The Synthetic & Rayon Textiles Export Promotion Council

MARKET WATCH 29 OCTOBER, 2015

NATIONAL

INTERNATIONAL

Textile industry urge for supportive policy measures to grab global opportunities

Textile industry that is going through recession is looking for various supportive policy measures from the government to grab the emerging global opportunities. While the Centre looks to address macro issues particularly towards controlling inflation, improving general economic conditions, infrastructure and measures aimed at ease of doing business, the weightage given to the textile industry is not enough. According to M Senthilkumar, Chairman, The Southern India Mills’ Association, the industry is facing severe recession for almost 18 months due to glut in the global market, market access related issues, delay in conclusion of FTAs, undue delay in disbursement of TUF subsidies and a host of other issues.  Renowned economist and corporate advisor S Gurumurthy, the SIMA Chief said that the industry faces two challenges – one on the raw material front and the other on market access.  The SIMA Chief’s appeal includes release of adequate funds to clear all pending TUF subsidies, 3 percent interest subvention for all textile products, providing suitable market specific incentives under MEIS till FTAs are concluded, reducing hank yarn obligation to 20 percent (from 40), urging Cotton Corporation to follow industry-friendly cotton trading policy, removing 5 percent import duty, 4 percent special additional duty, anti-dumping duty, reducing central excise duty to 6 percent so as to make MMF available at international price etc.

He said that during the first nine months of the current calendar year, has seen 24.3 percent decline in overall exports of which cotton textiles fell by 3.58 percent, textiles and clothing by 5.71 percent and garments by 12.02 percent.  Moreover, with the world trade undergoing certain structural changes, this has had a severe impact on Indian exports. There is a need for a slew of policy measures to bail out the ailing textile sector.  While, the Chairman of Confederation of Indian Textile Industry, Naushad Parikh has urged the government to address the raw material issue and also implement direct transfer of cotton subsidy to farmers to resolve issues relating to cotton and duty structure on manmade fibre.  The Ministry of Textiles as also the Industry and Commerce Ministry have sought various supportive policy measures from the Ministry of Finance and PMO to revive the Indian textile industry.

Source : Yarn and fibre

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Weak exports and swelling inventory hamper job creation

As one of the largest employers, the textile and clothing industry is under pressure from the global economic slowdown because of unfavourable government policies. This has not only impacted the industry's expansion plans but also the jobs situation in the industry. According to the 25th Quarterly Report on Changes in Employment, released by the Labour Bureau, job creation declined by almost 70 per cent in the quarter ended March 2015 compared to the December 2014 quarter. Industry sources say the industry employs over 55 million workers, of which 12 million are employed by the apparel industry. According to industry sources, job creation has almost come to a standstill across the entire value chain, from yarn and fabric to garments. The handloom and powerloom industry, on the other hand, is witnessing job cuts with 3,000 and 2,000 jobs being cut during the October-December 2014 and January-March 2015 periods, respectively, according to the report.

Source: Business Standard

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Government is ready to provide financial support to revive sick industrial units if it comes across a viable proposal, MSME Secretary Anup K Pujari said today.

If there is a specific idea in your mind and need some financial support to revive sick units, you may come up with a proposal," said Pujari at an Assocham conference here.

"Among the companies which have turned sick, if their business proposition is good but it has not been executed correctly, they may very well revive," he added. He also said that the one-page Udyog Aadhaar Memorandum recently notified by the government which must be filled online by all micro, small and medium enterprises (MSMEs) is getting a good response from the people. "There are some people who are criticising us because it is called Udyog Aadhaar, it is an erroneous impression that Aadhaar number is mandatory to get Udyog Aadhaar Memorandum filed," said Pujari. He, however, clarified that while an Aadhaar number is required because it is filed electronically, it need not be the Aadhaar number of that entrepreneur or the enterprise. "Any incorporated company will have an authorised representative who files for them, we want that person's Adhaar number, it is to ensure that whatever is being filed is not a ghost filing," Pujari said. "We also have a checking system on that by which we take the bank details and the IFSC code of that, I do think this will simplify ease of doing business," he added.

