While there may be a case for correcting tax anomalies, one view among officials is that tax rate changes should not be seen from the perspective of industry alone and consumer interest, especially in the case of mass use items, should be taken into account equally Federal indirect tax body, the Goods and Services Tax (GST) Council, which meets later today, is expected to consider tax rate changes on medical supplies needed in prevention and treatment of covid, but correcting tax anomalies in a host of sectors is likely to remain a work in progress. The problem of inverted duty structure or raw materials attracting higher taxes higher than finished products is a major issue in sectors like fertilizers, footwear and textile industry, which officials believe affects producers without any benefit to consumers. It also makes domestic industry less competitive against imports. The Council is likely to take up a proposal to correct the inverted duty structure of footwear valued upto ₹1,000 by raising the GST rate from 5% to 12% but a decision is expected to be political as it is a mass consumption item. More expensive footwear items are taxed at 18% now. While economics and business realities support a rate increase for correcting the tax anomaly, rate hike has to be politically acceptable among Council members. Officials of the Council have examined the need for raising the GST rate on fertilizers from 5% to 12% but this is unlikely to be taken up now, said a person briefed about the discussions between central and state governments. In case of textiles too, officials have examined tax rate changes needed to correct anomalies. The idea is to limit the 5% tax to fewer items in this sector but it remains to be seen if it gets political support in the Council. While there may be a case for correcting tax anomalies, one view among officials is that tax rate changes should not be seen from the perspective of industry alone and consumer interest, especially in the case of mass use items, should be taken into account equally. Demands from states to give tax relief on medical supplies is expected to be a major part of discussions on Friday.
Source: Live Mint
During the last financial year, India attracted USD 5.64 billion in FDI from Mauritius, according to the data by the Department for Promotion of Industry and Internal Trade (DPIIT). The US replaced Mauritius as the second largest source of foreign direct investment into India during 2020-21 with inflows of USD 13.82 billion, according to government data. Singapore remained the top source of foreign direct investment (FDI) into the country for the third consecutive fiscal at USD 17.41 billion. During the last nancial year, India attracted USD 5.64 billion in FDI from Mauritius, according to the data by the Department for Promotion of Industry and Internal Trade (DPIIT). The island country was followed by UAE (USD 4.2 billion), Cayman Island (USD 2.79 billion), Netherlands (USD 2.78 billion), UK (USD 2.04 billion), Japan (USD 1.95 billion), Germany (USD 667 million), and Cyprus (USD 386 million). Overall foreign direct investments into the country grew 19 per cent to USD 59.64 billion during 2020-21 amid measures taken by the government for policy reforms, investment facilitation and ease of doing business. Total FDI, including equity, re-invested earnings and capital, rose 10 per cent to the highest-ever USD 81.72 billion, as against USD 74.39 billion in 2019-20. In 2020-21, the computer software and hardware sector attracted the highest inows of USD 26.14 billion. It was followed by construction - infrastructure activities (USD 7.87 billion) and services sector (USD 5 billion).
