NATIONAL

• Bombay High Court forestalls Alok Industries' debt recast move
• For better social fabric, apparel makers under global eye
• Vietnam, India hail progress in textiles trade
• Free movement of businessmen in SAARC area by May: Jaishankar
• Morgan Stanley cuts India's 2016 GDP estimate to 7.5%
• Global Crude oil price of Indian Basket was US$ 36.10 per bbl on 16.03.2016

INTERNATIONAL

• Algerian textile industry seen as jobs creator
• Ban on second hand clothes to improve local industries
• 'Liquidity crunch hurting Pakistan textile exports'
• IMF projects 4.9% GDP growth for Indonesia

Textile Raw Material Price 2016-03-16

Source: Global Textiles

Note: The above prices are Chinese Price (1 CNY = 0.1535 USD dtd16/03/2016)

The prices given above are as quoted from Global Textiles.com.  SRTEPC is not responsible for the correctness of the same.

Bombay High Court forestalls Alok Industries' debt recast move

A Bombay High Court order on Wednesday forestalled implementation of textile maker Alok Industries' resolution for its lenders to convert loans into controlling equity until a winding-up petition by HSBC is worked out. Alok had taken the decision earlier this week as part of a corporate debt restructuring. However, HSBC's petition filed on behalf of a consortium of unsecured lenders, led by VTB Capital, is pending. It concerns Alok Industries' liquidation and settlement of $55 million outstanding dues, part of a $125-million loan the company had taken.  The matter has been adjourned till March 22 in the hope that the involved parties will come to an agreement, allowing the takeover process to continue, said a person aware of developments. Alok had offered guarantee in an offshore holding company that has no assets, said another person familiar with the details. Trilegal, the empaneled firm representing HSBC, and counsel for Alok IndustriesBSE 12.76 %, Sharan Jagtiani both declined to comment.

In January, a joint forum of 25 banks —led by State Bank of IndiaBSE 1.13 % that has loaned around Rs 13,000 crore to Alok — had decided to convert loans into a 65% equity stake. SBI Capital Markets was mandated to run a formal auction process to sell the core businesses as a whole or in parts and had called an extraordinary general meeting earlier this week. However, this process has no proposals for unsecured lenders though it accounts for repayment of its secured lenders, mostly public sector banks. HSBC and the investors it is acting for stand to lose more if the court orders liquidation, as they rank lower than secured lenders. "It is often a pressure tactic to file a winding-up petition," said a corporate lawyer asking not to be identified. The Bombay High Court's decision to stop lender action may set a precedent. In several similar pending cases, secured lenders are engaging with unsecured lenders out of court to arrive at haircut ratios and repayment schemes because court proceedings could hold up repayment for all concerned.

SOURCE: The Economic Times

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For better social fabric, apparel makers under global eye

Indian apparel suppliers including those catering to global brands such as Gap, H&M and Marks & Spencer will now be monitored for unfair trade practices, following the signing of an agreement by a consortium of international agencies including the UNICEF, Stop Child Labour and Solidaridad. The agreement on sustainable garment and textile, drafted under the guidance of the Social and Economic Council of the Netherlands, was signed on Friday in Netherlands by a broad coalition of industry organisations, trade unions, civil society organisations and the Dutch government. "Child labour and other abuses - from cotton to garments clothing - will be identified and addressed within three to five years," Gerard Oonk, director India Committee of the Netherlands told ET. "One of the specific goals is that companies within three years only source from suppliers in south India who do not use child labour and forced labour. From the third year on, the participating garment companies will also publicly communicate about their progress," he said. There is a possibility that suppliers will be put on a "blacklist" if they do not remediate labour rights violations, he said. There have been many instances of international brands withholding consignments from their Indian suppliers due to non-payment of salaries or issues pertaining to provident fund as well.

Although problem areas in India are minuscule compared to neighbouring Bangladesh whose apparel exporter sector came under a cloud since the 2013 Rana Plaza factory collapse claimed 1,100 lives, the $18 billion apparel export industry in the country cannot afford to err, said Prashant Agrawal of management consultancy firm Wazir Advisors. "With consumers getting conscious about the clean supply chain forcing brands to source ethically, this agreement would serve a significant role to cleanse the Indian supply chain," Agrawal said. Companies such as Gap and H&M have in the past forced their Indian suppliers to comply before they "resumed" business, he said. Apparel exporters from knitwear cluster in Tirupur, which caters to companies including Tommy Hilfiger, Nike and Gap, have been accused of practising bonded labour under the guise of a social security scheme 'Sumanagli'. "We are clean and complaint," said A Sakthivel, the president of Tirupur Exporters' Association, which represents nearly 1,000 exporters that employ about 4 lakh people. However, exporters ET tried to reach out to on this issue remained tight-lipped. Agrawal said that the agreement will have ramifications not just in the EU but in all western markets that source from India as major brands join forces to clean the supply chain. Oonk said that the companies that agreement will ensure that the suppliers do not engage child labour, bonded labour or pay below decent wages, allow freedom of association and implement other labour rights and environmental norms.

