Key to an expansion of digital and data services trade are the data protection regimes in both countries In a world reliant on digital connectivity and data, it critical that India plays a leading role in developing the international rules that will shape how we connect with friends and family and how international trade and investment will flow in the decades to come. Jobs creation and prosperity depend on digital and data trade. The UK and India can play a pivotal role in shaping the global data and digital rules, and the imminent Free Trade Agreement (FTA) negotiation is an ideal opportunity to support core features of a thriving international digital environment: cross-border data transfers; personal information protection; mechanisms to promote interoperability among privacy law frameworks; transparent access to government information; and consumer protection and choice online. In terms of managing non-personal data, businesses would like to see an agreed approach that balances innovation, market forces, security and protects businesses proprietary data. Key to an expansion of digital and data services trade are the data protection regimes in both countries, and they should be aligned with those of other major economies. The hope is that India’s Personal Data Protection (PDP) Bill will become leading-edge legislation, balancing privacy and innovation, and that this will enable the UK and India to align regulations with each other and with economies like the EU, Japan and Brazil. India’s non-personal data framework is also critical. Businesses from both countries that invest in the creation and collection of non-personal data are concerned that their investments will be undermined by being required to share that data—their asset—with third parties. So, while protecting data is a fundamental, it is important too that non-personal and personal data can move across cross-borders to promote innovation and investment. The two governments should sign an India-UK Data Adequacy Agreement that facilitates the cross-border movement of personal data and/or anonymised data sets based on mutual adequacy. Such an Agreement should incorporate provisions that protect the personal data and privacy of Indian and British citizens and guarantee the enforceability of those rights. In the absence of, or pending, an Agreement, other enforceable tools such as Binding Corporate Rules and model contract clauses to enable cross-border movement of personal data between the UK and India must be used. AI is an area that India and the UK, working together, can be pioneers, utilising their existing strengths in data and digital tech, to lead the world. But, to stay at the forefront, it will be important to increase technical skills and engender a greater cultural acceptance of AI, which will involve educating citizens, businesses, and indeed governments, of the potential societal benefits. Through the FTA, the two governments should jointly work towards establishing a consistent approach to ethical principles with trust built through the development of internationally agreed principles (Fairness, Accountability, and Sustainability & Transparency). It is fair to say that India’s telecoms sector has not been in rude health. The recent reforms by the government of India have certainly reduced the risk of the market shrinking to a duopoly, for all that means for consumer choice. So things are looking more promising than only a few weeks ago. This is critical as a robust digital infrastructure is key to digital transformation across sectors and across rural and urban areas and it underpins how efficiently and effectively digital trade grows. Therefore, supporting a vibrant telecom sector would support the pace of digitisation and help achieve India’s vision and ambition of becoming a trillion-dollar digital economy. The UK trade secretary, Anne-Marie Trevelyan, recently unveiled a new five-point plan for digital trade, during London Tech Week, stating that her department (the department for international trade) is committed towards facilitating more open digital markets; advocating for free and trusted cross-border data flows; championing consumer and business safeguards; promoting the development and adoption of innovative digital trading systems such as digital customs processes, e-contracting and paperless trading; and establishing global cooperation on digital trade. This approach creates the foundation for an even stronger UK-India partnership. A partnership that can lead the world in digital, data and AI-driven services. The UK-India FTA can build on this foundation, turning aspiration into reality.
