A sustained recovery in global trade and demand from key external markets like the US and the European Union in product categories such as textiles and garments have helped boost India’s exports, which recorded the sixth consecutive month of growth in August. India’s textile and apparel exports to the United States, its single largest market, were up 55 per cent in the first seven months of 2021. This is the fastest pace of growth among the top five countries exporting textile and garments to the US. A sustained recovery in global trade and demand from key external markets like the US and the European Union in product categories such as textiles and garments have helped boost India’s exports, which recorded the sixth consecutive month of growth in August. While India’s cumulative merchandise shipments have been helped by a spike in petroleum exports, the textile and garments sector has been a major product category recording a surge in value terms, alongside the gems and jewellery sector, engineering goods and cereals. In the high-margin global export market for clothing and apparel, India has been edged out by competitors such as Vietnam, Indonesia and Bangladesh consistently over the last 10 years, which have been growing much faster in supplies to key markets such as the US and the EU. The trend so far in 2021 marks a reversal of this trend — India’s exports to the US surged 55 per cent during January-July 2021, higher than Vietnam’s 18 per cent, Bangladesh’s 29 per cent, China’s 28 per cent and Mexico’s 31 per cent. One of the reasons cited by trade analysts is the higher export order books being reported by Indian garment exporters, alongside buoyant orders in the home textile segment where India has traditionally been a strong player. Less severe lockdown restrictions in the country’s export hubs, especially in southern states such as Tamil Nadu and Karnataka, during the second Covid-19 wave also ensured continuing operations of units, alongside some degree of diversion of products from the sluggish domestic market to exports. While officials at the Ministry of Commerce and Industry have maintained that duty remission schemes such as RoDTEP (Remission of Duties and Taxes on Exported Products) and RoSCTL (Rebate of State and Central Taxes and Levies) have helped free the financial headroom available for exporters, players in the garments and textiles sector have flagged concerns over delayed operationalisation of tax rebate schemes and lowerthan-expected benefits. Challenges on the availability of containers and high shipping costs have been cited by both exporters and analysts as areas of concern in the near term. From a macroeconomic perspective, rising exports are a positive sign for India’s economy as it recovers from the economic shock induced by the second wave of the Covid pandemic, which has differentially blunted three out of the four engines of GDP growth — private consumption, investments and government consumption. Exports have been a silver lining, even as there are looming headwinds, including runaway freight rates and the growing shipping container shortage, alongside the possibility of global central banks putting a stop to their quantitative easing policy that could, in effect, progressively temper consumer demand in these markets. India’s goods exports had touched $33.14 billion in August, up 45 per cent on-year, according to provisional data released by the Commerce and Industry ministry Thursday. The growth was, in part, attributed to a low base in August 2020 due to disruption caused by the first wave of Covid-19. The base effect is, however, tapering off, with the robust August 2021 export numbers coming in lower on a sequential basis as compared to the all-time high of $35.17 billion that outbound shipment hit in July — a drop of nearly $2 billion.
Source: Indian Express
"Delighted at the way the textiles sector has engaged with the idea of achieving bigger targets. We must aim for a USD 100 billion export target in the next five years," he said. Textiles Minister Piyush Goyal on Friday said the sector will achieve USD 44 billion exports target in 2021-22, and in the next five years, both the ministry and the industry have agreed to aim for USD 100 billion outbound shipments. He also said the Production Linked Incentive Scheme for technical textiles and man-made fibre segment will be approved soon by the Union Cabinet, a move which would give a boost to domestic manufacturing and exports. The proposed Mega Investment Textiles Parks (MITRA) scheme, under which seven such parks will be set up in the country over the next three years, is at an advanced stage of approval, the minister told reporters here. This scheme was announced in the Union Budget 2021-22. "Delighted at the way the textiles sector has engaged with the idea of achieving bigger targets. We must aim for a USD 100 billion export target in the next five years," he said. He added that export has to stand on its own feet and has to be independently viable as demand for subsidies would not always help. On free trade pacts, he said India is interacting with different nations to expedite FTAs or PTAs (preferential trade agreements). This engagement has been ongoing with the UK, EU, UAE, Australia, among others. Further, Goyal said they are working with the finance ministry on interest equalisation scheme and enhancement of insurance cover.
