INTERNATIONAL
Textile Raw Material Price 2016-10-26
|
Item |
Price |
Unit |
Fluctuation |
Date |
|
PSF |
1050.67 |
USD/Ton |
0.21% |
10/25/2016 |
|
VSF |
2443.94 |
USD/Ton |
-0.72% |
10/25/2016 |
|
ASF |
1890.18 |
USD/Ton |
1.59% |
10/25/2016 |
|
Polyester POY |
1085.37 |
USD/Ton |
0.00% |
10/25/2016 |
|
Nylon FDY |
2347.95 |
USD/Ton |
0.00% |
10/25/2016 |
|
40D Spandex |
4356.27 |
USD/Ton |
0.00% |
10/25/2016 |
|
Nylon DTY |
2030.46 |
USD/Ton |
0.15% |
10/25/2016 |
|
Viscose Long Filament |
1284.73 |
USD/Ton |
0.00% |
10/25/2016 |
|
Polyester DTY |
2547.31 |
USD/Ton |
0.00% |
10/25/2016 |
|
Nylon POY |
5567.16 |
USD/Ton |
0.00% |
10/25/2016 |
|
Acrylic Top 3D |
1329.03 |
USD/Ton |
0.00% |
10/25/2016 |
|
Polyester FDY |
2170.75 |
USD/Ton |
0.00% |
10/25/2016 |
|
30S Spun Rayon Yarn |
3012.47 |
USD/Ton |
-0.49% |
10/25/2016 |
|
32S Polyester Yarn |
1737.34 |
USD/Ton |
0.00% |
10/25/2016 |
|
45S T/C Yarn |
2584.23 |
USD/Ton |
0.00% |
10/25/2016 |
|
45S Polyester Yarn |
3160.14 |
USD/Ton |
0.00% |
10/25/2016 |
|
T/C Yarn 65/35 32S |
2318.42 |
USD/Ton |
0.00% |
10/25/2016 |
|
40S Rayon Yarn |
1860.64 |
USD/Ton |
0.00% |
10/25/2016 |
|
T/R Yarn 65/35 32S |
2229.82 |
USD/Ton |
0.00% |
10/25/2016 |
|
10S Denim Fabric |
1.35561 |
USD/Meter |
0.00% |
10/25/2016 |
|
32S Twill Fabric |
0.83581 |
USD/Meter |
0.00% |
10/25/2016 |
|
40S Combed Poplin |
1.17545 |
USD/Meter |
0.00% |
10/25/2016 |
|
30S Rayon Fabric |
0.68076 |
USD/Meter |
-0.43% |
10/25/2016 |
|
45S T/C Fabric |
0.65861 |
USD/Meter |
0.00% |
10/25/2016 |
Source: Global Textiles
Note: The above prices are Chinese Price (1 CNY = 0.14767USD dtd 25/10/2016)
The prices given above are as quoted from Global Textiles.com. SRTEPC is not responsible for the correctness of the same.
The lower shipments to Pakistan from the world's biggest cotton producer will help other suppliers such as Brazil and the United States. India's cotton exports in 2016-17 are likely to fall 28% from a year ago to 5 million bales as its top buyer Pakistan is set to halve purchases due to rising hostilities and improvement in its own production, industry and government officials said. The lower shipments to Pakistan from the world's biggest cotton producer will help other suppliers such as Brazil, the United States and some African countries in raising exports. Pakistan is likely to import 1 million to 1.5 million bales in the 2016-17 year that started on October 1, down sharply from 2.7 million bales a year earlier, India's Textile Commissioner Kavita Gupta told reporters on Monday. Gupta attributed the reduction to an improvement in Pakistan's cotton production, but industry officials said exports are down due to rising tensions between the two countries. "Pakistan still needs to import, but Pakistani buyers are turning to Brazil and the U.S.," said Pradeep Jain, a ginner based in Jalgaon in the western state of Maharashtra. The nuclear-armed rivals have seen tensions ratchet up in the past few months over the disputed territory of Kashmir. Last month, militants that New Delhi says came from across the border attacked an army base in Uri in the state, killing 19 soldiers. In response, Indian officials said elite troops crossed into Pakistan-held territory to kill suspected militants.
Pakistan, the world's third-largest cotton consumer, usually starts importing from September, but exporters said the number of inquiries had slowed to a trickle in the last few weeks. In 2015-16, Pakistan surpassed Bangladesh to become India's biggest cotton buyer and accounted for 40% of exports. India has so far in the season contracted 500,000 bales for export as demand was weak from overseas buyers, Dhiren Sheth, president of the Cotton Association of India, said. By this time last year, Indian traders had signed contracts to export 1 million bales, dealers said. India's cotton output in 2016-17 could rise 3.8% from a year earlier to 35.1 million bales as yields are expected to increase due to good monsoon rains, Gupta said. "This year, area under cotton was lower but due to good monsoon rains and less impact from pests, we are estimating higher per-hectare yields," she said.
SOURCE: Yarns&Fibers
Arvind Limited, one of India's largest integrated textile and apparel Company, has today announced its decision to raise about Rs 740 crore by diluting 10 per cent stake in its brand business arm, pegging its enterprise value at Rs 8,000 crore. The entire stake will be picked up by Multiples, the private equity firm founded by Renuka Ramnath. Arvind's brand portfolio business clocked a turnover of Rs 2,300 crore for the FY 2015-16. It is one of the fastest growing businesses in the country with a CAGR of 25 per cent for the past three years. The unmatched portfolio includes global marquee brands such as Calvin Klein, Tommy Hilfiger, US Polo Assn, Ed Hardy, Hanes, Arrow, Gant and Nautica, among others.
Commenting on the development, Sanjay Lalbhai, CMD of Arvind Limited said, “We are delighted to have Multiples as an investor. This transaction reflects the confidence of the investor community in the overall business strategy, the robustness of the platform and quality of our leadership team. The deal is an important milestone in our journey to be a fashion, apparel and accessories powerhouse.” “With India becoming the fastest growing economy in the world, we are confident of continuing this growth momentum and taking the business from over Rs 3,200 crore this year to Rs 9,000 crore by 2022. This transaction helps Arvind unlock the value that the brands business has accomplished in a short period and add financial muscle to future strategic opportunities for the Group. We will immensely benefit from our association with Multiples,” he added.
For the quarter ended September 30, 2016, Arvind has recorded 19 per cent growth in the consolidated revenue, which increased to Rs 2,331 crore. This figure was Rs 1,957 in the corresponding quarter of the previous year. Consolidated EBIDTA for the quarter increased by 2 per cent to Rs 232 crore as against Rs 228 crore in the corresponding quarter of the previous year. Profit after tax before exceptional items grew by 20 per cent to Rs 78 crore as compared to Rs 65 crore in the corresponding quarter of previous year.
“Our textiles business, which recorded 9 per cent revenue growth, continues to deliver a strong performance as we continue to pursue a calibrated growth strategy. The brands business continues to demonstrate strong growth with 33 per cent growth in Q2. Our established power brands consolidated their market positions. We believe that we will have continued growth momentum in the second half of the current financial year,” commented Jayesh Shah, director and CFO, Arvind.
SOURCE: Fibre2fashion
The World Bank’s annual Doing Business 2017 report released today recognizes India’s achievements in implementing reforms in four of its ten indicators – Trading Across Borders, Getting Electricity, Enforcing Contracts and Paying Taxes. This is the first time in its history that India has been recognized for improvement in four indicators.
