The Synthetic & Rayon Textiles Export Promotion Council

MARKET WATCH 12 NOVEMBER, 2021

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INTERNATIONAL

All imports are not necessarily bad: Piyush Goyal

On the issue of India's economic bounce back, he said: "We can expect good growth... I think all signals are very positive. In some sense, we have come back." Commerce and industry minister Piyush Goyal on Thursday said that all imports are not necessarily bad, and that all signals on the economic front, point towards growth while emphasising that the nationwide lockdown imposed last year to curb the spread of the Covid-19 pandemic was not a kneejerk reaction. Addressing the Times Now Summit 2021, Goyal, who is also the minister for consumer affairs, food and public distribution, said that the Bharatiya Janata Party will win the upcoming elections in Uttar Pradesh with complete majority and the ongoing farmers' agitation has no relation with the elections. The government, he said, is open to talks with them. On the issue of India's economic bounce back, he said: "We can expect good growth... I think all signals are very positive. In some sense, we have come back." Referring to growth in various indices on production, goods and services tax and exports, he said India's exports are at an all-time high. "We are at nearly $232 billion (exports) in first seven months (of the financial year) -- something we haven't seen in many years. Last year, for the whole year, we were at $290 billion which I think we will do in the first three quarters itself," he said, adding that the country's vaccination programme is a "huge success" with 110 crore doses and well poised to make 500 crore doses next year. "We have huge and ambitious plans on the anvil," he said. Answering a question on the nationwide lockdown imposed last year, Goyal said: "At that point, if we had not gone in for a strict lockdown and controlled the situation, bought us some time- those crucial three months to ramp up our testing facility, take technology to the next level, start developing vaccines, we have found solutions which are relevant to India, that helped save India and the led to a huge bounce back that we see today." On India's trade restrictions with China to curb imports amid the border tensions at Galwan last year, Goyal said India's policies are never based on one country or one region but always based on principles. "As far as trade goes, we have been most fair in our trade with all countries," he said. The Aatmanirbhar Bharat programme, he said, aims to make India more self-sufficient to enable it to engage with rest of the world with a position of strength and open the doors wider for greater degree of engagement to attract investments, technology, and more trade. "Imports also are necessary... all imports are not necessarily bad but one has to strengthen India's domestic capabilities. In last one year, we have seen growth with almost every country both in imports and exports," he said, noting that imports of coking coal and oil seeds are crucial to ensure that steel and edible oil prices remain affordable. Through the Production Linked Incentive schemes, the government is aiming at long term transformational impacts, not short-term impacts, he said.

Source: Economic Times

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GST Council likely to focus on rate rationalisation

In its December meeting, the GST Council is likely to focus on rate rationalisation and suggest ways for revenue augmentation. Though the date for the meeting has not been finalised, it could take place immediately after the Winter Session of Parliament. The session is scheduled to end on December 23. ‘Rules of Procedure and Conduct of Business in the GST Council’ prescribe the meeting to take place at least once in every quarter of the financial year. Last meeting of the Council took place on September 17. As on date, there are multiple rates comprising four main – 5, 12, 18 and 28 per cent – and some special rates such as 0, 0.25, 1 and 3 per cent. There has been thinking for a long time to bring down the number of rates and one idea was to merge 12 per cent and 18 per cent and prescribe a consolidated rate of 15 per cent. Various other combinations are also under consideration. A Group of Ministers is reviewing the current rate slab structure including special rates. The group, under the convenorship of Karnataka Chief Minister Basavraj S Bommai, has been asked to recommend the rationalisation measures, including merger of tax rate slabs, required for a simple rate structure. This group was constituted on September 24 and was asked to submit its report within 2 months. “It is expected that GoM’s report will be ready before the next meeting, so that the Council could consider and decide the next course of action,” a senior Finance Ministry official told BusinessLine. The GoM is expected to suggest changes that may be implemented immediately and the roadmap for implementation for the changes that should be implemented in the short and medium term.

Other terms

 

Other terms of reference for the GoM on rate rationalisation include review of the supply of goods and services exempt under GST with an objective to expand the tax base and eliminate breaking of ITC (Input Tax Credit) chain and review the instances of inverted duty structure. Inverted Duty Structure refers to higher duty on inputs and lower duty on output. This results in a higher refund to the industry which affects the cash flows for companies and revenue collections for the Government. Also, consumers do not gain anything. Last year, the council corrected IDS on mobile handset while this September, it decided to correct this anomaly on textile and footwear from January 1, 2022. The official said there are still some items such as fertilisers. “It is not just the government that has an issue with the IDS. Industry too has a tough time because their working capital gets blocked as GST paid at higher rates on inputs is blocked till the grant of refund,” he said. At the same time, businesses complain that the refund process is cumbersome and takes a long time. Earlier this year, while presenting the budget, Finance Minister Nirmala Sitharaman had said that the GST Council has painstakingly thrashed out thorny issues. “As Chairperson of the Council, I want to assure the House that we shall take every possible measure to smoothen the GST further, and remove anomalies such as the inverted duty structure,” she had said.