Source: Financial Express
The Union Budget for Financial Year 2023 is expected to be presented on February 1 Ahead of the Union Budget, the Finance Ministry has emphasised that tax exemptions will be phased out and tax rates would be rationalised in the medium term. The ministry has sought suggestions from trade and industry stakeholders, asking them to submit their recommendations by November 15 on policy changes in both indirect and direct taxes by giving economic justification. “Send your suggestions for changes in the duty structure, rates and broadening of tax base on both direct and indirect taxes giving economic justification for the same,” the ministry’s revenue department said in a letter to the Trade and Industries Association. The Union Budget for Financial Year 2023 is expected to be presented on February 1. The letter added: “As can be seen that the government policy with reference to direct taxes in the medium term is to phase out tax incentives, deduction and exemptions while simultaneously rationalising the rates of tax.” Currently, more than 100 exemptions and deductions of different nature are provided in the Income-Tax Act. “We will review and rationalise the remaining exemptions and deductions in the coming years with a view to further simplifying the tax system and lowering the tax rate,” Finance Minister Nirmala Sitharaman had said during her Budget speech. She had said that around 70 of them had been withdrawn in the new simplified regime. The department has asked the trade and industry bodies to supplement and justify their suggestion and views by relevant statistical information about production, prices, revenue implication of the changes and any other supporting information. The letter, which also dwelt on the inverted duty structure, said the request for correction of the structure for a commodity should necessarily be supported by value addition at each stage of manufacturing of the commodity. “It would not be feasible to examine suggestions that are either not clearly explained or which are not supported by adequate justification/statistics.” the ministry noted. The ministry also asked for suggestions on reducing compliances, providing tax certainty, and reducing litigations. However, it has clarified that goods and services (GST) matters are not examined as part of the Budget, as they are to be decided by the GST Council. Recommendation related with the Central Excise and Custom Duty could be given, it said. In the FY21 Budget, 80 exemptions related to Customs duty were withdrawn, while in FY22 Budget, it was proposed to review more than 400 old exemptions through extensive consultations from October 1.
Source: Business Standard
Increasing raw material prices are harming manufacturing sectors, including engineering and textiles. From engineering to textiles, manufacturing units across India are facing the brunt of a steep increase in raw material prices. Coupled with the price increase in fuel — coal and petroleum products — several of them are either making losses, or downsizing operations to be in business. The price increase has even reduced the sheen of the government’s record goods and services tax (GST) collections in October as part of the high tax revenues is attributed to high prices of products. “Whether it is the textile industry or the dyeing industry, all the raw materials we use, right from buttons used to zip, have become costlier by at least 30%. Most of these items are imported from China. The supplies have not reached the pre-pandemic level and there is a shortage,” Ashok Makkar, Chairman, Punjab Dyers Association, says. He also complains about the increase in the prices of petcoke. “Petcoke is used in boilers and is the critical fuel needed for the dyeing industry. The fuel cost has gone up at least three times in the last six months. The industry is running in losses now. With ever-increasing diesel costs, transportation has also become a costly affair. The consumer will have to pay more during their Diwali purchases,” Makkar adds. Jitendra P. Vakharia, President, South Gujarat Textile Processors Association, agrees that raw material prices are hurting their business prospects. “Availability and price of coal is the biggest issue. Earlier, coal used to be about 15% of the total cost, today it is more than 45% of our total cost, the highest cost factor. Four to five months back we were getting it for ₹4,500 per tonne, today the cost is around ₹15,000 per tonne. So, it is three times more. We don’t have surplus capital to deal with the situation,” Vakharia says. The price of dye chemicals have also gone up 50%, he adds. Suresh Kumar Patel, former president of Ahmedabad Engineering Manufacturers Association, also points out high inflation of base metal prices as something very serious. “We represent the foundry and engineering industries that depend heavily on cast iron, aluminium, copper and other metals. “The prices of all the metals have gone up. Take for instance, the raw material I specifically need, pig iron — which costs ₹50 a kilo today — up from ₹32 a kilo a year ago. We cannot pass on the price increase as the market cannot absorb it,” Patel says. “What should we do if not shut down?,” he asks. Due to the same reason, industrialists believe that the increase in GST collections has had a lot to do with a sharp increase in raw material prices. “We should be worried,” says K.E. Raghunathan, Convenor of the Consortium of Indian Association ((CIA), as GST collections have risen on the back of a 56% average increase in raw material prices during the last two years. “Huge increase in petrol, diesel, gas prices, etc., results in the escalation of output price in terms of transportation costs which comes under GST,” Raghunathan adds. The industrialists agree that the government has no control over price escalation in the international markets. However, the government ensures that the raw material prices are under check, even if it means lower taxation.
