Surat’s textile sector is going through a tough phase due to dwindling demand and rising prices of yarn. The sector that accounts for 40% of the MMF fabric demand in the country and the city's over 6.5 lakh powerloom machines manufacture around 3 crore metre of fabrics worth Rs 45 crore per day. The 450 textile processing units in the city manufacture finished fabrics, including saris and dress materials. Weak domestic demand for man-made fabric (MMF) and with Chinese polyester clothing making inroads into India via Bangladesh and Sri Lanka, the anti dumping duty on majority of fibres, MGNREGA scheme and rising yarn prices as the big yarn spinners are yet to reduce yarn prices even when the crude oil prices are below $55 a barrel have added to the woes of the textile sector in the city. The return of Nitish Kumar government in Bihar has initiated an exodus of migrant textile workers to their hometowns as they see hope in the MGNREGA scheme and Nitish government there. According to the Industry estimates, over 35,000 textile workers from Bihar are yet to return from their hometowns though assembly elections for which they had gone are long over.
Moreover, the recent strike by textile workers demanding wage hike, the weaving sector remained closed for 25 days. All these factors have led to closure of at least 10,000 powerloom weaving units with an installed capacity of less than 48 powerloom machines in Surat in the last eight months, rendering over 50,000 weavers jobless, said Federation of Gujarat Weavers Association (FOGWA) president Ashok Jirawala. According to the Industry experts, knitting sector in the city established three years ago at an investment of over Rs 2,000 crore and installed capacity of 500 machines was on the verge of closure due to Chinese knitted fabric, which is available at cheaper rates. Dinesh Zhaveri, a textile technologist said that India's export share in the world MMF segment is around 4% compared to 30% of China. Under the government's new import and export policy, almost all forms of exemptions have been removed, making polyester exports uncompetitive. Textile entrepreneurs are not able to compete with China because of the fact that the Surat has only 25,000 automated powerloom machines like Rapier, Waterjet and Airjet. The traditional looms are still weaving thin fabric on shuttle looms. Southern Gujarat Chamber of Commerce & Industry's textile committee chairman Devkishan Manghani is of the view that the weavers need to focus on manufacturing fabric for T-shirt, trousers and shirt as well apart from only saris and dress material. For that the weaving sector need to go fully for automation and modernization to match the international standard and increase exports for fabrics.
SOURCE: Yarns&Fibers
Maharashtra state government has identified ten viable districts on the basis of cotton availability for the textile parks of which the state government has approved nine new textile parks throughout the state to boost the textile sector of this two are in Vidarbha, and the rest in Marathwada and Jalgaon district of north Maharashtra. At the Textile Seminar 2015, organized by the industries department, chief minister Devendra Fadnavis said that the industry will always have a growth potential as demand for garment is never going to die down. Fadnavis further addeded said that in Nandgaopeth land has been allotted for 12 projects with a total investment of Rs2,603 crore and an estimated job creation for 6200 persons. Out of these, one company Shyam Indo Fab has already gone into production with an investment of Rs273 crore and 500 jobs. According to some sources, there is also a demand from 6 new textile companies for being allotted land in Nandgaopeth and other parks of the region. Donnear Mills, Siyaram, Damodar Rayon and Madhukar Rayon are some of the bigger ones who have shown interest.
Sunil Porwal the state's additional chief secretary (textile) said that the new parks in Vidarbha include those in Yavatmal and Buldhana. The state already has a textile park at Nandgaopeth in Amravati district. The Nandgaopeth textile park is considered to be the most promising with a capacity to attract investment worth Rs10,000 crore. Apart from this, an integrated textile park is being set up in Hinghanghat as part of a central government scheme. The park located in 108 acres can create 2000 jobs. Eleven units have shown interest, said a source. This makes four dedicated zones for textile industries in the state. The government is offering a slew of incentives to the sector which include VAT and stamp duty relaxations to land at low rates. In Yavatmal, land is being offered at Rs200 a square feet and Chikali-Buldhana it is for Rs80 a square feet.
Apoorva Chandra, the state's principal secretary (industries) said that the government is planning to bring all the concession available to the textile industry under one control. At present each of the incentive is governed by a different department. There are plans to bring it under one head, which in all probability would be the textile ministry. However, the government is waiting to get some clarity on the GST. If the bill is passed, changes will have to be made in the scheme. The state has attracted investment to the tune of over Rs40,000 crore in the textile sector during the last 4-5 years.