Improvement in Ranking and Distance to Frontier
The Doing Business report ranks countries on the basis of Distance to Frontier, an absolute score that measures the gap between India and the global best practice. India’s absolute score improved from 53.93 to 55.27 in the previous year. This is the first time in history that India has improved its absolute score in two consecutive years. Additionally, India’s Distance to Frontier score improved on 6 out of the 10 indicators, showing that India is increasingly progressing towards best practice.
|
Topics |
DB 2015 |
DB 2015 (Revised) |
DB 2016 |
DB 2016 (Revised) |
DB 2017 |
|
Overall rank |
142 |
134 |
130 |
131 |
130 |
|
Distance to Frontier |
52.67 |
- |
54.68 |
53.93 |
55.27 |
The change in ranking of India across the 10 indicators is as follows:
|
Topics |
DB 2015 Rank |
DB 2016 Rank |
DB 2017 Rank |
|
Getting Electricity |
137 |
70 |
26 |
|
Enforcing Contracts |
186 |
178 |
172 |
|
Starting a Business |
158 |
155 |
155 |
|
Registering Property |
121 |
138 |
138 |
|
Resolving Insolvency |
137 |
136 |
136 |
|
Construction Permits |
184 |
183 |
185 |
|
Getting Credit |
36 |
42 |
44 |
|
Protecting Minority Investors |
7 |
8 |
13 |
|
Paying Taxes |
156 |
157 |
172 |
|
Trading Across Borders |
126 |
133 |
143 |
Reforms Recognized by World Bank
Reforms Not Recognized by World Bank This Year
The World Bank acknowledges only such reforms which have been implemented in Mumbai and Delhi by 1st of June each year; if they are reported as implemented by business intermediaries. Following major reforms have not been accounted for in current year’s report:
We will continue our engagement with the World Bank and address their concerns to include these reforms in next year’s Doing Business report.
Reforms for Next Year’s Ranking
Over the past two years, the Government of India has implemented a host of reforms to make it easier for businesses to start, operate and exit. It is therefore disappointing that these achievements are not covered by the report due to methodological issues. The Government has engaged with the World Bank multiple times in the process, and is hopeful that they will take into account all the implemented reforms in future reports. Importantly, transformative reforms like the Insolvency and Bankruptcy Code and GST can serve as launching pads for India to drastically improve its ranking in future reports.
The Government remains committed to its goal of achieving among the top 50 rank in the report in the coming years. Action is already being taken to implement further reforms with an eye on next year’s report, including:
Regular Feedback Mechanism Next Year
Departments involved in implementing reforms have been asked to appoint observers who will regularly seek feedback from business on implemented reforms to ensure that the reforms are being felt. The observers will play a critical role in ensuring that reforms are functioning as intended and that any roadblocks along the way are being addressed in a timely manner.
DIPP will appoint external agencies as well to supplement these activities, as well as to help departments carry forward reforms, hold stakeholder consultations, and monitor implementation of reforms.
SOURCE: PIB
After pinning its hopes on a significant improvement in World Bank’s Ease of Doing Business Index, India has managed to move up by only one rank in the Doing Business Report 2017. India’s position on seven out of 10 parameters also went down, compared to the previous year's rankings. The government said the ranking failed to take into account the various reform initiatives undertaken by it. India remains at the 130th position out of 190 countries globally, it was revealed on Tuesday. This is the same as last year, but it qualifies for a single upward movement in rank as India’s position in 2016 has been revised to 131 by the World Bank. There were a total of 189 countries in the 2016 report when India’s position was only four places higher than 134 in the 2015 report. The rankings come in the backdrop of senior government officials repeatedly saying India’s ranking would be impressive in the 2017 report. It also makes Prime Minister Narendra Modi’s aim of pushing India among the top 50 nations by the time the 2018 report comes, a bit doubtful. India will have to improve its position by a whopping 80 places to meet the Prime Minister's target in just one year.
India rises a notch in index of ease of doing business The latest rankings do not recognise several reform measures taken by the government to implement ease of doing business in the country and the government will engage with the World Bank on these issues, Department of Industrial Policy and Promotion (DIPP) Secretary Ramesh Abhishek told reporters. The report takes into account reforms implemented only up to June 1, while several measures taken by the government came into effect after that, Abhishek added. The World Bank ranks countries on 10 parameters – starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority shareholders, paying taxes, enforcing contracts, trading across borders, and resolving insolvency.
Among the 10 parameters, India’s position deteriorated on all, barring the categories of getting electricity, enforcing contracts and registering property. The country continued to improve the most in getting electricity connection, with its ranking soaring from 51st last year to 26th in the latest report. However, the two other parameters recording positive movement – enforcing contracts and registering property – still place India at 172nd and 138th places, respectively, among all nations.
India’s ranking continued to weaken in areas of strength such as protecting minority investors (from 10th position to 13th position) and getting credit (from 42nd position to 44th). New Zealand bagged the top spot in the rankings followed by Singapore, Denmark, Hong Kong and South Korea. While China’s ranking improved by six notches from 84th to 78th, Pakistan fell an equal number of positions to reach 144th position from 138th earlier. Every other country in the BRICS (Brazil, Russia, India, China and South Africa) grouping had a higher ranking than India in the 2017 report. For India, the ranking covers data from Delhi and Mumbai, with weights of 53 per cent and 47 per cent, respectively. The World Bank sources feedback from users of government services, who had not been aware of various reforms being implemented, Abhishek said. DIPP will engage much more with users and make changes to the feedback system, he added.
Important reforms by the government not considered by the World Bank include enactment of the insolvency and bankruptcy code and introduction of the online single-window system for building approvals in both Delhi and Mumbai. India’s position on construction permit approval remains dismal, having fallen to 185 from 184. In terms of starting a business, India’s ranking went down to 155th position from 151st last year. This was also true for registering a property. On resolving insolvency, the country’s position slid a single rank to 136 from 135 last year. Confederation of Indian Industry director-general Chandrajit Banerjee said the government has undertaken a strategic and comprehensive reform package over the past two-and-a-half years, which has greatly contributed to strengthening investor confidence. The establishment of commercial divisions in the high courts of Delhi and Mumbai to deal with commercial cases above Rs 1 crore has helped raise the rank in ‘enforcing contracts’. It has become faster and cheaper to obtain electricity connection in these two cities, which have contributed to a jump in the rank on ‘getting electricity’ by as much as 111 positions in two years.
SOURCE: The Business Standard
Union Minister of State for Commerce and Industry Nirmala Sitharaman expressed her disappointment over India’s low rank in World Bank doing business index and its failure to achieve the set deadline. In her reaction on Twitter she wrote, ” Disappointed at our rank this year. Many of our reformatory steps were after WB deadline. Hopefully, with other steps, will help next year.” Her reaction came in the backdrop of World Bank’s fresh data released today about doing business in various countries across the globe. In the latest ‘Doing Business’ report, India’s place remained unchanged from last year’s original ranking of 130 among the 190 economies that were assessed on various parameters.
However, last year’s ranking has now been revised to 131 from which the country has improved its place by one spot. The World Bank’s report came at a time when Narendra Modi-led government is patting its back over the different initiatives it has taken over the last 2 years that is expected to bring unprecedented economic growth in the near future. In the same vein, the government has been making efforts to improve the ease of doing business and its stated claim is to bring the country up into the top 50.In his reaction, Economic Affairs Secretary Shaktikanta Das said, ” Many more measures in the pipeline to improve ease of doing business; hope we will get a better rank next year.”