Source: The Economic Times

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Punjab offers multiple opportunities for investment in textile sector

Progressive Punjab Investor Summit 2015 begins today in Mohali with focus on startup businesses in the state by providing budding entrepreneurs an international platform to present their innovative ideas before those who have already made a mark in the industrial sector. It is for the first time that the summit is joining hands with Startup Accelerator Chamber of Commerce (SACC). The technical session on manufacturing in progress Punjab summit-2015 will focus on reducing the cost of manufacturing, pooling research and development costs, measures to reduce the cost of inputs, skilling and retraining of existing work force to new technologies besides exploiting the emerging e-commerce platform to globally marketing the projects being manufacturing the Punjab.

Karan Avtar Singh, Additional Chief Secretary Industry & Commerce while presiding over the session of marketing said that Punjabi have entrepreneurship in their blood who are known for accepting challenges and succeeding in adverse circumstances.  Emphasizing on the strength of entrepreneurial qualities of state, he said that Punjab has emerged as the leading hub for textile-based industries such as apparel manufacturing, spinning and hosiery exports. With the development of apparel parks, favorable textile policy and other incentives for the creation of textile infrastructure, the state offers multiple opportunities for investment.  Inviting the investors to invest in manufacturing sector he said that another key strength of Punjab is its strong base of well-established Micro, Small and Medium enterprises in the state. He said that approximately 2,00,000 small scale industries which are one of the most important pillars of the industrial growth are active in the State. Singh said that Punjab has always promoted innovation & enterprise. There is scope for development of manufacturing across the value chain including services for high end design, Prototyping, 3D Printing etc. Govt. of Punjab is keen to develop a thriving ecosystem in the state for hi-tech manufacturing and encourage the local players to invest in the modernization of manufacturing facilities to improve quality, competitiveness and value addition. The session also discussed on the issue of building a robust manufacturing ecosystem - Strengthening vendor linkages, plug and play infrastructure and competitive industrial clusters. Role of government in facilitating vendor to anchor linkages and knowledge collaboration was also deliberated in the session. The delegates did a brainstorming on building a robust value chain for new age manufacturing – Industrial clusters with services for high end design, prototyping, 3D printing.  Progressive Punjab Investor Summit 2015 scheduled for October 28 to 29 in Mohali.

Source: Yarn and fibre

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Mumbai’s Mulji Jetha market found flooded with Chinese textiles

Mulji Jetha market, a 136 year old textile market in South Mumbai and the largest textile bazaars in Asia with hundreds of wholesale stories and some retailers too. The market which is still crowded and customers stream in endlessly but it has changed fundamentally. Instead of fabrics from the country’s traditional textile hubs, it is flooded with Chinese textiles. One such customer of this market, over half a century back, was a certain Dhirubhai Ambani, who would purchase fabric in bulk for export to secure yarn-making licences from the government, before he went on to script the rise of India’s largest private enterprise. According to Premal Udani, managing director, Kaytee Corp. Pvt. Ltd, an apparel manufacturer that supplies to Wal-Mart Stores Inc., Mulji Jetha hardly had any imported items 25 years ago. Now, there are hardly any local textiles. The issue is critical for fabric compared to apparel. The Chinese onslaught, or flooding of cheap Chinese items, is yet to happen in the apparel sector. If the government does not take a long-term approach, the organized mills will extinct in 10-15 years. According to Udani, Bangladesh’s apparel market was just $3 billion five years ago, while India’s was $5 billion. Currently, India is just $16 billion while Bangladesh has grown to $28 billion. The eastern neighbour has now started making denim and will enter more categories, he cautioned.