Source: Economic Times
Singapore has topped the list of foreign investment generators, accounting for 29 per cent of the record USD 81.72 billion foreign direct investment India received during the financial year 2020-21. The United States was the second FDI generator at 23 per cent and Mauritius third at 9 per cent. Notwithstanding the COVID-19 pandemic, trade between India and Singapore is likely to touch USD 21 billion in financial year 2020-21, India's High Commissioner to Singapore P Kumaran has said. "Trade between India and Singapore is a little over USD 19 billion," said the High Commissioner. "It is likely to be around USD 21 billion when the full data for the financial year 2020-21 is available. From April 2019 to March 2020, it was USD 23 billion," the envoy was quoted as saying in a Friday weekly on Indian aairs, tabla! Kumaran further said that "It is very encouraging despite the pandemic. Good performances by both sides under extremely stressful circumstances. It shows that we need each other and have to continue to support each other." Meanwhile, Singapore has topped the list of foreign investment generators, accounting for 29 per cent of the record USD 81.72 billion foreign direct investment India received during the financial year 2020-21. The United States was the second FDI generator at 23 per cent and Mauritius third at 9 per cent. Separately, Kumaran said nearly 90,000 people from Singapore have taken the Vande Bharat Mission (repatriation) fights to India since they were started by the Indian government on May 7, last year. "On an average, currently we do about 70 fights a month," he said. He further noted that "we also calibrate the number of ights depending on the load. To optimise the load, the carriers do multiple destinations in India. For instance, we combine Chennai and Mumbai or Delhi. So, two destinations get connected." However, the number of people taking the Vande Bharat lights has considerably reduced in recent weeks, according to Kumaran. Each eiight has a capacity of 180 to 200 and earlier it used to be 90 per cent occupancy going into India and 30 per cent from India. Now it is half of that. "People don't want to go because (COVID-19) cases are high in India. Also, not many reentry permits are being issued by the Singapore government," Kumaran said. "Only people who have urgent needs want to go. Nobody wants to take more risks than necessary," he said in an interview with the weekly.
Source: Economic Times
India’s labour-intensive eports such as leather, garments, gems & jewellery and carpets lost market share globally in the calendar years 2015-19 even as exports of raw material and semi- nished products like metals and chemicals exceeded global imports growth in the ve-year period, a study done by the Federation of Indian Export Organisations (FIEO) showed. Global gems and jewellery imports rose 5% in 2015-19 but India’s exports……………….
Source: Economic Times
“If there is a deficit in ARR, someone has to foot the gap, either by the consumers or by the government. If the government does not want to pass on the gap to the public, it has to give it to us in writing that they are ready to fill that gap through subsidy,” said the official. In view of the Covid situation, the Uttar Pradesh government has decided not to increase the prices of electricity in the state. In a meeting with key officials, chief minister Yogi Adityanath directed them to ensure that there is no increase in electricity prices this year. “The chief minister has given a general direction that the electricity rates will not be increased. The matter is with the regulator at present. Once the regulator decides on it, the government will take a view on it,” said a senior official of the government, who was present in the meeting. The direction comes at a time when the Uttar Pradesh Electricity Regulatory Commission is in the midst of preparing the tariff based on the annual revenue requirement (ARR) filed by the Uttar Pradesh Power Corporation. However, a UPERC official told FE that the chief minister’s direction “is a non-event for the Commission, unless and until it comes by way of a written communication from the government, accompanied with subsidies as per Section 65 of the Electricity Act. “If there is a deficit in ARR, someone has to foot the gap, either by the consumers or by the government. If the government does not want to pass on the gap to the public, it has to give it to us in writing that they are ready to fill that gap through subsidy,” said the official. Earlier, in February this year, the five power distribution companies (discoms) of UPPCL — Madhyanchal, Paschimanchal, Poorvanchal, Dakshinanchal and KesCo — had filed their annual revenue requirement (ARR) proposal to the UP Electricity Regulatory Commission, projecting a total revenue requirement of Rs 81,901 crore during 2021-22. It included an estimated expenditure of Rs 62,020 crore on the purchase of 1,20,043 million units (MUs) of electricity during the year. The UPPCL had also pegged the distribution losses at 16.64% for 2021-22 against the 11.08% approved by the UPERC in its last tariff order. It may be mentioned that the electricity regulator had rejected UPPCL’s demand for power hike in the last fiscal year, citing the adverse financial impact due to the pandemic on the livelihood, commercial and industrial activities and the reduced paying capacity of consumers due to expected contraction in GSDP. In a recent letter, the Union power ministry has asked a number of states, including Uttar Pradesh, to issue tariff orders for FY22 “at the earliest” for their power distribution companies (discoms). Irregular tariff revisions limit the discoms’ ability to become financially viable, which, in turn, leads to delayed payment to power generators and makes it difficult to maintain and upgrade their own network and systems, it had stated.