Source: Fortune India
According to the Preliminary data released by the commerce ministry, non-petroleum exports accounted for $30.27 billion of the overall merchandise exports. India’s merchandise exports of India grew 42.33% to $35.47 billion in October 2021, against $24.92 billion in October last year. However, trade deficit widened to $19.90 billion, marking a rise of 117.38%. According to the Preliminary data released by the commerce ministry, non-petroleum exports accounted for $30.27 billion of the overall merchandise exports, registering a positive growth of 29.63%, over $23.35 billion seen in the year-ago period. Non-petroleum and non-gems and jewellery exports made up $26.05 billion of the total exports last month, registering a positive growth of 27.54% over $20.43 billion seen a year ago, driven by engineering goods, petroleum products, gems and jewellery, organic and inorganic chemicals and textiles. Meanwhile, merchandise imports increased 62.49% to $55.37 billion in October 2021, as against $34.07 billion in October 2020, and $37.99 billion in October 2019. Apart from the high crude oil imports, Coal and gold imports more than doubled during October, rising by nearly 119% and 104%, respectively, in comparision with the same period a year ago.
Source: New Indian Express
Aiming to make Bengal self-sufficient in producing fabric needed to stitch uniform for school goers, the Mamata Banerjee government targets setting up of at least 2,500 high end looms across the state to meet the annual requirement of around 6 crore metres fabric. Already 350 entrepreneurs, who have the high-end machines at their units, have entered into agreement with the state government and there are another 200 in the pipeline. Owners of these 200 existing power loom units have informed the state government that they have already taken the move to set up these looms needed to weave fabric for suiting and shirting. Also Read - TMC sweeps Bengal bypolls 4/4 There are over 15,000 power looms in the state. But maximum of these have the infrastructure to weave only sarees and dhoti. So there is now requirement to set up high-end looms, which could be rapier looms or even of better categories. A senior officer of the state government said the target is to ensure that at least 2,500 looms with high-end machineries get set up in Bengal in next two years. It would help us to meet the demand of 6 crore metres of fabric needed annually to stitch uniforms of school goers. MSME minister Chandranath Sinha said: "Our aim is to upgrade and utilise the existing infrastructure of our state to produce the needed fabric as it would improve Bengal's economy besides making it self sufficient". The state Micro, Small and Medium Enterprises and Textiles (MSME and T) department, on behalf of the government, is entering into an agreement with the entrepreneurs who are interested in weaving the fabric for school uniforms. The reason being it is the state government only that provides the thread to these units to weave the fabric. The state government is also setting up 10 "Suto Hubs (thread hub)" across the state. Initially, two are coming up including one at Purbasthali in East Burdwan while the second "suto hub" is coming up in Cooch Behar. The Mamata Banerjee government every year provides freeof-cost uniforms to students of class I to VIII in state-run and aided schools. In the absence of infrastructure to produce 6 crore metre fabrics to stitch school uniforms, it had to be brought from Uttar Pradesh with production of only one crore metre Tamralipta and Kangshabati mills in Bengal.