SOURCE: The Financial Express
Underlining that India needs “transformative reforms” to boost its economy, the World Bank today said the country has witnessed “fast-paced” reforms in past two years with the government encouraging digitisation, streamlining electricity supply and supporting manufacturing. “The country has embarked on a fast-paced reform path,” the international lender’s annual report on Ease of Doing Business 2017 Report said in a special India-specific box. The report “acknowledges several substantial improvements”.
Titled ‘India has embarked on an ambitious reform path’, the report said that the current Indian government was elected in 2014 on a platform of increasing job creation, mostly through encouraging investment in the manufacturing sector. Soon after the elections policymakers realised for this to happen substantial improvements would be needed in India’s overall business regulatory environment, it said adding that ‘Doing Business’ indicators were employed as one of the main measures to monitor improvements in India’s business climate. “As a result of the election platform-driven reform agenda, over the past two years the ‘Doing Business’ report has served as an effective tool to design and implement business regulatory reforms,” the report said. The data presented by ‘Doing Business’ indicators have led to a clear realisation that India is in need of transformative reforms. The World Bank said India has achieved significant reductions in the time and cost to provide electricity to businesses. In 2015-16, the utility in Delhi streamlined the connection process for new commercial electricity connections by allowing consumers to obtain connections for up to 200 KW capacity to low-tension networks. “This reform led to the simplification of the commercial electricity connection process in two ways. First, it eliminated the need to purchase and install a distribution transformer and related connection materials, as the connection is now done directly to the distribution network, leading to a reduction in cost,” it said. “Secondly, the time required to conduct external connection works by the utility has been greatly reduced due to the low-tension connection and there is no longer a need to install a distribution transformer.” As a result, the time needed to connect to electricity was reduced from 138 days in 2013-14 to 45 days in 2015-16. And in the same period, the cost was reduced from 846 per cent of income per capita to 187 per cent. India further made paying taxes easier by introducing an electronic system for paying employee state insurance contributions, the World Bank said. In the area of trade, as of April 2016 the Customs Electronic Commerce Interchange Gateway portal allowed for the electronic filing of integrated customs declarations, bills of entry and shipping bills, reducing the time and cost for export and import documentary compliance, it noted.
SOURCE: The Financial Express
Asserting that the goods and service tax (GST) regime will be ushered in from April 1 next year, economic affairs secretary Shaktikanta Das on Tuesday said the recent series of reforms would help the economy grow at close to 8% in FY17 with the farm sector clocking 4-4.5% growth. India’s economy grew at a lower-than-expected 7.1% in the June quarter — the lowest expansion in six quarters — as a 19% year-on-year jump in government consumption and near removal of the drag on growth from foreign trade were more than reined in by a fall in investments. The GDP had grown 7.9% in Q4FY16 and 7.6% in FY16. Farm and allied sector growth (based on gross value addition) grew by 1.2% in FY16 as compared to a contraction of 0.2% in FY15. “We have an economy which had recorded 7.6% growth (in FY16). Thanks to good agriculture where we expect growth to be upwards of 4% ..and it could be even 4.5%… we are looking at (GDP) growth of close to 8% (in FY17),” Das said at an event organised by industry body Assocham here.
Das’s optimism emanates from a normal and evenly dispersed monsoon after two years of deficient rains that hurt growth. “The GST will happen, bankruptcy law has happened. Both these pieces of legislation together with amendments to the arbitration law, debt recovery tribunal and company laws have potential to create a very vibrant and dynamic economy,” he said.
The GST Council headed by finance minister Arun Jaitley has already held two-three rounds of meetings to finalise the details of the new tax regime, including tax rates. The Centre has proposed a multi-tier structure for GST: 6% on essential items, 12% and 18% standard rates on most of the goods and services while a peak rate of 26% has been proposed for demerit goods. Gold is proposed to be taxed at 4%. Separately, the Centre has suggested imposing a cess on demerit goods to fund compensation to states under the new regime for any loss of revenue, a move opposed by some states, though there has been sort of an agreement on keeping the clean energy cess in the GST regime and having a new impost on tobacco.
Das expressed confidence that the revenue-neutral rate structure would be decided in the council’s meeting next month. Dismissing criticism, he said the rate structure has been prepared on a very practical basis. “The rate has to be necessarily revenue-neutral. One cannot have a rate structure where governments run into huge deficit… Therefore, GST rates are worked out in such a manner that bulk of commodities are under the standard rate, which is 18%,” he said.
Besides GST, the other big reform is the Insolvency and Bankruptcy Code 2016, which got Parliament nod in May. It is touted as a big reform initiative to improve the ease of doing business by helping speed up unlocking of distressed corporate assets and boosting creditors’ ability to recover debts before they are truly sunk. “The law ministry, the legislative department are also working on finalising the regulation. We expect therefore the entire bankruptcy and insolvency law will become operational by end of December,” Das said.
Separately, the government has floated a draft Financial Resolution and Deposit Insurance (FRDI) Bill for resolution of failed financial institutions.”It’s our endeavour to introduce the Bill as early as possible in Parliament. We are trying to introduce it in the Winter Session,” he said. The FRDI Bill, together with the Insolvency and Bankruptcy Code, when enacted, will provide a comprehensive resolution mechanism for the economy.
SOURCE: The Financial Express
Notwithstanding criticism, the government is of the view that the proposed cess on luxury and sin goods under the goods and services tax (GST) regime is the best way of creating a corpus to compensate states for any revenue loss, as consumers will have to pay significantly more if the fund is financed from regular taxes. The government is also firmly backing its four slab-GST structure as it feels it’s the most appropriate system for a country where indirect taxes contribute a big percentage of the exchequer’s revenue and where tax rates on mass consumption items should remain low. The proposed tax structure has been criticised for being complicated and one that defeats the purpose of a single neat GST while the cess is seen as distortionary and one that would lead to cascading of taxes. The GST Council, the apex body on the new tax regime, will meet again on November 3-4 to freeze the tax rate. The government is confident that consensus on the cess and the slabs will be arrived at in this meeting.
Cheapest option
The government is targeting a Rs 50,000-crore corpus to fund states for any loss of revenue under GST and has proposed a cess on luxury and sin goods for this purpose. The benefit of the cess is that it would entirely accrue to the Centre and could then be distributed to states. The other option, backed by some states and experts, is to raise the highest tax rate instead as cess would cause cascading of taxes and would distort the GST. But, under this route, to create the Rs50,000-crore fund, the government estimated it would have to raise revenues of over Rs1.7 lakh crore from tax paying consumers. This is because of two reasons — 42% devolution out of Centre’s taxes to states under the Fourteenth Finance Commission and sharing of GST.
In order to retain Rs50,000 crore in the compensation fund, the centre would need about Rs86,000 crore in additional tax before 42% devolution to states. The NITI Aayog has also defended the cess despite its shortcomings in that there would not be input tax credit and said that it would anyway be temporary, as it would compensate the states for loss of revenue in the first five years of GST.
Four slabs
Former finance minister P Chidambaram has criticised the proposed multiple rates. “A well designed GST is expected to have standard rate, plus and minus standard rate. That latitude interpreted to me as multiple rate — zero to 100 — that's not GST. That is simply existing VAT rates in a new shape, old wine in a new bottle,” he had said. But the government is keen to press ahead with the four slab structure for GST, as it believes this is the best way of ensuring against revenue loss, while at the same time protecting consumers. Under the proposed structure, some goods will be exempted from GST while others will be levied 6%, 12%, 18% and 26% rate. The government expects goods taxed at 6% to account for 7.08% of tax base, the 12% slab to account for 28.3%, the 18% slab to account for 31.04% and the highest 26% rate to account for 24.8% of total revenue. Gold taxed at 4% will get the balance 8.7%. European countries too have multiple levies and if one takes into account the differential VAT rates for tobacco and alcohol, most of these countries effectively have four rates.