SOURCE: Yarns&Fibers
ITMACH Bhiwandi opened with a renewed vigour and optimism today. True to its reputation, the 3-day fair set the stage for investment and newer opportunities right on the first day, the organisers said in a media statement. Over 125 exhibitors, primarily, machinery and technology providers from the post-spinning, weaving preparatory, weaving, dyeing, printing and processing as well as garmenting sectors are exhibiting on area of 10,000 square metres at the fair, which is being organised by ITMACH India in association with Textile Excellence. The visitors flow peaked by noon and by the end of the day the exhibitors reported a good bank of queries on day one itself. “We were not really expecting much considering the venue being in Bhiwandi. However, we have to say we entertained a series of positive queries today,” said an excited R Anbazhahan, managing director, Reiniger Welker. Earlier, inaugurating the expo, Bhiwandi Mayor Tushar Chowdhury said, “ITMACH Bhiwandi is pioneering developments within the textile sector. The machines on display demonstrate a worldview. The industry here definitely takes an effort to go and fetch improved machinery from the world over, but bringing them back home and that too solely for a cluster is definitely a commendable work.” “ITMACH Bhiwandi understands the importance of firsthand experience and our effort has always been to get the international developments of the textile industry closer to home. Promoting the development of textile clusters in Western India has always been our priority and ITMACH is just a stepping stone of our efforts. Uplifting the textile clusters and bringing them face to face with the bigger developments of the industry, proved beneficial the last year. This year is a renewed effort for the same,” remarked an enthusiastic Arvind Semlani, director, ITMACH India. Visitors from Malegaon, Surat, Ichalkaranji, Kolhapur, Belgaum, Tarapur, and Bhiwandi dropped in to meet the technology providers on day one. “The show is set on a smooth step by step progress. And it is certainly an interesting feeling to come and interact with the industry and have such quality business discussions here at Bhiwandi,” said Manchhalal K Jain, director, Shree Daksh Jyot Silk Mills, Bhiwandi.
SOURCE: Yarns&Fibers
The Textile Association (India), Mumbai Unit takes pleasure in announcing a Conference on “Innovations @ ITMA 2015, Milan” on 12th February 2016 at Hotel The Lalit Mumbai, Sahar Airport Road, Andheri(E), Mumbai – 400 059, India. The much-awaited global textile machinery industry's largest extravaganza ITMA 2015 is just over at Fiera Milano Rho, Italy. ITMA is the biggest global marketplace and one-stop sourcing platform for emerging trends and innovation solutions. It covers the whole production chain from spinning, nonwovens, weaving, knitting right through to finishing. ITMA 2015 attracted 1691 exhibitors from 46 countries. The Indian participation was also quite significant and was the third largest exhibitors - with 158 exhibitors - as well in terms of visitors amongst the non-CEMATEX countries. Many leading Indian textile industry's leaders also made their presence felt and were taken notice by the most European & other exhibitors. At the end of eight days, the 17th edition of the world's most established textile and garment technology exhibition attracted visitorship of almost 123,000 from 147 economies.
TAI Conference
The seminars / conferences organized by The Textile Association (TAI), Mumbai Unit has always selected contemporary & innovative topics and high profile speakers. This Conference is no exception. This conference will be addressed by reputed professionals and renowned experts from different parts of the world will present their papers to over 300 equally high profile participants. This will give a rare opportunity to the participants to listen to such high quality experts. Due to Diwali Festival large number of Indian Textile experts missed ITMA 2015.TAI Mumbai thought it prudent to highlight on the innovative products displayed at the Show for those who missed ITMA show and could not attend it and for them TAI Mumbai has organized this Conference. The Conference will cover advances and Innovations shown in ITMA 2015. There will also be a panel discussion on wherein the senior managers who visited the show will express their views on their impressions on revolution & innovations displayed at ITMA 2015 show. Topics to be covered: Innovations in Spinning, Weaving, NonWovens, Knitting Technology, Processing, Digital Printing, Automation in Laboratory & Production
An Appeal
It is contemplated that this conference would provide an excellent opportunity for companies to gain global visibility and publicity by promoting their products and services to a highly focussed audience besides networking with the delegates from various parts of the world. It is needless to emphasis that your participation in this conference by way of advertisements, delegates and sponsorship will provide a common platform to meet the expert's from industry and to exchange the views on the technological developments in the field of textiles. The Textile Association (India), Mumbai Unit invites you to be part of this event to contribute towards the betterment of the Textile Industry.
SOURCE: Yarns&Fibers
The government today said it is taking steps to promote the rupee in global markets and increase its competitiveness vis-a-vis other currencies. “The Government has been taking measures to promote the internationalisation of the Indian Rupee,” Minister of State for Finance Jayant Sinha said in the Lok Sabha. In a written reply to a query on whether the government proposed to internationalise the domestic currency, Sinha said however that there is “no definitive roadmap set for internationalisation of the Rupee since it would require full capital account convertibility.” He added that there are restrictions on the rupee being used for international transactions. Sinha further said: “RBI in consultation with the government has recently put in place a framework for issuance of rupee denominated bonds overseas by Indian corporate.”