Source: Economic Times
The Council, which also consists of key financial-sector regulators, decided to keep a continuous vigil on financial conditions. The Financial Stability and Development Council (FSDC) under finance minister Nirmala Sitharaman on Friday deliberated on the management of stressed assets and lenders’ exposure to various sectors, amid fears of a spike in stress in the banking system once all regulatory forbearances, extended in the wake of the pandemic, are rolled back. The Council, which also consists of key financial-sector regulators, decided to keep a continuous vigil on financial conditions. Strengthening institutional mechanism for financial stability analysis, financial inclusion, framework for resolution of financial institutions and issues related to IBC (Insolvency and Bankruptcy Code) processes, data sharing mechanisms of government authorities, internationalisation of the Indian Rupee and pension- sector-related issues are among the issues that were discussed, according to an official statement. The gross non-performing assets (GNPAs) ratio of banks may surge to 9.8% by March 2022, under a baseline scenario, from 7.48% in March 2021, the Reserve Bank of India said in its Financial Stability Report (FSR) in July. However, under a severe stress scenario, the bad loans may shoot up to 11.22%, it cautioned. However, the report said banks have sufficient capital, both at the aggregate and individual level, even under stress. In an interview to FE recently, chief economic advisor Krishnamurthy V Subramanian said with 88% provision coverage and 14% of capital adequacy (CRAR), state-run lenders, the principal pillar of the banking system, could absorb any shock emanating from bad loans. Friday’s meeting also deliberated on the various mandates of the FSDC. These are financial stability, financial sector development, inter-regulatory Coordination, financial literacy, financial inclusion, and macro-prudential supervision of the economy, including the functioning of large financial conglomerates. Apart from Sitharaman, the FSDC meeting was attended by Bhagwat Kishanrao Karad and Pankaj Chaudhary, ministers of state for finance; RBI governor Shaktikanta Das; International Financial Services Centres Authority chairman Injeti Srinivas; secretaries of various departments of the finance and corporate affairs ministry; Sebi chairman Ajay Tyagi; Pension Fund Regulatory and Development Authority chairman Supratim Bandyopadhyay; Insolvency and Bankruptcy Board of India chairman MS Sahoo; Insurance and Regulatory Development Authority of India member (non-life) TL Alamelu and chief economic advisor Subramanian.
Source: Financial Express
To fund expansion project at Kheda facility in Gujarat Geosynthetic textile products maker, Texel Industries is looking to raise up to ₹12.49 crore from its rights issue. The issue which opened for subscription on August 31 will close on September 14. The company plans to issue up to 31,22,398 partly paid-up equity shares of face value of ₹10 each at an issue price of ₹40 per equity share. The rights entitlement ratio for the proposed rights issue is 55:92 rights equity shares of ₹10 each for every 92 equity shares of ₹10 each held by the equity shareholders. The record date was fixed at August 17, 2021. On Friday, company’s shares closed at ₹68.45 on BSE.
Expansion plans
Texel Industries looks to utilise the proceeds of the rights issue to fund the proposed expansion in Kheda facility. The expansion of the 10,080 tonnes of geosynthetics products at Kheda, Gujarat is being done at the cost of ₹29.92 crore and is set to be commissioned by end of September, the company informed. Of the planned ₹29.92 crore for the expansion, the company has already deployed ₹14.73 crore from internal accruals and borrowings. “Post completion of the expansion, installed capacity of the company will double to more than 19,000 MT per annum,” it said. Company has an existing manufacturing facility at Santej, Gandhinagar with installed capacity of 9,000 MT per annum. Shailesh Mehta, Managing Director, Texel Industries Ltd said, “Texel is now expanding its product mix to include various new products such as roof tile underlay, lumber wrap, and a floating cover for water reservoirs. The floating cover is a cover for farm ponds and water reservoirs, which prevents 30 per cent loss of water through evaporation.”
Company profile
Established in 1989, Texel Industries Ltd makes tarpaulins and geomembranes. The company manufactures a wide range of geosynthetic textile products which includes tarpaulins, geomembranes, vermibed, geotank, geotube, grow bags azollabed, and waterproof membrane. The products have applications in agriculture, aquaculture, horticulture, animal husbandry, civil engineering, water harvesting, disaster relief, transportation among others. Company got itself deregistered from BIFR in November 2016 after financial turnaround. Promoters holding in the company stands at 40.77 per cent as on June 2021. For the fiscal 2020-21, company had reported sales of ₹82.79 crore and net profit of ₹2.13 crore. For the first quarter of the current fiscal, April-June, 2021, the company’s net sales stood at ₹27.74 crore with 70 per cent year-on-year jump in net profits at ₹75 lakh.
