The Synthetic & Rayon Textiles Export Promotion Council

MARKET WATCH 2 JANUARY, 2016

NATIONAL

 

INTERNATIONAL

 

Textile exports hit due to US procurement legislation: FICCI

India's textile exports are getting affected on account of the US legislation for federal procurement, which stipulates sourcing of raw materials from the designated countries or domestic suppliers, FICCI said. The industry body submitted a representation in this regard to the Ministry of Textiles and Ministry of Commerce & Industry. "FICCI has requested the Government of India to take up the issue either bilaterally or multilaterally with the US government to resolve the issue amicably," it stated. Indian textile exporters have reported that the buyers or companies based in the US supplying to their government departments and agencies have halted sourcing raw materials from countries like India, which are not part of the General Services Administration (GSA) Schedule Contract. The GSA is responsible for supporting several federal agencies in the US with basic functions, including procurement services.

Pursuant to the Buy American Act, the US federal acquisition process is based on preferential treatment of US-made products. Manufacturers are considered as US products if manufactured domestically and the cost of local components is more than 50 per cent of the overall cost of all components. Under certain conditions however, the Buy American Act may be waived. The Trade Agreements Act of 1979 (TAA) gives the President authority to waive Buy American Act requirements for certain procurements. So far it has been waived for eligible products in acquisitions covered by the WTO Government Procurement Agreement, some relevant free trade agreements (FTA), as well as for least-developed countries. As per the TAA, all products listed on the GSA Schedule Contract be manufactured or "substantially transformed" in a "designated country". The designated countries, as per the GSA Schedule, consist of World Trade Organization Government Procurement Agreement Countries, Countries having Free Trade Agreement with the US, Least Developed Countries and Countries based in the Caribbean-Basin. As India does not fit into any of these criteria, the US-based buyers have stopped their sourcing from our textile manufacturers immediately, impacting the order books and the production lines of some of the major exporters, FICCI said.

SOURCE: The Economic Times

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Textiles Ministry terms proposed effluent norms as 'stringent'

Raising serious concerns over an Environment Ministry's proposal to mandate virtually all the textile units to reduce their effluent discharge to zero, the Textiles Ministry has asked to review the proposal as it could lead to closure of many units. In a letter to the Ministry of Environment and Forests, Textiles Secretary SK Panda has said the proposed standards are "too stringent" and it would make the zero liquid discharge commercially non-viable. The secretary also said insisting on zero liquid discharge standards will lead to closure of the industry and due to that people may lose their jobs. The proposed standards seek to lay down zero liquid discharge for textile processing units where water discharge is greater than 25 KLD (kilolitres per day). The Textiles Ministry has argued the domestic processing industry is largely unorganised and consists of small and medium units. The proposed norms are stringent in terms of capital investment and it would also have high recurring expenditure. The domestic industry has already raised their concerns on the move. They have requested to review the proposed environmental standards.

Speaking on the issue, the outgoing secretary Panda today said the norms could be implemented in a phased manner. The Textiles Ministry has held several meetings with the industry representatives, textile research associations and Indian Institute of Technology on the issue. A committee has already been formed for studying the existing technologies of effluent treatment, he told reporters here. He said, in the short-term best available technology can be introduced and for the long-term R&D would be pursued for developing cleaner and more cost effective options. Further, the secretary said that India's share in global apparel and garment industry is only 3.8 per cent and efforts should be put to increase this. On cotton exports, he said there is a need to improve the productivity quality of the natural fibre and look beyond China for shipments. China is the largest export destination. China's stock levels have reached over 8,000 million kg and due to this they are importing less from India, which is leading to a dip in domestic prices.

Further he suggested that tax holidays would help in setting up textiles parks. Panda said to safeguard the interest of cotton growers, the Cotton Corporation of India has procured 87 lakh bales in 2014-15. As an alternative to minimum support price, "Price Deficiency Payment System" for cotton is proposed to be started on pilot basis in Wardha district of Maharashtra during the next season 2016-17. This will give an idea about a new method, which will reduce outflow from public exchequer and increasing return to the farmer. Panda also said the approval of amendment of the technology upgradation fun scheme (TUFS) by the Cabinet yesterday would boost industrial growth and bring in higher productivity, better quality and higher exports. To boost handloom sector's growth, he said e-commerce medium can play a major role. "Further the textiles ministry is also pitching for reduction of excise duty on man-made fibres from the current 12 per cent in the forthcoming budget," he added.