SOURCE: The Economic Times
Debunking criticism over equity structure of the company building world’s biggest tax system, GST-Network Chairman Navin Kumar today said all measures have been taken to protect sensitive tax information and the government will have strategic control over it. By keeping Goods and Services Tax Network (GSTN) private, the company has been equipped to take decisions quickly as an agile and nimble organisation not bound by red tape that can retain talent by paying market salaries, he told PTI. Kumar insisted that enough fire-walls and 8-levels of security is being built to keep the data safe. BJP leader Subramanian Swamy has questioned the structure of the entity created under the previous UPA regime saying how a private firm can be allowed access to “sensitive” tax information without security clearance. The Government of India has 24.5 per cent stake in GSTN and the state government an equal share. The remaining 51 per cent is with private financial institutions. “But measures for strategic control by the government have been built-in,” he said adding the GSTN board has 14 directors, half of them are appointed by the government. The Centre and State nominate three directors each and the Chairman is jointly named by the two. “So government has 49 per cent equity and 50 per cent of the directors. The private equity holders who hold 51 per cent, can nominate only three directors. And then there are three are indepedent directors and one is a CEO. “The rules of business specify that no meeting of the board can take place unless 50 per cent of the directors are from government. Which basically means that no decision can be taken against the wishes of the government. So this is the strategic control that they exercise,” Kumar said.
While GSTN in day-to-day functioning works like a private company, takes quick decisions and is not bound by the PSU rules, there are certain critical decisions which can be taken only through special resolution in the general meeting, where 75 per cent of the votes are to be polled for any decision. “So in a nutshell, it is a non-government company over which government has a strategic control,” he said.
Asked about concerns over data security, he said this is not the first time that the government is implementing an IT project through a private company. “There are many large IT projects already in operation. Take the case of Income Tax. Who is doing the Income Tax project– it is Infosys and TCS. What are Infosys and TCS, they are private companies. Go to any VAT projects in the states, most of them are being done by either TCS or Wipro… “So is the I-T data sensitive or not? That is with these private companies. Now look at GSTN. GSTN is structured as a private company over which government has a strategic control. No decision can be taken without its consent… So what is the concern? If data can rest with TCS or Wipro without any problem, why is a question being raised about GSTN handling such data. Because here government has a presence on our board. So there is no problem,” Kumar said.
SOURCE: The Financial Express
Uttarakhand Commercial Tax Service Association today opposed the GST council’s decision to keep the states out of the tax administration process under IGST, saying it went against the principle of fiscal federalism by narrowing down the role of states and their dealer base.
Criticising GST Council’s handing over the complete administration of ‘services’ to the Central Board of Excise and Customs (CBEC) at its very first meeting on September 24, the Association’s president Yashpal Singh said it was unfair on part of the council to take away the tax administration domain from state agencies citing their “lack of experience”. “Not only that but the Council also negated the right of state’s absolute control of administration of such dealers which had an annual turnover of up to one and half crores, which was the result of prolonged debates,” he said. According to the proposed changes after GST, the Centre would levy and collect the Integrated Goods and Services Tax (IGST) on all inter-State supplies of goods and services in case of inter-State transactions.
On CBEC’s charge that the states are against GST roll out, and their struggle for “more work” and opposition makes their intentions dubious in nature, Singh said the allegation was totally baseless and false. “In reality the states are completely in favour of GST and the enthusiasm shown by them in ratifying the constitutional amendment proves the falsity of this bogus charge,” he said. States are opposed only to the idea of being kept out of the administration of “services” and there are primarily two reasons for this, he said. “First the argument cited by GST council that state tax authorities are ‘inexperienced’ to divest them of administration of services is demeaning to them. And secondly, the Model GST Law has included many transactions under the definition of ‘services’ like work contract, transfer of the right to use, and transactions done by hotels and restaurants etc, which were hitherto covered under the category of ‘goods’,” Singh said. In consequence, approximately about one third of the current tax base of states will shift from the control of states, which would be detrimental to the future prospect of state’s service cadres, the Association president said.
As far as the question of struggling for ‘greater work’ is considered, then at present CBEC administers only around 11 lakh dealers and all the states together administer around 63 lakh dealers registered for indirect taxation, Singh said. All such formulae that are proposed by the GST Council and even by states for administering this tax base, suggest that there would be fall in the dealer base that is hitherto being administered by the states, he said. “It could be part of a long term strategy of permanently disfranchising states from the administration of indirect tax administration after bidding adieu to the principle of fiscal federalism,” he said.
SOURCE: The Financial Express
Tamil Nadu Chamber of Commerce and Industry has condemned the proposed levy of cess on GST, terming it unethical and as an attempt to complicate the simple GST taxation system. Demanding the withdrawal of the proposed levy, Chamber President N Jegatheesan said the cess on ultra luxury goods like big car or “sin goods” such as tobacco and pan masala to compensate the states for any revenue loss over a period of five years on implementation of GST “will only complicate the simple GST taxation system.” “It contradicts the ‘One Tax’ principle of GST, as GST subsumes all cess and an array of indirect tax that is now being levied by the Centre and the State,” he said. The Chamber has appealed for not opening the Pandora’s box of cess under GST. It has further suggested that the Centre could, instead of levying a blanket cess on all demerit goods, opt for a slightly higher rate of tax on ultra luxury products and such goods to mop up funds for compensation to the states, with a commitment that it would be withdrawn “as soon as it is found that the increased rate is not necessary.”
SOURCE: The Hindu Business Line
With the Budget presentation advanced by almost a month, the Finance Ministry is unlikely to present a mid-year report card of the economy from this fiscal. Though the official date of the Budget is yet to be finalised, the government is left with little time to present a mid-year review. A senior government official said the practice of mid-year review may be discontinued altogether, “as it would mean duplication of our efforts to not only prepare the report but also the Budget.” The Mid-Year Economic Analysis, which is traditionally tabled by the Finance Ministry in the Winter Session of Parliament, is seen as a stock-taking exercise over a variety of parameters set in the Budget such as growth, inflation and current account and fiscal deficits of the current fiscal and also indicates the priorities for the year ahead. It also sets the government’s agenda in the economic sphere for the remaining months of the financial year. However, the Finance Ministry may still submit a status report on the implementation of major announcements in the Budget as well as the statement under the Fiscal Responsibility and Budget Management Act, sources said. The reports are usually submitted as an annexure in the mid-year review.
Status report
“The status report increases the government’s accountability and is likely to be tabled this year too,” said another official, adding that the statement under FRBM is also legally mandated. “Depending on the report of the FRBM Committee, this may also be discontinued in later years,” he added. The move comes after the Centre decided to advance the date of the presentation of the Union Budget by a month to the first week of February to ensure that the process is completed before the start of the new financial year. As a result, the Winter Session of Parliament, which used to start in late November and continue into December, has now been slightly advanced. The session will start on November 16.
The Finance Ministry has already initiated pre-Budget discussions and has sought suggestions on tax policies from stakeholders. Similarly, the Economic Division, led by Chief Economic Adviser to the Finance Ministry Arvind Subramanian, has also initiated work on the Economic Survey, which will be presented along with the Budget. NITI Aayog’s three-year vision document for the economy is also likely to be finalised by early next year, and could be presented in late January or early February. “The 15-year vision document will take some more time, but work is in full swing on the three-year action plan and it will be presented in the next few months,” said a person familiar with the development. The three-year action plan, which would outline the government’s key focus areas, is being seen as providing pointers to the Budget.