Source: The Hindu Businessline
A sustained recovery in global trade and demand from key external markets like the US and the European Union in product categories such as textiles and garments have helped boost India’s exports, which recorded the sixth consecutive month of growth in August. India’s textile and apparel exports to the United States, its single largest market, were up 55 per cent in the first seven months of 2021. This is the fastest pace of growth among the top five countries exporting textile and garments to the US. A sustained recovery in global trade and demand from key external markets like the US and the European Union in product categories such as textiles and garments have helped boost India’s exports, which recorded the sixth consecutive month of growth in August. While India’s cumulative merchandise shipments have been helped by a spike in petroleum exports, the textile and garments sector has been a major product category recording a surge in value terms, alongside the gems and jewellery sector, engineering goods and cereals. In the high-margin global export market for clothing and apparel, India has been edged out by competitors such as Vietnam, Indonesia and Bangladesh consistently over the last 10 years, which have been growing much faster in supplies to key markets such as the US and the EU. The trend so far in 2021 marks a reversal of this trend — India’s exports to the US surged 55 per cent during January-July 2021, higher than Vietnam’s 18 per cent, Bangladesh’s 29 per cent, China’s 28 per cent and Mexico’s 31 per cent. One of the reasons cited by trade analysts is the higher export order books being reported by Indian garment exporters, alongside buoyant orders in the home textile segment where India has traditionally been a strong player. Less severe lockdown restrictions in the country’s export hubs, especially in southern states such as Tamil Nadu and Karnataka, during the second Covid-19 wave also ensured continuing operations of units, alongside some degree of diversion of products from the sluggish domestic market to exports. While officials at the Ministry of Commerce and Industry have maintained that duty remission schemes such as RoDTEP (Remission of Duties and Taxes on Exported and RoSCTL (Rebate of State and Central Taxes and Levies) have helped free the financial headroom available for exporters, players in the garments and textiles sector have flagged concerns over delayed operationalisation of tax rebate schemes and lowerthan-expected benefits. Challenges on the availability of containers and high shipping costs have been cited by both exporters and analysts as areas of concern in the near term. From a macroeconomic perspective, rising exports are a positive sign for India’s economy as it recovers from the economic shock induced by the second wave of the Covid pandemic, which has differentially blunted three out of the four engines of GDP growth — private consumption, investments and government consumption. Exports have been a silver lining, even as there are looming headwinds, including runaway freight rates and the growing shipping container shortage, alongside the possibility of global central banks putting a stop to their quantitative easing policy that could, in effect, progressively temper consumer demand in these markets. India’s goods exports had touched $33.14 billion in August, up 45 per cent on-year, according to provisional data released by the Commerce and Industry ministry Thursday. The growth was, in part, attributed to a low base in August 2020 due to disruption caused by the first wave of Covid-19. The base effect is, however, tapering off, with the robust August 2021 export numbers coming in lower on a sequential basis as compared to the all-time high of $35.17 billion that outbound shipment hit in July — a drop of nearly $2 billion.
Source: Indian Express
Consultations with India Inc on trade pacts with UK, UAE on At a time when India has already announced its intent to seal trade pacts with key exporting partners, industry participants said their discussions with the government regarding proposed trade deals with the United Arab Emirates (UAE) and the United Kingdom (UK) have already kicked off. However, with respect to countries such as the European Union (EU), Australia, the discussion with industry is at a premature state and domestic players will get more clarity as and when the chief negotiators of both nations sit and discuss what can be offered. “Industry consultation is going on not only through the department of commerce but other line ministries also are approaching the industry, with discussion mostly on the goods side and pertaining to the UK. We expect some progress in the coming months, with respect to talks with the UAE and UK,” an industry official said, citing anonymity. In fact, pre-negotiation deliberations between India and the UK have already started. India hopes to kick start FTA negotiations with the UK by the end of December. On Thursday, a joint statement by India and UK said that they agree to be ambitious in the forthcoming FTA negotiations. As far as the UAE is concerned, India is aiming to finalize a comprehensive trade deal by December. Representatives from sectors such as steel, textile, engineering products, gems and jewellery have been meeting with the government, on FTA-related consultations with respect to the UAE. Last week, the Centre said that India and Australia are looking at finalizing an early harvest or a mini trade deal by December. It is learnt that the government will begin consultations with the industry within the next 10 days. “Negotiations between the both nations will also start soon,” a person aware of the matter said, adding that any investment agreement will be kept out of the deal, with the main focus being deepening of bilateral trade between the two countries. In May, India and the EU had agreed to resume negotiations for balanced and comprehensive free trade and investment agreements. However, it is learnt that there hasn't been much progress on this front as the EU is yet to appoint chief negotiators and kickstart pre-negotiation talks with India. Rahul Mehta, past president and chief mentor of Clothing Manufacturers' Association of India (CMAI), said that various stakeholder meetings are being called by the government. "(Any deal) with the EU will be a bit complicated with each country having its own requirements. India's FTA with the UK should come through fairly rapidly with the latter being equally interested. Australia should also be coming through soon," Mehta told Business Standard. According to other textiles and clothing (T&C) industry sources, barring Japan, most of the FTAs were signed with non-consuming countries from the T&C industry's perspective. However, FTAs with the EU, the US, Australia, and the UK would be a win-win situation, they said. The US recently indicated that it is not considering a new trade agreement with India. India would look at working with the US on market access issues to promote bilateral trade. Data collection exercise from the T&C industry has been going on for some years. So while no new data is to be gathered, government officials are meeting with industry representatives and are coming across as ‘aggressive’ about signing at least some of these FTAs soon. “We have made our stand clear that, as an industry, we want these FTAs to be signed soon since we are losing out to other manufacturing competing nations like Bangladesh who currently have a 10-12 per cent price advantage due to their concession agreement with countries such as the UK,” said another senior industry representative on condition of anonymity. The industry is also trying to convince its buyers to initiate talks with their respective governments, said A Sakthivel, chairman of Apparel Exports Promotion Council (AEPC) and president of Federation of Indian Export Organisations (FIEO). “The minister and officials are having frequent meetings and talks with the respective nations as well as industry councils in India. From our side, we have been trying to convince our buyers in countries like the UK, EU, UAE and Australia to work proactively with their respective governments for these FTAs. We hope these FTAs are done soon,” Sakthivel added. On the other hand, the most ‘sensitive’ sector--dairy--is yet to hear from the government on the FTAs, R S Sodhi, managing director of Gujarat Cooperative Milk Marketing Federation (GCMMF), popularly known as Amul, said.