Source: Business Line

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PM to launch two innovative customer centric initiatives of RBI on 12 November

Prime Minister Shri Narendra Modi will launch two innovative customer centric initiatives of the Reserve Bank of India on 12 November, 2021 at 11 AM via video conferencing. These initiatives are the RBI Retail Direct Scheme and the Reserve Bank - Integrated Ombudsman Scheme. The RBI Retail Direct Scheme is aimed at enhancing access to government securities market for retail investors. It offers them a new avenue for directly investing in securities issued by the Government of India and the State Governments. Investors will be able to easily open and maintain their government securities account online with the RBI, free of cost. The Reserve Bank - Integrated Ombudsman Scheme aims to further improve the grievance redress mechanism for resolving customer complaints against entities regulated by RBI. The central theme of the scheme is based on ‘One Nation-One Ombudsman’ with one portal, one email and one address for the customers to lodge their complaints. There will be a single point of reference for customers to file their complaints, submit the documents, track status and provide feedback. A multi-lingual toll-free number will provide all relevant information on grievance redress and assistance for filing complaints. Union Finance Minister and RBI Governor will also attend the event.

Source: PIB

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India looking at reciprocal access to foreign mkts through FTAs: Goyal

ndia is looking at reciprocal and equitable access to foreign markets through FTAs, which the country is negotiating with its trading partners, Commerce and Industry Minister Piyush Goyal said India is looking at reciprocal and equitable access to foreign markets through free trade agreements, which the country is negotiating with its trading partners, Commerce and Industry Minister Piyush Goyal said on Thursday. India is, at present, negotiating free trade agreements (FTAs) with countries like UAE, the UK, and Australia. Under a free trade agreement, two trading partners reduce or eliminate customs duties on the maximum number of goods traded between them. Besides, they liberalise norms to enhance trade in services and boost investments. "Through the FTAs, we are looking at reciprocal and equitable access to foreign markets. FTA is a win-win for both countries. If it is an unequal balance, FTA can never be successful," Goyal said at Times Now Summit 2021. He said that a few old FTAs of India which were not balanced have led to an increase in trade deficit with those nations. "We are now going through careful stakeholder engagement (to negotiate an FTA) and making sure that our MSMEs, dairy industry, farmers, and domestic production capacities get more opportunities. Our employment-oriented sectors like textiles, footwear, and pharma get good market access," he added. In such pacts, the government is also ensuring that services sector professionals too get good opportunities in the foreign markets through two way communication with Indian stakeholders, Goyal noted. "We are working through balanced, fair and equitable FTAs so that both sides benefit and jobs are created in India, and business opportunities are available for our small, medium and micro-industry," Goyal said.

Source: Business Standard

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4.5 lakh MSMEs in UP took advantage of ECLGS during Covid: State MSME min Sidharth Nath Singh

Credit and Finance for MSMEs: UP was ranked second in the Ease of Doing Business annual rankings released in September last year. Moreover, it secured sixth position in Logistics Ease Across Different States (LEADS) ranking this year from 13th rank in 2019.