In addition, non-residents are permitted to hedge the rupee risk of their exports and imports to and from India and loans denominated in Indian rupees with Indian authorised dealer bank onshore, Sinha added. He also said that the Standing Council of Experts on Indian Financial Sector has submitted its first report recommending policy proposals for improving the international competitiveness of currency, equity and commodity derivatives markets of India through a host of market micro-structure, regulatory and taxation reforms. The report has been circulated to all financial sector regulators and ministries concerned to examine and take necessary action to improve international competitiveness of Indian markets.
Replying to a separate query, Sinha said that as on December 15, 2015, all issues uploaded on Project Monitoring Group (PMG) portal pertaining to 335 projects stand resolved and 295 projects are still under consideration of PMG. With an objective to create an institutional mechanism for fast-tracking of stalled investment projects, a cell in the nature of PMG had been set up in June 2013.
SOURCE: The Financial Express
The rupee will largely remain stable but with a mild depreciating bias in the next one year, despite the expected four rate increases by the US Federal Reserve and even rate cuts by the Reserve Bank of India, said currency dealers in a poll by Business Standard. While 12 of the 13 polled expected the rupee to remain well within its record low level (68.85 a dollar, reached in August 2013) by December 2016, one participant expected it to touch 70 due to global credit market volatility. Till the end of this financial year, though, rupee should remain well within the range it is trading now. The currency closed at 66.40 a dollar on Friday and all 13 participants expect it to revolve around this level.
Theoretically, money flow is based on the interest rate differential. Hence, if the source country increases its rates, the recipient country should also raise these, to maintain the same differential. In the case of India, a squeeze in the interest rate differential will be largely inconsequential, with the country's robust fundamentals, said senior currency market participants and observers. “India’s environment is much better and stable than other emerging market economies. If you only consider the interest rate differential, the rupee should depreciate but continued capital flows will offset that,” said N S Venkatesh, executive director, IDBI Bank.
Rupee to remain stable in 2016: BS Poll First Rand Bank’s head of treasury, Harihar Krishnamurthy, said much of the weakness in the rupee had been already discounted. “Our trade deficit numbers are soft, oil prices continue to be benign, inflation is under control. So far, sentiment was driving the market rather than fundamentals. Purely sentiment-wise everyone expects rupee to weaken but we continue to be in a nice place,” said Krishnamurthy. Bank of America Merril Lynch’s chief India economist, Indranil Sengupta, expects the rupee to strengthen to 65 a dollar by March and 66 a dollar by December 2016. The strength will come on the back of a turnaround in corporate earnings and opening of more space for foreigners in the government securities market, he said.
Any occasional bouts of volatility can be ironed out by RBI through intervention, said Canara Bank’s chief economist, Manoranjan Sharma. “There is no reason for alarm,” he said. However, QuantArt Market Solutions’ managing director, Samir Lodha, said even as India was well placed, the world was not and that would impact the rupee, pushing it to 70 a dollar by December next year. “Global financial markets, especially credit markets, are significantly leveraged. It is quite likely that 2016-end would see a crisis-kind of situation stemming from the credit market. Credit contagion will spread and affect India significantly,” said Lodha.
SOURCE: The Business Standard
The government is expecting its ‘Make in India’ programme to be a major success, with a report by the Department of Industrial Policy and Promotion (DIPP) revealing that 10 companies have either committed or indicated investments worth $120 billion, mostly over a period of five to 10 years. Asked how much of the investments committed could actually translate into reality, DIPP secretary Amitabh Kant said: “We are confident that these committed investments will actually flow in.” Prime Minister Narendra Modi will inaugurate the Make in India Week in Mumbai on February 13. The event will focus on innovation, design and sustainability, and is expected to witness the participation of over a 1,000 companies and delegates from over 60 countries, he added.
According to the list prepared by DIPP, Reliance Industries, under the Digital India campaign launched on July 1, has pledged an investment of $42 billion, which is expected to create 500,000 direct and indirect jobs. However, the timeframe for such investments isn’t revealed in the list. RIL, under the Reliance Jio brand, has also committed to roll out internet protocol-based wireless broadband infrastructure across the country, and is also expected to set up a nationwide distribution network for small vendors to sell and service devices. Similarly, SBG Cleantech Consortium (SoftBank Corp, together with Bharti Enterprises and Foxconn) will invest about $20 billion over the next 10 years to generate 20 gigawatt (GW) of solar power and manufacture solar power equipment in India. The consortium SBG Cleantech Ltd would scout for project land in Andhra Pradesh and Rajasthan. The new company intends to participate in the 2015-16 round of solar power plant tenders under the National Solar Mission (NSM) as well as state-specific solar ventures. Foxconn would help with solar equipment for the projects.