Source: Financial Express
This has resulted in units closing down, with traders and exporters worried about completion of their export orders on time. The sharp spike in cases in Tiruppur has wreaked havoc for the textile industry. With no drop in cases, the administration has imposed a strict lockdown in the city, where one of the biggest textile manufacturing clusters in the country is located. This has resulted in units closing down, with traders and exporters worried about completion of their export orders on time. “For the past three weeks, our factories have remained shut. We don’t have any idea when we can resume operations as there is no decrease in daily caseload in the region,” said Raja M Shanmugam, president of Tirupur Exporters’ Association. The industry had recovered well from the first jolt of Covid and orderbooks of the units were full with export orders in the months that followed. Infact, export orders this year have increased by at least 15 to 20 per cent from pre- Covid levels as casual wear is in very much demand nowadays ,said Shanmugam. The exporters and manufacturers were busy working on their orders when the second wave hit them. With lockdown imminent, many migrant workers left for their native. However, the manufacturers ran the show with local labourers, but the shut down has left them all in a lurch. Increasing cases put textile industry in limbo The uncertainty prevailing over reopening of factories will cost manufacturers and exporters dearly. “If we are unable to fulfil export orders on time, it will get cancelled or we will have to give them a heavy discount. Either ways, it is our loss,” said Shankaran V, another exporter. Last year, the entire world was affected by the pandemic and so getting back on its feet was easier for the Tiruppur industry. But this time, what worries them is that India is only one badly affected by the second wave. “So this time, customers can buy products from countries like China, Bangladesh and Pakistan, where factories are still functional and we will loose our export orders forever,” said Shanmugam. Dr Venkatachalam, advisor at the Tamil Nadu Spinning Mills Association (TASMA), said, “Several crores worth of yarn orders from abroad are pending for the past few weeks at spinning mills. If we cancel orders immediately, we have to pay a penalty according to the contract. Even if we bear that brunt, it will be tough to renegotiate the order from the same buyer next time. There is a sense of uncertainty among the mills, whether to receive orders or give importance to pending orders. Since all the mills are closed as the government refused to run the facility even with in-house labourers, many large mills are forced to pay ‘holding charges’ for bulk containers.” The view was echoed by P Mohan, treasurer of the Tiruppur Exporters Association. He said, “European markets have opened for the past few weeks and almost all western countries have relaxed restrictions. They have started issuing orders for summer wear and buyers have started asking for price quotes, and samples from the units here. Many companies got the orders and some are awaiting confirmation. Garment units, who have had consistent orders, are shocked by the second wave and the resultant lockdown. Many companies have completed only half of their order and with buyers getting apprehensive and questioning exporters about the lockdown, these units fear losing out on orders. With Rs 2,000 crore business order currently in export units, I believe, we completed just half of them.” There are over 10,000 garment manufacturing industries in Tiruppur, employing over six lakh people. The cluster, on an average, exports textiles worth Rs 2,500 crore a month. (With inputs from Tiruppur.