SOURCE: The Hindu Business line
“India seems to be on the right track,” say some US executives I meet as an academic. But there are others with less flattering comments: “I have not seen any Indian brand in stores here… Not even a made-in-India label… How come India could not win a single gold in the recent Olympics?” Opinion about India in international business circles seems to be deeply divided.
India’s progress
The 2016-17 Global Competitiveness Report ranks India 39th among 138 nations — a 16-place jump from year-ago levels. The report assesses the competitiveness of a nation based on its macroeconomic environment, strategies employed to promote growth such as institutions and policies, and the ability of enterprises to create and sustain value. The nature of the economy and growth measures influence enterprise competency to compete and, in turn, enhance national productivity and prosperity.
India’s progress on global competitiveness is impressive. The economic development initiatives launched by the Modi government two years ago seem to be paying off. However, India remains a factor-driven economy characterised by an unskilled workforce, and heavy reliance on agriculture and extractive industries. Lack of complexity and technological sophistication in its economy limits its ability to offer high-value goods to global markets.
In 2015, India exported $262 billion — compare with China’s $2.3 trillion — of which, over one half was commodities and low tech goods (mineral fuel, clothing) while just 15 per cent was engineered goods (autos, appliances). Notably, India’s share in global merchandise trade has remained stagnant at 2 per cent over the last five years compared to China’s, which has grown from 10 to 14 per cent.
Manufacturing orientation
The Prime Minister’s economic development initiatives hope to rectify this situation through targeted programmes that would equip India for a stronger performance in global trade and competition. Among them is ‘Make in India’, a large-scale campaign to attract foreign direct investments to the manufacturing sector. These investments are designed to create jobs in massive numbers to absorb the country’s burgeoning workforce. More importantly, they are expected to move India up on the development ladder to the ‘efficiency-driven’ stage — exemplified by high-volume diversified manufacturing and the ability to globally market a wide range of value-added consumer and industrial goods. ‘Make in India’ has been well-received. In 2015, India emerged as the top destination for FDIs. Indications are this trend will continue. Encouraging as the news may be, manufacturing assets, ipso facto, will not propel India to the forefront of global merchandise trade and competition. What is additionally needed is a workforce that has complementary industrial skills.
India’s workforce of 500 million is mostly unskilled — by government estimates, 80 per cent has no marketable skills. Alarmingly, less than 10 million are vocationally trained as against 150 million needed by 2022 to transition India as a leading manufacturer. Undoubtedly, it is an uphill task and India has formed a Skill Development Agency to spearhead implementation, jointly with the private sector.
Reports indicate progress toward the goal but also mention tepid enrolment in short-term vocational training and apprenticeship despite the existence of an incentive regime. The reasons are not far to seek — India has never been a blue-collar economy. The educational aspirations of its citizens have historically been centred on academics and university education, driven by ambitions in the administrative and management cadres. By contrast, industrial training has generally been perceived as unglamorous, even undignified. Clearly, the solution to this problem lies in educating India through information distribution and publicity that describes entry jobs in industry and pathways to functional and general management.
Towards innovation
Manufacturing assets and workforce skills will give India the foundation to compete globally on a wide range of products. However, to be distinguished as a leader, India must transform from low-skilled commoditised production to designing and marketing sophisticated, proprietary technologies — it must evolve as an innovation-driven economy.
To realise this, India would need highly talented science and engineering graduates and substantial investment in R&D. India is self-sufficient in the former; it is the latter where the country is deficient. India’s R&D spending of $66 billion in 2015 (0.9 per cent of GDP) pales in comparison to China’s ($410 billion or 2.1 per cent of GDP). What is more troubling is that three-fourths of it comes from the public sector. The low private sector participation could be because of the relatively small size of most Indian firms and consequent lack of scale economies. This problem should resolve itself when manufacturing investments rise. So, is India globally competitive? The short answer is: It is a work in progress. Evidence suggests that India seems to be on the right track.
SOURCE: The Hindu Business Line
Ministry of Finance’s Department of Revenue under the chairmanship of revenue secretary Hasmukh Adhia will begin pre-Budget consultations with various industry associations from November 7. Adhia is scheduled to chair the first meeting with Automotive Components Manufacturers Association and Society of Indian Automobile Manufacturers on November 7, after which he will hold the next pre-Budget meeting with National Highways Builders Federation, Builders Association of India, Construction Federation of India and Confederation of Real Estate Developers Association of India (CREDAI) on November 8.
Industry chambers Federation of Indian Chambers of Commerce and Industry (FICCI) and Confederation of Indian Industry (CII) will discuss their tax proposals for Budget 2017-18 on November 11 and November 15, respectively. Representatives of ASSOCHAM and PHD Chamber of Commerce and Industry will meet the revenue secretary on November 16 and November 17, respectively, to present their proposals for next financial year’s Budget.
Separately, the department will also hold pre-Budget meetings chaired by other officials. On November 2, Member (Budget), Central Board of Excise and Customs (CBEC) will hold pre-Budget meeting with Association of Synthetic Fiber Industry, Association of Manmade Fiber Industry of India and Indian Spinners Association. Associations of telecom service providers such as Cellular Operators Association of India and Indian Cellular Association will meet CBEC Chairman Najib Shah on November 7, while representatives of Indian Drug Manufacturers’ Association and Organisation of Pharmaceutical Producers of India will meet Shah on November 11.
CBDT chairperson will chair meetings with Institute of Chartered Accountants and Chamber of Tax Consultants on November 7, while meeting with tax professional bodies such as EY, KPMG, PWC and Deloitte will be held on November 10. Pre-Budget consultations with Indo-American Chamber of Commerce, European Business Group and American Chamber of Commerce in India will meet CBDT chief on November 15. The meetings are scheduled to end on November 18, when Adhia will chair meeting with officials of Tobacco Institute of India.
The industry associations meetings with tax department officials assume greater significance on account of the proposed implementation of GST from April 1, 2017. Industry associations in their past meetings with finance ministry officials had asked for a timeline of at least six months before the implementation of the new indirect tax regime.
SOURCE: The Indian Express
Notwithstanding the rising clamour from certain quarters for a ban on Chinese goods, India is in talks with its neighbour to mutually decide the extent to which markets for goods can be opened up further, by eliminating import tariffs, as part of the ongoing negotiations for the Regional Comprehensive Economic Partnership (RCEP) pact. Trade Ministers from the 16-member RCEP — which includes the 10-member ASEAN, India, China, Japan, South Korea, Australia and New Zealand — will meet in Cebu, Philippines, on November 3-4 to see if final commitments in the area of goods, services and investments can be reached. However, progress is not possible till India and China strike a deal as New Delhi continues to be apprehensive about opening up its markets to Beijing, a government official said. “Both countries had a number of meetings at the RCEP officials meeting in China last week and the BRICS meeting in Delhi the week before. Some basic understanding has been reached by the two but an agreement is not yet on the horizon,” the official added.
Trade deficit
India’s growing trade deficit with China, which crossed $52 billion in 2014-15 and accounted for almost half of the country’s total trade deficit, is a matter of big concern for the country. It has led to several sections of India’s politicians, industry and the public calling for a ban on Chinese goods, which the government has said was impossible. Commerce Minister Nirmala Sitharaman is likely to meet her Chinese counterpart for a bilateral meeting just before the RCEP Ministerial meeting. While India had agreed to gradually phase out import tariffs on 42.5 per cent items imported from China in the first round of offers in the negotiations, it has fallen short of the overall expectations. Several members in the RCEP, including ASEAN and China, want that all members should be offered the same level of market opening.