Source: Millennium post
With around 5.63 lakh power looms, the textile industry is next only to agriculture, in providing direct and indirect employment in the State. Garment makers in Tiruppur, exporters in particular, which houses more than 3,000 units employing around 2 lakh people, voiced concern as price of yarn increased by Rs 50 per kilogram across all categories. Tiruppur Exporters Association (TEA) joint secretary Senthil Kumar said yarn price had been increasing steadily since 2020. “Every one or two months, mills revise price ranging from Rs 10-25 per kg. Last month, a few mills increased price by Rs 25-40. Today, large mills hiked the price by more than Rs 50 per kg as a result of which cotton yarn crossed Rs 350.” Tamil Nadu Spinning Mills Association (TNSMA) advisor Dr Venkatachalam justified the price hike stating that mills were battling a host of problems. “The price of cotton candy (one candy - 355.62 kilogram) has increased from Rs 62,000- 63,000 in early October, to Rs 66,000 in the last week. Further, transportation costs and labour charges have gone up, and mills are facing power shortages and most facilities operate on generators. All these factors could have pushed the yarn price up.” Meanwhile, weavers said they are unable to complete orders due to a rise in yarn price and shortage of raw materials. Small Textile Owners Association president GK Prabhakaran told TNIE, “The price of combed yarn was Rs 254 in January but has risen multiple folds. This has made it difficult for us to achieve 100 per cent production.” This apart, he said, weavers were struggling to get raw materials, including elastic fabric and polyester, which are procured from China due to the Centre’s ban on import. Weavers also complained of a lack of government support. K Gunasekaran (52), a weaver, said the weavers of Andhra Pradesh and Telangana got a 40 per cent subsidy for procuring new power looms. Further, pointing out that access to bank loans was tougher, the weaver said it dissuaded entrepreneurs from opting for the textile industry. Sources said, “The State provides free electricity to handloom and power loom weavers up to 200 units and 750 units respectively bi-monthly. A total of 77,550 handloom and 1,42,227 power loom weavers benefit from the scheme. Besides, 26,996 handloom weavers receive old-age pension. As far as the provision of subsidy is concerned, it is a matter of the government’s policy decision.” With around 5.63 lakh power looms, the textile industry is next only to agriculture, in providing direct and indirect employment in the State.
Source: New Indian Express
Exporters of home textiles are set to weave 20 per cent revenue growth this fiscal, and therefore achieve a higher global market share, Crisil said in a note based on the analysis of 50 companies that account for over 60 per cent of such revenue indicates. Home textile exporters are set for a big order boost from the biggest shopping season in the Western market and push their topline by around 20 per cent, said a credit rating agency, which has also upgraded the industry outlook to positive. Exporters of home textiles are set to weave 20 per cent revenue growth this fiscal, and therefore achieve a higher global market share, NSE 0.99 % said in a note based on the analysis of 50 companies that account for over 60 per cent of such revenue indicates. The report said the projected growth is riding on three tailwinds -- strong retail sales in the US and a better outlook for the upcoming festive season in other export markets; the continued focus on health and hygiene; and the 'China plus one' sourcing strategy adopted by large customers. Exports account for 60 per cent of the Rs 55,000-crore domestic home textiles industry, which comprises terry towels, bed sheets/ spreads, pillow covers, curtains, rugs and carpets. Domestic sales account for the balance, according to the agency. Home furnishing retail sales in the US, the key export market accounting for 55 per cent of the total export revenue pie, jumped 42 per cent year-on-year in the first half of 2021, compared to 15 per cent growth in the same period in 2019. Also, China plus one strategy is clearly playing out, which is visible from the sharp increase in the country's share of US imports of cotton bed-sheets and terry towels to 51 per cent in the first eight months of 2021 as against 46 per cent in 2020, while that of China has come down to 16 per cent from 20 per cent. Not surprisingly, the average capacity utilisation of three large listed home textile players in the bed linen segment rose to 87 per cent in the first quarter this fiscal compared to 68 per cent in the pre-pandemic level; and for the bath linen segment to 75 per cent from 66 per cent. Accordingly, the operating profitability is expected to improve 200-250 bps to 18 per cent this fiscal. Extension of the rebate of state and central taxes and levies scheme till March 2024 and better coverage of fixed costs from higher capacity utilisation will help offset the sharp increase in prices of cotton, the key raw material, the report said. While the increase in revenue and profitability will improve cash flows, current high capacity utilisation and healthy demand outlook will encourage capacity expansion in the near to medium-term, resulting in higher debt levels. Improvement in operating profit will offset the impact of higher debt and the resultant positive bias to credit quality and their interest coverage ratio to improve to 6-6.5 times over the medium term from 5.5 times in fiscal 2021, the report concluded.
