MARKET WATCH 20 OCTOBER, 2015

NATIONAL

INTERNATIONAL

Textile Raw Material Price 2015-10-19

Item

Price

Unit

Fluctuation

Date

PSF

1081.41

USD/Ton

-0.36%

10/19/2015

VSF

2284.02

USD/Ton

0%

10/19/2015

ASF

2294.25

USD/Ton

0%

10/19/2015

Polyester POY

1010.57

USD/Ton

-1.23%

10/19/2015

Nylon FDY

2534.30

USD/Ton

0%

10/19/2015

40D Spandex

5430.65

USD/Ton

-1.43%

10/19/2015

Nylon DTY

5868.24

USD/Ton

0%

10/19/2015

Viscose Long Filament

1287.61

USD/Ton

-0.85%

10/19/2015

Polyester DTY

2361.15

USD/Ton

0%

10/19/2015

Nylon POY

2483.14

USD/Ton

0%

10/19/2015

Acrylic Top 3D

1089.28

USD/Ton

-1.84%

10/19/2015

Polyester FDY

2770.42

USD/Ton

-0.56%

10/19/2015

30S Spun Rayon Yarn

2864.86

USD/Ton

0%

10/19/2015

32S Polyester Yarn

1747.25

USD/Ton

-0.89%

10/19/2015

45S T/C Yarn

2723.19

USD/Ton

-0.57%

10/19/2015

45S Polyester Yarn

3006.53

USD/Ton

0%

10/19/2015

T/C Yarn 65/35 32S

2597.27

USD/Ton

0%

10/19/2015

40S Rayon Yarn

1920.40

USD/Ton

0%

10/19/2015

T/R Yarn 65/35 32S

2313.93

USD/Ton

0%

10/19/2015

10S Denim Fabric

1.10

USD/Meter

0%

10/19/2015

32S Twill Fabric

0.93

USD/Meter

0%

10/19/2015

40S Combed Poplin

1.02

USD/Meter

0%

10/19/2015

30S Rayon Fabric

0.75

USD/Meter

0%

10/19/2015

45S T/C Fabric

0.76

USD/Meter

0%

10/19/2015

Source: Global Textiles

Note: The above prices are Chinese Price (1 CNY = 0.15741 USD dtd. 19/10/2015)

The prices given above are as quoted from Global Textiles.com.  SRTEPC is not responsible for the correctness of the same.

Textile entrepreneurs eye China, Russia as dollar dream sours

India's bilateral trade with its northern neighbour China is skewed in terms of having more imports than exports. India's exporters body Federation of Indian Export Organisation red flagged the devaluation of the Chinese Renminbi, forecasting an expansion of the deficit in bilateral trade with China towards $50 billion. It said there has been a 17.6% overall decline in exports from India, making it more improbable to achieve the number of previous fiscal 2014-15.

For Indian entrepreneurs, China appears to have unfurled a currency expressway into the global exports market, leveraging their giant capacities and light currency. The immediate task at hand for Indian players is to hold their ground in the trade scene with China. Rate negotiations in commodities such as cotton yarn takes place in trade fairs, a recent one such in China showed Tamil Nadu's textile players the intensity of this imbalance. "The yarn exhibition in China recently told us what the situation is. There was immense pressure on pricing. Indian manufacturers struggled to get a good rate for their yarn. We realised we need a local presence," said Prabhu Damodharan, Secretary of Indian Textile Federation. The idea of a common office in China has been mooted in a letter southern entrepreneurs have sent to the textile ministry. Sent on Monday, the letter suggested that direct selling offices in China, with the industry funding the expenses and the ministry facilitating the setting up.

In India, textiles initially appeared to buck the slowing trend in exports but it has now been dragged into the decline - ready-made garment exports in April had crossed Rs 10,000 crore but a gradual but steady decline through the April-September period bought down the number to Rs 7,545 crore. The Tirupur exporters Association alone has set a target exceeding of Rs 36,000 crore for the year 2016-17. "In terms of the greenback, the growth is only 2.32%, which is worrying. It is mainly due to demand compression in the West," said a top official from the Tirupur Exporters Association.