Credit and Finance for MSMEs: Around 4.5 lakh micro, small and medium enterprise (MSME) units in India’s most populous state of Uttar Pradesh have raised credit so far through the central government’s Emergency Credit Line Guarantee Scheme (ECLGS) launched last year post Covid, said state’s MSME Minister Sidharth Nath Singh on Thursday. Speaking on Day 1 of Financial Express Online’s inaugural SME Artha event, Singh said “Approximately 4.5 lakh units in UP took advantage of emergency credit guarantee scheme and were able to revive their units. It helped them recover from the working capital or credit squeeze they had.” With nearly 90 lakh MSMEs, UP had the largest number of estimated small businesses with a 14.20 per cent share of 6.33 crore MSMEs in the country, as per the MSME Ministry 2020-21 annual report. Including UP, a significant part of the country’s MSME landscape was severely impacted due to Covid and following lockdown restrictions last year that led to challenges in production, labour movement, supply chain disruption, and more. “During Covid last year and this year, we had decided not to shut our industrial units. We arranged for (movement) of their workers with mobility passes. We also ensured that they have the raw material supply by making sure vehicles carrying raw materials pass unhindered…We also waived fixed electricity charges,” added Singh who is also the minister for Investment & Export, NRI, Textile, Handloom & Sericulture, Khadi & Gramodyog, and Vice Chairman, Invest U.P. The state was ranked second in the Ease of Doing Business annual rankings released in September last year. Moreover, UP secured sixth position in Logistics Ease Across Different States (LEADS) ranking this year from 13th rank in 2019. The ranking launched by the Commerce Ministry back in 2018 measures the ease in logistics activities in states. The tally was topped by Gujarat, Haryana, and Punjab. “We realised that it is not going to easy for MSMEs to perform due to covid. Hence, we announced a reform policy particularly in the labour sector wherein we removed all labour laws except two which are (related to) minimum wages and the number of hours. Many other states followed what UP did. During Covid period, we also came up with a major reform in the MSME sector. For registering an MSME unit in the state, one can get a deemed No Objection Certificate (NOC) in 72 hours by online application and within three years the MSMEs will have to obtain all the NOCs and submit to the authorities,” said Singh. The minister also highlighted that a GST cell was created to help MSMEs struggling with GST filing and the MSME Sathi app was launched to address different other issues faced by MSMEs. Similarly, “for the accounting purposes and particularly in the GST area, we brought in an iCloud-based software, trained initially about 20,000 MSMEs and provided the software to them free of cost. We have been able to add almost 80 lakh more MSMEs in the last 4.5 years,” he said. According to Singh, 80 per cent MSMEs in UP contribute towards the state’s exports. UP wants to enhance its export value from Rs 1.21 lakh crore annually to Rs 3 lakh crore by FY27.

Source: Financial Express

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"Covid a huge opportunity to prepare for next 25 years "- Shri Piyush Goyal

 “Covid has given India a huge opportunity to prepare for next 25 years," said Shri Piyush Goyal, while speaking at a media conclave in New Delhi today. The Minister for Commerce & Industry, Textiles, Consumer Affairs and Food & Public Distribution said that India's economy is fully back on track with the indicators showing great results. He said that exports are at an all-time high with almost Rs 235 Billion dollar already achieved in just 7 months. GST collections were touching Rs 1.3 lacs cr and PMI for Services was at a decadel high. Valuations in Industry are great. He said that lockdown gave us the time to ramp up the capabilities and capacities to tackle the pandemic like no other country. He said that from PPE kits to Vaccines we have found solutions relevant to India. World is looking towards India. Shri Goyal said that this huge bounce back has been due to an extraordinary leadership at the top. Regarding Atma Nirbhar Bharat, Shri Goyal said that the mission is about engagement with the world from a position of strength. “It's not about closing all imports. It's a holistic programme targeting the benefits for 1.3 Billion people. It will create capacities for the future,” he said. Shri Goyal said that India believes in Multilateral free and fair trade. “We believe in strengthening the capacities and quality of Indian products. PLIs have been introduced in 13 sectors. Imports happen wherever some domestic capacity is not there. But we are working towards making India Atma Nirbhar and upscaling capacities in India,” he said. Shri Goyal added that the world now sees India as an emerging super power and recognizes it as a trusted business partner. He said that we are going through engagement with the world through FTAs, balanced and fair equitable agreements. “Huge opportunities are emerging for India in the fields that would create employment opportunities along with growth,” he said.

Source: PIB

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Notices to firms after mismatch in GST tax credits

The GST framework allows companies to set off part of their future tax liability against GST paid by them on the raw materials sourced from suppliers. Goods and services tax authorities have started issuing notices to several companies, after uncovering a mismatch in tax credits using deep analytics tools embedded in the GSTN software. The tax department's analytics department has found these discrepancies in returns filed by companies, industry trackers said. The GST framework allows companies to set off part of their future tax liability against GST paid by them on the raw materials sourced from suppliers. As per the GST framework, both supplier and the company that it supplies have to upload forms on the tax department's website. The tax department then matches the GST paid with the tax credit claimed. Often, there is a mismatch between the figures uploaded by the supplier and the tax credit claimed by the company. In these cases, the tax department can reject the tax credit claimed for the whole transaction. Some legal experts advising companies that have received such notices said that the department's notices should have given more time to companies. "As per process, the adjudicating authority ought to have first scrutinised the returns and served a notice in case there was any discrepancy or mismatch. This would have given the assessee an opportunity to undertake rectification, if required. Only if there was a failure on the part of the assessee to rectify the discrepancy or mismatch, should the assessing officer have issued a show-cause notice," said Abhishek A Rastogi, a partner at law firm Khaitan & Co. The tax department is of the opinion that the scrutiny of returns is not a mandatory step, and the authorities have the power to directly issue a show-cause notice. The government had earlier allowed a 20% mismatch, which has now been brought down to 5%. The tax notices come at a time when many companies are facing cash-flow issues and are highly dependent on smooth tax refunds.