Bharti Enterprises has also committed to invest $16.7 billion in the next five years. The funds will be invested in creating infrastructure in rural and urban areas and setting up an eco-system to enable usage of e-health and e-education facilities. The company also plans to manufacture a range of affordable electronics products in India through collaboration with various manufacturers around the world. Dalian Wanda Group has decided to invest $10 billion over the next five years and has been considering a few sites to develop integrated industrial townships and theme parks. Idea cellular has indicated investments $7 billion by 2020 for network and broadband deployment. Other notable companies that have either indicated or committed investments are Sterlite Technologies, Adani Group, Foxconn Technology, JSW Steel, Reliance ADAG, IKEA, Airbus, CISCO, Bombardier, Siemens, General Motors and Uber Technologies.
SOURCE: The Financial Express
The government on Friday lowered its forecast for gross domestic product (GDP) growth to 7-7.5 per cent in this fiscal year, down from an earlier forecast of 8.1-8.5 per cent. Though it stuck to the fiscal deficit target of 3.9 per cent of the GDP for the year, Chief Economic Advisor Arvind Subramanian said at a press conference that the target of 3.5 per cent looks challenging for next year. The mid-year economic analysis tabled in Parliament struck a note of caution by saying there was a case for re-assessment of the medium-term fiscal consolidation road map because of the additional expenditure due to the recommendations of the Seventh Pay Commission and the higher pension payout for defence veterans next year. “If the government sticks to the path for fiscal consolidation, that would further detract from demand. On these assumptions, and unless supply side reforms provide an impetus to growth, real GDP growth next year based on an analysis of demand is not likely to be significantly greater than growth this year,” the report said. The mid-year review, which was prepared by Chief Economic Advisor Arvind Subramanian and his team, examined the trends in receipts and expenditure for the first two quarters of the year in relation to the budget and provided a statement explaining deviations in meeting the government’s fiscal obligations.
Govt pares growth forecast to 7-7.5% The analysis said weak exports and low private sector investment were among the reasons for lowering the GDP growth forecast. “Given the challenges, we estimate that real GDP growth for the year as a whole will lie in the 7-7.5 per cent range,” the report said. It forecast nominal GDP growth for the year at 8.2 per cent. “The economy is recovering, but it is hard to be definitive about the strength and breadth of the recovery for two reasons: the economy is sending a mixed signal and there is some uncertainty on how to interpret the GDP data. The data uncertainty is, in fact, reflected in the mixed, sometimes puzzling, signals emanating from the economy,” Subramanian told reporters after the tabling of the analysis. The report said, “Both direct and indirect tax collections have registered a dramatic increase in buoyancy in the first half of 2015-16 compared to the average of the previous three years.” This would be the prime reason that the fiscal deficit target for the year would be maintained, Subramanian said. While making a case for setting a more realistic disinvestment target for next year, he said there would not be any expenditure cuts in the fourth quarter of this fiscal year.
According to the latest roadmap laid out in the budget for 2015-16, the government is targeting a fiscal deficit of 3.5 per cent in 2016-17 and 3 per cent in 2017-18. By Subramanian’s assessment, these numbers may now have to be reviewed. "The deficit target of 3.9 per cent this year will be met, but 3.5 per cent next year looks more challenging," he said. “As long as oil prices do not decline further and remain around $50 per barrel, the additional boost to consumption that the economy received this year – of about 1-1.5 percentage points – is likely to recede,” the report stated. It, however, forecast a pickup in exports and said there was a need to continue boosting public sector investment in infrastructure, something that was done this year. Subramanian added in the press conference that the current account deficit would be in the range of 1-1.2 per cent next fiscal year. The report said retail inflation was likely to remain within the RBI's target of about 6 per cent. Subramanian later said inflation had moderated significantly. Underlying determinants like rural wages and farm support prices were also moderating and foreign exchange reserves had risen to about $352 billion. "The rupee has been very stable. The focus on the rupee-dollar rate conveys a misleading impression about the stability of the rupee. If you measure it against a basket of currencies, it has actually been quite stable," he said. Subramanian also pitched for continuing with reforms to boost supply. He added that the GST, bankruptcy code and measures to boost agricultural output were some of the major steps this government would need to take. Subramanian said fiscal and monetary policy must be framed to take into account the decline in nominal GDP growth. There was a need to boost demand, he added.
WHAT THE CEA SAID
For current financial year
For next financial year and beyond
SOURCE: The Business Standard
External Affairs Minister Sushma Swaraj on Friday said the National Democratic Alliance government in the past 18 months had effectively used diplomacy as a force multiplier to significantly strengthen its flagship programmes like the 'Make in India'. Addressing the 88th Annual General Meeting of the Federation of Indian Chambers of Commerce and Industry on 'Translating Aspirations into Reality: India @ 2022", Swaraj said the government had "refashioned" foreign policy with the focus to catalyse progress at home. "Consequently, much of our diplomacy focus has shifted to its economic dimensions, especially in facilitating business interactions," Swaraj said. The minister said there had been a marked increase in foreign direct investment commitments in the past year, estimated at 40 per cent more than the one before. "The 'Make in India' programme has started to gain increasing traction, the latest vote of confidence coming in the $12 billion commitment made by Japan during Prime Minister (Shinzo) Abe's visit," she said. Swaraj said the 'Skill India' endeavour has found experienced and responsive partners, ranging from Germany to Singapore. The international response to the 'Digital India' campaign and the interest in 'Smart Cities' has also been very strong, while the Ganga rejuvenation programme has been offered best practices and effective technologies, she said.