Rajeev Gopal, chief marketing officer at viscose staple fibre maker, Birla Cellulose, a unit of Aditya Birla Group said that the Indian textile industry is facing serious threat from China, and even Indonesia, across the value chain—from fibre to yarn to fabric and even garments—on account of dumping at very low prices.  The Indian textile industry, though competitive, especially in the upstream, is facing a squeeze on margins due to such low prices. This will result in closures and will discourage investments in this vital sector which is a large employment generator and a foreign exchange earner. The government will need to provide safeguards to ensure reasonable returns for the Indian industry. The Chinese avalanche has reached the doorsteps of Reliance Industries Ltd (RIL) too, whose founder made his early fortune at Mulji Jetha. On 24 September, Anil Rajvanshi, senior executive vice-president and head (corporate and industry affairs) at RIL, in his capacity as chairman of the Synthetic and Rayon Textiles Export Promotion Council (SRTEPC), wrote to Arvind Subramanian, India’s chief economic adviser, warning about a steady increase in imports of Chinese fabrics. Last year, imports of fabrics touched $850 million, or Rs.5,500 crore. Ninety-five percent is imported for trading at the cost of domestic industry and 100,000 labourers are rendered idle owing to these imports and revenue loss as the Modvat (modified value added tax) chain breaks.  All the neighbouring countries, Bangladesh, Thailand, Indonesia, Vietnam and China, have same rate of VAT (value-added tax) or excise duties on all natural and man-made or synthetic fibres as a result the textile industry in all these countries has grown in double digits in the last five years. The purpose of Modvat is to avoid the cascading effect of taxes on both inputs and final products. The scheme permits a manufacturer of excisable goods —like textiles—to avail of credit on duty paid on the notified inputs received and used in or in relation to the manufacture of final products and to utilize such credit towards the duty liability on disposal of final goods.

According to SRTEPC data, availability of all fibres in India is 10 billion kg, with cotton at 6.5 billion kg and man-made fibres at 3.5 billion kg. In order to achieve Modi’s target, India needs to double the size of fibre availability to 20 billion kg. With limited compounded annual growth rate (CAGR) of cotton at 1.5%, the production of man-made fibres has to be increased three times to around 12 billion kg. SRTEPC said that imports of fibre, yarn and value-added products such as finished textiles should be discouraged, as it badly hurts the domestic industry, capital and manpower employed.  Import of fabrics should be allowed to actual users and under advance licence only. The association said that it was shocking that the value of fabric imported under advance licence is below Rs.300 crore in the last three years while in the last year alone, imports, mainly from China, were to the tune of Rs.5,500 crore. The bulk of fabric is imported by traders, who retail in India, hurting domestic textile producers. Babubhai S. Ahir, promoter of textile firm Challenge Enterpises Ltd, said that the domestic fibre manufacturers cannot match the price offered by

Chinese companies as a result the Mulji Jetha market is covered with more Chinese fabric products. Due to this Chinese dumping over 80% domestic fibre manufacturers are now extinct. In India, the textiles sector employs the maximum workers after agriculture. Prime Minister Narendra Modi wants the sector to triple in size—from the current $110 billion to $300 billion by 2020. The changing hues of Mulji Jetha market attests to the urgency of the task.

Source: Yarn and fibre

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GST key reform for creating single market in India: World Bank

The proposed GST law is the most important reform towards creating a single market in India and if it is implemented by April 2016 then its impact will be visible by 2018, the World Bank said today. The proposed GST law is the most important reform towards creating a single market in India and if it is implemented by April 2016 then its impact will be visible by 2018, the World Bank said today. “The GST (Goods and Services Tax) is the single most important tax reform because it is so important for creating one market in India. I continue to believe that the Indian government is committed to get the GST done, hopefully in the Winter Session (of Parliament). “GST will make it easier to pay tax. For example, if it gets introduced by April 2016, realistically speaking you would only see the impact of GST by 2018 as per a survey based methodology,” World Bank Country Director in India Onno Ruhl said today. He said the GST is very important for the economy and it is a long-term measure. However, it is not the only thing that is going to improve the country’s business ranking.  Ruhl was addressing the media on the occasion of the release of the “Doing Business 2016” ranking in India today.

As per the new ranking for doing business environment, World Bank has ranked India 130 out of 189 countries. It was ranked 142 in Doing Business 2015. Ruhl said India’s improved position in the ranking was attributed to many factors of which the new Companies Act and better electricity situation are significant. He said the trend of decline has been successfully reversed by India. “It is really good news that on starting a business, on getting an electricity connection, e-filing to taxes, trading across borders, India has already taken actions since May 31,” he said.  However, speaking about the challenges, he said India ranks worst when it comes to getting construction permits done and enforcing contracts. “Getting construction permits and enforcing contracts (are the areas) where India is really very close to the very bottom,” Ruhl added. Among others, the India World Bank head also said that the agency is constantly engaged with the government and suggesting it in its preparation and action plan to improve the business environment. Besides, he also stressed that the World Bank will in future will be engaged with the Department of Industrial Policy and Promotion (DIPP), industry bodies CII, FICCI to prepare the state rankings in future as well. Ruhl also hoped the government to introduce the Bankruptcy Code in the upcoming winter session of Parliament. “Bankruptcy Code is very important; it is an important part of business environment. Our understanding is that the government intends…in the Winter Session. If adopted in the Winter Session it will definitely have a significant positive impact on the business ranking,” he added.

