how Amitendu Palit, an economist specializing in international trade and investment at the National University of Singapore, described New Delhi’s efforts to wean itself away from Beijing. “The PLI schemes will take at least four-five years to create fresh capacities in specific sectors. Till then reliance on China would continue.”
Source: The Business Standard
India’s trade deficit with China narrowed last calendar year as exports rose 16.15% to $20.25 billion, led by iron and steel, aluminium and copper, while imports shrunk 10.87% to $66.78 billion.
The country’s trade deficit with China fell to $45.91 billion from $56.95 billion in 2019, officials said. Shipments to China crossed $20 billion for the first time even as exports of mangoes, fish oil, grapes and tea declined.
“Among the key agricultural commodities, including sugar, rice and oil, which we had focused on in 2019, the major contributors were cane sugar, soybean oil and vegetable fats,” one of the officials said quoting data from Chinese agencies.
China was India’s largest trade partner, according to India’s official data for April-December FY21.
In order to reduce its dependence on imports, especially for non-essential and low-quality goods particularly from China, India has launched production-linked incentive scheme to promote domestic manufacturing, mandated local content in public procurement, restricted and prohibited certain imports, put in place quality control orders, and launched a series of anti-dumping probes.
It has also tightened the scrutiny of imports that make their way through free trade agreement partners. Besides, 24 focus sectors have been identified in which the country is keen to become self-reliant.
Last year, a steep rise was witnessed in exports of ores, iron and steel, aluminium and copper. Exports of iron and steel amounted to $2.53 billion, a whopping 336.44% rise year-on-year, the official said citing data from Chinese agencies.
Among agricultural goods, exports of mangoes and fish oil fell to nil while that of tea and fresh grapes saw steep declines.
As per the official, India is now the fourth largest exporter of iron ore, and iron and steel to China and the fifth largest exporter of aluminium and its products to China.
Organic chemicals, electronic components, telecom instruments, consumer electronics, plastics and fertilisers are India’s top imports from China. Imports of electrical machinery and equipment, boilers, machinery and mechanical appliances, plastics, furniture articles of iron and steel, toys, sports equipment and ceramics declined last year.
“The exports growth maybe healthy but most of our exports to China have been of primary goods and raw materials while imports have been largely intermediate and finished goods,” said a Delhi-based trade expert. “The trade imbalance can’t be corrected till this trend changes.”
India has also witnessed higher imports from Hong Kong, which emerged as the country’s sixth largest trade partner in FY20 from its number 13 spot in FY18.
Source: The Economic Times
The growth momentum needs to strengthen further for a sustained revival of the economy and for a quick return of the level of output to the pre-Covid trajectory, Reserve Bank of India (RBI) Governor Shaktikanta Das said.
According to the minutes of the RBI’s Monetry Policy Committee (MPC) meeting held on February 5, Das said growth, although uneven, is recovering and gathering momentum, and the outlook has improved significantly with the rollout of the vaccine programme in the country. “The sharp correction in food inflation has improved the near-term headline inflation outlook, although core inflation pressures persist,” Das said.
The MPC kept the policy rate — repo rate — unchanged at 4 per cent at the review meeting.
However, RBI Deputy Governor Michael Patra said concerns about financial stability have risen and the recent new highs scaled by equity markets could be driven by “irrational exuberance”.
Given the sharp moderation in inflation along with a stable near-term outlook, monetary policy needs to continue with the accommodative stance to ensure that the recovery gains greater traction and becomes broad-based, Das said.
High frequency indicators suggest that the economic recovery is normalising fast in both rural and urban areas, Das said. The agricultural sector has been resilient throughout the pandemic and its prospects appear bright in view of higher rabi sowing and comparatively better reservoir levels. Manufacturing activity is picking up. Although initial revival was propelled by pent-up demand, indications are that growth impulses are now being driven by pick-up in activity across manufacturing and services, he said.
According to Patra, the recent new highs scaled by equity markets could be driven by irrational exuberance. “It is difficult to tell in an environment of exceptionally low interest rates all around, large corporate profits but still no capex to write home about, and high levels of market borrowings,” he said, according to the minutes.
Banks have stronger capital buffers than during the global financial crisis, but stress in the financial sector’s balance sheets could intensify as the camouflage of moratorium, asset classification standstill and restructuring fades, Patra said.
MPC Member Shashanka Bhide said accommodative monetary policy stance is needed to strengthen ongoing economic recovery enabling expansion of both output and demand.
Ashima Goyal, MPC member, said inflation presents a mixed picture. Prices of many food products have softened, bringing down headline inflation. Profiteering in retail supply has not been able to withstand excess supply, although data shows only the beginning of reduction in retail margins, Goyal said.