SOURCE: The Economic Times

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Textile industry urged to aim for higher share in global trade

The textile industry should look at reviving technology and skills to recapture higher share in the global trade, Kavita Gupta, Textile Commissioner, said here recently.She was speaking at the inauguration of joint technological conference of textile research associations. The productivity levels of the industry should be to global standards. “The future of textile industry is going to be technical textiles,” she said. In the last five years, there had been 20 per cent growth year-on-year in this segment. The sector should aim to be 40 per cent of the country’s textile industry.The centres of excellence created for technical textiles should look at having joint annual conferences as done by the research associations. The Union Government had allocated Rs. 200 crore under the technology mission for technical textiles and there is still some fund that is not spent. The centres should come forward with proposals, she said.D. Krishnamurthy, chairman of the council of administration of South India Textile Research Association, said the association had conducted 19 training programmes in the last one year. He also elaborated on the projects taken up and completed by the four textile research associations in the country.

The South India Textile Research Association has launched a portal for textile mills. The units can log in and register. They can submit the required data online and will get a consolidated report on the quality of fibre and yarn. Initially, it will be for 40s, 60s, 80s and 100 count yarn. This effort by SITRA is to establish standards for quality of yarn.According to M. Senthil Kumar, chairman of Southern India Mills’ Association, the average export of cotton yarn a month in 2013-2014 was around 120 million kg. However, it dropped to 100 million kg a month now. In the last 18 months, almost two million new spindles have been added because of incentives announced in the textile policies of individual States (Gujarat, Maharashtra, etc). The cost of production between these new mills and the existing ones is also high. Hence, cotton yarn should be included in the schemes promoting exports.

SOURCE: The Hindu

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Textile Inc sulks over Centre's new 'anti-MSME' subsidy scheme gives

Ludhiana's famed textile industry has called the Union government's decision to make amendments in a major scheme related to subsidies forwarded on textile machinery as "pro-corporate, anti-small sector, and confusing". In a meeting on December 30, the Centre's Cabinet Committee on Economic Affairs (CCEA) gave a go-ahead to amend its Technology Upgradation Fund Scheme (TUFS), removing a portion that gives 30% subsidy on textile machines priced between Rs 75 lakh and Rs 5 crore. However, with the new amendment forwarding 15% subsidy to machines costing up to Rs 30 crore and having no mention of any additional benefit to small-time industrialists, representatives of Ludhiana's textile industry bodies have called the move as one that will benefit large enterprises. Harish Dua, president of Knitwear and Apparel Exporters' Organisation, said it seemed the decision had been taken to "benefit large enterprises". He added that the amendments were confusing as they were not clear on whether old benefits would be withdrawn from the small sector. Bhushan Abbi, president of Home Furnishing and Textile Cluster, went to the extent of warning to launch a statewide strike over the decision.

On the other hand, officials of the Union ministry of textiles were incommunicado and tight-lipped over the matter. They also could not clear the air on the government's stance towards smaller units. When TOI tried to contact secretary (textiles) Rashmi Verma, her personal secretary K S Parkash said she had taken over the post on Thursday and might not be aware of the notification. He asked TOI to contact director (textiles) S P Katnauria. The director, however, said he was not authorized to comment on the issue and asked TOI to get in touch with the secretary. All efforts to contact TUFS section officer Satish Kumar on his landline number went in vain. Finally, officials promise to revert back in a few days. Dua said the decision would be a "disaster for micro, small and medium enterprises". "They were the target category for this scheme. Now, with this support gone, how will MSME units survive?" He accused ministry officials of being "callous". "The officers themselves are clueless about what does the notification means. All our efforts to get an answer from the ministry have turned out to be futile," he said. Abbi, on the other hand, said the amendments would destroy small industrial units. "Given the decision that they have taken, it looks like their intention is to do exactly that," he said. "The rampant culture of corruption in the offices of textile ministry has made our lives hell. Money is extorted from industrialists for every little work. If the government doesn't clear the air on this notification, the whole textile industry of Punjab will go on strike."