Prioritising mini trade deals
Experts and government officials said that signing mini trade deals can be a good strategy to begin with, before signing a full-fledged deal. Till now, India has signed an early harvest deal with Thailand and Singapore. “Early harvest agreement can be a good strategy because first of all it will help us to start the FTA in a limited way and over a period of time, as industries give more negotiating room to the government, the list can be expanded. We can start in a limited way. It sends a very positive signal to the industry” Ajai Sahai, director-general (DG) and chief executive officer (CEO), Federation of Indian Export Organisations (FIEO) said.
Source: Business Standard
The uncertainties pertaining to Remission of Duties and Taxes on Export Products (RoDTEP) rates had put the exporters in a peculiar position The Foreign Trade Policies (FTP) formulated by the government in the past have contained various schemes including certain export incentives and export promotion schemes. It is most certain that the upcoming FTP will also contain such schemes. With the FTP 2021-26 on the anvil, one of its most anticipated and speculated aspects is the treatment (which may include continuation, phasing out or even abrupt withdrawal) of some of the schemes which were included in the FTP 2015-20 as well as possible inclusion of new schemes. The Centre has already given adequate and clear signals that the Merchandise Exports from India Scheme (MEIS) will not find a place in the new FTP. In fact, it will be a surprise to the export community, if MEIS is included in the new FTP, especially after the announcement of its termination w.e.f. January 1, 2021, as an aftermath of the World Trade Organization (WTO) panel report dated October 31, 2019. This is more so with the formal introduction of the scheme, which is considered to be a result of the quest for a WTO compliant (more specifically compliant of the SCM Agreement) scheme.
The arrival of RoDTEP
The industry was eagerly awaiting the implementation of the RoDTEP scheme to see the uncertainties revolving around it cleared once and for all. The government finally notified the RoDTEP scheme on August 17, 2021, even before the notification of the new FTP. This may serve as a pilot scheme that could be fine-tuned by the time of notification of the new FTP 2021-2025. In a comparison with the MEIS, RoDTEP appears to cover many more products. But on the other hand, various categories of goods that were eligible for MEIS seems to be completely avoided under the RoDTEP (at least presently) such as inorganic chemicals, organic chemicals, medicaments, certain textile products (due to the continuance of a separate scheme called RoSCTL) and certain articles of iron and steel. Also, the benefit under the RoDTEP scheme is currently not extended to export-oriented units and SEZ units, among others. It is possible that these products/categories may also be brought under the RoDTEP coverage in near future. Another major concern regarding the RoDTEP scheme is that the rate prescribed under the scheme is significantly lesser than the MEIS rates. The writing on the wall was clear with the budget outlay for the RoDTEP scheme and even the comments of some of the officials, including G.K. Pillai (who headed the committee that submitted a report on RoDTEP rates) himself. It must also be borne in mind that the RoDTEP is designed to be a remission mechanism, not an incentive scheme, and so the rates prescribed under the scheme may have a closerto-reality correlation with the actual incidence of levies embedded in the export product than the MEIS rates. However, there are a lot of products that have suffered a cut to the extent of 90% of their MEIS rates for instance, where the MEIS rate was 5%, the RoDTEP rate is fixed at 0.5%. Obviously, the uncertainties pertaining to the RoDTEP rates had put the exporters in a peculiar position, especially considering the fact that the scheme has been introduced with retrospective effect (from 01.01.2021). A large number of exporters may not have been able to work out the costing of their export products correctly due to the unavailability of the RoDTEP rates (and withdrawal of MEIS) and most of them continued with the costing that they had adopted under the MEIS regime. In fact, many exporters have anticipated a rate comparable to the MEIS rate and made the costing accordingly. As the RoDTEP rate is drastically lower than the MEIS rate, the exporter community is forced to bear the brunt in the form of reduced margins, which may add to their COVIDwise woes. It would be interesting to see if the government had considered extending the RoDTEP benefit at the MEIS rates (wherever applicable) from January 1, 2021, till the publication of the actual RoDTEP rate on August 17, 2021. The Centre, however, cannot take any such action rashly without examining the impact it might have in the light of the WTO ruling relating to MEIS, especially when reports have started coming from various corners that RoDTEP may also be challenged in the WTO. Overall, it can be said that some modifications in the RoDTEP scheme are plausible when the new FTP is notified.