SOURCE: The Economic Times

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India welcomes Omani firms to invest its textile sector

The India’s ambassador to the Sultanate, Indra Mani Pandey in a speech at the inauguration of the exhibition ‘Vastram -Splendid World of Indian Textiles’ said that textiles are an important part of India’s exports to the Sultanate, hence India absolutely welcomes Omani investments in India’s textile sector, which is the second largest employer in that country, offering direct employment to around 35 million people and indirect employment to millions more. Highlighting the diversity of Indian textiles in terms of production, material and the processes involved, he said that the purpose of the exhibition is to showcase this diversity to the people of Oman and the Indian community.

Oman is a maritime neighbour of India and people-to-people relations and exchanges for centuries have been a key enabling factor in the evolution of India’s historical ties with Oman. As the tourism between the two countries is growing, there is a growing mutual awareness of diverse cultures of India and Oman, Pandey said. The Ambassador further added that recently, there was Oman-India Investment Meet and in two months’ time, they are going to organise another investors’ meet. They very much welcome Omani companies to go and invest in India, and they are ready to facilitate it.

Regarding the Indian-Omani joint ventures involved in the textile industry, Pandey said that there are 1,500 joint ventures between the two countries and there must be many textile-oriented ones among them. There is one which is being created in Salalah. Mohamed Al Riyami, former assistant to His Majesty Sultan Qaboos bin Said’s adviser at the Ministry of Information, also encouraged Omani companies to invest in the textile sector in India. He said that the Omani investors should go to India and invest but get these items into Oman and put them for sale in Oman. Al Riyami said that the exhibition provided a ‘unique experience’ and expressed hope that an exclusive Indian textile exhibition will be held in future, where the items would be put on sale.

India-Oman diplomatic ties are 60 years old, but bilateral cultural and trade relations between the two countries have existed since 5,000 years ago, he said. Oman is going to be a big commercial centre in the Middle East, Al Riyami noted, encouraging more investment from India in various parts of the country. The exhibition ‘Vastram -Splendid World of Indian Textiles’, featuring more than 30 traditional Indian textiles and a large site-specific installation in three categories of painted/printed, woven/non-woven, embroidery and embellishments. The collection of Indian Council of Cultural Relations, put together by Shelly Jyoti, an artist, fashion designer and poet, was inaugurated at Oman Avenues Mall on Thursday as part of the 60th anniversary celebrations of India-Oman diplomatic ties. The exhibition runs until October 25.

SOURCE: Yarns&Fibers

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TPP accord may shrink India's textile exports: India Ratings

Trans-Pacific-Partnership (TPP) agreement may shrink India's textile exports of around $40 billion over the medium-term, India Ratings and Research (Ind-Ra) said.  The US, Japan and 10 other Pacific-Rim nations recently reached a final agreement on the largest regional trade accord in history dubbed as the Trans-Pacific Partnership (TPP) deal.  "The key nations out of the 12 countries which India exports textile and apparels to are US, Japan and Canada. The value of India's textile and apparel exports to these three countries stood at $11.5 billion in FY15 which is likely to reduce due to the TPP," Ind-Ra said.  The TPP-member nations led by the US account for 40 per cent of world trade and the deal gives them duty free access to each other, thereby making imports from other countries uncompetitive.  However, the lack of TPP members' backward integration into yarn and fabric will constrain members from taking full benefit and hence limit the negative impact in the short-term. The impact will depend upon how fast these countries are able to set up captive capacities, Ind-Ra said.  This may lead to an overall pricing pressure which will weigh down the garmenters' margins. Ind-Ra maintains an overall stable outlook for the country's textiles sector.

India exported $41.4 billion of textiles (including raw cotton) out of which $18 billion was apparels in FY15.  US is a key destination for textile and apparel exports, and US import duties range between 15 to 50 per cent, depending upon woven or knit textile, or type of raw material used, which can lead to loss of export sales for India, especially detrimental to companies which are exporting majorly to the US, Ind-Ra said, adding that companies with superior geographic diversification are better placed.  