SOURCE: The Times of India

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Green norms proposal may shut units: Textile Ministry

The Environment Ministry’s proposal, to hastily implement a ‘stringent’ norm mandating nearly all textile processing units to eliminate liquid discharges, can result in closure of many small and medium enterprises (SMEs) and trigger large-scale job losses, according to the Textile Ministry.In his response to the draft notification by the Ministry of Environment, Forest and Climate Change, Textiles Secretary, S. K. Panda, has said the proposed standards — mandating ‘Zero Liquid Discharge’ (ZLD) for textile processing units where waste water discharge is over 25 kilo litres a day — will be “too stringent” for the domestic textile processing industry that is largely unorganised and comprising of SMEs, according to reliable sources.

Around 94 per cent of India’s apparel workers are employed in firms with 50 workers or less, and less than six firms have over 2,000 workers, Niti Aayog Vice Chairman Arvind Panagariya had said.The Environment Ministry also requires textile units in clusters (like Tirupur and Ludhiana) to establish a ZLD-common effluent treatment plants irrespective of their waster water discharge levels.Setting up ZLD-effluent treatment plants will need huge initial capital investment as well as high recurring expenditure making it commercially non-viable, the secretary said.

Citing several representations from the textile sector against such norms, he also said insisting on ZLD could in turn result in closure of several units and unemployment for workers in those units.Mr. Panda, therefore, said the environment ministry should consider implementing the ZLD only in a phased manner. He said the environment ministry should keep in view the larger interest of the textiles sector as well as the country’s economic development, and implement the ZLD only in a phased manner. Meanwhile, the Textiles Ministry has set up a panel to look into the existing technologies of effluent treatment and suggesting the best available technology — after taking into account the financial and other related factors — that can be introduced in these SME units.

The Textiles Ministry has said, as a short-term measure, the best available technology will be adopted, but in the long-term, research and development will be pursued for developing cleaner and more cost-effective options. One of the alternatives being tried out is marine discharge, where waste is recycled and the residue (which is substantially salt, and therefore considered safe) is discharged into the sea. But for that, the units will have to be located near the coastal region as setting up long pipelines from inland units to the sea will be non-viable. The Supreme Court had several years ago asked the textile units in Tirupur (Tamil Nadu) to ensure that they do not pollute the Noyyal river and that they bring down their liquid discharge to zero. The order had led to the closure of several units in the area.

SOURCE: The Hindu

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Textile unit owners seek interest-free loan

Textile unit owners in Komarapalayam have urged the Central and the State Governments to provide them interest-free loans for establishing the common effluent treatment plant (CETP) at Pallakapalayam. The loan amount was to cover the owner’s share of 25 per cent for establishing CETP. There are over 200 processing unit owners who have formed the Komarapalayam Green Cauvery General Textile park cluster. They have identified 60 acre land in the area for establishing the park with zero liquid discharge at a cost of Rs. 168 crore. At a meeting held here recently, members said that the owner’s share of 25 per cent for establishing CETP could not be borne by them as they were already facing huge loss and also most of the units are small. They urged the government to provide interest-free loan on long term basis. Establishing the park with common effluent treatment plan was the only way for continuous functioning of their units which are facing closure due to effluent discharge.

SOURCE: The Hindu

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Funds allocated for setting up incubation centres for technical textiles

Kavita Gupta, Textile Commissioner, at the inauguration of the joint technological conference of textile research associations on Wednesday said that the Union Government has allocated Rs.17.40 crore this financial year for setting up incubation centres for technical textiles. The incubation centres will have plug and play facilities and all the eight Centres of Excellence for technical textiles have established the centres. The Ministry has allocated Rs.152 crore under the Technology Mission for Technical Textiles for the eight centres of excellence and 76 per cent of the funds have been utilised. “Funds are not a constraint,” she said. The Centres have facilities for research and development, testing, standardising products and commercial production at the incubation facilities. Technical textiles are products manufactured for non-aesthetic purposes. This could include protective clothing and textiles used in applications such as automotive and medical. Ms. Gupta later told presspersons that cotton production in 2015-2016 (October to September) is expected to be 365 lakh bales as against 380 lakh bales. The yield has improve although there is a decline in area covered under cotton. As far as textile exports is concern due to the global slowdown, there is a marginal decline seen so far this year compared to the same period last year.

SOURCE: Yarns&Fibers

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Bleak outlook for textile machinery exports: FICCI

India's textile machinery sector has a moderate production outlook but export prospects look bleak for 2016, according to Federation of Indian Chambers of Commerce and Industry's (FICCI's) latest quarterly survey of the Indian manufacturing sector. No investments for expansion are expected till the first half of the year while hiring has a bleak outlook, the survey found. Most of the respondents in textile machinery sector reported an improvement in output during October-December quarter in 2015 vis-à-vis the same quarter in 2014, though not high levels of growth. However, almost all the respondents reported a fall of in their exports for October - December 2015 quarter as compared to the corresponding quarter of 2014.

