Synopsis Kassia President KB Arasappa also requested the Finance Minister to take steps to see refunds were released on priority. Karnataka has been under a lockdown until May 24, and manufacturing activities, except those in the essential sectors, have been at a standstill. The lockdown has choked production in industries and caused cash crunch, he said. Small scale industries body Kassia on Monday urged Finance Minister Nirmala Sitharaman to extend deadlines for GST payments and ling of GST returns for March, April and May to June. The association wants the government not to levy any penalty or interest on such late payments in view of the on-going lockdown in Karnataka due to Covid-19. Kassia president KB Arasappa also requested the Finance Minister to take steps to see refunds were released on priority. Karnataka has been under a lockdown until May 24, and manufacturing activities, except those in the essential sectors, have been at a standstill. The lockdown has choked production in industries and caused cash crunch, he said. In the event of deaths of a supplier, the recipient is unable to get a refund in cases of inverted duty structure or exports, and this has hurt the small and medium industries, Kassia said. Kassia also urged Karnataka home minister Basavaraj Bommai,who represents the state on the GST Council, to highlight the issues industries are facing at the Council meeting scheduled for May 29.
Source: Economic Times
Exporters said their FY20 entitlements under the Service Exports from India Scheme (SEIS) could be to the tune of Rs 3,000-4,000 crore. Through this scheme, the government offers exporters duty credit scrips at 5-7% of the net foreign exchange earned, depending on the nature of services. Realising that the government faces resource crunch, the state-backed SEPC has proposed that the Centre limit the SEIS benefits to a maximum of Rs 5 crore per exporter for various services sectors. However, sectors, including travel and tourism, healthcare, education and aviation, which have been worst hit by the pandemic should be exempted from this ceiling and allowed the full entitlement, according to the SEPC (Services Export Promotion Council). The Council has already made representations to commerce and industry minister Piyush Goyal and finance minister Nirmala Sitharaman, seeking to expedite the release of funds. Earlier this month, former commerce and industry minister Suresh Prabhu wrote to the finance minister to consider the Council’s request and swiftly release the SEIS benefits. The SEPC has said that the SEIS is the only incentive scheme available to services exporters, and the eligible ones have already been factoring in the incentives in their pricing and business sustainability strategies. Many multi-national companies have taken into account the 5-7% incentives under SEIS available to their Indian operations while taking investment decisions in India, it highlighted. The SEIS was introduced in the Foreign Trade Policy (FTP) for 2015-20; the validity of the FTP has now been extended up to September 2021. Exporters say unlike the Merchandise Exports from India Scheme (MEIS), there is no notification so far on the SEIS for 2019-20, even though it is a part of the current FTP. Last year, when the commerce ministry first extended the validity of the FTP, benefits under the MEIS were allowed to continue until a new scheme replaced it (from January 1). However, the ministry had said a call on whether to extend the SEIS validity would be taken soon. Nevertheless, exporters are certain that at least FY20 benefits should be cleared at the earliest. Services exporters had claimed 5,569 SEIS scrips worth Rs 3,475 crore in FY18. A surplus in India’s services trade has been substantially offsetting the merchandise trade, thus keeping a leash on overall trade deficit. Thanks to the pandemic, services exports dropped almost 6% year-on-year in FY21 to $203 billion, while merchandise exports contracted by just over 7% to about $291 billion, according to a quick estimate by the commerce ministry. While merchandise trade witnessed a deficit of nearly $99 billion in FY21, the surplus in services trade was to the tune of $86 billion, which narrowed the overall trade deficit to just about $13 billion. Highlighting that industry has to get out of the mindset of subsidies, as these are detrimental to the country’s long-term interests, Goyal had made a case (before the pandemic) for discontinuing the SEIS in its current form. “For example, we now give subsidies on services exports. I have gone through the list in great details, barely 2,200 companies take that subsidy. Some of them are such large names, making 1000s of crores of rupees of profit, that there is no business of giving them a subsidy,” he said. Trade analysts, too, have pitched for a revamp of the SEIS, but only when it announces the next FTP. This, they say, will maintain policy stability. They have also favoured quick release of benefits to ease liquidity woes of various services sectors, especially those battered by the pandemic.