Amongst Asian peers, Vietnam would be a key beneficiary of the TPP, while India, China, and Bangladesh would be negatively impacted.  Vietnam is the second-largest garment exporter in the world with garment exports worth $24 billion in 2014 and would thus be able to increase its textiles export market share strongly to TPP countries by being able to sell at zero duty.  However, India has in edge in value added garmenting, which should remain partly insulated due to the lack of readily available similar capabilities in TPP countries. China which houses 40 per cent of global apparel capacity ($165 billion exports) is not a part of TPP, which is a breather for India.  Also, amongst TPP countries, Vietnam is the only key manufacturer of garments; hence capacity to serve the entire demand will be limited.

SOURCE: The Economic Times

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Handicrafts put up a handy exports show

While merchandise exports have been in negative territory for the 10th month in a row, some odd sectors have weathered the crisis, reports Banikinkar Pattanayak in New Delhi. Handicrafts, where competition is outdone by India’s unique artistry, is one. Hit hard in the immediate aftermath of the global financial crisis in 2008, India’s handicraft exports bounced back in recent years, as outbound shipments more than doubled over the last five years through 2014-15, exceeding the growth in the country’s overall merchandise exports. In rupee terms, handicraft exports almost tripled to Rs 18,639 crore in the five years through 2014-15 thanks to a depreciation of the rupee against the dollar.

Analysts said while overall merchandise exports continue to suffer in recent years due to a gloomy external environment, the handicrafts segment has bucked the trend despite the fact that the US and EU account for more than half of India’s handicraft supplies and commodity prices have slid globally. In fact, handicraft exports started to rebound after 2010-11, albeit on a relatively smaller base, just two years after the subprime crisis, despite a fragile recovery in these nations. Such exports grew to $3.04 billion in 2014-15 from $1.7 billion in 2010-11, recording an average annual growth rate of nearly 20%, while the country’s overall merchandise exports witnessed an average annual growth rate of 5.9% during this period.

Handicraft exports have consistently exceeded the target set by the government in each of the last five years, while the overall merchandise export growth target continues to falter. While agriculture was among the segments that witnessed high export growth rate in recent years, it witnessed a contraction in the last fiscal, partly due to a massive plunge in global commodity prices.

SOURCE: The Financial Express

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Exim Bank focusing on project exports

Exim Bank is focusing on financing project exports and extending line of credit to promote exports, even though the export scenario in recent times is not very encouraging due to the recessionary conditions in the West, according to N.Shankar, Executive Director of the bank. He was speaking here on Monday after participating in a seminar on export promotion jointly organised by the bank and the Federation of Indian Export Organisations (FIEO). He said India's share of the world exports is very low and therefore, all efforts should be made to push exports for a healthy foreign exchange position and to finance our imports. He said Exim Bank was also concentrating on facilitating Indian companies to float joint ventures in Cambodia, Laos, Myanmar and Vietnam and execute projects in those countries.

SOURCE: The Hindu Business Line

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Pre-Budget talks: economists want tax transparency

Hoping to give a boost to the economy in the next fiscal, Finance Minister Arun Jaitley on Monday kicked off preparations for the Union Budget 2016-17 with a discussion with eminent economists on possible measures to contain the fiscal deficit, boost agricultural productivity and improve tax transparency. While Jaitley did not comment after the two-hour meeting, Minister of State for Finance Jayant Sinha, after the talks at the NITI Aayog, said the discussions centred on boosting farm sector production, fiscal expenditure and public investment. “We also spoke about the financial sector … more credit for agriculture, MSMEs and what we could do to further strengthen our banks,” Sinha said, adding that talks also focussed on job creation for the young people and whether it should be in the manufacturing or services sector.