Source: Economic Times

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AP govt wants Centre to set up mega textile park at Kopparti

Probably, the one at Mannavaram will be converted..., he said.Earlier in 2008, the NTPCBHEL power project was proposed for manufacturing cold turbine but it has been a nonstarter, he added.In the meeting, the state minister also requested the central government to reduce the states share in the Visakhapatnam-Chennai corridor from 20 to 10 per cent.We get ADB funding for a corridor development up to 600 million tonnes in the ratio of 7821 Andhra Pradesh Industries Minister Mekapati Goutham Reddy on Thursday called on Union Commerce and Textile Minister Piyush Goyal and demanded setting up of a mega textile park at Kopparti in the Kadapa district, besides reducing the state's share in the Visakhapatnam-Chennai corridor from 20 to 10 per cent. The minister also requested the central government to set up one of the three electrical equipment zones to be set up in the country under the production-linked incentive (PLI) scheme to be set up in Andhra Pradesh. Speaking to reporters after the meeting, Reddy said, ''The Centre has plans to set up seven textile parks in the country. We have proposed the Centre to set up one at Kopparti.'' Besides a textile park, the minister requested the central government to look into the possibility of converting the 750 acres of land previously allotted to the NTPC-BHEL power plant at the Mannavaram village in the Chittoor district for setting up of an electrical equipment zone. ''The Centre is planning to set up three electrical equipment zones. Probably, the one at Mannavaram will be converted...,'' he said. Earlier in 2008, the NTPC-BHEL power project was proposed for manufacturing cold turbine but it has been a non-starter, he added. In the meeting, the state minister also requested the central government to reduce the state's share in the Visakhapatnam-Chennai corridor from 20 to 10 per cent. ''We get ADB funding for a corridor development up to 600 million tonnes in the ratio of 78:21. I have requested to change the ratio to 90:10. The state contribution will reduce by 10 per cent and will benefit the state,'' he added. Reddy also invited the Union minister for the inauguration of the Medaxil office in the Med Tech Zone in Visakhapatnam. Andhra Pradesh Residence Bhavan Commissioner Bhavana Saxena, Andhra Pradesh Industrial Infrastructure Corporation (APIIC) Managing Director Subrahmanyam Jawwadi, and MedTech Zone CEO Jitendra Sharma, among others, were present in the meeting.

Source: Devdiscourse

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Bright crop prospects will boost rural demand, says NITI Aayog

The consumer price index (CPI) fell to 4.3 per cent in September 2021, the lowest since April 2021 Record kharif output and bright prospects for the rabi crop will boost rural demand, which in turn will help in economic growth exceeding 10 per cent in 2021-22, the NITI Aayog has said. This will spur a revival in the manufacturing sector with improving capacity utilisation by firms in the coming months, Vice-Chairman Rajiv Kumar said in the think tank’s latest publication, ArthNITI. His GDP growth projections are higher than the 9.5 per cent given by the Reserve Bank of India’s monetary policy committee. In his foreword to the publication, Kumar said a significant increase in exports would boost growth and employment while a gradual pickup in contact-intensive services was likely to support the growth momentum. On the major challenges, he said inflation was emerging as a key risk to sustainable global economic recovery with supply-chain constraints and rising energy prices. “Crude oil (Brent) price at above $85 per barrel (October 2021) has risen over 60 per cent in 2021 despite the decision by OPEC plus (July 2021) to boost output till April 2022. The World Bank (October 2021) forecasts that energy prices are expected to average more than 80 per cent higher in 2021 y/y and will remain elevated in 2022, adding to global inflationary pressure and potentially shifting economic growth to energy-exporting countries from energy importing ones,” Kumar said. The consumer price index (CPI) fell to 4.3 per cent in September 2021, the lowest since April 2021. Sharply decelerating food prices have eased headline inflation closer to the midpoint of the RBI’s target. “Trade growth is rebounding strongly, with much stronger imports than exports, reflecting India’s robust economic recovery,” the vice-chairman said. He said India sustained its pace of economic recovery in September 2021 as reflected by acceleration in the manufacturing PMI at 53.7 in September (52.3 in August 2021), offset by a modest deceleration in the services PMI at 55.2 (56.7 in August 2021). Other key high frequency indicators — power consumption, railway freight, goods and services tax collection, e-way bills, etc — also showed a continued pickup. The index of industrial production (IIP) witnessed growth of 11.9 per cent in August 2021 with core sector output growth of 11.6 per cent, reflecting strong activity in the industrial and infrastructure sectors. On the Centre’s finances, he said higher than expected revenue trends, driven by both direct and indirect taxes, had provided the much-needed fiscal space for required policy action. He said India achieved the landmark milestone of administering 1 billion Covid-19 vaccine doses on October 21 and the rapid vaccination drive across the country would ensure that the risk of future waves was minimised.