Source: Economic Times
Power loom weavers said apart from the free supply of electricity up to 750 units bimonthly, they do not get any substantial support from the State. Power loom workers have appealed to the State government to create a separate directorate for the sector stating that it would help the industry grow. “Power loom workers were disappointed with the discussion on the demand for grants for the Ministry of Handlooms and Textiles in the Assembly session. Even the word ‘power loom’ was not mentioned in the policy document. The DMK manifesto promised to separate handloom and textiles sectors, so we are urging the government to form a separate directorate for power loom or at least keep us under the textile directorate instead of the handloom directorate,” said Suresh, president of Tamil Nadu Federation of Power loom Associations. Sources said there are 1.15 lakh handloom units in the State, whereas six lakh units function in the power loom sector, which is the second-highest in India. Of this, more than 60,000 power looms function under 209 cooperative societies. Power loom weavers lamented that there are not many schemes implemented by the State for their welfare. “Because of the high cost, only the affluent buy handloom garments. The power loom industry caters to the clothing demands of the majority of the country’s population but is neglected. Even as per the government estimate, there are 1.15 lakh handloom units in TN employing 2.44 lakh workers. But handloom sector is given several hundreds of crores of rupees as subsidy, whereas power loom industry is left to fend for itself,” said Kandhavel, associations’ co-ordinator. Power loom weavers said apart from the free supply of electricity up to 750 units bimonthly, they do not get any substantial support from the State. The majority of power looms are plain looms with very few shuttleless looms. If the State and Centre don’t support upgradation, the power loom industry will slowly vanish, they added. “The Centre provides 50 per cent subsidy to upgrade looms and the State only 10 per cent. This should be increased since states like Telangana and Andhra Pradesh provides 40 per cent subsidy. Whenever we talk about the increase in the yarn price affecting our business, there is no response from the government. If there is a separate directorate, all these problems could be addressed,” Kandhavel said. The creation of separate departments or ministries will also help to stop the manufacturing of products reserved for handlooms in power looms, he opined. Minister for Handlooms and Textiles, R Gandhi, said the proposal for the formation of the separate textile and handloom directorates has been placed before the Chief Minister. “We will consider the request and take action if it is reasonable,” he said.
Source: New Indian Express
Share of the informal economy has fallen drastically to 15-20 per cent of the gross value added (GVA) or the formal GDP in 2020-21 from 52.4 per cent in 2017-18 due to digitisation and the rapidly expanding gig economy, said Soumya Kanti Ghosh, the group chief economic advisor at SBI. The share of the same had stood at 53.9 per cent in 2011-12. The digitisation drive and pandemic-induced emergence of the gig economy have led to a faster formalisation ofthe economy, with the share of the informal sector shrinking to just 15-20 per cent in 2021 from 52.4 per cent in 2018, according to an SBI Research report. Share of the informal economy has fallen drastically to 15-20 per cent of the gross value added (GVA) or the formal GDP in 2020-21 from 52.4 per cent in 2017-18 due to digitisation and the rapidly expanding gig economy, said Soumya Kanti Ghosh, the group chief economic advisor at SBI. The share of the same had stood at 53.9 per cent in 2011-12. According to Ghosh, many measures since the note-ban in November 2016 have accelerated digitisation of the economy, and the pandemic-induced emergence of the gig economy has facilitated higher formalisation of the economy, at rates possibly much faster than most other nations. The note ban hit hardest the informal sector which then constituted 93 per cent of the workforce. The second blow to the informal economy was the GST and the final and the hardest hit came from the pandemic. At least Rs 13 lakh crore has come under the formal economy through various channels over the past few years, including the recent scheme on the E-Shram portal, the report said. Real GDP was estimated at Rs 135.13 lakh crore in FY21 but lost 7.3 per cent of that in FY22 after the worst economic contraction on record due to the pandemic. The 2011 Census pegged the size of the informal sector in trade, hotels, transport, communication and broadcasting at 40 per cent; in construction at around 34 per cent; 16 per cent of public