Sources said the domestic taxation structure was also discussed and comments were sought on how to further simplify it and make it more transparent. “The Government is keen to project the country as an attractive investment destination and taxation is a key component. Already in this year’s Budget, the Government has announced reduction of corporate tax rate to 25 per cent along with elimination of all subsidies,” said a person familiar with the development, adding that the roll out of the goods and services tax and its positive impact was also discussed. “It is very early in the cycle to start the consultation. But we felt that if there were good ideas, we could incorporate them even in this fiscal. It was a very good interaction and we look forward to incorporating much of this for this fiscal as well as the coming fiscal,” Sinha said. He also expressed confidence that the implementation of One Rank One Pension and increase in salary Bill due to the Seventh Pay Commission will not strain the government’s fiscal position in 2015-16. The Centre has set a target for the fiscal deficit at 3.9 per cent of the GDP in 2015-16. This was the Finance Minister’s first such consultation before the next Budget although Revenue Secretary Hasmukh Adhia has met industry groups to get their suggestions on taxation policy.

Economists including Subir Gokarn, Director of Research at the Brookings Institution India’; Ajit Ranade, Chief Economist, Aditya Birla Group; Rajiv Lall, Vice-Chairman, IDFC Ltd, Tushar Poddar, Chief Economist (India), Goldman Sachs, and Sajjid Chinoy, Chief Economist (India), JP Morgan, attended the meeting. The meeting was attended by NITI Aayog Vice-Chairman Arvind Panagariya, Reserve Bank of India Deputy Governor Urjit Patel as well as senior Finance Ministry officials, including Chief Economic Adviser Arvind Subramanian and Finance Secretary Ratan Wattal. Besides, Revenue Secretary Hasmukh Adhia, Economic Affairs Secretary Shaktikanta Das and Financial Services Secretary Anjuly Chib Duggal also attended the meeting.

SOURCE: The Hindu Business Line

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Manufacturing job growth remains under stress

During the first year of the National Democratic Alliance government's term, job creation in India's manufacturing sector showed signs of stress. However, the situation seems better if the pace of employment generation is compared on an annual basis. Sequentially, employment generation in most labour-intensive sectors slowed in 2014-15, showed the 25th Quarterly Report on Changes in Employment, released by the Labour Bureau. Every quarter, the Chandigarh-based Labour Bureau conducts quarterly job surveys to gauge the impact of government policies on employment generation in the textiles, leather, metal, automobiles, gems and jewellery, transport, information technology (IT) and handloom sectors. The latest estimates showed in January-March this year, 64,000 jobs were created in eight crucial sectors of the economy. Though the number of new jobs was the lowest in four quarters, it rose sharply compared to the year-ago period, primarily driven by the IT sector. In the December quarter of 2014-15, 158,000 new jobs were generated, while in January-March last year, the number of jobs had decreased by 36,000.

On an annual basis, the number of jobs created in the textiles, leather, handlooms and transportation sectors was low. There was a sharp cut in employment in the metals sector, which had shown signs of a job revival in the first two quarters of 2014-15. The gems & jewellery sector, too, lacked shine. However, Prime Minister Narendra Modi's strong push to the IT sector led to a sharp rise in the number of jobs here. For instance, in the March quarter of FY15, 37,000 new jobs were created in this sector, against a decline of 4,000 jobs in the year-ago period. Manufacturing job growth remains under stress Economists say the growth in job creation hasn't kept pace with overall economic growth, as the corporate sector, particularly manufacturing, isn't producing more. "Growth in the manufacturing sector has been really low in the past three years. If there is less production, there is a tendency to cut jobs or relieve labour," said Madan Sabnavis, chief economist, CARE Ratings.

Staffing firms said the government had been successful in creating jobs for the youth. "Sequentially, the numbers do not mean much, as companies follow a particular production cycle and employment is linked to that. However, the numbers are very encouraging on an annual basis, showing a bright future for jobs in the coming years," said Rituparna Chakraborty, president of the Indian Staffing Federation. Most jobs created in the quarter ended March this year were contractual. Firms hired 49,000 contractual workers compared to only 15,000 full-timers. This might point to a recovery, as direct employment had declined by 24,000 in the corresponding period last year.