Source: Business Standard

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RSWM to spend Rs 330 crore in capex this fiscal

 RSWM Ltd, a manufacturer and exporter of synthetic and blended spun yarns, will invest Rs 330 crore in capital expenditure (capex) over the current financial year, to continue its growth trajectory and stronger financial performance. The investment allocation will support the expansion of the denim fabric manufacturing capacity, cotton melange yarn manufacturing capacity and modernisation across all units, the flagship company of the LNJ Bhilwara Group said in a statement. RSWM Chairman and Managing Director Riju Jhunjhunwala said the financial year 2020-21 was a year full of learnings and challenges both in terms of business and battling the pandemic. However, it was also a satisfying year for the company as it has made structural changes that were critical for a sharper focus of business growth. ''Further, an allocation of Rs 330 crore is done for continued growth trajectory and stronger financial performance. ''The investment allocation will support expansion of the denim fabric manufacturing capacity, cotton melange yarn manufacturing capacity and modernisation and balancing equipment across all units,'' said Jhunjhunwala. The company has returned into profitability after delivering a profit after tax (PAT) of Rs 82 crore for in the first half (April-September) of the current financial year. Despite the lockdown-induced restrictions in many parts of the country during the second wave of COVID-19, RSWM has registered a turnover of Rs 1,695 crore in the first half of FY22 as against Rs 769 crore in the corresponding period of FY21, he added. On the outlook, the company said it is looking forward to continued robust business performance in the third quarter of 2021-22, as consumer sentiments and market confidence improved due to increasing vaccination. ''Moreover, increased penetration of organised retail, festive celebrations, favourable demographics and rising income level is expected to drive demand of textiles after recording a sharp increase in online apparel buying during the COVID-19 lockdowns. ''With this, the pandemic has also led to an increased demand for technical textiles,'' it said. RSWM produces and supplies yarns to some of the most renowned brands in over 78 countries. It is one of the largest manufacturers and exporters of synthetic and blended spun yarns from India. The company is part of the USD 967-million LNJ Bhilwara Group, which had started in 1960 with a textile mill in Bhilwara, Rajasthan. It has now diversified in textiles, graphite electrodes, power generation, IT-enabled services, power engineering consultancy services, energy storage solutions, and skill development.

Source: Dev Discourse

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Freight rates perk up, but diesel hike hits margins in India: CRISIL

 With the monsoon withdrawing, consumption recovering and infrastructure activity picking up, freight rates saw a sequential recovery in October, according to rating agency CRISIL, which recently said that with high diesel prices, the overall profitability of Indian transporters remains below levels seen in the closing quarter of the last fiscal. The recovery has been broad-based, with most route-commodity combinations seeing an increase in freight rates. In October 2021, 80-85 per cent of the combinations saw an improvement in freight rates over August 2021, while 15-20 per cent was unable to pass on the diesel price hikes due to demand-supply considerations. CRISFrex captures changes in freight rates on a sequential basis. What makes it first-ofits-kind in India is that it also tracks the free cash flows, or FCF (pre-EMI) of transporters on an ongoing basis. Higher FCF would typically lead to higher demand for commercial vehicles. Applications like textiles (especially readymade garments) have been struggling as demand may take another few months to revive to pre-pandemic levels, CRISIL said in a report. Over the past 2-3 years, the domestic road freight transportation industry ran into many speed-breakers. The axle load norms caused a discernible drop in fleet utilisation levels in fiscal 2019, while the BS-VI norms led to a 10-15 per cent increase in the prices of new trucks in fiscal 2019-20. Then came the COVID-19 pandemic and the sharp economic contraction. In the first quarter of fiscal 2020-21, fleet utilisation rates plunged with most consumption and demand centres locked down. A sequential recovery was visible with a gradual reopening of the economy over the next three quarters Amid all this, freight demand recovery was sporadic across segments; FMCG/FMCD recovered faster than discretionary segments such as readymade garments/textiles, and other consumer durables. Even within states, recovery varied based on the pandemic caseload and unlocking levels. In such scenarios, transporters, logistics service providers, original equipment manufacturers and financers need to know the predicament of freight users, taxonomised by sectors, routes, applications and platforms. CRISIL, which has been tracking freight rates and operator cash flows (pre-EMI) across 32 key routes in India on a bi-monthly basis since October 2020, will now deliver the data signals every month. FreightSigns has found that consumer essentials like agri-products and FMCG/FMCD are the most resilient and stable segments driving the trucking industry, even in the current context. In fact, many large fleet operators have shifted focus from bulk commodities to lighter applications in the past two years. Two, the industry is showing signs of improvement in terms of the freight index and EMI serviceability across route-commodity combinations despite a jump in diesel prices. That’s because freight rates increased relatively higher compared with the increase in diesel prices over June-October 2021. Furthermore, utilisation in terms of the average monthly running or the number of trips done has also improved across most of the 159 route-commodity combinations tracked by CRISIL.