India had offered to eliminate tariffs on 80 per cent of items for ASEAN, 62.5 per cent of items for Japan and South Korea and 42.5 per cent of items for China, Australia and New Zealand with which it does not have a bilateral free trade pact. New Delhi has said that it was impossible for it to eliminate duties on 80 per cent of items for China as it would be catastrophic for the Indian industry even if it is carried out in a relatively longer time frame. “India has to definitely go higher than the offer to eliminate tariffs on 42.5 per cent of items for China, but certainly Beijing also has to understand that it can’t go as high as 80 per cent. The offer will be in between the two, but it will be a difficult decision for India,” the official added. Once it is decided what would be offered by India to China, it would serve as a benchmark and New Delhi can make its final offer for the other countries as well. The RCEP countries account for 45 per cent of the global population and 40 per cent ( $21.3 trillion) of world trade. Once the RCEP, which includes goods, services and investments, is implemented, it would result in one of the largest free trade blocs in the world.
SOURCE: The Hindu Business Line
China is unlikely to deter its firms from investing in India, but it is not going to be an easy sailing for Chinese investors who will have to deal with labour unions which they are not used to at home, official media reported. As India is wooing investments from China, "the Chinese government has not expressed opposition to the general industrial transfer from China to India", an article in the state-run Global Times said. Chinese officials have rolled out concrete measures to encourage local enterprises to go abroad and explore overseas markets, including India, it said. "Currently, India is on track to hold on to its spot as one of the world's fastest growing emerging countries, and Chinese manufacturers are salivating over this fast-growing consumer market. Furthermore, the Chinese economy will likely gain momentum from the formation of a new cross-nation industry chain between the two neighbours. "Considering the above factors, China's government is unlikely to deter India's effort to woo Chinese component companies, despite the possibility that this could cause job cuts in the manufacturing sector at home. But at the same outbound investment by Chinese component enterprises into India will not be a 'plain sailing' as 'the greatest challenge of setting up plants in India lies in the hesitation of Chinese entrepreneurs to step up local production," it said. The article said, "as Chinese component enterprises become more deeply entrenched in the Indian economy, they will soon encounter a number of differences between the two countries in terms of commercial ecology". "For instance, Indian labour unions ensure workers have a voice in corporate governance, while Chinese entrepreneurs usually lack experience dealing with strong unions," it said.
Despite being a Communist nation, China has no labour unions except the state controlled All China Federation of Trade Union which toes the government line on labour related issues with very few incidents of labour unrest. In 2010, there was a series of protests by workers in China, demanding a pay rise and improved collective bargaining rights. Workers had clashed with the institutionalised unions that were formed to represent them. The Chinese investments also will be hampered by lack of skilled workers besides lack of cohesion between the states the article said. "As China-made products gain greater market shares in the Indian consumer markets, India may still have a long way to go in persuading Chinese component enterprises to step up local production," it said, adding that private investors in India have "misgivings". "If Indian private enterprises have misgivings about investing in the country, India may struggle to persuade Chinese firms to invest extensively in India in the short term," the article added.
SOURCE: The Economic Times
Sino-India relationship has endured severe storms over the decades. From India-China war of 1962 to the most recent development following surgical attacks carried out by Indian army across LoC in PoK. Both the countries have joined hands for BRICS but there was fall out over China’s decision to block India’s permanent seat in UN, entry in NSG or over extending technical hold on India’s move to get Pakistan-based Jaish-e-Mohammed(JeM) chief Masood Azhar designated a terrorist by the United Nations. But both the countries’ vicissitudes of fortune are all passé as they have made spectacular economic progress and now are on the brink of virtually lording it over the world. Both these countries’ economic growth is exhilarating as the two neighbours have achieved what few, if any other country barring the US and UK have done. Now one won’t be able to tell the story of the 21st century without India and China as its main protagonists. And what’s even more awe inspiring is that the world’s two most populous nations are poised to get even larger economically.
Notably, both the Asian giants do not appear in the world’s top economies in the chart until the 1990s. China first to come out of the blocks, zooms up the chart past Europe’s economic superpowers and Japan. India, however, jumps into the frame by the late 2000s and does the catch up but by the end of the next decade, India is predicted to be up there along with China and the US. These countries are projected to rank as the world’s top three economies, according to the Washington Post report.
The neighbours had their own issues but reformative policies of the respective governments have been the key driver behind the economic growth. China’s opening up of its economy under Deng Xiaoping in the 1980s and India’s landmark reforms in the early 1990s set the stage for the nations’ return as key global players. This includes the rise of hundreds of millions of people out of poverty, the report said.
SOURCE: The Financial Express
India and the EFTA, a bloc of four European countries including Switzerland, will resume the long-stalled negotiations for a proposed free trade agreement this week in Geneva to iron out differences. A team of officials from the commerce ministry is visiting Geneva to resume talks, an official said. “The three-day negotiations will start from tomorrow,” the official added. The last round of negotiations was held in November 2013 and thereafter the negotiations have remained suspended. In June this year, a meeting between the chief negotiators of India and European Free Trade Association (EFTA) was held here to take stock of the ongoing negotiations for Trade and Economic Partnership Agreement (TEPA). Both sides had expressed willingness to jointly address the major outstanding issues and agreeing to an early resumption of negotiations and concluding a balanced agreement in a time-bound manner. The trade pact talks had started in October 2008. So far, 13 rounds of negotiations have been held at the level of chief negotiators. The four EFTA members are – Switzerland, Iceland, Norway and Liechtenstein. The proposed pact covers trade in goods and services, market access for investments, protection of intellectual property and public procurement.
Negotiations were stuck on some issues related with intellectual property rights. EFTA wants India to commit more in IPR. They were also demanding for data exclusivity, which India is completely opposed to. The two way trade between the regions stood at $21.5 billion in 2015-16 as against $24.5 billion in the previous fiscal. The trade gap is highly in the favour of EFTA group.
SOURCE: The Financial Express
The international crude oil price of Indian Basket as computed/published today by Petroleum Planning and Analysis Cell (PPAC) under the Ministry of Petroleum and Natural Gas was US$ 49.54 per barrel (bbl) on 24.10.2016. This was higher than the price of US$ 49.41 per bbl on previous publishing day of 21.10.2016.
In rupee terms, the price of Indian Basket increased to Rs. 3312.04 per bbl on 24.10.2016 as compared to Rs. 3305.32 per bbl on 21.10.2016. Rupee closed stronger at Rs. 66.86 per US$ on 24.10.2016 as against Rs. 66.89 per US$ on 21.10.2016. The table below gives details in this regard:
|
Particulars |
Unit |
Price on October 24, 2016 (Previous trading day i.e. 21.09.2016) |
Pricing Fortnight for 16.10.2016 (Sep 29, 2016 to Oct 12, 2016) |
|
Crude Oil (Indian Basket) |
($/bbl) |
49.54 (49.41) |
48.69 |
|
(Rs/bbl |
3312.04 (3305.32) |
3243.24 |
|
|
Exchange Rate |
(Rs/$) |
66.86 (66.89) |
66.61 |
SOURCE: PIB
Despite uncertainty surrounding the Trans-Pacific Partnership agreement, foreign textile and garment firms are still investing heavily in Vietnam. In the northern province of Vinh Phuc, Hong Kong-based TAL Group officially launched a US$50 million project to manufacture fabrics, garments, and textiles last week. Located in Ba Thien Industrial Park (IP), the plant is expected to churn out 12 million products per year and create 3,500 jobs. This is TAL Group’s second project in Vietnam, after it entered the country in 2004 to set up a US$40 million textile-garment factory in Phuc Khanh IP in the northern province of Thai Binh, currently employing more than 3,000 workers. TAL Group, a private, family-owned firm, is one of the world’s largest clothing manufacturers-with 25,000 workers at eight factories worldwide. It specializes in the manufacture of quality men’s and women’s garments for leading apparel brands.