Source: The Financial Express

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Ease of doing business report: India climbs four places to 130

India climbed up four places from last year to 130 among 189 countries in providing ease of doing business, the World Bank said late on Tuesday, but analysts said the pace of improvement was far from what is needed to achieve the Narendra Modi government's target of catapulting the country to among the top 50 by 2017.  India's 2015 rank, pertinently, was revised to 134 from 142 earlier due to a change in the methodology and revisions of data due to new information, the World Bank said.  India was elevated in the pecking order mainly due to an improvement in “getting electricity” and “starting a business”, but in the crucial criterion of enforcement of contracts, one area India continues to be ranked among the last 10 countries, no change was seen.

"I am grateful that the World Bank has recognised that India is now becoming an easier place to do business. A large number of steps which we have already taken are going to be reflected in the rankings next year,” finance minister Arun Jaitley said. The government has been flagging steps taken to ease the setting up of businesses, the streamlining of tax administration by electronic means as well as legislative measures like the National Company Law Tribunal being set up to fast-track exit from and closure of businesses to drive home the point that it is becoming easier to do business in the country.  Recently, the World Bank and the Department of Industrial Policy and Promotion (DIPP) did a joint study which revealed that Gujarat topped among states in implementing an ‘action plan’ on ease of doing business, with Andhra Pradesh placed next, and Jharkhand coming in at third position. Outlined in December 2014, the action plan, the first in a series, was seen to be carried out in earnest by many states during the six-month assessment period (January-June 2015) and improvement was most visible in tax (VAT/CST) reforms, the world body said, but revealed that on average, only 32% of the proposed reforms had been implemented on a pan-India basis.  In enforcement of contracts, only 20% of the action plan materialised in the assessment period, although, the bank noted, this was a medium-term objective. But when it came to dealing with construction permits, where again India was found among the 10 most laggard nations, a reasonable improvement was noticed.  India’s rank on ‘getting electricity’ and ‘starting a business’ improved in 2016 by 29 and 9 places respectively. Businesses can now get electricity 14 days sooner on faster internal processing and the removal of redundant inspections. It is also relatively more reliable.  Similarly, starting a business now takes 29 days from 34 in the previous report and requires less procedures. In addition, starting a business has been made easier by eliminating minimum capital requirements of R1 lakh through amendments to the Companies Act in May 2015. The amendments also ended the requirement to obtain a certificate to commence business operations.  Compared with other emerging markets, India’s ranking lags behind peers the most in dealing with construction permits, enforcing contracts and resolving insolvency. With reform efforts ongoing, including the likely introduction of a bankruptcy law in the winter session of Parliament, this trend of improving the ease of doing business in India should continue.

Source: The Financial Express

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New transfer pricing rules to be less taxing

The declining trend in the income tax department’s estimates of alleged income suppression by multinational companies would get buttressed, thanks to the new set of transfer pricing (TP) rules issued earlier this week. The declining trend in the income tax department’s estimates of alleged income suppression by multinational companies would get buttressed, thanks to the new set of transfer pricing (TP) rules issued earlier this week. Currently, transfer pricing adjustments become necessary when the transaction price with related parties abroad reported by a company varies from the arm’s length price or a benchmark industry standard beyond a specified limit (+/-3%). As per the new rule, however, if the price being audited falls between 35th and 65th percentile of the data set, it would be considered as arm’s length price and so no TP adjustments would be needed. Under the Income Tax (16th Amendment) Rules, 2015, a “range concept” is introduced, which means the taxman would use median of six comparable transactions by other players in the industry to compute the extra taxable income, instead of the average or the arithmetic mean of the comparable prices. Since the median of the comparable prices could often be closer to the transaction price being audited compared to the average of the selected prices, any extra income that may be attributed to the MNC for deviating from the arm’s length price may be smaller than what is currently being attributed in many cases.