Source: Fibre2 Fashion

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Bangladesh signs MoU with France to boost trade

Bangladesh offers best competitive fiscal and non-fiscal incentives for investment, says FBCCI chief To boost bilateral trade between Bangladesh and France, the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI) recently signed a memorandum of understanding with Mouvement des Entreprises de France International (Medef International) at the France-Bangladesh business council meeting. The meeting, organised by Medef International and the Embassy of Bangladesh in France, took place on 10 November in Paris, read a press release. Md Jashim Uddin, president of FBCCI and Pierre–Jean Malgouyres, chairman of the France – Bangladesh Business Council, Medef International, inked the deal on behalf of their respective organisations. Prime Minister Sheikh Hasina virtually addressed the event as the chief guest. Dr AK Abdul Momen, foreign minister of Bangladesh, Salman F Rahman, private industry and investment advisor to the prime minister of Bangladesh and Khondker M Talha, ambassador of Bangladesh to France, were also present in the meeting. Addressing the meeting, FBCCI President Md Jashim Uddin stated that Bangladesh attaches great importance to its existing cordial relations with France. "France is the fifth-largest export destination for Bangladesh showing a rising trend in major export products like woven garments, knitwear, home textile and footwear," he added. He said Bangladesh offers the best competitive fiscal and non-fiscal incentives for investment. "Manufacturers of Bangladesh are adopting greener technologies and modern production methods aligned with 4IR and challenges of climate change. Among the world's top 10 green RMG factories, seven are located in Bangladesh," the FBCCI chief added. He further said that to ensure inclusive growth, Bangladesh requires huge foreign direct investment. The meeting was attended by many senior FBCCI officials.

Source: TBS News

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Vietnam issues implementation guidance for UKVFTA on trade remedies

 The Ministry of Industry and Trade, Government of Vietnam, has issued Circular No. 14/2021/TT-BCT guiding the implementation of the United Kingdom-Vietnam Free Trade Agreement (UKVFTA) on trade remedies. The circular guides the investigation and application of anti-dumping, anti-subsidy and bilateral safeguard measures on the implementation of the UKVFTA. Anti-dumping duty or countervailing duty must not be higher than the dumping margin or subsidy level, states the circular that takes effect from December 15, 2021. The bilateral safeguard measure and the safeguard measure provided in Article XIX of the 1994 General Agreement on Tariffs and Trade may not be concurrently applied to the same imported goods eligible for preferential tariffs under the UKVFTA, the ministry said. “The time limit for investigation for application of bilateral safeguard measures is 1 year from the date the investigation decision is issued. The duration for application of a bilateral safeguard measure must not exceed 2 years. In case the investigating agency concludes that a bilateral safeguard measure must be further applied to prevent or remedy serious damage and facilitate the adjustment of the domestic industry, the duration for application may be extended for 2 more years,” the ministry added in its circular. In case the duration for application of a bilateral safeguard measure is longer than 2 years, such measure must be gradually loosened throughout the application of the duration.

Source: Fibre 2 Fashion

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Korea seeks deeper engagement with Bangladesh with focus on young generation