Source: New Indian Express
Dibya Shankar Mishra, Minister of Energy, Industries and MSMEs, Government of Odisha while addressing the Annual General Meeting of Federation of Indian Chambers of Commerce & Industry (FICCI) Odisha State Council today urged industry champions in the state and the country to be environment-friendly and conserve nature. “We will have to protect nature and work towards a zero-discharge industry. We need to take care of our workforce and workplaces for a healthy and holistic growth of our industries,” he said. While the world is still discussing effects of global warming, Odisha is facing those adversities year after year. We will keep facing adversities like COVID, cyclones and floods until we take care of the environment, he said. Further, the Minister said that the six focus industries in the state- tourism; food processing; chemicals, plastics, and petrochemicals; electronics manufacturing; ancillary and downstream industries in metal sector; and textiles and apparels, have been performing well, both in terms of production and investments. “However, if the state has to aim for further development and investments, we need to focus on IT and electronics. There is a vast scope of development in this sector. The state government will facilitate all necessary actions towards this effect,” he noted. Elaborating on Odisha being a land of opportunities, Mishra said, “Odisha boasts of available land bank. It is time to shift from the coast to the west and south of the state for available land resources for industries.” Speaking at the event, Hemant Sharma, Principal Secretary, Industries Department, Government of Odisha noted that the state government is committed to bring more progressive industrial policies and facilitation mechanisms for investments. “Major pillars of industry in the state– mining, metallurgy, textiles, food processing and petrochemicals continue to do well. Our endeavour is to continue to broad base our industrial development. We are devising our industrial policies to make it more progressive and forward looking,” he said. Dr Nitin B Jawale, MD, IPICOL and Special Secretary, Industries Department, Government of Odisha said that the state government has taken huge strides in investment and industrialisation in the state. “Whatever heights we (the state) have reached and whatever accolades we have achieved, FICCI has been a very important part of it.” FICCI and the Govt of Odisha share the same vision for the next stage of industrial development, noted Dr Jawale. “We have largely shifted to broad based inclusive industrial growth. FICCI has really understood the terms of this game and has helped us by not just getting large-scale investments but also investments in the medium and small sector industries,” he added. “Vision 2030 is our (the state government’s) very ambitious plan; we want to establish ourselves as the biggest primary producer of industrial metals– steel and stainless steel and aluminium. Odisha produces one-fourth of India’s steel and more than half of stainless steel and aluminium produced in the country. The next level of development is adding value to the metal that is produced in the state. We have a plan of adding 50 per cent value to the metal produced in the state. The Vision 2030 plan involves participation from the MSME sector, particularly the medium industries sector and niche industries,” he further added. Monica Nayyar Patnaik, Chairperson, FICCI Odisha State Council and MD, Sambad Group noted that the FICCI Odisha State Council has partnered the Govt of Odisha as its National Industry Partner for various programmes like Make in Odisha, Krushi Odisha and Odisha 50. “We (FICCI) are also a part of the state government’s task force in vaccination drives and procuring medical oxygen supply,” she said. Applauding the state government, Dilip Chenoy, Secretary General, FICCI said that the impact of the cyclone on the industry and production has been minimum due to the efforts of the government. Further, Arun Chawla, Deputy Secretary General, FICCI said FICCI as national industry partner of Government of Odisha has organized series of roundtables on focus sectors in partnership with the state government. J K Mohanty, Co-Chairman, FICCI National Tourism Council and CMD, Swosti Group, J.K Rath, Chairman, MSME Committee, FICCI Odisha State Council, Prabodh Mohanty, Managing Director, SNM Group, S S Upadhyaya, Resident Director, Jindal Stainless Limited, K.K Mohapatra, COO, Sambad, Kishore Mohanty, Head-Corporate Affairs, IMFA, Sunita Mohanty, Chairperson, FICCI FLO, Bhubaneswar, S.S. Patnaik, Project Head, MGM Minerals and Sanjeev Mohanty, Head, FICCI Odisha State Council participated in the FICCI Odisha State Council virtual AGM. It was attended by 75 industry members.
Source: Sambad English
DP Singh says its production has fallen by almost half amid Covid DP Singh, an entrepreneur, says the production in his factory producing rubber rollers for textile processing units across the country is now half of what it used to be in preCovid era. “My industry is badly hit. Fabric in general and costly fabric in particular is no longer in the priority list of people. Travel and party restrictions have limited the mobility of people. So the demand for textile has waned, prompting the industrialists to bring down production. This, in turn, curbed the demand for rubber rollers.” Even as the demand was extremely low yet there has been a tremendous increase in price of almost all raw materials utilised in manufacturing rubber rollers. For instance, prices of synthetic rubbers, rubber chemicals and carbon black increased between 25 to 40 percent during the past few months. Besides, there has been disruption in imports as well. “This changing scenario is impacting the industry so much that there is hardly any scope for research and development. We are continuously fighting an unknown enemy and taking short term measures to tackle day to day problems. Hence long term planning has massively suffered.” “At this juncture, we cannot think of new expansion or upgrade in the current scenario as our capacity utilisation right now is already down to 50 percent.” Since most of the highly industrialised states like Maharashtra and Gujarat have massively suffered due to corona hence orders from these states have evaporated. Apart from industry, what pricks him more is the need for a sustainable environment. “It is for all of us to think about environmental sustainability in our manufacturing activities. This pandemic has taught us the hard way that playing with nature will cost dear to humankind.” Short-term measures to help tide over crisis DP Singh, an entrepreneur, says this changing scenario is impacting the industry so much that there is hardly any scope for research and development. “We are continuously fighting an unknown enemy and taking short term measures to tackle day to day problems. At this juncture, we cannot think of new expansion or upgrade in the current scenario as our capacity utilisation right now is already down to 50 percent,” he says.