In the March quarter this year, there was robust employment growth in export-oriented units, with 73,000 workers being hired, compared with job cuts of about 2,000 in the year-ago period. Also, for units producing for the domestic market, the number of jobs decreased by 9,000, compared with a decline of 34,000 last year. "This has come as a surprise. It looks as if the export sector was generating more jobs, preparing for the future. But I don't think this growth in jobs can be sustained," Sabnavis said. "The government has to make easier laws to acquire land and bring in labour law flexibility to help industries grow. These changes, however, would take time," said Chakraborty.

SOURCE: The Business Standard

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Global crude oil price of Indian Basket was US$ 46.47 per bbl on 19.10.2015

The international crude oil price of Indian Basket as computed/published today by Petroleum Planning and Analysis Cell (PPAC) under the Ministry of Petroleum and Natural Gas was US$ 46.47 per barrel (bbl) on 19.10.2015. This was lower than the price of US$ 47.34 per bbl on previous publishing day of 16.10.2015.

In rupee terms, the price of Indian Basket decreased to Rs 3012.31 per bbl on 19.10.2015 as compared to Rs 3075.65 per bbl on 16.10.2015. Rupee closed stronger at Rs 64.82 per US$ on 19.10.2015 as against Rs 64.97 per US$ on 16.10.2015. The table below gives details in this regard: 

Particulars

Unit

Price on October 19, 2015 (Previous trading day i.e.  16.10.2015)

Pricing Fortnight for 16.10.2015

(Sep 29 to Oct 13, 2015)

Crude Oil (Indian Basket)

($/bbl)

46.47              (47.34)

47.70

(Rs/bbl

3012.31          (3075.65)

3115.29

Exchange Rate

(Rs/$)

64.82            (64.97)

65.31

SOURCE: PIB

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China's growth slows to 6.9%

China's economy grew 6.9 per cent in the third quarter from a year ago, as a deepening industrial rout and slumping stock market pushed growth to its slowest quarterly pace since the global financial crisis of 2009. The weak result in the July-to-September period compares with growth of seven per cent in each of the first two quarters of the year, but was slightly better than the 6.8 per cent rate that economists had forecast. The government's official target for the year is growth of around seven per cent. "China was facing increasing downward pressure of domestic economic development" in the first nine months of the year, the official statistics agency said in a statement accompanying the data released Monday morning in Beijing. Still, it added, "the overall performance of the national economy was stable and moving in a positive direction." Uncertainties over China's decelerating growth have shaken global stock markets in recent months as investors have raised doubts about the quality of Chinese economic data and the transparency of the country's policy decision-making process. Concerns have been heightened by China's botched attempt to prop up its stock markets in July and the surprise move in August to devalue its currency, the renminbi, by the most in nearly two decades. In addition to prompting increased volatility on stock markets around the world, questions over China's development have affected global monetary policy. Janet L. Yellen, the chairwoman of the United States Federal Reserve, cited uncertainty over China as a reason for delaying raising interest rates after the Fed's meeting last month. China is struggling with an industrial slump that in recent months has appeared to be worse than the country's leaders had anticipated. Data released Monday showed continued pressure, with industrial production rising 5.7 per cent in September, near its slowest pace since the financial crisis.

Overall investment rose 10.3 per cent in the first nine months of the year, its slowest rate of increase in 15 years. In response, China's central bank has cut interest rates five times since last November, and has taken other steps to free banks to lend more. The government has also pledged to spend hundreds of billions of dollars this year on new infrastructure projects, including rail lines and water treatment plants, to help lift growth. To offset the industrial slowdown, China is relying on a rise in consumer demand driven through continuing urbanization and a growing middle class. Evidence of this emerging economic driver can be seen in recent months in double-digit growth rates in areas like box office revenues and online merchandise sales. Overall retail sales rose 10.9 per cent in September from a year earlier, data released Monday showed. But so far, rising spending by Chinese consumers has failed to offset the slump in the economy's traditional industrial engine. "We don't really trust the overall growth figures," said Julian Evans-Pritchard, an economist following China at Capital Economics. "There's plenty of evidence to suggest the economy is growing significantly slower than that, but that doesn't mean that the G.D.P. data, particularly the breakdown, doesn't tell us anything." He pointed to the rising share of services and consumption in the overall economy, which continued to gain prominence in the third quarter despite the slump in activity related to the stock market. For example, while a continued contraction in housing construction weighed further on the industrial sector, sales of newly completed or existing homes have been rebounding sharply - helping lift business at services companies like property agencies. Compared with the April to June quarter, the third quarter "had some additional weakness in industry, but that's been made up by some strength in services," Evans-Pritchard said. "Things look to have been pretty stable overall."