Momentum around 50th anniversary of relationship to take ties to new height, says Ambassador Lee South Korean Ambassador to Bangladesh Lee Jang-keun has said his country wants to take the strong relations with Bangladesh to a new height engaging deeply in every potential area giving much focus on the young generation in terms of cooperation and collaboration. “The Golden Jubilee of diplomatic relations in 2023 would be a significant momentum for the two countries to take the strong ties to a new height,” he said, mentioning that the two countries now need to diversify the areas of cooperation. He was delivering the keynote address at a webinar hosted by the Cosmos Foundation, the philanthropic arm of the Cosmos Group, at its Ambassadors’ Lecture Series Dialogue premiered on Thursday. The topic for discussion was "Bangladesh-South Korea Relations: Prognosis for the Future." Enayetullah Khan, chairman of the Cosmos Foundation, earlier made the inaugural remarks. Dr Iftekhar Ahmed Chowdhury, a Singapore-based renowned scholar-diplomat and former foreign affairs advisor of Bangladesh Caretaker Government chaired and conducted the session. Ambassador Lee, stated that he keeps three key words -- elevation, diversification and generation -- in his mind always, and said Bangladesh is a young country with the majority of its young people that deserves attention. He said they have to focus on the young people in their collaboration as the young generation owns the future of this country. Dr Debapriya Bhattacharya of the Centre for Policy Dialogue, Chairman and CEO of Youngone Corporation and KEPZ Corporation (BD) Ltd Kihak Sung, former BGMEA President and Mohammadi Group Chairperson Dr Rubana Huq, former Bangladesh Ambassador to South Korea Iftikharul Karim; and Research Fellow and Head at Bangladesh Centre for Terrorism Research (BCTR) Shafqat Munir comprised the panel of discussants. Enayetullah Khan echoed the ambassador on what he says Bangladesh-Korea relationship looks bright and will grow even brighter. “I hope our relationship will grow deeper and wider and I would say we’ll enjoy a strategic partnership of relations between Bangladesh and Korea,” he said. One of the cornerstones of the Bangladesh-Korea relationship has been the Youngone Corporation, probably the most important foreign company success story in Bangladesh in the last four decades, Khan said, adding, “They’re the largest foreign investors in Bangladesh’s RMG sector.” Appreciating the diversified role of Kihak Sung, Khan said the Youngone Chairman has not only created a world-class export processing zone in Chattogram but also has turned it into a place of nature conservation and biodiversity. “Kihak Sung has worked very silently to promote Bangladesh-Korea ties.” He said the bilateral trade volume between Bangladesh and South Korea is almost close to $1.6 billion and hoped that it will become $2 billion soon. Dr Iftekhar Chowdhury said Korea has been the lead bird in the Asian region in what in development economics is known as the “flying geese paradigm”, and the Korean model is supremely worthy of emulation by others. He said Korea’s global role has been concomitant with its economic rise and one example was the leadership at the United Nations provided by former UN Secretary General Ban Ki-moon what he has personally witnessed. Dr Iftekhar said bilateral relations between Bangladesh and Korea have grown by leaps and bounds and have been mutually most rewarding. He stated that the relations have the potential to be even more robust, adding: “Our ties are a good example of how shared values can effectively drive positive collaboration between two nations.” He recalled how the skilled labour market opened up in Korea which is different from the kind of market Bangladesh sees in the Middle East. Dr Iftekhar hoped this is something that they focus on as the two countries can benefit enormously from this. He appreciated the enormous contributions of Kihak Sung to the Bangladesh economy and said: “I would like to state unequivocally that he’s a true friend of Bangladesh.” Dr Debapriya said it is a matter of great anguish for him as an economist to see that Bangladesh could not really take the full advantage of the South Korean market even after duty- and quota-free market access and diversify its products beyond the garments and leather. Talking about Foreign Direct Investment (FDI), he said Korean investment is also diversifying into non-garment areas, IT, technological upgradation and all other issues which he termed very fantastic. “I hope the FDI process will further take its momentum.” Coming on the remittances, the economist said Korea has been one of the incremental sources of remittances beyond Bangladesh’s traditional sources -- Saudi Arabia, Kuwait, the United Arab Emirates and others. “We'll need much more skilled people to be working there and we need to prepare for the new markets,” he said. If Korea continues DFQF market access beyond 2026, Dr Debapriya said, it would be a great gesture on the part of the Korean government to strengthen the partnership with Bangladesh. But at the same time, he said, there may be much more selective and supportive international support measures for the diversification agenda which Ambassador Lee has rightly mentioned that they link it up with LDC strategy. The economist mentioned that geopolitically Bangladesh has become such an attractive attention globally. “We quite often don’t appreciate in this modern globalized world the relationship that happens here is not necessarily what happens here. It happens as a result of many other things which happen elsewhere in the world,” he said. Inspired by his love of nature and outdoor pursuits, Sung founded Youngone Corporation in 1974 and started their operations in Bangladesh 40 years ago. “There’re lots of joys and lots of struggles if we look back in the past decades,” he said. Sung hopes the textile zone at the Korean EPZ in Chattogram will become a "textile hub" in Bangladesh bringing a lot of businesses. Bangladesh needs to make a lot of efforts to produce and supply more manmade