administration; and 20 per cent of manufacturing and almost 100 per cent formalisation in finance, insurance and utilities, and to a large extent in real estate and agriculture. The formal financial sector has even expanded by 10 per cent post-the pandemic, with the DBT transfers gaining traction and that of formalised utility services size expanded by 1 per cent during the pandemic, according to the report. The report, quoting the monthly EPFO payroll data, said that since FY18, almost 36.6 lakh jobs have been formalised till July 2021 and the report expects that this fiscal formalisation rate will be higher than FY20 but lower than the FY19 level. Since FY18, the agriculture sector has been formalised by 20-25 per cent due to the increasing penetration of KCC credit and now the informal agriculture sector is 70-75 per cent. Over the years, usage of Kisan credit cards has also increased significantly as the per card outstanding has gone up from Rs 96,578 in FY18 to Rs 1,67,416 in FY22, an increase of Rs 70,838. And there are 6.5 crore such cards, the amount formalised is Rs 4.6 lakh crore, the report noted. It also said payments worth Rs 1 lakh crore have been made at petrol pumps alone in the past five years. A sizeable informal economy is not just an emerging and developing economy feature, and according to the IMF, 20 per cent of the European GDP is an informal economy. On the impact of the just-launched E-Shram portal, a first-ever national database of unorganised workers, on the formalisation of the economy, the report said as much as 5.7 crore unorganised workers have registered in the first two months after its launch in August, with 62 per cent of workers belonging to the 18-40 agegroup and 92 per cent of the registered workers having monthly income of under Rs 10,000. Ghosh considers the E-Shram portal to be a big step towards employment formalisation as to date the rate of formalisation of unorganised labour due to E-Shram is around 17 per cent or Rs 6.8 lakh crore, which is 3 per cent of GDP in just two months. He also called for more rationalisation of indirect taxes like GST and excise, saying just 11.4 crore tax-paying households or 8.5 per cent of the total population contribute Rs 75 lakh crore or 65 per cent of the private final consumption expenditure and cross-subsidies to 91.5 per cent of the population. As of the 2014 NSSO survey, as much as 93 per cent of the workforce earned their livelihoods as informal workers, who were hit the hardest by the pandemic too.
Source: Economic Times
The two countries are in the process of finalising offer lists on 200 priority items under the proposed agreement. Ambassador of Thailand to Pakistan Chakkrid Krachaiwong on Tuesday announced that the Free Trade Agreement (FTA) between Pakistan and Thailand to increase market access is expected to be finalised by the end of this year. He was speaking at the Pakistan ASEAN Business Forum, organised by United Business Group (UBG) of Federation Pakistan Chamber of Commerce and Industry (FPCCI) here. The idea for an FTA in both countries was initially floated in 2013, during bilateral talks on trade between the two countries; the Thai ambassador said. Krachaiwong said the first round of FTA talks between the two countries was followed in September 2015, however, the process of dialogue between had slowed down due to the pandemic. Now, the 10th round of FTA between Pakistan and Thailand would start next month in which big progress is expected,” he said. He informed that Pakistan and Thailand were in a process of finalising offer lists on 200 priority items under the proposed agreement. While talking to APP, a senior official of the Ministry of Commerce said Thailand and Pakistan had held nine rounds of talks that had concluded 12 chapters of the agreement’s 13 chapters in total. He said the remaining issues pending negotiations included customs protocol, trade facilitation, as well as related regulations regarding market access, he informed. He said Pakistan had liberalised investment in most industries, especially food processing, logistics, textiles, automobiles, Information Technology (IT), construction, tourism and hotels, adding that the country was an interesting and large market with a population of more than 220 million, the world’s fifth largest, including 30 million adults with a high level of purchasing power. He further added that Pakistan has an abundance of natural resources such as copper, coal, gold and fishery resources such as shrimp, crab, fish and shellfish, which are raw materials for the seafood processing industries. According to data issued by the United Nations (UN), COMTRADE database on international trade Pakistan exports to Thailand totalled $141.53 million while imports from Thailand stood at $896.05 million during 2020.