SOURCE: The Business Standard

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Pakistan, Japan collaborate for textile development

The Trade and Development Authority of Pakistan (TDAP), Pakistan-Japan Business Forum (PJBF) and Japan International Cooperation Agency (JICA) jointly organised a ‘Pakistan-Japan Textile Workshop’ at a hotel. The purpose of the workshop was to provide useful information to improve production management, quality control and inspection for Pakistani manufacturers. The presentations, on the occasion, were made by Japan Textile Importers Association (JTIA) senior expert Yashiro Shoda and QTEC General Manager Hisao Nishiyama. Shoda spoke on “Expectations of Pakistan Textile Industry”, referring to some industrial engineering approach, while Nishiyama talked about “Good Factories & Bad Factories” with many practical advices and examples from his experience of audit and inspection of textile factories.

TDAP Chief Executive Officer SM Muneer, PJBF Vice Chairman Kalim Farooqui, and JICA expert Hideaki Shimizu also addressed to the workshop. SM Muneer said that Pakistan had a dynamic, vigorous and export-oriented textile industry that has an overwhelming impact on the economy. This is a good time for Pakistan to take positive steps towards entering the Japanese market, he added. He said for export promotion to Japan, JICA and TDAP have recently opened a new website to provide business information of Japan, especially for Pakistani exporters. Addressing the workshop, Yasuhiro Shoda adviced that Pakistan needed to work on the process design and curtailing of costs, while Nishiyama said that Japan has a $100 billion apparel market and the Japanese consumers like maintaining quality standards. “The Japanese textile delegation of 13 members visited Pakistan without being afraid of several security issues. In addition, we hear that some famous Japanese apparel companies are also planning to buy garments from Pakistan on original equipment manufacturer (OEM) basis. We believe this is a good time for Pakistan to challenge the Japanese market besides the US and European markets,” he added. Recently, Pakistan-Japan Textile Day was observed in Lahore on Oct 12, which was also attended by the Japanese importers. They had productive business-to-business (B2B) meetings with local exporters. Around seventy B2B meetings were held between the Pakistani sellers and Japanese buyers. Some Japanese importers were keen on buying yarn and fabrics from Pakistani companies.

SOURCE: The Daily Times

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APTMA lauds govt decision to rescue spinning sector

The All Pakistan Textile Mills Association (APTMA) Central Chairman Tariq Saud has appreciated Finance Minister Ishaq Dar and Special Assistant to the Prime Minister on Revenue Haroon Akhtar for their timely and prudent decision of protecting the domestic commerce from the dumping of highly subsidised import of textile products. He said the textile industry, representing almost all the sub-sectors from yarn manufacturers to garments manufacturers, is grateful to the government for its timely and wise action."An unchecked entry of dumped textile products was hurting the infrastructure of the basic textile industry of Pakistan," he added. He said the government has averted the destabilisation of the infrastructure of basic textile in Pakistan, adding that the growth of agriculture sector and the employment attached with it were also rendered vulnerable. He has dispelled the apprehension that the entry of cheap yarn was beneficial to the value added textile sub-sectors, saying that the entry of subsidised yarn at the cost of the employment of a large number of workforce in the basic textile sector, extensive damage to infrastructure and diminished immediate supply source had put to risk the viability of the value added sector as well. He said the finance minister recognised the risk to domestic commerce and has assured of restoring the viability of the textile industry by reducing cost of doing business and reviving the competitiveness of the textile industry internationally. Tariq Saud expressed hope that the government would resolve the pending issues, including removal of electricity surcharge and gas infrastructure development cess (GIDC) for captive and processing use. Zero rating of taxes on exports and focus market incentives are also being expected by the textile industry, he added. He said the government has averted the market imbalance by imposing additional 10% regulatory duty and the value added sector of the textile industry having $10 billion worth exports has always been in favour of such measures.