Source: Tribune India
The closure of operations is due to the lockdown restrictions of the Government of Tamil Nadu for the Covid-19 pandemic. Loyal Textile Mills Limited and Lambodhara Textiles Limited have closed operations of their mills in Tamil Nadu for one week due to the Covid-19 spread. “Due to the lockdown restrictions of Government of Tamil Nadu for Covid-19 pandemic, our mills located at Kovilpatti, Sattur and Sivagangai shall remain closed from May 24, 2021, to May 31, 2021,” Loyal Textile Mills Limited said in its filing on Monday. “In view of the Covid-19 pandemic and in line with various directives being issued by the Government of Tamil Nadu, the company has been taking measures to ensure safety and health of all its stakeholders including employees." The Management has decided to suspend the operations of the company from Monday, May 24, 2021 until further notice,” Lambodhara Textiles said in its filing on Monday. During early trade on Tuesday, Loyal Textile Mills Ltd was trading at Rs725 per piece up by Rs29.65 or 4.26% from its previous closing of Rs695.35 per piece on the BSE. Lambodhara Textiles Ltd was trading at Rs64.45 up per piece by Rs0.25 or 0.39% from its previous closing of Rs64.20 per piece on the BSE.
Source: India Infoline
British exports worth billions of pounds have faced tariffs on trade with the EU since Brexit, according to an analysis of official EU statistics. Despite the tariff-free deal agreed with the EU, a study by the University of Sussex found up to £3.5bn of British exports had taxes applied. That accounts for about 10% of British goods exports to the EU. Some firms paid due to the complexity of claiming zero tariffs, or said they planned to reclaim the fees later. For exporters, maintaining zero tariffs under the post-Brexit deal is not automatic: it needs to be claimed on customs declarations that from January have had to accompany every export to the European Union. An analysis for the BBC, by the University of Sussex's Trade Policy Observatory, used European customs data from these declarations. The figures indicated that between £2.5bn and £3.5bn of British exports faced a tariff in the first three months of 2021. The European Commission confirmed that according to data collected by its customs authorities, €2.5bn of eligible UK exports did not use the zero-tariff agreement. "Tariff-free trade is only tariff-free if firms not only meet the rules of origin criteria, but also can deal with the necessary bureaucracy and paperwork," said Prof Michael Gasiorek, trade expert at the University of Sussex. "What this analysis shows is that in the first quarter, around 27% of trade that could have entered tariff-free did not do so. "In some sectors and for some firms, this will no doubt improve, but it reflects the reality that leaving the EU has imposed real costs on firms, with long-term implications for trade and production." The data covers all British exports to the EU in January and February, and some reporting nations in March. Individual businesses and groups told the BBC of instances where millions of pounds in tariffs had been paid. Most put this down to complex arrangements for claiming zero tariffs, difficulties over the re-export to the EU of goods processed in Britain, and an expectation that some of these fees could eventually be recovered. Some of the world's biggest multinationals have paid seven-figure tariff bills. Rare vehicles A classic car repairer, The Classic Car Mechanic, showed tariff bills of hundreds of pounds for car parts for rare vehicles sent to Hungary, which could not be valued, and so were hit with a tariff by French customs. "We've had to pay a tariff, even though we've got a zero tariff," said the boss of the business, Simon Spurrell. "It's the same with all the other shipments, all UK origin parts, but they dispute it and they hold it up. "We feel that we have no fight left in us, we have to then, as a small organisation just say, well, we'll cut our losses, and just pay the duty." The Trade Policy Observatory has tried to quantify the effect of extra trade barriers with the EU on different sectors. Although exports began to recover from a massive drop in January, over the quarter, the Observatory calculated that, of the worst affected sectors, textiles saw exports fall 63%, food suffered a 36% drop, and the automotive industry saw exports down 20%. Other