"Spreading the message of 'easier to do business' is one of our major goals. So too is the involvement of CEOs (chief executive officers) in this effort," Swaraj said. She said accelerating of long-pending procurement decisions for defence forces had complemented the opportunities that the government has created abroad. The minister also said "the mindset of our bureaucracy has completely changed" in providing succor to Indians in need of help, including better passport services or evacuating Indians from trouble regions in West Asia. She claimed India's foreign policy of past 18 months had deepened ties with the US, Japan, China and key European countries like France, the UK and Germany. Swaraj counted settling the longstanding boundary problem with Bangladesh as a key success in the neighbourhood. "By calling for an inclusive Nepal and urging a political solution to long pending political problems, we are committed to unity, peace and stability of Nepal which will create a more durable foundation for our bilateral relations to prosper," she said. Swaraj said ties with Pakistan have predictably been the most challenging to take forward. "However, the recent NSA (national security advisor)-level dialogue on security and terrorism and the establishment of a comprehensive bilateral dialogue following my visit to Islamabad now offers a pathway," she said. The minister said India had for decades operated in an international system that is driven by Western concepts and values. "The India of today aspires to project its own heritage on the global scene. There is much to be done on that score," she said.
SOURCE: The Business Standard
The tenth ministerial conference of the WTO maybe headed for a wash out with no deal in sight favouring India and the developing countries. Despite day long intensive negotiations among India, China, EU, the US and Brazil, there could be a no show for India as none of its concerns - reaffirmation of Doha, public stockholding and special safeguards mechanism- have been discussed till now. Sources said that talks are hovering around export competition and agriculture only and hence, the talks are likely to get extended as against the the chair of the ministerial Amina Mohamed's claims that there is no crisis and a deal will be clinched in a few hours before the ministerial ends. In fact, the draft being discussed in the one that had taken India by surprise yesterday as it had ignored all of its concerns.
While India has stuck to its stance of reaffirming the Doha development agenda, there is immense pressure on the country to give up its demands and cave in, especially because the ministerial is happening in Africa for the first time. The next few hours will be a tightrope for India because it doesn't want to be seen as obstructionist or a deal breaker but simultaneously protect its interests. "We have no differences with Africa," commerce minister Nirmala Sitharaman said but India is fighting its own battles in the small grouping since morning. Sources also said that India insisted on the sanctity of all Doha decisions as the EU, US, Australia and Brazil are against its continuation. "They have a problem everyone Doha is mentioned. They feel it that it leads to prejudging of issues because many members don't want to reaffirm it. Our concern is that this will raise questions on the sanctity of the earlier decisions also," a source said. India is also insisting that some issues - related to export competition- are being given undue importance and being dealt with hastily even though they were not adequately discussed in Geneva.
SOURCE: The Economic Times
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$ 33.33 per barrel (bbl) on 17.12.2015. This was lower than the price of US$ 34.20 per bbl on previous publishing day of 16.12.2015.
In rupee terms, the price of Indian Basket decreased to Rs 2221.08 per bbl on 17.12.2015 as compared to Rs 2286.11 per bbl on 16.12.2015. Rupee closed stronger at Rs 66.65 per US$ on 17.12.2015 as against Rs 66.85 per US$ on 16.12.2015. The table below gives details in this regard:
|
Particulars |
Unit |
Price on December 17, 2015 (Previous trading day i.e. 16.12.2015) |
Pricing Fortnight for 16.12.2015 (Nov 27 to Dec 11, 2015) |
|
Crude Oil (Indian Basket) |
($/bbl) |
33.33 (34.20) |
39.02 |
|
(Rs/bbl |
2221.08 (2286.11) |
2603.80 |
|
|
Exchange Rate |
(Rs/$) |
66.65 (66.85) |
66.73 |
SOURCE: PIB
India will be joining the league of the US, Japan, France along with other emerging markets peers as the top largest 10 members of International Monetary Fund. The US Congress has approved the the crucial quota reform pending since 2010. New Delhi had pushed for pending quota reforms since. Finance minister Arun Jaitley had strongly taken up the issue at the last fund bank meeting at Lima. Under the IMF's quota reforms of December 2010, developing countries will see a more than 6% shift in quota in their favour. India's vote share will go up to 2.69% from the current 2.34% . Four emerging market countries (Brazil, China, India, and Russia) will be among the ten largest members of the IMF. Other top 10 members include the United States, Japan, and the four largest European countries (France, Germany, Italy, and the United Kingdom). The quota shares and voting power of the IMF's poorest member countries will be protected, an IMF statement said on Friday. US Congressional nod had held up this crucial reform of the multilateral body. "The United States Congress approval of these reforms is a welcome and crucial step forward that will strengthen the IMF in its role of supporting global financial stability. The reforms significantly increase the IMF's core resources, enabling us to respond to crises more effectively, and also improve the IMF's governance by better reflecting the increasing role of dynamic emerging and developing countries in the global economy," IMF managing director Christine Lagarde said.