Source: The Indian Express
The Central Board of Indirect Taxes and Customs (CBIC) has extended the time limit for sanction of pending integrated goods and service tax (IGST) refunds, in cases where records have not been transmitted on the portal due to mismatch in outward supplies returns and input tax credit.
"It is seen that a considerable number of exporters have been facing difficulties in getting their IGST refund sanctioned either due to lack of facility to amend GST 3B return or bona-fide clerical/human errors while filing the documents," the Board said Monday.
The extension will overcome the problem of refund blockage by allowing refunds subject to undertakings or submission of chartered accountants certificates by the exporters and post refund audit scrutiny, the Board added.
The time limit for sanctioning pending IGST refunds was extended in cases where records have not been transmitted to the Indian Customs and Central Excise Electronic Commerce/Electronic Data interchange Gateway or ICEGATE - a portal that provides e-filing services to the trade and cargo carriers and trade partners - due to GSTR1 and GSTR3B mismatch error.
This facilitation would be applicable to all shipping bills filed up to March 31, 2021.
The CBIC has also extended the facility for resolving invoice mismatch errors through customs officer interface on permanent basis. Earlier this facility was provided for a limited period, in respect of shipping bills filed up to December 31, 2019.
The exporter may avail the facility of correction of invoice mis-match errors in respect of all past shipping bills, irrespective of its date of filing subject to payment of a nominal fee
Source: The Economic Times
China's demand for India's cotton has pushed domestic yarn prices higher, said India Ratings and Research.
Accordingly, domestic yarn production increased in January 2021, led by a strong export and moderate domestic demand during December 2020.
"While yarn production was substantially lower on a YoY basis up to 8MFY21, exports increased by higher single digits YoY due to a healthy demand from neighbouring countries,"
"China's demand for Indian yarn resumed to pre-Covid levels during November-December 2020, as against a volume drop from Bangladesh and Vietnam during same period."
In January 2021, cotton yarn prices increased 15 per cent MoM and 30 per cent YoY, resulting in higher gross margins.
"The higher cotton yarn demand is attributed to the global supply curbs on Xinjiang region (China) cotton, which is benefitting Indian domestic spinners."
"While exports are likely to moderate during January-February 2021 with likely shutdown of mills ahead of Chinese new year, demand resumption is likely by March 2021."
Consequently, cotton prices surged by 7-10 per cent MoM during January 2021, led by a strong export demand for cotton yarn.
"The international prices rose by 13-17 per cent YoY, led by the buoyant China demand for US cotton, which is having a rub-off effect on cheaper Indian cotton prices."
However, apparel exports declined in December 2020, after recovering over September-November 2020 on a YoY basis due to the impact of a second wave of Covid-19 in the US and Europe.
"This would also impact the near-term order book position of ready-made garment exporters for the upcoming fashion season."
"During November 2020, knitted apparels volumes remained stagnant with realisations gaining by high single digit yoy basis; on the contrary, woven apparels volumes increased by 8.2 per cent and realisations fell substantially yoy basis. During 2020, India exports to the US fell 20-25 per cent YoY in both volume and value terms."
Source: Business Insider
In a bid to preserve and promote the art and artisans of traditional ''matikala'', the UP Government has made a provision of Rs 10 crore in its Budget 2021-22.
An arrangement of interest-free loans of up to Rs 10 lakh has been made for reserved category beneficiaries and general category women and the same at 4 per cent annual interest for male beneficiaries of general category under the Mukhyamantri Gramodyog Rozgar Yojana.
In the handloom and textile industries'' sector, a target has been made to generate 25,000 employment in the field of textiles in the financial year 2021-2022.
The budget has also proposed power supply to power loom weavers by the state government at a subsidized rate.
In the sector of IT and electronics, there will be establishment of electronic city on Yamuna Expressway near Jewar Airport and Defence Electronics Manufacturing Cluster in Bundelkhand.
PPP model-based construction of ''Advanced Information Technology Complex'' in a 40-acre area at Nadarganj near Lucknow Airport is proposed.
Source: The Outlook Magazine
Sanjiv Ranjan, Indian ambassador to Colombia, has said that there is a huge potential for Indian apparel exporters in Colombia, particularly in its ‘resilient and innovative’ fashion industry with domestic sales of about US $ 7 billion.
Addressing an event, he said that India’s apparel export to Colombia is just 3 per cent of its global imports.
“This does not really reflect the strength of what our sector stands for. We have a huge untapped potential in this sector which needs to be explored and utilised by our exporters,” he added.