advanced manufacturing industries have not been affected, according to the analysis, which seeks to isolate the impact of post-Brexit barriers from the impact of the pandemic. A government spokesperson said: "The vast majority of traders have adjusted well to our new trading relationship with the EU. "HMRC continues to work closely with exporters to ensure they correctly apply rules of origin requirements and are aware of their right to refunds. "The unprecedented zero-tariff zero-quota deal we secured with the EU allows businesses to trade smoothly, while we can now regulate in a way that suits the UK economy and our businesses - doing things in a more innovative and effective way, without being bound by EU rules." The analysis also showed that in the early months of the deal, there were some marked differences between EU nations in the extent of use of the free-trade deal for imports of British goods. Data for what is known as "preference utilisation" of British exports to Germany shows rates well below half in January and February at 42% and 44% respectively. The trade deal has been used more, according to the data, for exports to France, reaching 77% in March. Preference utilisation rates (PURs) measure the extent to which tariff preferences provided by a particular trade agreement are being used by imports and exports of either side. European Commission sources stressed that overall use of the deal was in line with the first months of other free-trade deals and that it would take some time to assess the impact. UK government ministers told Parliament last month that they would be releasing their equivalent data for EU exports into Great Britain shortly.
Source: BBC
The PTI government is celebrating over the increase in the textile export during the FY21. The value-added sector grew in garment and apparel exports from July to March, according to the statistics. Exports totaled $11.35 billion in the first quarter of this year, up from $10.41 billion in the same timeframe last year, a 9.06 percent increase. But, don’t get so excited the reality is different to what is shown and presented through data. The actual devil lies in the details of the statistics the 3.4 times increase in the exports for textiles in April 2021 was mostly due to the low base effect. Covid restrictions and lockdown around the globe had significantly impacted all industrial activates internationally, during the last year in April 2020. According to PBS, the figures for month on month exports show that it had been lower than 1.3%. Despite the deceiving growth percentage and month-on-month fall, textile exports reached $1.337 billion in April-21, the third highest monthly number in the previous year, according to Pakistan Bureau of Statistics (PBS). Both divisions of the textile group grew by triple digits year over year in April-21. Textile exports increased by nearly 17% year on year to $12.7 billion in 10MFY21, according to the PBS statistics. While the trend of valueadded textile export growth persisted in April-21 and overall in 10MFY21, April also showed an increase in the exports of basic textiles such as cotton yarn and cotton fabric. However, exports from the two categories were negative in 10FY21, as they had done in prior months. Knitwear, bed wear, and home textiles dominated the value-added category in 10MFY21, with double-digit increase. Though a crucial value-added commodity, readymade clothes continued to increase at a modest pace (12.6 percent YoY) in 10MFY21. It is also commonly being said that Pakistan’s textile exports are seeing a boom in the worldwide third wave of corona. The lethal wave has destroyed the economy of various countries, and a notable drop in Chinese and Indian textile exports have been noticed’ which has resulted to give Pakistan’s textile industry a major boost. However, domestic challenges such as cotton scarcity have been witnessed, which led to ECC allowing dutyfree imports of cotton yarn till June 30, 2021. There are still uncertainties which includes potential interest rates hikes, supply restrictions owing to a long term cotton scarcity and appreciation of currency. Also, the much-anticipated textile strategy has yet to be unveiled, despite the fact that policy consistency, such as the maintenance of the LTFF and TERF schemes, and competitive energy pricing, are the primary drivers of future textile export development.