SOURCE: The Economic Times

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Vietnam, India hail progress in textiles trade

Vietnam and India have made significant progress in textile and garment trade last year, Vietnamese Deputy Minister of Industry and Trade Do Thang Hai said on Tuesday. He made the statement at the third meeting of the Vietnam-India Joint Sub-Commission on Trade in New Delhi, the Vietnam News Agency reported. Commerce Secretary Rita Teaotia who led the Indian delegation, said the partnership between the two countries has been further developed in multiple fields, including textiles and garments. Teaotia suggested the two sides enhance information exchanges, particularly in trade and commerce, as well as to strengthen connections in air and sea transportation. The Vietnamese deputy minister said that bilateral cooperation has seen notable progress since the second meeting of the Vietnam-India Joint Sub-Commission on Trade in Hanoi last year; the highlight being textiles and garments, followed by energy and industry, footwear and chemicals.

To further cement economic ties, Do Thang Hai recommended the two nations enhance regional value chains and identify ways to support businesses. He also urged that India's privileged credit package worth $300 million for investments in Vietnam's garment and textile sector, should take effect soon. Hai suggested that India can consider opening a bonded warehouse in Vietnam to reduce costs and increase competitiveness for its products. Hai also met Textiles Minister Santosh Gangwar. The two countries could complement each other and tighten their partnership so as to integrate into global value chains more deeply, he noted. Gangwar said the government would try to meet the challenges to stabilise Indo-Vietnam cooperation in textiles and garments,. He also said the upcoming visit of Prime Minister Narendra Modi to Vietnam will give a push to that end.

SOURCE: Fibre2fashion

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Free movement of businessmen in SAARC area by May: Jaishankar

Foreign Secretary S Jaishankar on Wednesday said the SAARC Business Travellers’ card that will ensure seamless movement of businessmen within the South Asian region will be launched by May. “The SAARC Business Travellers’ Card, an initiative designed to enable easier movement of South Asian businessmen to India, will be launched within the next two months,” he said while addressing the 42nd SAARC Standing Committee Meeting in Pokhara, Nepal. In an official statement issued here, Jaishankar highlighted the need for greater connectivity within the SAARC region. He said that the speed of regional connectivity has to be “hastened” particularly in those areas that are central to the SAARC developmental agenda. “In this context, I urge that we sign, at an early date, the SAARC Motor Vehicles Agreement and SAARC Railways Agreement. Finalisation and implementation of these agreements will realise a long standing dream of seamless movement of passengers and cargo through the entire region,” he said. He added that India was focussing on projects in areas such as rail and road building, power generation and transmission, waterway usage and shipping through regional, sub-regional, trilateral and bilateral arrangements. Jaishankar also hoped that the much-touted SAARC Satellite may be launched by the end of the year, which is aimed at supporting applications in the area of health, education, disaster response, weather forecasting and communications. He said the SAARC Knowledge Network would provide a unified high speed network backbone for knowledge related institutions in the region. “This will bring together all stakeholders – scientists, researchers and students – to work closely for faster development,” he added.

SOURCE: The Hindu Business Line

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Morgan Stanley cuts India's 2016 GDP estimate to 7.5%

Global financial services firm Morgan Stanley has scaled down its growth forecast for India for 2016 to 7.5 per cent from 7.9 per cent previously. It noted that the country's economy is expected to see tepid recovery mainly due to external factors. Morgan Stanley said that though the domestic macro environment has been improving steadily in the last two years, the pace of recovery has been slower than anticipated, reined in by weak external demand conditions. “We are revising down our growth estimate for 2016 to 7.5 per cent from 7.9 per cent previously and for 2017 to 7.7 per cent from 8 per cent,” Morgan Stanley said in a research note.

Despite the downward revision, the global brokerage firm said there is a slow recovery in growth driven by domestic factors. “We expect the recovery in growth to be driven by domestic drivers – urban consumption and a revival in public capex. We expect the rise in foreign investment inflows to support the revival in capex further,” the report noted. The report said the country's macro stability conditions are likely to remain in check with a low chance of “overheating”. It expects the current account deficit (CAD) and inflation to remain moderate. While external demand conditions continue to be slow, Indian exports have been contracting (in value terms) over the last 14 months, with a broad-based decline in commodity and non-commodity exports. Services exports have followed a similar trajectory, with growth slowing to 0.4 per cent in 2015 from 5.1 per cent in 2014. It said the recovery in private sector capex has been tepid, with a muted rise in projects under implementation in 2015.