Transfer-pricing

TP adjustments sought by the I-T department had grown exponentially from R1,220 crore in 2005-06 to over R70,000 crore in 2012-13 but has since declined to R47,000 crore in 2014-15. While MNCs have expressed concern over the rise in TP adjustments, the tax officers have been advised by the government to refrain from high-pitch assessments that could drive investors away. The fact that the revenue department’s TP figures routinely got struck down by tribunals and courts also forced it to be more realistic. As reported by FE recently, the Central Board of Direct Taxes (CBDT) has directed its field officers to refrain from manual selection of transactions for scrutiny based on the threshold value and instead restrict audit to cases only where the revenue risk to the government is huge. Also, an assessing officer will have to give a structured opportunity of hearing the taxpayer before a case is referred to a transfer pricing officer.

“The introduction of range concept and the use of multi-year analysis is expected to have a significant favorable impact on transfer pricing compliance and litigations,” said Rahul Mitra, national head, litigation and dispute resolution, transfer pricing and direct taxes, KPMG India. “Though it has come a bit late in the day, finalisation of rules is a welcome step. The explanation with elaborate illustrations is helpful in reducing ambiguity,” said Amit Maheshwari, partner, Ashok Maheshwary & Associates.

Source: The Financial Express

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Najib Shah is new CBEC Chairman

The government on Wednesday appointed senior Indian Revenue Service officer Najib Shah as Chairman, Central Board of Excise and Customs (CBEC). “The Appointments Committee of the Cabinet has approved the appointment of Najib Shah, Member, CBEC, as Chairman, CBEC,” said an order by the Department of Personnel and Training. A 1979 batch officer of the Indian Revenue Service (customs and central excise), Shah was appointed as Member of the indirect taxes board in May this year. Earlier, he was also posted as Director General, Directorate of Revenue Intelligence. He was acting Chairman of CBEC after Srivastava retired in May this year.

Source: The Hindu Business Line

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TPPA in its final phase

The Trans – Pacific Partnership Agreement (TPPA) which according to International Trade and Industry Minister of Malaysia Datuk Seri Mustapa Mohamed will help the nation gain priority market access, especially to the four new free trade access markets as soon as it is in force is close to its finalization process. The minister justifies this delay in signing of the deal by saying that there were still several technical details that needed to be ironed out before any conclusions can be made. This includes the legal scrubbing and the finalisation of related schedule. He said that they have been able to defend their country’s policy on several matters giving example on the bumiputra policy as well as in intellectual property rights. He also added the instance of the import duty of almost 73% from textile product export to the US which will be repealed immediately with TPPA. Furthermore, TPPA will repeal import duty for Malaysia's main export products such as electric and electronic, rubber-based items, palm oil and automotive spare parts and timber products to TPPA market such as the US, Canada, Mexico and Peru. The minister further added that the matter would be brought to Parliament in a session which is not yet decided, adding that Malaysia was so far satisfied with the result of the negotiation and that Malaysia's interests have been taken into consideration. The minister said that the countries involved in the agreement will reveal the details of the negotiation to the public simultaneously in the near time.

Source: Yarn and fibre

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Global crude oil price of Indian Basket was US$ 44.56 per bbl on 28.10.2015

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$ 44.56 per barrel (bbl) on 28.10.2015. This was higher than the price of US$ 43.94 per bbl on previous publishing day of 27.10.2015. In rupee terms, the price of Indian Basket increased to Rs 2898.34 per bbl on 28.10.2015 as compared to Rs 2854.05 per bbl on 27.10.2015. Rupee closed weaker at Rs 65.04 per US$ on 28.10.2015 as against Rs 64.96 per US$ on 27.10.2015. The table below gives details in this regard:

Particulars

Unit

Price on October 28, 2015 (Previous trading day i.e. 27.10.2015)

Pricing Fortnight for 16.10.2015

(Sep 29 to Oct 13, 2015)

Crude Oil (Indian Basket)

($/bbl)

44.56              (43.94)

47.70

(Rs/bbl

2898.34         (2854.05)

3115.29

Exchange Rate

(Rs/$)

65.04            (64.96)

65.31

Source: Ministry of Textiles

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Rupee weakens by 27 paise on strong dollar demand

The rupee had recovered by 4 paise to close at 64.93 per dollar yesterday at the Interbank Foreign Exchange market.The rupee depreciated by 27 paise to 65.20 against the dollar in early trade today on strong month-end demand for the US currency from importers. Forex dealers said dollar strengthening against other currencies overseas after the US Federal Reserve signalled it may raise interest rates in December weighed on rupee sentiment. Stock markets opening with losses too put pressure on the domestic unit. The rupee had recovered by 4 paise to close at 64.93 per dollar yesterday at the Interbank Foreign Exchange market. Meanwhile, the benchmark Sensex fell 93.42 points, or 0.34%, to 26,946.34 in early trade.