EOU vs. MOOWR
An eagerly awaited aspect of the new FTP is the way forward on the Export Oriented Unit (EOU) scheme, which was also questioned before the WTO and found by the WTO panel to be not compliant with the SCM agreement. The streamlining of the facility of manufacture in a bonded warehouse (generally referred to as MOOWR) is generally perceived as a possible alternative to the EOU scheme. It is believed to solve the issue at the WTO level as well as to avoid certain GST issues, especially pertaining to the refund of IGST paid on exports. It also provides relaxations from certain major procedural requirements that the EOUs are subjected to presently. It is seen that various EOUs are currently exploring the option of migrating to the bonded warehouse scheme due to the various advantages that MOOWR offered over EOU. However, when RoDTEP is introduced, exports by both EOU and MOOWR are declared as ineligible for the benefit. But the scheme states that EOU may be included in its purview depending on the recommendations of the RoDTEP committee whereas no such indication has been given in respect of MOOWR. This will certainly cause more confusion among the industry regarding whether to continue under the EOU scheme or move to MOOWR. The present legal framework dealing with EOU provides for conversion of EOU to Domestic Tariff Area (DTA) which is essentially an exit from the EOU scheme. In this route, at the time of debonding, the unit is required to pay the customs duties that were foregone on the capital goods and raw materials by virtue of the unit being EOU. However, a patent lacuna in the legal framework is the absence of any provision which permits direct conversion of EOU into the scheme of manufacture of goods in bonded warehouse promulgated now. Presently, the provisions require the EOU to pay the duty foregone and exit the EOU scheme before moving into the bonded warehouse scheme. This process may further hit the cash crunched manufacturing sector though under the bonded warehouse scheme also the units are allowed to keep the imported material without payment of duty. Thus, paying the duty foregone to exit the EOU scheme only to enter another scheme in which the imported material is allowed to be kept without payment of duty is not in tune with the larger scheme of things. On the contrary, it may lead to various issues including blockage of working capital, unintended tax incidence etc. Express prescription of a standard procedure for such conversion from EOU to bonded warehouse scheme may bring more clarity and make the transition easier and smoother, reducing the scope for uncertainties and disputes and also boosting the Make in India effort. It is said that one of the most desired qualities of a law is certainty. Ambiguities cause speculation and lead to undesirable consequences. It may be in the interest of the industry as well as of the nation at large that clarity is brought on the vital issues which will have a bearing on the future course of the trade. It is critical not only for recovery from the disruption caused by the pandemic but also for the natural progression of the economy as well as of the law.
Source: Business Today
Telangana Chief Minister K Chandrasekhar Rao submitted requests for several educational institutions and development projects in the state. Telangana Chief Minister K Chandrasekhar Rao met with Prime Minister Narendra Modi in Delhi on Friday, September 3, and submitted several requests related to development projects and the establishment of educational institutions. At the meeting, which lasted about 50 minutes, CM KCR also sought a review of IPS cadre in the state, in accordance with the reorganised districts and the associated administrative setup of police units. KCR was in Delhi also to lay the foundation stone for the TRS party office in the national capital, to be called Telangana Bhavan. Regarding development projects in the state, under the Pradhan Mantri Gram Sadak Yojana (PMGSY) — meant to improve connectivity in remote rural areas — KCR sought additional funds for the scheme, and up-gradation of the roads from 3.75 metres lane to 5.5 metres bituminous pavement for the entire eligible length of nearly 4000 km. He also requested that the Union government completely fund road works for improved connectivity in remote areas with the presence of “Left Wing Extremism”, instead of putting them in the CSS (Centrally Sponsored Schemes) format where states are required to contribute their share in 60:40 ratio. He also sought sanction for the Hyderabad Nagpur Industrial Corridor project. The Chief Minister also requested a grant-in-aid of Rs 1000 crore for the development of an integrated state-of-the-art textile park in Warangal, which is set to come up in an area of around 2000 acres. “It is estimated that in order to develop the infrastructural facilities in the park to international standards, an investment of nearly Rs1,600 crores is required. Given the scale of financial requirement, I am sure