Source: Financial Express
Coimbatore, Tiruppur units see long-term gain from key export markets of US, Europ The sudden spike in Covid-19 infections in India, especially in and around the textile hubs, has hurt the textile sector, albeit temporarily, at a time when the industry has been gearing up to meet strong export demand catalysed by geopolitical factors. Though exporters were expecting some impact from the second wave, they were confident of overcoming it due to learnings from the first wave, and adequate precautionary measures were put in place. The second wave has, however, posed a lot of challenges for manufacturers in the textile hubs of Tiruppur and Coimbatore. While Coimbatore is the second worst-hit region after Chennai, Tiruppur has also seen a spike in daily new cases over the past few days. “Tiruppur has seen a complete shutdown of textile units, while export-oriented units in the outskirts and rural areas are trying to operate with skeletal staff,” says Prabhu Damodharan, Convenor, Indian Texpreneurs Federation. Each unit is adopting calibrated measures and adhering to government guidelines. Industry representatives say that units have realised the need to break the transmission of virus and are ready to undergo the short-term pain for long-term gains once key export markets see a revival. A Sakthivel, Chairman, Apparel Export Promotion Council (AEPC), points out that while new infections in Tiruppur have increased, it is not at alarming levels despite being an industrial township with about five lakh workers. But exporters have taken adequate precautions to execute some important orders. “Thanks to the State government's efforts, we expect the situation to improve soon. Also, our key markets — such as the US and Europe — are not under lockdown like last time and orders continue to flow from these regions,” he added.
Demand boom
Damodharan also pointed out that key consumption markets are witnessing a demand boom and the industry has communicated to the buyers that the lockdown and restrictions will be a short term one, may be for three weeks. “We told them that we will meet their requirements as we have adequate raw material and manpower to ramp up quickly. In some product cases, we have order visibility for six months,” he added. Damodaran said organised players have retained their migrant labourers and workers by providing them with accommodation and making arrangements to vaccinate them at the earliest. “I would say about 95 per cent of migrant workers are staying back. The association has also communicated to the members that this would be a short-term disruption and workers can be retained with adequate protective measures,” said Sakthivel.
Source: Business Line
Karur: Textile manufacturing units in the district will remain closed from Wednesday after Karur textile manufacturer exporters association announced complete closure taking into consideration increasing Covid-19 cases. The decision was taken after the association members met electricity minister V Senthil Balaji and district superintendent of police (SP) G Shashank Sai on Tuesday. Over 300 Covid-19 positive cases have been reported in the district in the last few days. While export textile units were allowed to operate with 50% staffs during complete lockdown in the state, Karur handloom export cloth manufacturers association had voluntarily stopped their operations from last Wednesday considering increasing Covid-19 positive cases. Congratulations! You have successfully cast your vote Login to view result Karur textile manufacturer exporters association president M Nachimuthu said in a statement that they have been running their units with all precautions and following SOPs to complete the pending export orders. “But Covid-19 positive cases are on the rise. To contain further spread of the virus, we have decided to shut all operations of our units voluntarily from Wednesday for five days,” he said. Earlier in the day, minister Balaji inspected the Tamil Nadu Newsprint and Papers Limited (TNPL) units. The minister said that considering the need for oxygen beds for Covid-19 patients in Karur district, 150 oxygen beds will be created on the TNPL campus within a week.
Source: Times of India
The rupee rose for the second straight session on Monday to close 7 paise higher at 73.22 (provisional) against the U.S. dollar on the back of positive domestic equities and weak American currency. At the interbank forex market, the rupee opened at 73.24 and hit an intra-day high of 73.16 and a low of 73.26. The local unit finally settled at 73.22, registering a gain of 7 paise over its previous close. On Friday, the rupee had closed at 73.29 against the U.S. dollar. The domestic unit has appreciated 20 paise in the last two trading sessions. Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.09% to 90.23. On the domestic equity market front, the BSE Sensex ended 848.18 points or 1.74% higher at 49,580.73, while the broader NSE Nifty advanced 245.35 points or 1.67% to 14,923.15. Foreign institutional investors (FIIs) remained net sellers in the capital markets, as they pulled out ₹2,607.85 crore on Friday, as per provisional data. Brent crude futures, the global oil benchmark, rose 0.19% to $68.84 per barrel. Meanwhile, India's COVID-19 tally mounted to 2,49,65,463 on Monday with 2,81,386 fresh COVID-19 cases, the lowest in 27 days, while the death toll climbed to 2,74,390 with 4,106 fatalities, according to Union Health Ministry data.