Source: Business Standards

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China's cloudy future - I

China's hope of resuming more sustainable market-based economic growth may be belied. China's current economic slowdown is now well known, but its political implications for the future of the Leninist Chinese Communist Party (CCP) - which has ruled China for the last 66 years - remain cloudy. In this column I speculate on its future in the context of China's millennial past. Given its secure borders, relatively abundant resources, and a large population, China has in much of the past been able to develop without any international intercourse. China's major economic problem has been that its heartland is an agricultural region with about one-third of the arable land per person as the rest of the world. Foreign and inter-regional trade can overcome these limits to raising per capita incomes, and there have been three major periods since the 11th century when such an opening has led to accelerated growth. The first was the opening up and creation of a commercial economy by the Song dynasty in the 11th century, which led to the first Chinese economic miracle. It was, however, based on a form of "crony capitalism", and was subsequently aborted because of the reassertion of atavistic attitudes to trade and commerce, as well as the failure to bind the state against its predatory rent-seeking instincts. Emblematic of the return to insularity was the dismantling of the Chinese navy by an edict of 1436 by the Ming Emperor. (See my Unintended Consequences, Chapter 3; W H McNeill: The Pursuit of Power, Chapter 2).

Thereafter, once the industrial revolution led to Promethean growth (with rising per capita income), this insularity meant relative poverty, with China remaining an agrarian economy undergoing Smithian growth (with stagnant per capita income) as it had for millennia. But it allowed centralised control and the maintenance of order and internal unity. Though trade through the northern Silk Route continued and allowed some foreign influences and the creation of some wealth, this could be easily managed.  China's second opening was with the Opium Wars and the "carving up of the Chinese melon" by foreign powers in the second half of the 19th century. This destabilised China. For, trade made the coastal regions wealthy whilst the subsistence farmers in the Han interior remained poor. The newly enriched leaders in the coast had an interest in intensifying relations with the foreign powers which made them wealthier, increasing the regional wealth and income disparity between the cost and the interior. "In due course, foreigners allied with Chinese coastal merchants and politicians became more powerful in the coastal regions than the central government. The worst geopolitical nightmare of China came true. China fragmented, breaking into regions, some increasingly under the control of foreigners, particularly foreign commercial interests. Beijing lost control of the country" ("The geopolitics of China", Stratfor Analysis, 25 March 2012). Mao Zedong's three-fold aim, after the CCP's victory in the civil war, was to recentralise China, to end the massive inequality between the coastal region and the rest of Han China, and to expel the foreigners. He was reverting to China's classic insular policy, and accepting the inevitable result: China would become equal but remain extraordinarily poor.

After the fall of the Gang of Four in the 1970s and Deng Xiaoping's rise to paramountcy, he took a gamble. He was worried that without opening up China he could not meet the domestic pressures that were building up for a rise in living standards. Also the technological gap that was opening up with Chinese insularity threatened its security. Deng believed that he could avoid the destabilising of China by his "Open Door Policy" as the preceding one had done in the pre- Communist period "by maintaining a strong central government, based on a loyal army and Communist party apparatus. His successors have struggled to maintain that loyalty to the state and not to foreign investors, who can make individuals wealthy. That is the bet currently being played out."

To date, Deng's bet has paid off handsomely. Through the "Open Door Policy", China has become the workshop of the world and the second largest global economy. But, as in the previous periods when China opened up, regional disparities have widened: the coastal region has become wealthy, the interior remains poor. This in part explains the Bo Xilai affair and its denouement. Mr Bo recognised this disparity and espoused a return to Maoist policies which proved immensely popular in his relatively backward interior satrapy of Chongqing. Given his connections to the section of the army his father had commanded, he clearly posed a threat of becoming a regional Maoist warlord shattering China's unity. He and his associates, including those in the army, were purged in traditional Communist fashion.