SOURCE: The Economic Times
External Affairs Minister Sushma Swaraj on Friday said dealing with Pakistan had been “most challenging” in the last 18 months since the Narendra Modi government came to power, even as she emphasised that under her the focus of diplomacy has shifted to economics. “Ties with Pakistan have predictably been the most challenging to take forward. However, the recent NSA-level dialogue on security and terrorism and the establishment of a Comprehensive Bilateral Dialogue following my visit to Islamabad now offer a pathway,” she said while addressing the FICCI AGM here. Swaraj further said countering terrorism has become a “salient feature” of the country’s foreign policy and a substantial portion of it relates to India’s relationship with Pakistan. On Nepal, Swaraj said that her government has taken it to the “next level” by urging a “political solution” and an “inclusive” Nepal. She also highlighted how this government has shifted the focus of diplomacy towards economic ties.
Economic ties
“It is apparent that many of the flagship programmes of the government can be significantly strengthened through international collaboration. Consequently, much of our diplomacy focus has shifted to its economic dimensions, especially in facilitating business interactions,” she said. As a result, she said, FDI inflows have increased 40 per cent compared to before. “The ‘Make in India’ programme has started to gain increasing traction, the latest vote of confidence coming in the $12-billion commitment made by Japan during PM Abe’s visit,” she said. Swaraj said in the last 18 months, India’s international profile has been “significantly enhanced.” “Our views on key international issues — be it on trade, climate change, terrorism or maritime security — are also being given greater consideration,” she said.
SOURCE: The Hindu Business Line
The US has turned distinctly cool to India's overtures to joining the Asia-Pacific regional trading arrangement, APEC.India and US in a joint statement signed in January this year said Washington would support India's prospective membership in APEC. India itself reached that point after some internal struggle, when for years, it tried but failed to get a foot in the door.That was seen to be a sign that India may be finally turning the corner on its approach to multilateral trading arrangements. APEC is not exactly a negotiating forum, its importance lies in its "aspirational" approach which its supporters say would help Indian regulators harmonize their standards and procedures with global norms. In fact, for the few in the Indian government who want to keep India in the new international trading frameworks, APEC is seen to be important. In fact, last week, Japan also agreed to support India's bid for membership of APEC. But it was significant that India's bid was not even discussed during the recent APEC summit in Manila.But months after the agreement, the US trade leadership believes India could be intransigent on trade negotiations and liberalization. This, they believe, could impact the pro-trade atmosphere of other countries in the room. US Government sources here said they wanted India to be more explicit about its intent. Richard Fontaine of Centre for New American Security (CNAS) summarized the problem: "US supports India for UN Security Council but not APEC; it is supporting Papua New Guinea for TPP (Trans-Pacific Partnership), but not India."
Indian officials on the other hand have a very different take on the issue. India's aim of joining APEC has been expressed at the highest levels by the PM, and echoed by Commerce Minister Nirmala Sitharaman when she visited the US for the trade policy forum meetings in October. While APEC membership by itself may not be very important, it's a crucial stepping stone to joining the new game on the block --TPP. Fred Bergsten of Peterson Institute of International Economics, in a recent paper argues, "TPP and FTAAP (Free Trade Area of Asia and Pacific) confront the political reality that up to this point, only APEC members have been deemed eligible for. Hence India would have to become an APEC member or the current norm would have to be waived.”
India has a credibility problem when it comes to multilateral trading arrangements, because its trade negotiators have earned for themselves the dubious distinction of being the loudest block in any negotiations. In recent months, Singaporean officials have met top level Indian leadership to complain that countries negotiating RCEP (Regional Comprehensive Economic Partnership) want India out, blaming India for the negotiations going nowhere. In recent weeks, Indian officials have pointed to India's proactive role in negotiating a climate agreement in Paris as a sign that India was changing its stance.