According to the survey, the current capacity utilization in the sector is about 60 per cent which is same as that of last year for most of the respondents. Respondents from textile machinery industry do not have plans to add capacity in next six months. Respondents in this sector have reported that they have no plans to hire new workforce in next 3 months. The average reported cost of credit for the sector hovers around a relatively high 13.9 per cent. Most of the respondents in the sector believe that growth rate of manufacturing sector is going to remain at the same level for next few months. Respondents from the textile machinery sector have suggested correction in the various levies, correction of cost of labour and power and some support package to revive manufacturing sector's growth. Some of the major challenges for the textile machinery sector are increased competition from imports, lack of export demand and lack of skilled labour.

SOURCE: Fibre2fashion

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Mafatlal Industries receives promising textile brand award

Mafatlal Industries Ltd (MIL) was recently awarded ‘India’s Most Promising Brand 2014 – 2015’ in the textile category by World Consulting & Research Corporation (WCRC) at Gibson Hall, London. On the behalf of the company, M B Raghunath, president (sales & marketing) of Mafatlal Industries Ltd, received the trophy and citation awarded as ‘India’s Most Promising Brand 2014 – 2015’ in the textile category. During the event, Abhimanyu Ghosh, chairman & editor-in-chief of WCRC, in the presence of some of the top speakers from the UK, stated, “The vision of WCRC is not just to push brands to do better so that they retain their leadership position but also to showcase the success of Brand India on a global scale. Even the big daddys of global business have received effective helping hand from the branding and listing majors from around the world. WCRC wants to do the same for Indian and Asian brands.”

India’s most promising brands 2015 is a brand project which represents the most credible, transparent and differentiated standard of brand research. The research has been conducted through rigorous research parameters involving secondary as well primary research for different product categories wherein Mafatlal Industries Ltd, as a brand, was selected in the textile category. Since 1905, Mafatlal Industries Limited is a pioneer for quality textiles in India with products consisting of yarn dyed Shirtings, Suitings, Voiles, Prints, Linens, Bleached White Fabrics, Rubia, value added and fashion Denims, School Uniform fabrics, Corporate/ Institutional Uniforms, Bed & Bath Linen and Ready-mades.

SOURCE: Yarns&Fibers

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Common wage pact for knitwear workers likely

It now looks that a common wage pact is coming up for workers in Tirupur knitwear cluster as various textile associations had tentatively decided to hold joint negotiations with the labour unions for fixing wage revisions. The existing four-year wage agreement is going to come to an end in January. Till now, South India Hosiery Manufacturers’ Association and a few other associations were signing a wage pact with labour unions and Tirupur Exporters’ Association along with a few other associations had been signing a separate agreement. South India Hosiery Manufacturers’ Association (SIHMA) joint secretary R. Damodaran told The Hindu that a joint wage pact could bring parity in the wage scales across the sector and also the negotiations would become easier with the labour unions.

A preliminary meeting of representatives of SIHMA, Tirupur Exporters’ Association and four other associations held here explored the possibilities of going ahead for a common wage pact. In the meantime, the textile associations here had also asked the major trade unions which include CITU, AITUC, MLF, LPF, ATP and INTUC to come up with a joint set of demands prior to the commencement of the wage revision talks. As a run up to the wage revision talks, the unions had actually given the representations containing the demands separately. Trade unionists said that they would be pressing for a substantial hike in the wages along with demands for introduction of perks like house rent allowance and medical allowance, which till now did not find place in the wage pacts. The wage scales were usually computed separately for different segments of the production chain namely tailoring, ironing, packing, fabrication, knitting machine operations, damage checkers and labelling.

SOURCE: The Hindu

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Daily Crude oil price of Indian Basket was US$ 32.90/bbl on 31.12.2015

The Petroleum Planning and Analysis Cell (PPAC) under the Ministry of Petroleum and Natural Gas has reviewed international prices of crude oil and petroleum products for the month of December 2015. In the case of PDS Kerosene, the under-recoveries for the month of January 2016 will be Rs 9.16 per litre (Rs 12.93 per litre in last month). The cash transfer to customer under DBTL will be Rs 238.17, out of which Rs. 190.51 will be Cash Compensation on Domestic LPG by Govt. to consumers & Rs 47.66 will be the Cash compensation on Domestic LPG by OMCs towards ‘Uncompensated Costs’ to consumers.  