fibre (MMF) so that such a supply chain is established successfully here. Sung expressed optimism over an increased export from Bangladesh to Korea and other countries. “I think going forward, Bangladesh needs to make a lot of efforts to make FTAs (Free Trade Agreements) with many countries so that these low hanging fruits of textile and clothing business can be harvested properly,” he said. Before seeking to pluck new fruits, Sung said, there is more need to reap the existing low lying fruits further. “We need to do that. But we need to harvest textile and clothing business as much as possible going forward,” he added. Sung made a presentation on what the Youngone Corporation is doing apart from highlighting the new initiatives at Korean Export Processing Zone (KEPZ). Korea Export Processing Zone (KEPZ) has recently inaugurated a 100-acre Hi-tech Park within KEPZ. Dr Rubana Huq said Bangladesh supplies $323 million of garments to Korea whereas Korea buys $9 billion from other countries. She said there is a mismatch between what they supply and what Korea buys. “We need to crack your better market and we need your support in value-added products. We’re doing better with Korea and we would just like to do more.” Dr Rubana said light engineering is one thing that they all like to go into because only dependence on the RMG sector has to end. “We’ve to do that, and we need Korea’s support as well in this regard.” She emphasized the need for a “virtual market”, adding that the online market is expected to go up to $872 billion by 2023 and Bangladesh should not miss this opportunity. If Korea can extend a helping hand, especially while Korea concentrates on elevation, generation and of course diversification, Rubana said, adding: “I think your (Ambassador) expectations will soon be translated into reality if we’re all in it together.” Former Ambassador Iftikharul Karim said he believes, first and foremost, political relations must be nurtured and strengthened through regular, periodic bilateral dialogue at the highest levels emphasizing sovereignty, mutual respect and cooperation at the bilateral, international as well as regional level. Secondly, the former diplomat said, economic, trade and commercial relations need to be given priority while taking into account the fragility of Bangladesh economy and its needs. “Focusing on small and medium industrial enterprises could be a priority consideration and should be promoted and protected as Bangladesh economy shifts to industrialization,” he said. Iftikharul Karim said diversification of the Bangladesh economy to engage in new sectors such as the ICT industry, where South Korea is already a giant, could become the engine of economic cooperation between the two countries. Thirdly, he said, there has to be conscious and deliberate policies to promote and strengthen interaction between trade bodies and entrepreneurs for mutual confidence building and seamless sharing of information. The future trajectory of Bangladesh-Korea relations has immense potential and if the political leadership sees fit, they can together take this already established friendship to an entirely different and higher plane that will make the past 50 years, impressive as it is, look like a pale shadow. Shafqat Munir shifted the focus on security cooperation, greater cooperation on strategic and geopolitical issues; and more specifically on defence cooperation that the two countries could potentially do in terms of innovating and diversifying the relationship. He endorsed the statement by Dr Debapriya that the bilateral relations are no longer confined to what happens between the two capitals and it is essentially also a reflection of what happens in the region and what happens in the wider geopolitical space. “In this context, I don't see a lot happening between Dhaka and Seoul at the moment - but there's a serious opportunity for us to do more,” said the analyst, noting that Korea is a significant geopolitical player in the international scene. He appreciated Korea’s continued support for resolving the Rohingya refugee crisis. “We really appreciate the support that you have provided us but as the crisis has now entered almost into its fifth year, we’ll continue to seek your support in the international arena and bring the situation to a peaceful resolution.” Ambassador Lee, who had made a detailed presentation with historical references, concluded saying they need to move beyond RMG and diversify collaboration between the two countries as so far RMG occupies the largest portion of collaboration. Dr Iftekhar Chowdhury, the chair of the discussion, in his concluding remarks underscored that while bilateral relations between Bangladesh and South Korea are excellent, there is also ample room and scope for much greater cooperation.  As Bangladesh graduates out the LDC status, he said, it will need to upgrade and widen its export market and Korean support and technology transfer would be most useful.

Source: Dhaka Tribune

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Ethiopia's Bahir Dar Industrial Park Begins Exporting Textiles

 Bahir Dar Industrial Park, located in Ethiopia's Amhara region, has started exporting textiles. One of the 13 industrial parks in Ethiopia, Bahir Dar Industrial Park is fully dedicated to textile production. The industrial park, which went operational in October 2020, has so far created permanent and temporary employment for 1,300 workers. Hop Lun Apparel Ethiopia PLC, a company founded in Hong Kong in 1992, has become the first company to export apparel from its production plant at Bahir Dar Industrial Park. The company has exported 75,000 apparel, worth over $570,000, to the US market. Tiruye Kume, General Manager of Bahir Dar Industrial Park, remarked the industrial park will have an important role to play in alleviating the lack of foreign currency as it goes on to operate in its full capacity. Employment, skill transfer, and generating foreign exchange are priority areas the industrial park is focused on, she added.

Source: 2merkato

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