Source: Daily Times
Even with the pullback from a 4.7% surge in spending in March, the April increase provided further evidence that consumers are driving a strengthening recovery from the pandemic recession. Americans increased their spending by 0.5% in April, a slowdown after a massive gain in March that had been powered by the distribution of billions of dollars in individual stimulus checks. Even with the pullback from a 4.7% surge in spending in March, the April increase provided further evidence that consumers are driving a strengthening recovery from the pandemic recession. The April gain was led by a 1.1% rise in spending on services, the sector that covers airline travel, hotels and restaurants, areas that were devastated by the pandemic-caused shutdowns a year ago. Friday's report also showed that ination by a measure preferred by the Federal Reserve surged by a bigger-thanexpected 3.6% for the 12 months that ended in April. Even excluding the volatile food and energy categories, core ination over that period was a still high 3.1%. Both gures are far above the Fed's 2% annual ination target. Yet the current year-overyear ination gures are likely temporarily elevated. That's because when the pandemic paralyzed the economy in early spring last year, many prices plummeted before rebounding later in the year. That factor at least partly explains why the 12-month ination gures look so large. They are expected to ease in the coming months, although inflation pressures have been surfacing in the prices of many goods and components _ a result, in most cases, of supply shortages. n its report Friday on consumer spending in April, the government said that goods purchases fell 0.6%. To some economists, this suggested that consumers have embarked on a long-anticipated shift away from the large goods. ``The great consumer spending rotation to services has begun,'' said Gregory Daco, chief U.S. economist at Oxford Economics. ``As health conditions continue to improve and the economy reopens, generous scal stimulus, rebounding employment and rising optimism will help unleash pent-up demand.'' Daco forecast that consumer spending, the main driver of the U.S. economy, could grow this year by around 9.5%. If so, that would amount to the strongest such showing since 1946, when the nation was emerging from World War II rationing and other restrictions. Friday's report from the Commerce Department also showed that personal incomes, which provide the fuel for spending, tumbled 13.1% in April. But the drop in income was expected, having followed a record 20.9% income gain in March that reected the billions in one-time checks to most adults. The April gain in consumer spending, slight as it was compared with March, supported the view that the economy is rebounding rapidly as individuals and businesses grow increasingly condent enough to spend, hire and invest. On Thursday, the government estimated that the economy grew at a robust 6.4% rate in the January-March quarter, powered in large part by consumer and business spending. The economy is thought to be expanding even faster in the current April-June quarter with many analysts forecasting an annual gure of 10% or more. The outlook for the rest of the year is brightening, too, on the strength of trillions of dollars more in government support, increased mobility as vaccinations keep increasing and a surge in pent-up consumer demand. More Americans are venturing out to shop, travel, dine out and gather in large groups at sporting and entertainment venues. For 2021 as a whole, many economists foresee growth, as measured by the gross domestic product, achieving its fastest pace since at least 1984. As the recovery rapidly expands, the risk of a pickup in ination continues to loom. Should ination, which has been dormant for years, begin to accelerate on a sustained basis, it might compel the Fed to respond with interest rate hikes that could derail the recovery. Gus Faucher, chief economist at PNC Financial, said that while the April ination gures exceeded expectations, much of the increase related to supply-chain bottlenecks in such areas as computer chips and autos. ``We have some temporary ination pressures,`` Faucher said, ``but those will fade, so there is nothing that the Federal Reserve is going to be concerned about. When asked about the rise in ination, Chair Jerome Powell and other Fed oicials have said repeatedly that they believe the ination spikes that have surfaced with some goods will prove temporary as bottlenecked supply chains are unclogged. On Thursday, Treasury Secretary Janet Yellen echoed this sentiment but also cautioned a House committee that the economy could endure a ``bumpy'' period with high ination through year's end. The 3.6% increase in prices over the past 12 months was the largest year-over-year rise since September 2008. Excluding volatile food and energy costs, the 3.1% year-over-year rise in core ination was the sharpest since 1992. And the one month increase in core ination in April, 0.7%, was the biggest since 1981. in April, down from 27.7% in March. Many Americans built up saving over the past year, either from government stimulus checks or from hunkering down at home and avoiding much spending. Economists generally believe that the pool of savings will help fuel the spending boom they envision in the coming months.