 Product-wise Under-recoveries of Public Sector Oil Marketing Companies (OMCs) 

Product

Unit

Under / (Over) recovery (eff. 1st Jan 16)

Cash transfer to customer under DBTL (eff. 1st Jan 16)

PDS Kerosene*

(Rs./Litre)

9.16

-

Cash Compensation on Domestic LPG by Govt. to consumers**

(Rs./Cylinder)

-

190.51

Cash Compensation on Domestic LPG by OMCs towards ‘Uncompensated Costs’ to consumers**

(Rs./Cylinder)

-

47.66

 

 

 

 

 

 

 

 

 

 

*Inclusive of the quantum of erstwhile Fiscal Subsidy Scheme 2002 i.e. Rs 0.82/Litre.

 ** Cash Subsidy is for Delhi market.

The under-recoveries for the full year 2014-15 has been Rs 72,314 crore. The figure was Rs 1,39,869 crore for full year in the 2013-14.

Regarding daily international crude oil price of Indian Basket as published today, the price was US$ 32.90 per barrel (bbl) on 31.12.2015 as against US$ 33.36 per bbl on 30.12.2015. In rupee terms, the price of Indian Basket decreased to Rs 2182.09 per bbl on 31.12.2015 as compared to Rs 2215.77 per bbl on 30.12.2015. Rupee closed stronger at Rs 66.33 per US$ on 31.12.2015 as against Rs 66.42 per US$ on 30.12.2015.

The table below gives details in this regard:

Particulars

Unit

Price on December 31, 2015(Previous trading day i.e. 30.12.2015)

Pricing Fortnight for 01.01.2016

(Dec 12 to Dec 29, 2015)

Crude Oil (Indian Basket)

($/bbl)

32.90               (33.36)

33.58

(Rs/bbl

2182.09           (2215.77)

2234.08

Exchange Rate

(Rs/$)

66.33              (66.42)

66.53

 

SOURCE: PIB

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FTAs have not contributed to rise in trade deficits: Commerce Ministry

The Commerce Ministry today said free trade agreement (FTAs) have not contributed to the increase in trade deficits with "some countries". Though the preferential imports have been increasing from the period 2009-10 to 2014-15, they are still not significant, ranging from 5.9 per cent of total imports under the India-Malaysia comprehensive economic cooperation agreement (CECA) to 29.9 per cent of total imports under the India-Korea comprehensive economic partnership agreement ( CEPA) during 2014-15. "This clearly indicates the preferential imports under FTAs have not contributed to the increase in trade deficits with some countries," the commerce ministry said in its year-end review statement. The implications of such agreements on India can be gauged from the regular impact analysis conducted by the Department of Commerce. One of the methods of gauging this impact of FTAs on overall trade is through preferential trade data.

In this context, the department has analysed the broad trend of India's preferential imports under the FTAs with countries including Thailand, Singapore, South Korea, Japan, ASEAN and Malaysia. Some sections of industry including exporters have raised concerns over these free trade pacts. They have stated that these agreements have benefited more to the partner countries. A separate set of analysis on trade in products where preferences have been exchanged under the India-ASEAN, India-Japan and India-Korea FTAs was also carried out by external agencies such as the Centre for WTO Studies and the National Centre for Trade Information (NCTI), it said. "The analysis notes the increase in imports of intermediates and capital goods on lines where preferences have been granted. Similarly, there has been no significant increase in imports of consumer goods. "This could thus be attributable to use of cost effective inputs for domestic manufacturing," it said.