that you will appreciate that we need to be supported in this venture by the Government of India,” KCR wrote in his letter to PM Modi. KCR also requested that the Union government sanction district-wise Jawahar Navodaya Vidyalayas (JNV) as per the district reorganisation that was done in 2016. However, only nine districts currently have Navodaya Vidyalayas, in Ranga Reddy, Komaram Bheem Asifabad, Warangal Urban, Nagarkurnool, Nalgonda, Siddipet, Khammam, Karimnagar and Kamareddy. The CM requested that the remaining 21 rural districts also be sanctioned 21 new Jawahar Navodaya Vidyalayas. He also noted that no IIM has been sanctioned so far due to the presence of the ISB (Indian School of Business) in Hyderabad. Noting that ISB is a private institution with exorbitant fees, KCR requested that an IIM (Indian Institute of Management) be established in Telangana, for which land will be provided in the premises of the University of Hyderabad “as there is more than 2000 acres of land in the HCU campus, allotted by the State Government.” He also requested that the Ministry of Education take action to start a Tribal University in the state, as per the Andhra Pradesh State Reorganization Act, 2014, and also sanction an IIIT (Indian Institute of Information Technology) in Karimnagar under the Ministry of Education’s PPP model. As part of a review of IPS cadre in accordance with the reorganised districts, with the police administration being reorganised into 20 police districts and 9 police Commissionerates, in place of 9 police districts and 2 police Commissionerates that existed earlier. While the Ministry of Home Affairs had done an IPS cadre review earlier in 2016, where 76 senior duty posts and 139 total authorized posts were approved for the state, KCR noted that the state government has since sought the creation of additional posts, to take the number up to 105 senior duty posts and 195 total authorized posts.
Source: The News Minute
India's foreign exchange reserves rose to a record $633 billion in the week ended August 27 after the International Monetary Fund (IMF) made an allocation of 12.57 billion special drawing rights (SDRs), equivalent to $17. India's foreign exchange reserves rose to a record $633 billion in the week ended August 27 after the International Monetary Fund (IMF) made an allocation of 12.57 billion special drawing rights (SDRs), equivalent to $17.86 billion, to the country on August 23. The fresh SDR allocation to the Reserve (RBI) follows the recent G-20 decision to increase IMF’s lending capacity by $650 billion to fight the economic fallout of Covid-19.
Source: Economic Times
Andhra Pradesh government on Friday credited ₹1,124 crore towards incentives for Micro, Small and Medium Enterprises (MSMEs) and textile units across the State to benefit 97,423 units and over 12 lakh employees. Chief Minister YS Jagan Mohan Reddy has formally released ₹440 crore to MSMEs and ₹684 crore to textile and spinning mills, including the rebate on electricity bills in Amaravati. So far, the State government had spent a total of ₹2,086 crore on the MSME sector, which includes clearing the pending arrears left by the previous government totalling around ₹1,588 crore. About 62 percent of the MSMEs which were run by the BC, SC, ST and Minorities and 42 percent that are operated by women have been benefited with the government’s incentives. Speaking on the occasion, the Chief Minister said supporting MSMEs is more like saving the State economy amidst the pandemic crisis, when the world economy is at minus (-)5.2 percent, where even the global markets have been eroded due to Covid.
Investments In the last 27 months, the government provided over 25 welfare schemes to the people without discrimination even in difficult times, due to which the purchasing power has been sustained eventually leading to the sustainment of the MSME and industrial sector, he added. Over 68 major industries had invested a capital of ₹30,175 crore and provided direct employment to 46,199 people. In addition, by investing ₹34,384 crore, another 62 mega industries are also being set up and provide employment to 76,916 people, the Chief Minister said according to a release.
Source: The Hindu Businessline
Andhra Pradesh Chief Minister YS Jagan mohan Reddy on Friday (today) transferred Rs 1123 crore towards incentives for Medium Small and Micro Industries (MSMEs) and Textile units in AP. Jagan transferred amount from his Tadepalli camp office directly into the bank accounts of managements of small scale industries. He later interacted with entrepreneurs who set up these industries. They wished that Jagan should remain as CM of AP for ever saying that his encouragement to small scale industries will not only provide employment to people in AP but will also contribute to growth of state’s economy. They said that Jagan released even arrears that existed during previous TDP regime since 2018 which proved his commitment towards welfare of all sections despite financial constraints.