Source: The Hindu
India's annual rate of inflation, based on monthly wholesale price index (WPI), hit an all-time high of 10.49 per cent for April 2021, compared to 7.39 per cent in March 2021. The WPI inflation for textiles increased to 9.74 per cent, while it was 0.58 per cent for apparel, according to the Office of the Economic Adviser, ministry of commerce and industry. "The annual rate of inflation in April 2021 is high primarily because of rise in prices of crude, petroleum, mineral oils, viz petrol, diesel etc, and manufactured products as compared to the corresponding month of the previous year," an official statement said. The official WPI for all commodities (Base: 2011-12 = 100) for the month of April 2021 increased to 131.7 from previous month's 129.3. The index for manufactured products (weight 64.23 per cent) for April 2021 increased to 129.4 from 127.3 for the month of March 2021. The index for ‘Manufacture of Textiles’ sub-group too rose to 128.4 from previous month's 127.1, while the index for ‘Manufacture of Wearing Apparel’ sub-group rose slightly to 139.7 from 139.4 in March 2021. The index for primary articles (weight 22.62 per cent) increased to 151.8 in April 2021 from previous month's 146.2. The index for fuel and power (weight 13.15 per cent) however decreased to 108.6 from 109.7 in March 2021. Meanwhile, the all-India inflation rate for consumer price index (CPI) on base 2012=100 stood at 4.29 (provisional) in April 2021 compared to 5.52 (final) in March 2021, according to the Central Statistics Office, ministry of statistics and programme implementation.
Source: Fibre2fashion
Solar cells are the basic ingredient used in the manufacturing of solar modules and Chinese products are 15-20% cheaper than their Indian counterparts. The commerce ministry has initiated an anti-dumping investigation against the import of solar cells from China, Thailand and Vietnam. The investigation was triggered by an application by the Indian Solar Manufacturers’ Association (ISMA). Solar cells are the basic ingredient used in the manufacturing of solar modules and Chinese products are 15-20% cheaper than their Indian counterparts. The notice issued by the directorate general of trade remedies said that prima facie evidence of dumping was found against the aforementioned product of the above countries, leading to injury to the domestic industry. Low module prices have played a major role in bringing solar tariffs down to the current low of Rs 1.99/unit, but it has kept the domestic solar sector relied on imports and local manufacturers have found it difficult to sell their products. A similar anti-dumping investigation against the import of solar cells from China, Taiwan and Malaysia was initiated by the government in July, 2017 but was eventually called off in March, 2018 on ISMA’s request. To boost domestic manufacturing, the Centre had imposed a 25% safeguard duty on solar imports from China and Malaysia in July 2018 for two years, which was extended to July 2021, at a rate of 15%. As FE reported earlier, after the safeguard duty imposition on China and Malaysia, solar imports had since surged from Vietnam and Thailand. Between FY18 and FY20, imports of solar cells and modules from Vietnam and Thailand recorded a growth rate of 800% and 5,750%, to $136 million and $117 million, respectively. Import of Chinese products have fallen 60% to $1.3 billion in the same period. Overall solar imports have come down by 72% annually in April-February FY21 to $468.5 million due to the Covid-19 restrictions, as the pace of solar capacity addition also dwindled to 5 giga-watt (GW) in the same period, down by about 45% annually. From the beginning of FY23, solar module and cell imports will attract a basic customs duty (BCD) of 40% and 25%, respectively. However, procurement of these items from China is seen to surge significantly in the last three quarters of FY22 as there will be no import barriers in place after the safeguard duty regime ends in July. The government has introduced the Rs 4,500-crore production-linked incentive scheme for solar module manufacturing, which analysts at India Ratings said, will push the sales of 20 GW of domestic product from the output capacity developed under the five-year programme. As on date, the domestic cell manufacturing capacity is around 3 GW and module making capacity is 10 GW.