China-based Texhong Group, one of the world’s largest yarn suppliers, just confirmed its investment in Vietnam earlier this month. The group’s founder and chairman, Hong Tianzhu, said that, even without the Trans-Pacific Partnership (TPP) the competitiveness of the company’s Vietnam operation “is very strong [compared with other] Southeast Asian nations, and even compared to Chinese production bases.” Texhong Group has been aggressively raising production capabilities in TPP signatory Vietnam. Tianzhu has said that one of the main intentions of the company’s Vietnamese investment is to benefit from the trade agreement. Execution of the TPP “will pose new challenges to China’s textile and apparel enterprises,” so the company is building up its Vietnam operation “with respect to the cost advantages” and prospects of the pact, he said in the company’s annual report in March.
Vuong Duc Anh, director of the Import-Export Department under the Ministry of Industry and Trade, said, “Vietnam’s garment and textile exports grew 8% each year in the past, before any trade agreements had been discussed. This was still one of the key industries of the economy.” Much of this growth is predicted to come from the textile and garment industry’s exports to the US and other countries. Vietnam has a cost advantage in the labour-intensive garment segment and could exploit the preferential access to big markets granted by the TPP. According to a consultant of the Japan International Cooperation Agency (JICA), a number of Japanese investors were implementing a “China+1” business strategy. Instead of focusing only on China, they would also open another production location so as to diversify their supply sources. Vietnam is among the locations that receive their attention. “With reasonable labour costs, Vietnam is one of the most recommended candidates for Japanese garment and textile businesses to choose when seeking a new investment destination,” he said. “Many delegations came to Vietnam to find partners for joint ventures in textile and garments, as well as to build their plants. [This is thanks to it being a] low-cost sourcing alternative to other [countries], and its stable political and economic environment.”
Industry insiders said that the trend of increased investment and expanded production among foreign-invested projects in Vietnam is still evolving, only in part due to the benefits that would be reaped by the nation’s free-trade agreements on the horizon. “We see that Vietnam’s market is moving fast. The company has a vision to thrive within the market, making Vietnam one of our biggest investments and an important market in our global business plan,” said Paul Hulme, president of Singapore’s Huntsman Textile Effects. Last year, the company inaugurated a new bonded warehouse with a capacity of 250 tonnes of dyes and chemicals near Ho Chi Minh City.
SOURCE: The Global Textiles
A delegation has returned to the UK after a bid to persuade East African states to reverse their decision to outlaw imports of used textiles and leather goods. On 2 March 2016, heads of state of the East African Community (EAC), an intergovernmental organisation of Burundi, Kenya, Rwanda, South Sudan, Tanzania and Uganda, passed a directive to phase out such products by 2019. This has been a concern for the Textile Recycling Association (TRA) in the UK because of the jobs they fear will be lost in this country as EAC members account for a quarter of the exports to Africa - the biggest global market for the UK. The TRA also believes tens of thousands of people trading in imported clothing in the EAC will lose their livelihoods. The US textiles recyclers’ organisation SMART is also concerned on both counts and has added its support.
Now Jalia Packwood, development officer at Bangor University Sustainability Lab, has visited ministers and other officials in East Africa in an initiative sponsored by the university, the TRA, the Economic and Social Research Council and the Bureau of International Recycling (BIR). Packwood said the EAC directive was being taken very seriously by the partner states and they were working hard to ensure that it is implemented. “It is therefore pertinent that the issue is handled carefully and responsibly by different partners to ensure that the best strategy is adopted by the EAC,” she said at the latest convention of BIR in Amsterdam. “It is also important for the exporting countries to consider relevant and meaningful collaborations with the EAC in the textile sector to ensure that the people and the recycling sector do not suffer as a result of the directive.
The Bangor-TRA response had suggested alternative strategies:
Alan Wheeler, director of the TRA, centre, also speaking at BIR, complained more generally of “erroneous reporting” on used clothing exports which, he said, added fuel to flawed arguments from supporters of bans on used clothing exports. “The TRA is so frustrated by these types of misconception that we have teamed up with our equivalent trade association in North America (SMART) and issued a joint statement challenging these assertions and highlighting the really important benefits that our industry brings to the global economy, environment and to social wellbeing.”
SOURCE: The MRW
The world's first trade transaction involving shipment of cotton using the efficiencies of a distributed ledger, the Skuchain's Brackets system, for all parties has been undertaken by Commonwealth Bank of Australia, Wells Fargo and Brighann Cotton. The interbank open account transaction provides more efficient and effective method for the shipment of goods. The transaction involving a shipment of cotton from Texas, US to Qingdao, China involved two independent banks combining the emerging disruptive technologies of blockchain, smart contracts and Internet of Things (IoT), Commonwealth Bank said.
The trade involved an open account transaction, mirroring a Letter of Credit, executed through a collaborative workflow on a private distributed ledger between the seller (Brighann Cotton (US)); the buyer (Brighann Cotton Marketing Australia); and their respective banks (Wells Fargo and Commonwealth Bank). The trade introduced a physical supply chain trigger to the terms of the transaction to confirm the geographic location of goods in transit before a notification is sent to allow for release of payment.
The tracking feature adds a new dimension, providing all parties with greater certainty compared with traditional open account and trade instruments like Letters of Credit, which focus on documents and data. The use of blockchain technology creates transparency between buyer and seller, a higher level of security and the ability to track a shipment in real time. The advancement from paper ledgers and manual processes to electronic trackers on a distributed ledger reduces errors and accomplishes in minutes what used to take days. “The combination of these emerging technologies could eliminate many inefficiencies currently experienced in international trade. The benefits of lower costs and improvements to security through reduction of errors, risk and time, enable a company to achieve greater efficiency and have more predictable working capital,” explains Cameron Austin, general manager of Brighann Marketing.
Michael Eidel, executive general manager of Commonwealth Bank's Cash-flow and Transaction Services, said: “Existing trade finance processes are ripe for disruption and this proof of concept demonstrates how companies around the world could benefit from these emerging technologies. We strive to stay at the forefront of disruptive technologies to understand how they can be used to enable greater efficiencies and solve the real world challenges our customers face. The interplay between blockchain, smart contracts and the IoT is a significant development towards revolutionising trade transactions that could deliver considerable benefits throughout the global supply chain.”
“In this case, we demonstrated how a new approach to trade could benefit a joint Wells Fargo and Commonwealth Bank customer, Brighann Cotton. This marks another step in evaluating technology that, over time, could support the evolution of trade finance. While significant regulatory, legal and other concerns remain to be addressed with the technology, we are committed to engaging with our partners to explore potential applications within trade finance,” said Chris Lewis, head of International Trade Services for Wells Fargo.