Source: Telugu 360
The COVID pandemic and the resulting massive production disruptions in Southeast Asia will lead to greater diversification and a major reshaping of global supply chains, say experts. Southeast Asia has emerged as a key player in global supply chains over the past few decades, with countries like Vietnam, Thailand and Malaysia becoming major manufacturing hubs. The region now is a key production zone for cars, computers, electronics and garments, among other products. But the massive production disruptions wrought by the COVID pandemic now threaten to cause a shift in value chains. The region has been hit by a resurgence in coronavirus infections in recent months, blamed largely on the highly contagious delta variant. And lockdown measures and tighter restrictions to control the virus’ spread have shut down factories in many countries. Manufacturing across the region has been badly affected and “remained in a downturn during August,” according to a survey of around 2,100 factories. The month’s Purchasing Managers’ Index (PMI) “remained firmly in contraction territory” at 44.5 due to “rising COVID-19 cases and lockdown measures,” according to London-based information provider IHS Markit. August was the third consecutive month that the index for the region was below 50, which means a slowdown. “The fastest rates of decline were recorded in Myanmar, Vietnam and Malaysia,” IHS Markit economist Lewis Cooper told the DPA news agency.
Factory closures affect production
The drop in manufacturing capacity, particularly in countries like Thailand and Vietnam, has affected the global value chains. Many companies sourcing goods from the region say they have faced unprecedented disruptions this year due to COVID outbreaks and container shortages. “Given Vietnam’s increased role in global manufacturing supply chains, notably in the final assembly stage of electronics, in recent years, the surge in infections is being felt in telecommunication-related goods,” Sian Fenner, lead Asia economist at Oxford Economics, told DW. Rajiv Biswas, Asia-Pacific chief economist at IHS Markit, said that the impact of Vietnamese factory closures had become increasingly widespread. “Over 100 seafood processing factories were closed in southern Vietnam during periods in August, while over one-third of textile and garment factories are also reported to have been temporarily closed in recent weeks due to the pandemic,” he told DW. The expert also pointed out that conglomerates like Samsung and Toyota had faced production challenges. He said Samsung managed to mitigate the disruptions by shifting production to other parts of their global manufacturing supply chain, but Toyota temporarily halted several auto assembly lines due to the disruption to supply chains in Southeast Asian manufacturing hubs. To avoid disruptions to production, Vietnamese authorities have been allowing factories to remain open if they adopt strict containment measures, including offering on-site accommodation or direct transport for employees to avoid catching and spreading the virus. Despite the leeway, Fenner said, many factories “have been forced to close, in part, due to the costs associated with providing adequate accommodation.” Unable to bear the isolation and spend all the time at the workplace, some workers also quit and leave for home. n the case of Thailand, an exodus of migrant workers since the beginning of the pandemic is leading to labor shortages. “This is impacting the labour-intensive manufacturing sector, notably food, textiles and some rubber producers,” Fenner said.
Source: Indian Express
Responding to the trade data for August, 2021 showing an impressive growth of 45 per cent with exports touching 33.14 billion dollars, Dr A Sakthivel, President, FIEO said that the continuous growth in exports since March this year not only augurs well for the economy as whole but also yet again reiterates the commitment and hard work of the exporting community. ''It also goes to show that exporters have continuously been giving their best in response to the government's call of achieving a 400 billion dollars export target for the fiscal,'' added Dr Sakthivel. Steady recovery in global trade added with the expectation of buoyant order booking position for the coming months has also led to such continuous growth in exports, reiterated FIEO President. The government's vision of Atma Nirbhar Bharat with the focus on both manufacturing and services has also given a much-needed boost to the sector. Dr Sakthivel once again complimented the government under the able and dynamic leadership of Prime Minister Narendra Modi and also the Union Finance Minister, Union Commerce & Textiles Minister for showing confidence and trust on the exporters during such challenging times. He also added that the Prime Minister's address and engagement with exporters have drawn a road map for exports, which we will pursue with greater vigour and zeal. The FIEO President said that the top sectors, which performed impressively during the month were Engineering Goods, Petroleum Products, Gem & Jewellery, Organic & Inorganic Chemicals, Drugs & Pharmaceuticals, Cotton Yarn/Fabrics/Made-ups, Handloom Products etc., RMG of All Textiles, Electronic Goods, Plastic & Linoleum and Rice. Dr Sakthivel emphasised that many labour-intensive sectors were major contributors, which itself is a good sign, further helping job creation in the country. However, imports clocking 47.01 billion dollars with a growth of 51 per cent during the month should be analysed, said Dr A Sakthivel. Further, FIEO is of the view that though the government has announced a slew of measures to support exports including the announcement of much awaited RoSCTL and RoDTEP, however the need of the hour is to soon address the left out key issues on RoDTEP front. Besides issues including priority status to exports sector, release of the necessary funds for MEIS and clarity on SEIS benefits, resolving risky exporters issues, augmenting the flow of empty containers and establishing a regulatory authority to seek justification of freight hike and imposition of various charges by the shipping lines need urgent intervention of the government. FIEO Chief requested the government to provide freight support to all exports till March 31st, 2022 as freight rates have skyrocketed and are likely to sombre by March 2022.