Talking about plantation sector, it said that a policy for development of natural rubber sector is being formulated to address demands of the industry and growers. A national level steering committee of departments, and research institutions in the public and private sector has been formed to coordinate and fast-track the research initiatives in the area of white stem borer and to address the problem of fall in productivity of arabica coffee, it said. Further to include states in the process of boosting India's overall exports, it said 15 states have prepared their export strategy and 28 have intimated appointment of Export Commissioners. "The Council for Trade Development and Promotion has been constituted to develop partnership with States in India's export efforts. The first meeting is scheduled on 8th January," it added. The Commerce Ministry said so far it has concluded 11 such pacts and five limited scope preferential trade agreements. The ministry has also said it aimed at increasing the exports of goods and services to about USD 900 billion by 2019-20 and raise India's share in world exports from present 3.5 per cent. In 2014-15, the country's exports stood at USD 310.5 billion and the share in world exports is 2 per cent. The Department of Commerce also said it has taken several steps to improve Ease of Doing Business in the country. The new foreign trade policy has brought about reduction in the number of documents required for export and import from 7 and 10 respectively to 3 each now, it said today. The Directorate General of Foreign Trade, it said, is working on more steps with regard to ease of doing business such as online issuance of Export Obligation Discharge Certificate and message exchange with CBDT for PAN.

SOURCE: The Economic Times

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India, Pakistan look to tap trade as peace dividend

As part of the new comprehensive bilateral dialogue mechanism, India is looking to give Pakistan preferential access to its large market under the South Asian Free Trade Area (SAFTA) regime provided Islamabad can keep its promise to give India MFN status, known in the neighbouring country as non-discriminatory market access (NDMA). Pakistan, in fact, was on the verge of giving India NDMA in early 2014 before the Nawaz Sharif government backed out because of, according to Indian officials, pressure from the Pakistan Army. Economic and commercial cooperation is one of the pillars of the comprehensive dialogue, as indeed it was under the composite dialogue process. Foreign secretary S Jaishankar is scheduled to travel to Islamabad on January 15 to discuss the modalities and schedule of the comprehensive bilateral dialogue with his counterpart Aizaz Ahmed Chaudhary. India believes that Pakistan can greatly ease its foreign exchange constraints and provide stimulus to its exports with access to the Indian market. India also believes that trade normalisation could be one of the low hanging fruits after the leg-up to the relationship in the form of PM Narendra Modi's unexpected Lahore stopover. After he came to power in 2013, Sharif had signalled that his government could look at reviving the September 2012 roadmap under which both countries were meant to initiate trade in gas and electricity to help Pakistan overcome its power woes. Late in 2013, according to India, the Sharif government did a complete turnaround over the issue as it perhaps felt that trade normalisation would perhaps be too much of a concession to the outgoing UPA government.

Pakistan though is likely to wait until Modi's visit to Islamabad later this year before taking any decision on NDMA to India. It continues to maintain that it is only seeking a level playing field with a view to making trade mutually beneficial. Pakistan high commissioner Abdul Basit said in November that non-tariff barriers on the Indian side were adversely impacting Pakistan's exports to India. India counters this by saying that Pakistan has never specifically spelt out these barriers. "As far as we know, Pakistan has only taken mentioned issues like poor connectivity with Lahore and the stringent visa regime,'' said an official. The Sharif government for a brief while in early 2014 indicated that it could consider opening up the Wagah border for trade but later backtracked. According to Pakistani sources, Islamabad has not given up the idea but it will wait for India to make the right concessions to facilitate it.

Commerce and industry minister Nirmala Seetharaman had said in Parliament in the winter session that Pakistan had not provided MFN to India and that it had also not removed trade restrictions on the land route. When Sharif and Modi met last year in May, they discussed the possibility of quickly normalising trade relations with the Indian PM specifically mentioning the issue of MFN. India and Pakistan have in the past had several rounds of informal discussions to facilitate trade normalisation with Pakistan even sharing its list of 185 items which are of export interest to it. The Indian commerce ministry under UPA had indicated it would provide SAFTA tariff concessions on these and both sides even shared the texts of their respective gazette notifications in that regard.

SOURCE: The Economic Times

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India, China to study regional trade pacts

India and China have decided to undertake a joint study on the impact of regional trade agreements, a first of its kind effort by the two Asian rivals, a senior official has said. The move also signals growing ties on economic issues between the two Asian giants. The study will be conducted jointly by the NITI Aayog and China's Development Research Centre (DRC). The deal to undertake the joint study was signed during the recent visit of NITI Aayog officials to China. "When I went to China we had a very good meeting with the president of DRC and we agreed that we will jointly do a study on the impact of the mega regional trade arrangements that are being formed — how the TPP (Trans Pacific partnership) that the United States has signed with 11 other countries is going to impact us," Arvind Panagariya, vice chairman of NITI Aayog told TOI. "Whether India and China should try to join those agreements? Should India and China speed up their own efforts at something like the RCEP (Regional Comprehensive Economic Partnership)? There are a set of questions which we would look up in this joint work," said Panagariya. In recent months, India and China have collaborated on several key issue including at the ministerial meeting of the WTO in Nairobi.