Notably, the annual household expenditure on fashion in Columbia is roughly 24.3 trillion Columbian peso.
Columbia has a robust network of almost 14,000 companies in the fashion industry, mostly in the small and medium sized categories. Even during the peak of the pandemic in June 2020, clothing accounted for nearly 57 per cent of the total fashion spending followed by jewellery.
“It is one of the most vibrant sectors of the region. While the Government is trying at its level, the private sector should find out how to contribute to this resilient and innovative sector,” the ambassador said.
It is pertinent to mention here that of the top 10 apparel imports from India to Colombia, only two are in the MMF category and the rest are cotton garments. This may be the reason Bangladesh and Vietnam are scoring ahead of India.
India’s apparel export from India was around US $ 21 million in 2019.
Source: Apparel Online
Australian cotton farmers who suffered due to the China-Australia trade spat are being hopeful with new customers in sight. Australia's cotton industry has diversified since China stopped buying. Cotton growers, who are expected to receive high returns for their produce this year, are making some inroads into Indonesia, Thailand, Vietnam and Bangladesh.
Australian growers and shippers claim Chinese spinning mills were told last October to stop buying Australia-grown cotton, and the billion-dollar a year trade essentially stopped.
The Australian department of agriculture will not say what the cost to farmers has been of higher tariffs and unofficial customs bans across a range of commodities.
"It's not all doom and gloom," Toowoomba-based cotton trader and industry analyst Pete Johnson was quoted as saying about China's exit from the Australian market by an Australian newspaper.
Johnson estimated growers would lose a $10-$20 a bale premium without China in the market, but that returns to growers this year were expected to be ‘historically high’.
"Spreading that risk is ultimately not a bad thing for the industry,” he added.
Source: Fibre2Fashion News
There is no denying that 2020 was a drastic year for the apparel trade. USA – the world’s largest apparel importer – fell by 23.46 per cent in its imports as it faced massive consequences of the pandemic as all apparel product categories tumbled massively.
However, the fall recorded in nightwear category was the lowest in both volumes and values.
USA imported 56.10 million dozen of nightwear products in 2020 worth US $ 2.26 billion, falling by just 0.98 per cent and 7.59 per cent on Y-o-Y basis, respectively.
As China had no story to tell other than the negative trajectory, countries like India, Bangladesh, Vietnam and Indonesia all upped their respective nightwear exports to USA.
India shipped US $ 138.72 million worth of nightwear to USA in 2020, surging 8.05 per cent on Y-o-Y basis. Volume-wise, the country upped its shipment by 9.77 per cent.
As far as Bangladesh is concerned, it surged by 5.57 per cent in its nightwear exports to USA in value terms to US $ 85.56 million.
Vietnam, on the other hand, grew significantly by 29.80 per cent to US $ 382.38 million in its nightwear exports to USA during 2020.
Indonesia, which has gained significant ground in the recent years in US nightwear market, increased 11.15 per cent in 2020 to US $ 66.67 million.
Source: Apparel Online
ny, Malek Spinning Mills, Marchi & Fildi Spa, Lenzing AG, Recovertex, Renewcell, Saraz Fibre Tech, Usha Yarns Limited and Worn Again Technologies.
Through collaboration among the participants, the partnership aims to build a successful business model for adopting more circular processes. It plans to facilitate a decrease in textile waste and increase the use of recycled fibres, distributing value throughout the fashion value cycle and generating economic benefits in Bangladesh by accelerating the fiber recycling market.
The initiative is focusing on Bangladesh as it arguably possesses the most in-demand and recyclable waste of any garment producing country, but the majority of its waste is currently being exported or downcycled.
Therefore, there is a substantial opportunity to make it a leader in circularity by scaling the recycling capacity in the country and generating more value from these waste streams, GFA said. Following the hardships in the country generated by COVID-19, this approach also aims build industry resilience for the future.
The business model and project learnings will be presented at the end of 2021 in a ‘Circularity Playbook for Bangladesh’, which will be used as a guide to replicate the partnership in other countries, such as Vietnam and Indonesia.
The partnership is still welcoming new applicants.
Source: Fibre2Fashion News
The present government has correctly emphasised the need to develop and expand technical education in the country. It has set up various engineering universities and some engineering colleges, which provide BSc level courses in various technical subjects. The roles of these colleges are fully controlled and managed by the universities they are affiliated with. Every year, many students get admitted to the government engineering colleges with the dream of contributing to the economy and the country. How effective are these colleges in making these dreams come true? The general contention is that they provide very mediocre education that does not fulfill the needs of the students.