SOURCE: The Daily Times

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Indonesia to continue crackdown on illegal textile imports

Indonesia's Customs and Excise Department would continue to confiscate any illegally imported textile products to protect the domestic industries, so that they remain viable, the government has said. "These smuggled products will damage the domestic industries because they could be easily produced at home and so they must be prevented (from entering the country)," an Indonesian news agency quoted Finance Minister Bambang Brodjonegoro as saying in Jakarta. The Finance Minister's comment came as he accompanied President Joko Widodo for the inspection of four containers of illegal textiles that were confiscated. Brodjonegoro said the operation to confiscate the illegal textiles was carried out following indications that they would be distributed directly to agents and not to the bonded zone destination in Purwakarta. "When they arrived at Tanjung Priok port, two containers did not go to the bonded zone in Purwakarta (West Java). Instead, one went to a warehouse in Marunda, Jakarta, and the other to Cikampek in Palimanan, West Java. These were caught on the charge that the containers did not go where they were supposed to," he said. The imported goods in the containers were to be unloaded outside the zone and transported directly to other places for sales without paying the import tax. The goods smuggled from China included 3,519 textile rolls or 376,000 yards of cloth, worth $10,28,000. In all, the state suffered a loss estimated at Rp2.21 billion ($1,63,281). The bonded zone is a facility given by the government to certain companies that wish to delay the payment of customs and import taxes to boost exports. So far, the facility has often been misused.

President Joko Widodo hailed the foiling of the illegal textile imports in the bonded zone, saying the distribution of unlicensed products has been disrupting the national textile industry. He appealed to the police and the attorney general's office to support the Directorate General of Customs and Excise to prevent such cases from recurring in the future. "I have ordered the police chief and the attorney general to back the Directorate General of Customs and Excise so that illegal textile does not slip into the country again because not only will it deny income to the state, but it would also damage the domestic market. Our industries cannot compete in such a market then," he said.

SOURCE: Fibre2fashion

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Central Bank of Nigeria proposed assistance to textile industries to boost economy

Nigerian economy would soon receive boost going by the commitment of the central Bank of Nigeria to support the textile industry operators. This stand was recently maintained by stakeholders in the economy, a development that would further trigger rapid evolution in the garment manufacturing industry. Mr. Godwin Emefiele, the Governor, Central Bank of Nigeria (CBN), recently met with the owners of textile industries in the country with a view to assisting them to overcome challenges that hamper production. Mr. Emefiele during the meeting in Abuja, emphasized that the textile industries must be assisted to operate optimally in order to create more jobs and boost the nation’s Gross Domestic Product (GDP). The CBN Governor observed that some of the industries, in an attempt to resume full production, had accessed loans from the Bank of Industry (BoI) but had concerns about short tenure and moratorium. The Governor therefore sought for the commitment of the industrialists, especially those still operating at minimal scale, to assist them access more finance from the banks. Accordingly, he urged them to articulate all their concerns in a formal letter to the Bank, in order to enable the Bank take necessary action.

Alhaji Isma’ila Isa Funtua, on behalf of the textile owners, and representative of the United Nigeria Textile Limited (UNTL called for the restructuring of the BoI loan as well as helping to make cotton, which is the primary raw material for any textile industry, available to the textile owners. A committee of the textile owners was thereafter constituted and given the mandate of drafting the formal complaint to the CBN. Present at the meeting were the Deputy Governor, Economic Policy, Dr. (Mrs.) Sarah Alade; Special Adviser to the Governor on Development Finance, Mr. Paul Eluhaiwe, and Alhaji Ibrahim Mu’azu and Dr. Mudashiru Olaitan, Directors of Corporate Communications and Development Finance Departments, respectively. While expressing concern over the multiple challenges of power, smuggling and financing facing the industry, Mr. Emefiele pledged that the Bank would take the issues up with the relevant authorities.

SOURCE: The Business World Nigeria

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