China had invited India for the APEC summit in Beijing in 2014, where it launched talks into a new FTAAP. China is also planning to get into an expanded TPP in the coming years, either at the head of RCEP or by itself. If India is not playing the game, trade economists say New Delhi could be looking at large-scale trade diversion. At this moment, India is out of talks for TPP, reluctant on RCEP, stalled on EU-India FTA and not yet started on a bilateral investment treaty with the US. India stayed away from the Beijing summit, so may not be invited for the talks when they happen. The only multilateral game in play globally at present is the WTO's Doha round, currently being negotiated in Nairobi. Having worked out some poorly negotiated FTAs in the recent past, the Indian government tends to view trading deals suspiciously. However, many trade experts say this flies in the face of the Modi government's intention to ramp up manufacturing and increase its global trading footprint. Bergsten points to an "intimate linkage between India's proposed economic reforms and a bold new thrust for its international trade and investment policies. Huge gains would result for India: its exports could expand by $500 billion and its GDP would grow by 4 per cent from an ambitious FTAAP.”
SOURCE: The Economic Times
With diplomatic tensions mounting between Turkey and Russia over the downing of the Russian Su-24 jet fighter plane on 24 November, there are rising concerns that the important Turkish clothing sector could struggle as a result of these geopolitical troubles. Yesterday (17 December), Russian President Vladimir Putin used crude language to antagonize Turkey's leaders about the incident, which has already sparked Russian restrictions on Turkish exports. And while it is still unclear to what extent this will cover textiles and clothing, there are concerns that it will. According to data from the Russian Federal State Statistics Service (Rosstat), between January and September this year, Russia imported around US$514m worth of fabrics and textiles from Turkey, for instance.
Paul Morris, an independent UK-based textile consultant who has been connecting British brands with Turkish manufacturers since the mid-1980s working with Marks & Spencer, Next and Tesco, says: "If things get worse, then Turkey will fight back. They won't be pushed around and the Russians will know it is not a Ukraine." Tighter sanctions would inevitably follow leading to the diversion of significant levels of Turkish clothing and textile production. The result: "It could benefit UK brands [for instance], as the price will drop." Buzz Carter, founder of London-based sourcing show Fashion SVP, adds: "The Turkish economy has been suffering for a while and very recently suffering because of the Russian stand-off and Russia is their major market." He notes that faced with a weakening Turkish lira and a weak Russian economy, Turkish exporters had already been casting around for new markets: there were 17 Turkish clothing manufacturers exhibiting at last September's edition of Fashion SVP in London's Olympia. Turkey is also, of course, facing insecurity on its southern border, with the Islamic State (IS) continuing its baleful presence. That said, the bulk of Turkey's clothing and textile sector is in the west of the country, far from the troubles. It is in the Adana the cotton growing region, north of the Syrian border, where security issues could pose difficulties, says Morris.
Near-sourcing alternatives Compounding these difficulties is that north African competitors such as Morocco and Tunisia are live to the threats facing Turkey and ready to offer European buyers near-sourcing alternatives. Emmanuel Bisi, managing director of London-based market expansion consultancy firm Expandys, says: "Salary evolution data shows that Turkey's minimum salary is rising more rapidly than Morocco. Buyers I know see Morocco as a clear alternative if things get worse in Turkey." Certainly buyers from UK-based Arcadia Group brands Topshop and Dorothy Perkins, as well as those from Monsoon were present at October's Maroc in Mode garment production sourcing show, attended by just-style. Moreover, with the Turkish lira currently weak against the euro and the US dollar, this has made inputs more expensive, counteracting the benefits of exporting Turkish- made products valued in a depressed currency. "Turkey's main economic pressure is that the recession has drawn away investment capital and that is what they really need; that means the Turkish lira has dropped in value so the raw materials they have to buy [from overseas] cost more," explains Morris. He adds: "You always need a plan B and a C," in terms of sourcing solutions. That said, there is hope. Turkey still has the competitive edge in terms of capacity and a vertical supply chain for producing fashion and fabrics, he says. And in terms of quality: "You'd struggle to beat Turkey."
SOURCE: Just Style
Textile marketers in Kano State have described the Central Bank of Nigeria (CBN’s) foreign exchange policy as a threat to textile business in Nigeria as it is systematically edging out international investors in the sector. A former chairman of Kantin Kwari Textile, Alhaji Sunusi Umar Ata, made this known at a press briefing in Kano on the current economic status of Nigeria’s textile industry. He said the policy has crippled the sector to the extent that the Chinese, who are the strong operators in the business, are systematically backing out of it, a situation which he added, has led to the loss of huge amounts of revenue. He stated that to make issues worse, the activities of the newly constituted Task Force stationed in most of the international airports across the nation has been forcing many business people to backpedal from the business, adding that judging from the economic situation in the country; Nigeria needs a viable business atmosphere now more than ever. Ata called on the federal government to consider reviving the textile industry before taking the measures it has to save the situation, adding that the withdrawal of the Chinese would create a huge gap in the economy as thousands of Nigerians would be forced to join the already saturated unemployment market.