The textile sector is the source of over 80 percent of foreign exchange earnings in Bangladesh; it is called the country's economic backbone. The garment industry's growth rate in 2019 was 11.49 percent, compared to 7.8 percent in 2017. However, growth has slowed down due to Covid-19. To continue the growth trend, the government has set up a few textile colleges, including a textile university. However, challenges remain, which we bring to the fore to address key issues that are critical to improving the textile engineering colleges.
There are seven textile colleges in Bangladesh; several more are under construction. Each college trains about 480 students. In Pabna Textile Engineering College, it was found that there are four assistant professors, eight lecturers, six t-instructors, and a few other teachers, but no professors. The conditions of the new colleges are deplorable.
The first problem in every college is a crisis of teachers. Where one teacher is recommended for every 12 engineering students, there are too few teachers in service to meet the student-teacher ratio. Thus, guest teachers conduct many classes. Some colleges have been upgraded from offering Diploma to BSc degrees, where Diploma teachers are being promoted to take classes. Although new teachers are hired occasionally, additions to the teaching staff are negligible compared to the need. Lacking adequate training, despite their best efforts, these teachers cannot give the students their best.
The appointment of departmental teachers is critical for the development of any educational institution. However, there is a crisis of departmental teachers and technicians in textile education. Students cannot make much progress due to the lack of seminars, as well as required information and useful guidelines. Consequently, they are very frustrated, and many students want to pursue higher education abroad.
Regarding laboratories, students cannot do their thesis work properly due to lack of equipment and budgetary allocations for laboratory research. There is no equipment in the laboratories that deals with modern textiles and technical textiles like microfibre, fibre composition, and modern dyeing. Thus, thesis work is based on using conventional instruments. How is it possible to improve technical education in the country if we continue in this way?
Last year, students of certain institutions pursued their theses on fibre composition, but it was not practical due to the lack of modern laboratory equipment. Where such equipment is available, research is hampered for a lack of skilled technicians. Thus, the progress of the nation's engineering colleges and the quality of the graduates are questionable. Where research is the lifeblood of an engineering institution, these colleges do not have a budget for research, nor do they have trained technicians and faculty. One wonders why a decent budget is not allocated to conduct research in our engineering colleges.
Let us also take a glance at the curriculum. The truth is that many of the subjects are old-fashioned. Although the industries have become modern in keeping pace with the times, the curriculum has remained the same. Students also have a two-month long internship in the last semester and a "mill inspection" every semester to improve their technical capacity. These experiences could be improved in great measure. Graduating students thus face a very embarrassing situation when they land their first jobs in the industry: they lack adequate and modern knowhow.
The present world also demands a move from traditional textile to technical textile. The entire sector needs to change in tandem with the needs of the rest of the world. And for this, we need a rich technical education system based on research. About four million people are directly or indirectly involved in this sector in Bangladesh, where only three lakh people were employed in 2000. In most of the factories, foreign engineers occupy the top positions due to a lack of skilled local engineers. By developing local competence, it can reduce the country's reliance on foreign engineers and enable the locals to play a pivotal role in taking the country forward. Support from the textile industry through joint programmes and funding support would be the icing on the cake.
Source: The Daily Star
The bilateral trade between India and Mexico is rising and there is huge potential for growth of Indian apparel exports to Mexico, according to Indian ambassador to Mexico Manpreet Vohra, who recently told a virtual meeting titled 'India-Mexico Synergies in Apparel and Textiles' that the bilateral trade has grown 46 per cent to about $10 billion since 2014.
The meeting was recently organised by the Apparel Export Promotion Council (AEPC) and the Indian embassy in Mexico City.
"Mexico is now India's largest trading partner in Latin America and the second-largest in entire America after the USA and having overtaken Canada and Brazil. Our trade is also fairly well balanced with only about $1 billion in India's favour," Vohra was quoted as saying by a news agency.
The ambassador said one of the most important products in the bilateral trade basket is garments and textiles, and for which India is among Mexico's top suppliers. In 2019, Mexico imported $381 million worth of textiles and clothing items from the country.
"However, there is much more room for growth borne out by the fact that in 2019 Mexico imported over $10.7 billion worth of garments and textiles from all over the world. Even 2020 data shows from January to November that despite the pandemic Mexico has still imported $7.9 billion of these items. India, therefore, can surely increase its share in the import matrix of Mexico," the envoy said.
India is one of the leading manufacturers and exporters of high quality and competitively priced garments and textiles, he said, adding that the size of the country's domestic market alone is $100 billion.
"Of the 10 top apparel products that are being exported from India to Mexico only one item is a MMF fabric, all other items are cotton fabrics. This is where the gap is and where we see growth," Sudhir Sekhri, chairman, export promotion, AEPC, noted.