Source: KNN India
Apparel shipments, particularly knitwear, bring in $3.38 billion for the country Following a more than 11% drop a month ago, Bangladesh's export earnings made a dramatic recovery in August, clocking over 14% year-on-year. Apparel shipments, particularly knitwear, brought in $3.38 billion for the country, according to the Export Promotion Bureau (EPB). However, it's still behind the monthly target of $3.71 billion. The EPB said that the combined earnings in July and August declined by 0.31% year-onyear, which were $6.87 billion in the same period last year and 7.84% short of the export target, set at $7.44 billion for the period. File photo shows a general view of the container yard of the Chittagong port Dhaka Tribune Apparel shipments, particularly knitwear, bring in $3.38 billion for the country Following a more than 11% drop a month ago, Bangladesh's export earnings made a dramatic recovery in August, clocking over 14% year-on-year. Apparel shipments, particularly knitwear, brought in $3.38 billion for the country, according to the Export Promotion Bureau (EPB). However, it's still behind the monthly target of $3.71 billion. The EPB said that the combined earnings in July and August declined by 0.31% year-on-year, which were $6.87 billion in the same period last year and 7.84% short of the export target, set at $7.44 billion for the period. Last month, the readymade garment sector saw an increase of 11.56% year-on-year, with exports totaling $2.75 billion, up from $2.46 billion the previous year. However, in July and August of 2021, the apparel sector's shipping fell by 1.27% year-onyear to $5.64 billion. Apart from jute and jute goods, all main merchandise’ exports saw strong growth, including agriculture, leather and leather products, home textiles, frozen and live fish, engineering products, medicines, specialist textiles, and plastic products.
Source: Dhaka Tribune
Vietnam textile and garment industry Due to the impact of the pandemic, it may be difficult to reach this year’s export target of $ 39 billion.Report by Vietnam National Textile Clothing Group (Vinatex) He said clothing companies have faced many difficulties in production since June 2021, when a pandemic broke out in the southern regions. In just one month, more than 40,000 workers were dismissed, mainly in the southern region. Textile companies are also facing risks associated with contracts with their customers, according to a Vietnamese newspaper report. Hong Sheng Wen, deputy director of Kwang Viet Garment Co Ltd in Tien Giang’s Mekong Delta, said that from July 15, 2021, companies had to stop production due to the effects of the health crisis. In the first six months of this year, textile and garment exports reached $ 15.2 billion, up 15% year-on-year. However, Vinatex Chairman Le Tien Truon said the results of the first half could be completely lost if creative solutions in production and business were not implemented significantly. He said production turmoil can have serious implications for supply chains and workers’ lives. Hoang Ngoc Anh, Executive Secretary of the Vietnam Textile Apparel Association (VITAS), said social distance regulations had a negative impact on textile companies’ performance, with factory outages reaching 35%. According to VITAS, export sales in this sector are projected to reach $ 32-33 billion this year, or 84% of the planned setting, if the pandemic is curtailed in late August. Textile companies are currently receiving a lot of orders from the United States and the European Union, he added. Vietnam’s textile and garment industry may find it difficult to reach its export target of $ 39 billion this year due to the effects of the pandemic. The Vietnam National Textile Clothing Group (Vinatex) reports that clothing companies have faced many difficulties in production since the pandemic in the southern region in June 2021. Vietnam’s textile garment sector may find it difficult to reach its export targets.
Source: Eminetra
Austrian cellulosic fibre producer Lenzing Group has signed up to a UK agreement designed to limit the impact clothes and home textiles have on climate change. Lenzing is now a signatory of Textiles 2030, the WRAP initiative to accelerate the fashion and textile industry’s move towards circularity and system change in the UK. Textiles 2030 was officially launched by UK waste recycling charity WRAP in April. The ten-year voluntary clothing and textile waste programme aims to slash the environmental impact of UK clothing and home fabrics through practical interventions along the entire textiles chain. “As a proud manufacturer of Tencel in the United Kingdom, we welcome collaboration across the supply chain with stakeholders who echo our values and commitment to support circularity,” Liliana Morfin Huber, business development manager UK for Lenzing Group told Just Style. The Austrian business recently announced it is investing GBP20m (US$27.6m) in the construction of a new wastewater treatment plant at its Grimsby site as part of its bid to reduce wastewater emissions by 2022. With the implementation of the project, Lenzing has biological wastewater treatment plants at all production sites in accordance with the quality standard of the best available technology (BAT). The plant design with new technology, which was developed as part of a research project, meets all requirements of British regulations and is supported by the local authorities. Responsible use of water is one of Lenzing’s core areas under its sustainability strategy ‘Naturally Positive.’ The main topics are the efficient use of water in production and the use of the latest water treatment technologies.
Source: Just-style