The second consequence of these regional disparities is that, the CCP is now trying to make the interior also a land-based trading hub, distinct from the sea-based coastal hub, as it was in the old imperial days, when the Silk Road provided trading opportunities through Central Asia. This, I conjecture, is the main motivation for the push for linking Eurasia through the New Silk Road, besides also providing an alternative route for transporting the natural resources China still needs, from the choke points in the Malacca Straits and Indian Ocean. It also allows China to utilise its excess capacity in its infrastructure industries. Whilst globalisation has greatly benefitted China, for a Leninist party obsessed with centralised control, it also makes China dependent on the outside world. In fact, the economic road map laid out at the CCP's Third Plenum in 2013 called for both a "decisive role" for markets and a "dominant role" for the state. Hence policymakers "find themselves squeezed between the Scylla of the market and the Charybdis of state control". The future of this tussle will be decided by President Xi Jinping, and state control will win. For, "China's president does not exactly leave the impression of being willing to leave things to chance. He is all about control: of his party, of the media and doubtless of the economy too. When push comes to shove, state intervention is likely to prevail over what must look like a reckless dabbling with market forces by their technocrats". (David Pilling: "China's push-me-pull-you policies leave the world reeling", FT, 27 August 2015). This means that China's hope of resuming more sustainable market-based economic growth maybe belied. What does this mean for the future of the CCP, its likely future foreign policy and therefore for China?

Source: Business Standard

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CBN to revive Nigerian textile industry

In order to improve the economy of the country, the Central Bank of Nigeria (CBN) has proposed to provide financial help to textile industries in Nigeria. Recently, a meeting with garment and textile makers was held by Godwin Emefiele, CBN governor, in Abuja.

He discussed on how to solve the issues which are hindering textile production and provide assistance in such issues. He stated that garment and textile manufacturing industries create employment and contribute to the country's economy and therefore must be provided proper assistance to function properly. Godwin focused on aiding small and medium scale producers by providing loans from banks so that they could carry on with full production without having to worry about short tenure and suspension. Also, the industrialists who are still operating at minimal scale would be provided assistance to access more finance from the banks. The commitment of the Central Bank of Nigeria (CBN) to support the textile industry operations would give a boost to the Nigerian economy eventually.

Source: Yarn and fibre

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Pakistani traders urged to partake in 24th Turkey World Trade Bridge 2015

Turkey is not only a gateway to Europe but also one of the fastest growing economies thus it offers a lot to Pakistani businessmen interested to enter EU market. At a seminar on ”24th Turkey – World Trade Bridge 2015” jointly organized by the Lahore Chamber of Commerce and Industry (LCCI) and Pak Turk Businessmen Association here at the LCCI on Tuesday, the Pakistani entrepreneurs were urged to participate in the global trade fairs and exhibitions like 24th Turkey World Trade Bridge 2015. The LCCI President Sheikh Muhammad Arshad said that Pakistani businessmen should avail all available opportunities to the maximum. They should participate in global trade fairs to get awareness about the day-by-day changing global trends. It would not only enable them to expand their own businesses but it would also strengthen the Pakistan’s external trade.  It would increase Pakistani business community liaison with their global counterparts besides giving them an access to unexplored and untapped business destinations of the world. The LCCI president said that it goes without saying that for the members of Lahore Chamber of Commerce & Industry, this exhibition can provide great opportunity to interact with Turkish businessmen. The location of the Trade Bridge 2015 has significant value in terms of being so near to Europe.  Director Pak Turk Businessmen Association (PTBA) Mehmet Kirtas said that TUSKON’s World Trade Bridge series have gained a wide recognition in international business circles since the first trade bridge program in 2006. Turkiye World Trade Bridge 2015 (TWTB 2015) will have a sectorial focus as well and it will cover sectors of Ready Wear, Textile, Leather, Home Textile and related machinery. He revealed that Confederation of Businessmen and Industrialists of Turkiye (TUSKON) is organizing a new track of its world famous series of international business summit, Turkiye World Trade Bridge, on December 2 and 3 in Istanbul.

Source: Yarn and fibre

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