Source: Fibre2Fashion News
There is no specific issue but they will have "broad-based" discussions as the new administration is in place in the US. "We want to develop a much solid relationship with the US," said Dr Momen.
With an upward trend in both way export and import, the total trade volume with the US jumped to US $4.1 billion in 2009 from US $1.5 billion in 1996, reflecting a 59.4 % increase in the total trade volume.
Since then, the figure showed an increasing trend of trade with the US with an amount of $6.4 billion in 2014 to $ 9 billion in 2019.
However, the trade figure with the US was US $3,405.4 million until mid-2020 despite the Covid-19 pandemic.
In 2018-19, Bangladesh export to the US was US $6.8 billion, including major exportable items, such as, woven apparel, knit apparel, miscellaneous textile products, cap, headgear, footwear, tobacco, snacks food, furniture, ceramic, toys, plastic items and artificial flowers.
Earlier, the foreign minister said, there were indications that the new US administration under President Joe Biden would look into the issue of genocide in the Rakhine State and will hopefully proactively take action for their safe return to Myanmar.
Source: The Daily Star
Despite having extended duty-free market access facilities to the Chinese market, Bangladesh’s apparel exports to the country declined by 32.72% to $163.30 million during the July-January period of the current fiscal year.
On June 16, 2020, the Chinese government announced the duty-free export facilities for 97% of its tariff line.
With the announcement, a total of 8,256 Bangladeshi items are now eligible for zero duty facilities in the Chinese market effective from July last year.
According to Export Promotion Bureau (EPB) data, during July-January, the first seven months of the Fiscal Year 2020-21, Bangladesh earned $163.30 million, down by 32.72%, exporting clothing products to the Chinese markets. In the same period last year, Bangladesh earned $242.73 million.
As per the data, Knitwear products recorded a 22.76% negative growth to $77 million, which was $99 million in the same period of the previous year.
Woven products earned $87 million, down by 39.61%, which was $143.50 million a year ago.
However, the country’s total export earnings from China declined by 9.57% to $388 million during the July-January period of FY21, which was $429 million in the same period a year ago.
Major export goods to China include apparel goods, jute and jute products, rawhide and skins, plastic products, live and frozen fish and crabs.
Talking on the issue, industry people and economists blamed limited product baskets, while exporters are yet to get a clear notion about the items that are included in the duty-free market access list.
“It was expected that Bangladesh exports to China will see a rise with the effectiveness of new duty-free market access facilities but it did not happen as expected. This was because of the lack of a diversified product basket,” Khondaker Golam Moazzem, Research Director at the Centre for Policy Dialogue (CPD) told Textile Today.
“In addition, COVID-19 pandemic impacted the exports, which is another reason for the decline.”
To capitalize the duty-free market access, exporters have to be clear about the products included in the new list of tariff-free access to China, while the government has to provide the data on the prospects market opportunity, said the economist.
Based on the findings, exporters have to develop a wide range and diversified as well as value-added products. Customers’ demand and their fashion trend should be taken into consideration in developing products, said Moazzem.
Besides, a 40% value addition by Bangladesh to the product’s price is a barrier in cashing the opportunity. To reap the most benefits, the government has to negotiate with the Chinese government to liberalize value addition conditions, he added.
However, the exporters opined that Bangladesh could not cash the opportunity as the pandemic hit the exports when the duty-free market access came to effect.
“In the new list of duty-free market access, there are more items than that of the past and it is an opportunity for Bangladesh to grab more share in the Chinese market,” Abdus Salam Murshedy, Exporters Association of Bangladesh (EAB) president told Textile Today.
Since the COVID-19 pandemic hit the country’s exports and the supply chain was disrupted, we could not tap the opportunity. But we are hopeful to take the duty-free market access advantage with the return of normalcy in the economic activities, said Salam, also a former president of Bangladesh Garment Manufacturers and Exporters Association (BGMEA).
On top of that, it would take time to be familiar with the new items and connect new buyers. By this year, Bangladesh will be able to take the advantage of the duty-free market access, he added.
Bangladesh also needs to attract Chinese investment in grabbing the market share as it would help to move toward value addition and to produce products beyond traditional ones.
We need to make products that the Chinese consumers want to buy and this new investment is crucial.
To this end, Chinese investment can help Bangladesh to a great extent, Dr. Zahid Hussain, former lead economist of the World Bank, Dhaka told Textile Today.
For example, we can attract more investment in manmade fiber and high valued products as the Chinese investors have experienced in these segments. If we can do it, it would help the local manufacturers to learn experience through knowledge sharing, said the economist.
Source: Textile Today