A group of 47 countries — including India, China, South Africa and host Kenya — had come together to argue that the Doha Development Round should remain firmly on WTO's agenda and had attempted to block moves by advanced countries led by the US to focus on "new issues". The rise of plurilateral trade agreements such as TPP, comprising a dozen countries led by the US, are a source of concern for developing countries such as India as they go beyond the WTO agreements in areas such as intellectual property rights. This has raised fears of adverse impact on access to medicines, given the weak patent rules that are proposed. Similarly, the agreement on investment is loaded in favour of developed countries.

SOURCE: The Economic Times

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Forex reserves rise $943.40 m to $352 b as on December 25

Foreign exchange reserves as on December 25 rose by $943.40 million from a week ago to $352.04 billion, according to data from the Reserve Bank of India. Foreign currency assets (FCAs), which form a key component of the reserves, rose by $922 million from the previous week to $329.19 billion. FCAs are maintained in major currencies such as US dollar, euro, pound sterling, Japanese yen, etc. However, foreign exchange reserves are denominated and expressed in US dollar only. The movements in the FCA occur mainly on account of purchase and sale of foreign exchange by the RBI in the foreign exchange market in India, income arising out of deployment of the foreign exchange reserves, external aid receipts of the government and revaluation of assets. Gold reserves, however, remained stable at $17.54 billion. Special drawing rights (SDR) from the International Monetary Fund rose by $16.2 million from last week to $4.01 billion. SDR is an international reserve asset created by the IMF and allocated to its members in proportion of the members’ quota at the IMF. The country’s reserve position in the IMF stood at $1.3 billion, up $5.2 million from the previous week. Last week, the reserves had fallen by $1.4 billion to $351.10 billion. The figure had touched a life-time high of $355.46 billion in the week ended June 19.

SOURCE: The Financial Express

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'India to top growth among large economies in 2016'

India is expected to be the leader in economic expansion among large economies in 2016 after posting one of the highest growth rates in 2015, according to World Bank Senior Vice President and Chief Economist Kaushik Basu. He told reporters in Hyderabad after presiding over the valedictory session of 98th annual conference of Indian Economic Association that India's growth rate would be in the range of 7-7.5 per cent, in line with the World Bank previous forecast. The Bank is scheduled to unveil its next half yearly economic forecast for India on January 7, 2016. Basu expects India to grow between 7 and 7.5 per cent in 2016. Whatever will be the actual growth figure on this scale, India would still be the leader among major economies. “There are a few smaller economies going faster, but among the major economies India expected to be on the top not only in 2015 but we expect India to lead the chart in 2016 as well," he said . Basu, who was the Government's Chief Economic Advisor from December 2009 to July 2011, said the rest of the economy was doing well despite exports taking a knock over the past year. But he insisted that India has a great potential in the export and manufacturing sectors, particularly in the latter because of rising wages in China.

SOURCE: Fibre2fashion

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Pakistan, Sri Lanka to sign MoUs for trade and training

Pakistan and Sri Lanka are going to sign two memoranda of understanding (MoUs) for promoting trade and providing training services during Prime Minister Nawaz Sharif’s visit to Colombo next week. The prime minister along with a delegation will be on a trip to Sri Lanka from January 4 to 6 where two MoUs will be inked for deepening trade and investment ties between the two countries. “First agreement will be between the Trade Development Authority of Pakistan and the Sri Lankan Export Development Board in a bid to promote trade and exchange delegations between the two sides,” a senior official in the Ministry of Commerce told The Express Tribune. The second MoU will be between the Pakistan Institute of Fashion Design and the Sri Lankan Gems and Jewellery Training and Research Institute for imparting training to Pakistani students. The Sri Lankan institute has expertise in gems cutting and polishing and many Pakistani students will benefit from this expertise. Pakistan wants to increase quota for rice exports to Sri Lanka from 6,000 to 10,000 tons. In exchange, Sri Lanka is seeking to enhance export of tea and rubber to Pakistan.