SOURCE: The Daily Trust
Finance Minister Ishaq Dar has said that textile sector was the most important foreign exchange earner for the country and it would be facilitated in every possible manner to perform at optimum level. The minister was talking to a delegation comprising representatives of textile industry, which held a meeting with him the other day. The delegation also apprised him of the problems faced by the value added sector. Special Assistant to Prime Minister (SAPM) on Revenue Haroon Akhtar, Parliamentary Secretary on Finance Rana Muhammad Afzal and Fedral Board of Revenue (FBR) Chairman Nisar Muhammad Khan were also present in the meeting. The delegation informed the minister that shortage of gas was the most critical problem faced by the textile value added sector, which had impaired level of production and consequently led to decreased exports and diminished foreign exchange earnings. They were of the view that the shortage of gas could be met through provision of imported LNG at a reasonable price. The delegation also requested for restructuring of bank loans and their repayment on easy instalments, which they said would highly facilitate the value added sector. Members of the delegation, while referring to the issue of GST refunds, appreciated the measures being taken by the government. The finance minister stated that the textile sector was the most important foreign exchange earner and it would be facilitated in every possible manner to perform at optimum level. The finance minister also set up a special committee headed by the SAPM to take stock of the issues raised by the delegation and suggested remedial measures. The committee also includes key representatives of the textile industry.
SOURCE: The Daily Times
Turkey's textile manufacturers are in a rush to find new buyers as they are being forced out of Russia, which is good new for Lithuanian clothing producers, the business daily Verslo Zinios reported on Friday, cites LETA/BNS. The Turks, who until recently did not take much interest in the annual trade fair Baltic Textile and Leather, are now looking for contacts. According to Linas Lasiauskas, director general of the Lithuanian Apparel and Textile Industry Association, Lithuanian companies would be willing to purchase Turkish fabrics, but the terms have not been flexible until now. The Turks wanted to sell fabrics in large quantities, which was not acceptable for small companies, designers and boutiques. The situation has changed, which may encourage companies to go into the wholesale textile business. There are few such suppliers in the Lithuanian market now.
SOURCE: The Baltic Course
China's yuan closed firmer against the dollar on Friday, but has slumped 0.4 percent against the dollar this week, which would be a seventh straight weekly slide, the longest weekly losing streak since late 1995. The People's Bank of China (PBOC) continued to set its daily yuan/dollar guidance rate at lows in 4-1/2 years, to 6.4814 per dollar prior to market open on Friday. The spot market opened at 6.4870 per dollar and closed at 6.4815, 0.03 percent firmer than the previous close, but it lost 0.4 percent for the week and has shed a combined 2.6 percent over the past seven weeks. The yuan had eased over 10 straight days against the dollar through Thursday, the longest daily weakening streak on record. The PBOC appears set to let the yuan depreciate to 6.5 per dollar before the year-end, traders said, but may not want it to fall too fast to spark any market panic. The offshore yuan was trading 1.27 percent weaker than the onshore spot at 6.565 per dollar, hitting the weakest level since Aug. 12, which was the second round of a hefty two-day devaluation of the currency that took place that month.
SOURCE: The Economic Times
Consensus remains elusive on export subsidies at the WTO ministerial meeting here with India hardening its position over demand for a permanent solution to special safeguard mechanism, public stockholding and others. A deadlock continues here till late evening on the last day of the four-day meeting with leaders indulging in hectic parleys to find a workable solution. Sources here said members were yet to arrive at consensus on all important issues even on the last day of the trade ministers' meeting and rumours were rife that talks may get stretched till weekend. They said rich nations are pushing new issues such as deal on phasing out export subsidies and government procurement, even as differences over key issues of the Doha round like farm subsidies are yet to be iron out.
EU Trade Commissioner Cecilia Malmstrom in her blog said, "What a week. The air is perpetually full of rumour and speculation about what is possible to achieve here at the 10th WTO Ministerial Conference in Nairobi, Kenya. It's quite improbable that we will finish this conference today, as planned. Many of us have rebooked our flights for the weekend instead". The Indian team led by Commerce Minister Nirmala Sitharaman is holding hectic parleys on all the key issues. Yesterday WTO members were engaged in negotiations to iron out differences till late night, sources said. Backed by several developing countries, India is pitching for finding permanent solution on public stockholding for food security purposes, special safeguard mechanism (SSM) tool to protect farmers from sudden surge in imports or dip in global prices; and conclusion of the pending agenda of the Doha Round.
On the other hand, developed nations like the US and EU are pushing for new issues like government procurement. Public food stockholding is crucial for India's food security programme. India wants permanent solution to the issues related to it. Amid the continuing deadlock, the blame game has now shifted to social media with topics like #IndiaStandsBehindFarmers trending in response to #IndiaBlocksTrade possibly from developed countries.
SOURCE: The Economic Times