Following the successful completion of this transaction, Commonwealth Bank and Wells Fargo have announced that they will continue to actively collaborate with trade finance clients, financial institutions, fintech companies and consortiums like R3, as well as players in the insurance and shipping industries, to ensure their clients benefit from the changes in technology across the global trade ecosystem
SOURCE: Fibre2fashion
European Parliament President Martin Schulz told German radio on Tuesday that he did not expect a free trade deal between the European Union and Canada to be signed this week. Belgium said on Monday it could not formally back the Comprehensive Economic and Trade Agreement (CETA) – which needs the unanimous support of the 28 EU nations – because its French-speaking Wallonia region opposes it. “I don’t think that we’ll get a solution this week,” Schulz told Germany’s Deutschlandfunk radio station. “That would seem to be very, very difficult to me.”He added that it would therefore be necessary to postpone an EU-Canada summit planned for Thursday. Whether or not an agreement can be reached this week depends on the federal Belgian government reaching an agreement with Wallonia on Tuesday, Schulz said. He said he was “sceptical” about that but thought they would ultimately find a compromise. In a broadcast statement on Monday Schulz said he was optimistic about finding a solution: “There is not only still hope with CETA. We are on the way to find a compromise and to find a solution for questions raised by the Wallonians, which are questions raised by a lot of citizens all over Europe.”
SOURCE: The Financial Express
Advanced fibre-based materials, digitisation of manufacturing and supply chains, new sustainable and customer-centric business models and access to growth markets will shape the future of Europe's textile and fashion industries, a new research agenda states. The Strategic Innovation and Research Agenda (SIRA) was unveiled last week at the 'European Textiles – going digital, going high-tech' conference in Brussels, which was organised by the European Technology Platform for the Future of Textiles and Clothing (Textile ETP). Some 150 participants from 24 countries attended.
The SIRA – entitled 'Towards a 4th Industrial Revolution of Textiles and Clothing' – outlines the major innovation themes and research priorities that are expected to drive and shape the future of the textile and clothing sector in Europe over the coming decade. It has been jointly developed by over 100 textile industry, technology and research experts from across Europe. "The trends we foresaw during the development of the first Strategic Agenda in 2006, of an industry that is shedding production volumes in favour of higher value-added products for niche markets have played out very strongly in the last ten years," Paolo Canonico, president of Textile ETP, told the conference. According to Textile ETP, the EU textile and clothing sector has reduced turnover by 19% while labour productivity has grown by 36% and extra-EU exports by 37%. "Since the economic crisis in 2009 this trend has further accelerated and by 2015 virtually all key figures for the sector, including employment numbers have shown growth. This can continue for the foreseeable future provided research and innovation, education and training and technology transfer to the many small companies in the sector is smartly supported at EU, national and regional level."
Four strategic innovation themes were singled out as having the most impact for the future development of the European textile and clothing industry: Smart, high-performance materials – Priorities identified include new and improved high-performance fibres, novel 1, 2 and 3-dimensional fibre-based structures, multifunctional textile surfaces and e-textiles with embedded ICT-enabled smart functions. Advanced digitised manufacturing, value chains and business models – new manufacturing technologies for complex textile and composite structures, digitization and flexible production processes and factories, virtual modelling and design of fibre (and textile) based materials and products, digitisation solutions for the full textile-fashion value chain and new digitally enabled business models. Circular economy and resource efficiency – This will be enabled by research on more water and energy-efficient textile processing techniques, new recycling concepts and technologies, development of substitutes for hazardous process chemistry, the adoption of biochemistry and bio-based material solutions as well as a better exploitation of natural fibres sources of European origin.
High-value added solutions for attractive growth markets – To be developed collaboratively with suppliers and end users. Some 600,000 new jobs are expected in the industry until 2025. For this to succeed, Europe must support and further develop its world-leading textile education and training infrastructure in order to preserve specialised traditional skills and know-how and acquire new qualifications for the textile business of the future. The Agenda lists 19 research priorities and over 90 specific research topics. "In the coming months and years, the European textile and clothing research and innovation community organised in the European Technology Platform will intensively engage with EU research and innovation policy makers, programme managers and partners from related industrial sectors and technology domains to further improve the situation for textile-related collaborative research and innovation in Europe," SIRA says. just-style's takeaways from the event focus on the fact clothing manufacturing will be completely transformed by the internet and digital printing over the next five to ten.
SOURCE: Just Style
The future of the Comprehensive Economic and Trade Agreement (Ceta) is hanging by a thread after Belgium announced it couldn't sign the treaty because of opposition from regional parliaments. If it does fall over, free trade advocates fear it could jeopardise this country's chances of securing a deal with the EU. "It's been said by a number of commentators that if Canada and the European Union can't do a trade deal, well, nobody can," Dairy Companies Association chair Malcolm Bailey said. "I'd like to think that this deal will remain viable, but clearly if this deal falls over it doesn't bode well for New Zealand and an European Union trade agreement."
Despite the Belgian stalemate, the EU and Canada still hope to sign the agreement later this week. International Business Forum executive director Stephen Jacobi said the EU's credibility was on the line. "This is more than just a hiccup I believe. This is a major blow to the EU's ability to conclude FTAs (free trade agreements). It doesn't mean they can't do FTA's in the future, but it will mean that they have to be done a little differently." New Zealand hopes to start talks with the EU next year and Trade Minister Todd McClay remains optimistic that will happen. "I met with the EU Trade Commissioner on Friday of last week in Oslo and she confirmed to me that the EU-NZ FTA is on track for launch next year, and that both sides will continue to work together to make sure that happens." "And then it will be some years before we conclude. It's my expectation that whatever the European Union has to do to sort this mess out, they'll do so." But support for the current batch of trade pacts , including the TPP and its trans-Atlantic cousin, TTIP, appears lukewarm at best. Opponents argue a major overhaul of such deals is needed to ensure that those at the bottom benefit, and that they don't undermine a country's right to determine what's best for their citizens.
SOURCE: The RNZ
There is no basis for continuous depreciation of China's yuan currency, and the exchange rate will remain broadly stable, the deputy governor of China's central bank said in a newspaper editorial on Tuesday. The comments by Yi Gang in the People's Daily, the official paper of China's ruling Communist Party, came after a two-week slide in the yuan that shaved off more than 1.5 percent of its value against the dollar. They echoed repeated statements by other top policymakers over the past year as the yuan has weakened substantially against the dollar. "The Chinese currency has stayed stable against a basket of currencies. The yuan was less volatile than major reserve currencies, and its volatility was far below other emerging market currencies," Yi said.
On Monday, the yuan hit a fresh six year low against the dollar, drawing large dollar sales by state banks, which some traders suspected was being carried out on behalf of the central bank to support the currency. The yuan's fall has been exacerbated by global uncertainties such as Britain's exit from the European Union, which battered most emerging currencies, but recent weakness has revived memories of China's surprise devaluation last August and another rapid depreciation early this year. Those declines in the yuan spread turmoil in global financial markets as investors fretted about deepening economic woes as growth slipped to a quarter-century low. Even before Brexit, most market watchers polled by Reuters had already expected Beijing would allow the yuan to weaken modestly this year as the economy continues to slow.
China Foreign Exchange Trade System data showed on Monday that the index for the yuan's value based on the market's trade-weighted basket stood at 94.30 on Friday, down 0.4 percent from the previous week. Market confidence in the likelihood of a U.S. interest rate rise in December has also pressured the yuan with a recent Reuters poll showing the largest bearish positions in the currency since late July. Yi said two-way volatility of the exchange rate against the dollar had increased over time. Separately, Yi also said that China would maintain its prudent monetary policy while keeping ample liquidity in the financial system. The government would strengthen its credit policy to support small and medium-sized enterprises, he said in the editorial.
SOURCE: The Yahoo Finance