Source: Pakistan Today
Does Pakistan need more Man-Made Fibres (MMF) to grow its share in global apparel exports? Studies conducted by various trade organizations place share of MMF in global textile trade anywhere between 55 to 70 percent. Yet, a comparative analysis of regional exporting countries show that while higher use of MMF can definitely help Pakistan increase its apparel exports, it is not a make-or-break in achieving the pipe dream of $30 billion in textile exports. To understand the role of MMF and other non-cotton fibres (such as synthetic, artificial, animal, and non-cotton plant-based fibres), BR Research conducted a time series analysis of regional exporters’ performance using trade statistics from International Trade Centre. Bear in mind, the following analysis is restricted to trade value and not volume, as quantity statistics for all countries were either not available, or used varying units (metric tons, versus units in dozens) which rendered volumetric analysis futile. Analysis is based on Product Clusters at 6-digit level, which lists various products ‘by type of fibre’ used in manufacturing. Based on ITC data, annual global apparel trade (HS Code Chapters 61 and 62) has averaged close to $450 billion per annum for the past five years. Of this, 42 percent consists of apparels – both knitted/crocheted as well as woven – made of cotton-based fibres. The remainder 58 percent not only includes man-made fibres, but also other natural fibres such as silk, wool, hemp etc. However, synthetic and artificial fibres have the greatest share of pie, varying between 45 – 48 percent (in value terms!) But country-wise analysis reveals more startling trends. The three Asian apparel giants – China, Bangladesh, and Viet Nam – that together boast 45 percent share in global apparel exports - have followed different trajectories to unlocking apparel export success. Over the past five years, share of cotton in Viet Nam’s apparel exports has averaged less than 30 percent, while MMF have maintained a lion’s share. It is pertinent to note while Viet Nam’s apparel exports are evenly divided between knitwear (HS Chp. 61) and readymade garments (HS Chp. 62) in value terms, share of cotton fibre is significantly higher in Vietnamese knitwear – nearly 40 percent; and while share of apparel made-of cotton fibre in non-knitted garments is less than 20 percent! The case of Bangladesh is even more stark! Just like Viet Nam, apparel exports are neatly divided between knitwear and non-knitwear garments, each with a share of $19 billion per annum. But surprisingly, share of apparel made of cotton-based fibres in Bangladesh’s exports is significantly high! During the last five years, share of cotton-fibres exceeded 70 percent within Bangladesh’s apparel exports, averaging 75 percent for apparel in the knitwear category. Back home, comparison to global trends makes little intuitive sense, if not altogether comical. In line with other regional exporters, Pakistan’s apparel exports are also evenly divided between knitwear and woven garments (albeit with a slight tilt towards knitwear, 52-48) in value terms. Share of cotton-based fibres in knitwear exports averages under 35 percent for Pakistan, which is lowest among the group of countries selected! Yet, higher use of MMF by Pakistani knitwear manufacturers has certainly not helped the country grow its share in world market, which averaged at 1.2 percent, compared to 6 and 9 percent for Viet Nam and Bangladesh, respectively. In sharp contrast, share of cotton-based fibres in Pakistan’s woven and other nonknitwear garments averaged at over 80 percent during the past 5 years, possibly highest in the world. Although higher share of cotton-based garments is understandable (due to higher share of cotton-based denim garments in Pakistan’s readymade garment exports). But it comes as little surprise that Pakistan’s share in global trade of non-knitted garments is also abysmally low (in value terms), averaging at 1.1 percent during the period under review. Of course, there is little denying that global textile mix is shifting towards man-made fibres, with share of cotton-fibres observing a secular decline over the past century. However, as the exponential growth of Bangladesh’s apparel exports over the past two decades show, MMF is certainly not the only route to success in global trade; which is even more remarkable for a country with little to no indigenous production of cotton.