Source: Financial Express
Key players in clothing design, recycling technologies and consumer behaviour have come together in a new project in Denmark to make textiles circular. The project involves breaking down worn, damaged or new clothes that are discarded into raw materials to create new textiles or other products. It could have a major impact on future design of textiles. The focal point is sustainability in the textile industry - and recycling of all textile waste in Denmark. The project is called ReSuit (Recycling Technologies and Sustainable Textile Product Design), and is supported by the Innovation Fund with DKK 13 million (€ 1.8 million). The project has a total budget of DKK 22.8 million. The consortium includes partners within clothing and textiles (Bestseller, Elis and Designskolen Kolding), raw material production (A/S Dansk Shell), consumer behaviour (Naboskab) and new recycling technologies (Fraunhofer, Danish Technological Institute and Aarhus University). “Yearly, 100 billion textile units are produced worldwide, and they are to a great extent treated as disposable cutlery. Materials worth 400 billion euros are lost as we lack infrastructure and solid recycling technologies on a very large scale. In this project, we are looking to get all textile waste in Denmark into a loop where it can become new textiles or raw materials for other products. If it succeeds, it can become a game changer,” says Anders Lindhardt from Danish Technological Institute, which is heading the project. The consortium will address the textile problem from two angles - how the textile industry can get better at designing sustainably, and which technologies can ensure circularity for consumer textile waste. Regarding design, the focus is on sustainable design of textile products – that is textiles that are designed with recycling in mind. The work involves a mapping of which colours and additives are used in textile production and an assessment of their significance for the recyclability of the materials. As far as possible, the work must result in the phasing out of substances that are not suitable for future recycling technologies and in design guides for sustainable textile products. “Circularity is not a stock commodity. We need disruptive innovation to create the circular solutions we strive for at Bestseller. It is an enormously complex field, which is why we are working on multiple elements simultaneously to be able to secure the sustainable fashion production of the future. With ReSuit, we are part of an ambitious and multifaceted collaboration. Here, Bestseller’s circular design principles come into a meaningful context and if the project manages to develop proper technologies from various knowledge areas, we will see a unified solution with far-reaching potential – not just in Denmark and not just for Bestseller – which is exactly what we are aiming for,” says Camilla Skjønning Jørgensen, sustainable materials and innovation manager, Bestseller. The company Naboskab, which specialises in understanding and changing consumer behaviour, is to map out how consumers can be motivated to act sustainably. When it comes to textile waste, the project focuses on the enormous quantities of clothes and textiles that end up as garbage every year – in Denmark alone it is 85,000 tonnes. From 2022, Denmark will start sorting clothes separately - and from 2025 the rest of the European Union will follow. "Polyester accounts for half of all clothes fibres in the world. Therefore, we will further develop technology based on chemical purification to recycle the polyester materials so that they can return to the textile industry,” says Lindhardt. The remainder of the textile products must be degraded using so-called HTL technology (hydrothermal liquefaction). The process makes it possible – under the influence of water, heat and pressure – to convert the complex textile stream into oil products that can be used for the production of eg plastic, fuel or synthetic textile fibres. “We have recently discovered that the oil yield of HTL becomes significantly greater when we mix different raw materials, for example plastic and biomass. And that is exactly the raw material combination we find in textiles. Therefore, we have great confidence that we can get a good yield from the textiles as we mature the HTL technology in the project,” says associate professor Patrick Biller from the Department of Biological and Chemical Engineering, Aarhus University. In the project, the HTL technology will be further developed and scaled up in collaboration with A/S Dansk Shell, which has successfully tested the possibility of refining bio-oil products and sees opportunities for recycling of other oil products.
Source: Fibre2fashion
China's textile industry showed strong performance in the first quarter (Q1) of this year. The added value of large-scale textile companies with annual operating revenue of at least 20 million yuan ($3.09 million) increased by 20.3 per cent year-on-year, according to data from the country's ministry of industry and information technology (MIIT). The combiner operating revenue of large-scale textile firms expanded by 26.9 per cent year-on-year to about 1.05 trillion yuan during the three-month period, the MIIT data showed. These firms earned 43.4 billion yuan worth of profits, registering a surge of 93 per cent over same period of previous year, when the country saw lockdown periods due to the spread of COVID-19 pandemic. Meanwhile, the exports of garments from China in January-March 2021 totalled $33.3 billion, an increase of 47.7 per cent year-on-year. Online retail sales of clothing products too grew by 39.6 per cent during the period under review.