Source: Economic Times
Following the European Commission’s update of the 2020 New Industrial Strategy: 'Building a stronger Single Market for Europe’s Recovery', the European Social Partners for the textile, clothing, leather, and footwear (TCLF) sectors have given a call for a dedicated strategy to help the TCLF sectors survive following the COVID-19 pandemic. The strategy aims to help guide the TCLF industries through the current green and digital transition, while facing tough global competition, stressing the need to safeguard the industries and protect jobs in Europe, a press release issued jointly by Euratex, Cotance, CEC, and industriAll Europe said. On May 25, employers’ and workers’ representatives for the European TCLF sectors met with the European Commission to discuss the current challenges facing the TCLF industries and potential EU action to help support the sectors and their workers. Following discussions on the terrible impact of COVID-19 on the sectors and the need for a strong EU action, the Joint Statement: ‘’The future industrial strategy of the EU Textiles Ecosystem (TCLF sectors)’’ was adopted. The Joint Statement highlights the need for a dedicated strategy with support at national and EU level to help the TCLF sectors survive following the COVID-19 pandemic, while they continue to face tough, and, sometimes unfair, global competition. "The Social Partners of the TCLF industries fully support the EU’s ambitions for a green and digital transition of the sectors, but insist on concrete European measures to help the industries transform while the continues to suffer from an unlevel global playing field," the joint press release said. Specific joint demands include: full engagement with Social Partners in both the recovery and the transition of the industries, support for the EU Pact for Skills for the relevant ecosystem, a revision of the GSP which doesn’t negatively impact the sectors and its workers, support to decarbonise the sectors, careful consideration of the Due Diligence Legislation and quality dialogue with Social Partners ahead of the EU Sustainable Products Initiative and the Consumer Agenda to ensure that all policy gaps are addressed. Special attention must also be given to the forthcoming EU Textiles Strategy which should fully represent the needs of the EU’s entire textiles ecosystem. We look forward to working with the Social Partners and the EU institutions to roll out a coherent and effective strategy for our industry. We need to build a new business model, based on quality, sustainability and innovation. Our companies should operate in open and fair markets," Dirk Vantyghem, director general of Euratex, said. “Representing more than 95 per cent of our sectors, SMEs are the main target of the updated Industrial Strategy. They need tailored and easily accessible financial support, as well as proportionate measures to enable them to lead the twin transition. We can build a more resilient ecosystem by ensuring that the specificity and needs of our industries are considered in the development and implementation of the strategy at regional, national and EU levels,” said Carmen Arias, general secretary of CEC. “The companies and the people working in Europe’s TCLF ecosystem excel not only in generating wealth and jobs for our economy, but also their creativity is a distinctive cultural feature that is unparalleled in the world. It is therefore essential that our regulators apply the utmost care in finding the right mix of incentives and directives for ensuring their sustainable development and that their service to society is not compromised,” Gustavo GonzalezQuijano, secretary general of Cotance, said. "The TCLF sectors in Europe employ over 2 million people, with many of these workers playing a crucial role during the COVID-19 pandemic by producing personal protective equipment, such as masks and gowns. We owe it to these workers in Europe to make sure that the sectors come out of the pandemic ready to face the green and digital transition which is top of the EU’s ambitions. Workers are ready to meet these challenges and we call for investment in the factories and their workforces to ensure a positive and green future for the TCLF industries in Europe, with high quality and well paid jobs for its workers," Judith Kirton-Darling, Deputy General Secretary of industriAll Europe, said.
Source: Fibre2Fashion