Source: Business Recorder
China last week reiterated that lifting additional tariffs by the United States is in the fundamental interests of consumers and producers on both sides and is conducive to global economic recovery. The Chinese commerce ministry made the remarks after vice premier Liu He held a video conversation with US treasury secretary Janet Yellen at US invitation. China expressed concern over issues, including the lifting of additional tariffs, US sanctions and the fair treatment of Chinese companies, during the conversation. Ministry spokeswoman Shu Jueting said the two sides held discussions for about 90 minutes, and conducted pragmatic, professional and in-depth exchanges on a wide range of topics concerning economics and trade. They discussed the macroeconomic situation and policies of both the countries, including economic growth conditions, inflationary pressure, financial stability, supply chains and other issues, official Chinese media reported. They also exchanged views on specific cooperation in multilateral and bilateral fields such as financial market supervision and cooperation under the G20 framework, Shu added. Liu, who is also a member of the political bureau of the Communist Party of China Central Committee and chief of the Chinese side of the China-US comprehensive economic dialogue, has spoken twice with both Yellen and US trade representative Katherine Tai via video and telephone since May this year, according to the ministry. Both sides agreed to continue communication at all levels to focus on practical cooperation and solving specific problems from the perspective of both countries and the whole world, she said. Shu said the US move is an over-generalisation of the concept of national security, abuse of national power and malicious suppression of a Chinese company without basis in facts. It also undermined the atmosphere of cooperation between the two sides, she added.
Source: Fibre 2 Fashion
China’s manufacturing purchasing managers' index (PMI) came in at 49.2 in October, down from 49.6 in September, according to the National Bureau of Statistics (NBS). The slowdown was a result of tight power supply and a sharp rise in prices of some raw materials, said NBS senior statistician Zhao Qinghe. A reading above 50 indicates expansion, while one below reflects contraction. Data on October 31 also showed that the PMI for China's non-manufacturing sector came in at 52.4 in October, down from 53.2 in September. In October, the sub-index measuring purchase prices of major raw materials rose by 8.6 percentage points from September to 72.1, while the ex-factory price index climbed to 61.1, up 4.7 percentage points from last month, an official news agency reported. The sub-index for production retreated 1.1 percentage points to 48.4, while that for new orders dropped 0.5 percentage points to 48.8. The figures showed that production and market demand in the manufacturing sector both weakened last month, said Zhao.
Source: Fibre 2 Fashion
Finland in late October proposed to Parliament a piece of legislation on labelling of production material in footwear and textile products based on the European Union (EU) Market Surveillance Regulation, which would specify obligations of companies related to labelling of materials. The proposed law also enables the imposition of penalty payments for incorrect or deficient labelling. The EU already requires that footwear and textile products clearly indicate what material the item is made of. According to the proposal, the Finnish Safety and Chemicals Agency Tukes could impose a penalty payment for deficient or incorrect labelling of footwear and textile products, according to a press release from the Finnish ministry of economic affairs and employment. The EU Market Surveillance Regulation requires that member states enact sanctions nationally. Manufacturers, importers and marketers of footwear and textiles sold in the EU must ensure that all products bear a label indicating the material the product is made of. In Finland, the labels must be in both Finnish and Swedish. Requiring labels of materials is not new, but penalty payments due to incorrect or deficient labels have not been possible before. A key objective of the reform is to improve consumer protection, the press release said. It is due to come into effect as of the beginning of 2022. The government proposal is part of a more extensive implementation of the Market Surveillance Regulation, the proposal on which was submitted to parliament on September 23 this year.
Source: Fibre2 Fashion