Source: Fibre2fashion
International brands are giving tough competition to the local Vietnamese apparel industry, causing the market share of domestic brands to shrink. Poor design, small scale, less professionalism, counterfeiting and a lack of strategy for managing and promoting the brands in the long run are cited as the reasons for this in a recent report. Currently, Adidas, Inditex and H&M are the top three brands in Vietnam, according to a report by Vietnam Industry Research and Consultancy (VIRAC). Following these are Vietnamese enterprises that own brands such as Biti’s, Canifa, Viet Tien and May 10. More than 200 mid to high-end foreign brands have their official stores in Vietnam. In spite of exporting textiles and garments to the world, Vietnam’s apparel market is unknown globally as the products are exported under the names of foreign brands. The VIRAC report stated that it is necessary to improve the domestic industry with the help of media to bring Vietnamese brands to the world. Vietnam currently does not have an environment and a methodical school for operating fashion brands to develop the domestic industry effectively and systematically, it added. Talking about the trends for the country’s apparel industry, the report said that sustainability will be the top trend in the in the near future, followed by influencer marketing, video content, distribution on e-commerce channels and second-hand business. The revenue of the apparel market of Vietnam in 2020 decreased by over 10 per cent compared to 2019 due to the pandemic.
Source: Fibre2fashion
BEIJING (Reuters) -China's factories slowed their output growth in April and retail sales significantly missed expectations as officials warned of new problems affecting the recovery in the world's second-largest economy. While China's exporters are enjoying strong demand, global supply chain bottlenecks and rising raw materials costs have weighed on production, cooling the blistering economic recovery from last year's COVID-19 slump. Factory output grew 9.8% in April from a year ago, in line with forecasts but slower than the 14.1% surge in March, National Bureau of Statistics data showed on Monday. Retail sales, meanwhile, rose 17.7%, much weaker than a forecast 24.9% uptick and the 34.2% surge in March. NBS spokesman Fu Linghui said while China's economy showed a steady improvement in April, new problems are also emerging, notably the rise in international commodity prices. “The foundations for the domestic economic recovery are not yet secure," Fu told a news briefing in Beijing on Monday. "For companies as a whole, price increases are conducive to the improvement of corporate efficiency, but the pressure on downstream industries needs to be paid attention to," he added. China's factory price inflation hit its highest pace since October 2017 in April. That could rise further in the second and third quarters, according to a report from the central bank last week. The slower growth rates in the April activity indicators were also due in part due to the fading base effects as year-on-year comparisons rolled away from very sharp declines seen when the coronavirus shut down much of the country in early 2020. In the factory sector, motor vehicle production growth fell sharply to 6.8% from 69.8%, due in part to the base effect as well as critical shortages of semiconductors used in car systems. Growth in the production of cement slowed in April, and coal production fell on year, although aluminium and crude steel output hit record highs, helped by firm demand. "China's economy shows signs of unbalanced recovery: strong exports and domestic investment on one hand, but weak consumption on the other," said Zhiwei Zhang, chief economist at Pinpoint Asset Management, in a note. Sectors related to travel, leisure and entertainment are large employers and still held back by COVID-19 uncertainty, he said. Home appliances sales growth dropped particularly sharply in April from the month before, falling from 38.9% growth on year in March to 6.1%, NBS data showed. Julian Evans-Pritchard, senior China economist at Capital Economics, in a note said month-on-month retail sales growth fell well below its pre-pandemic pace. "Looking ahead, we think the rebound in consumption should gather pace again in the coming months as the labour market continues to tighten," he said. China's economy expanded by a record 18.3% in the first quarter and many economists expect growth will exceed 8% this year. Exports accelerated in April, thanks to strong demand for Chinese goods amid a brisk U.S. economic recovery and stalled factory production in other countries. However, April also saw factory activity slow amid supply bottlenecks and rising costs and policymakers have acknowledged some of the recent weaknesses seen in the economic recovery. "The cost of production has definitely increased, leading to a decrease in profits," said the manager of an automobile accessories factory in China's eastern Zhejiang province, surnamed Xu. Sales are increasing but relatively slowly, and the factory plans to decrease production accordingly, he said. A top decision-making body of the ruling Communist Party said last month the country will encourage manufacturing and private investment to recover as quickly as possible. The Politburo meeting chaired by President Xi Jinping also warned China's economic recovery remained uneven and that its foundation was not yet solid. The activity indicators on Monday also showed fixed asset investment increased 19.9% in the first four months from the same period a year earlier, slowing from January-March's 25.6% increase. Growth in real estate investment, property sales by floor area and new construction starts by floor area all cooled in the first four months compared to the first quarter, NBS data showed, amid increased scrutiny from policymakers on developers' financing activities. "The government may put the monetary policy tightening on hold for now and observe the pace of recovery," Zhang from Pinpoint Asset Management said.
Source: Business Standard