During the PM’s visit, the sixth secretary-level technical talks will be held between trade officials of the two sides on various technical and trade-related matters. They have already a free trade agreement (FTA) in place, but are eager to further liberalise the partnership in order to expand scope of the FTA from goods to services and investment. They will also talk about enhancing business-to-business partnership. In this regard, Pakistani traders will organise a single-country exhibition in Colombo from January 15 to 17, which will showcase the commodities produced in Pakistan. Similarly, Sri Lankan businessmen will also hold a trade show in Pakistan. The FTA with Sri Lanka has a significant importance because it was the first trade accord Pakistan signed with any country. Apart from this, Colombo is one of the closest business partners of Islamabad among regional nations as ties with India and Bangladesh often turn sour and hurt the trade relationship.

At present, the volume of trade between Pakistan and Sri Lanka is $350 million, which they want to increase to $1 billion by expanding its scope.  “Sri Lanka has an edge in export of finished and made-up garments whereas our strength is in fabrics and textile products,” the commerce ministry official said. “It will be a big breakthrough if they succeed in including services and investments in the FTA,” the official said.

SOURCE: The Tribune

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Vinatex expects Vietnam garment exports to rise 8% in 2016

Garment exports of Vietnam are likely to increase by 8 per cent to reach $29.5 billion to $30 billion in the year 2016, according to Hoang Ve Dung, deputy general director of Vietnam National Textile and Garment Group (Vinatex). At present, Vietnam is among the top five largest apparel exports in the world and its garment exports are forecast to earn around $28 billion in 2015. The increase in Vietnam's clothing exports is predicted on the basis of the country signing free trade agreements and a boost in domestic production, Ve Dung said at a recent media briefing, Vietnamese media reported. Vietnam's garment exports to major markets have grown at a steady pace this year of 12.95 per cent to the US, 5.96 per cent to the EU, 7.95 per cent to Japan and 8.77 per cent to South Korea. Vinatex members like Garment 10 Joint Stock Company, Phong Phu Textile and Garment Corporation, Viet Tien Garment Company and Hoa Tho Textile and Garment Joint Stock Corporation contributed to this increase in exports. Speaking of Vinatex in particular, Tran Viet, head of Vinatex's marketing department, said the company exported $3.5 billion worth of apparel in 2015, registering an increase of 10 per cent over the previous year despite a gloom in the global trade. In 2015, Vinatex completed its equitisation plan and made new investments in several textile projects which is expected to increase the share of domestic content in finished products to 65 per cent by 2020, Viet said.

SOURCE: Fibre2fashion

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Ethiopia approves import of pest-resistant improved cotton variety

The Ethiopian Textile Industry Development Institute (ETIDI) on Thursday said that the country’s textile industry is presently facing shortage of raw cotton, to address the problem it has been decided to import pest resistant improved cotton variety. Sileshi Lemma, Director General of ETIDI, said that a study meant to address the shortage has been conducted and importing improved variety was taken as a solution. The country has already approved a proclamation which offers permission for the importation of cotton variety. Following the increasing number of textile industries, the shortage of raw cotton is becoming acute, Fasil Tadesse, President of the Ethiopian Textile and Garment Manufacturers Association, said. According to Fasil, the shortage, coupled with cotton’s low quality, is affecting the country’s textile industries not to manufacture with their full capacity and become competitive. Mesele Mekuria, Cotton Development Inspection Director at ETIDI, said that the new variety will increase the country’s cotton harvest by up to 40 percent.

SOURCE: Yarns&Fibers

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China factory output contracts

China's first official economic report of the year suggested manufacturing weakened for a fifth straight month in December, the longest such streak since 2009. The purchasing managers index edged up to 49.7 last month from a three-year low of 49.6 in November, the National Bureau of Statistics said on Friday. That compared with a median estimate of 49.8 in a Bloomberg survey of economists. The non-manufacturing PMI, meanwhile, rose to 54.4, the highest since August 2014. Numbers below 50 indicate deterioration. The slight improvement in the country's sluggish manufacturing sector follows stepped-up stimulus including six People's Bank of China interest-rate cuts. Policy makers trying to meet Premier Li Keqiang's goal of about 7 percent growth this year are also facing pressure from employment, which has been steady thanks to a resilient services sector. Economists said the continued contraction portends more monetary and fiscal support. "Growth momentum is stabilising somewhat, however, as the index remained below 50 for five consecutive months, the manufacturing sector is still facing strong headwinds," said Zhou Hao, an economist at Commerzbank AG in Singapore. "Monetary policy will remain accommodative and fiscal policy will be more proactive."

SOURCE: The Business Standard

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