SOURCE: Fibre2fashion

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Global Crude oil price of Indian Basket was US$ 36.10 per bbl on 16.03.2016 

The international crude oil price of Indian Basket as computed/published today by Petroleum Planning and Analysis Cell (PPAC) under the Ministry of Petroleum and Natural Gas was US$ 36.10 per barrel (bbl) on 16.03.2016. This was higher than the price of US$ 35.42 per bbl on previous publishing day of 15.03.2016.

In rupee terms, the price of Indian Basket increased to Rs 2431.94 per bbl on 16.03.2016 as compared to Rs 2381.35 per bbl on 15.03.2016. Rupee closed weaker at Rs 67.37 per US$ on 16.03.2016 as against Rs 67.23 per US$ on 15.03.2016. The table below gives details in this regard: 

SOURCE: PIB

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Algerian textile industry seen as jobs creator

Algeria's Labour and Employment Minister Mohamed El Ghazi has stressed that textile industry has a "great potential" in terms of job creation in the country, the Algeria Press Service has reported. Textile industry "plays an important part in economic stimulus programmes launched by President of the Republic Abdelaziz Bouteflika," the minister said. "Textile industry is known for its great potential in terms of job creation as Algeria has undeniable assets, mainly in terms of units, qualified workforce, demanding local market and interesting export assets particularly for the African market," El Ghazi said at a forum on Algerian textile industry in the capital Algiers. The minister said the efforts of government's National Agency for Support to Youth Employment (ANSEJ) and the National Unemployment Insurance Fund (CNAC) have made possible the financing of 8.944 micro-businesses that generated 29.894 jobs. He said that these micro-businesses "working in some textile accessories subcontracting would contribute to the diversification of national economy."

SOURCE: Fibre2fashion

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Ban on second hand clothes to improve local industries

East Africa where second hand clothes and shoes known as mitumba are commonly available throughout not only allows governments to earn from import revenues and business licence fees but employs thousands in these countries. Mitumba also allows consumers to have access to variety. One can buy a Calvin Klein dress for about $5, which is definitely better than that $30 Chinese dress which fades after the second wash, or a pair of Grenson shoes for less than $10, certainly better than those shoes imported from Asia that burn your feet. But not everyone is happy with mitumba. Local producers have been lobbying East African governments to impose a higher levy on second-hand clothes and footwear. The 17th Ordinary Summit of the East African Community Heads of State held in Arusha, Tanzania on March 2, 2016, directed member states to phase out importation of used textile and footwear within three years. The clarion call ‘Buy East Africa, Build East Africa’, is aimed at promoting industrialisation of the region.

Notwithstanding the positive impact of banning used clothes and shoes in local industries and long-term growth of the region, the move may not necessarily be optimal. Improving the business environment under which domestic producers can be as competitive is optimal through providing reliable and cheap electricity and water; improving access to good roads; reducing corruption that adds onto the cost of doing business; and providing incentives to foreign companies to establish plants in the region. The move to ban used clothes and shoes will result in socio-economic costs, albeit in the short run. The reality is thousands of second-hand business operators will be out of a job after three years without a safety net. East Africans will be forced to buy either first-hand imports or low-quality but dearly priced locally manufactured clothing and shoes for some years to come, which basically makes the move less pro-poor.

SOURCE: Yarns&Fibers

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'Liquidity crunch hurting Pakistan textile exports'

Chairman of All Pakistan Textile Mills Association (APTMA) Tariq Saud has said the liquidity crunch of large manufacturers cum exporters has started hurting the textile industry exports seriously due to the pending sales tax refunds. Consequently, he said, the manufacturing of exportable goods is being compromised heavily. He said the Ministry of Finance has announced liquidation of refunds up to Rs 5 million in cases where the Refund Payment Orders have been issued from March 15 to 30. "This is a positive development and the textile industry is grateful to the Federal Finance Minister Ishaq Dar," he added. However, he said, it will not resolve the liquidity issues of major manufacturers cum exporters, each of whom has got stuck-up hefty outstanding amounts as refunds up to Rs 500 million.

SOURCE: The Business Recorder

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IMF projects 4.9% GDP growth for Indonesia

The International Monetary Fund (IMF) expects Indonesia's economy to expand 4.9 per cent year-on-year in 2016, slightly up from a 4.7 per cent in 2015. It said Indonesia has "safely navigated" challenges caused by the fall of commodity prices and China's slower growth path, but the outlook could still worsen. "Risks to the outlook are tilted to the downside, mainly from external factors including more volatile global financial conditions, a deeper-than-expected slowdown in emerging market trading partners and further declines in commodity prices, requiring continued vigilance by policymakers," the IMF said.

In its annual policy review, the Fund said medium-term growth prospects are favorable, provided that Jakarta charts a course to more inclusive growth and takes steps to enhance financial system stability. The IMF Executive Board said that Indonesia's tight monetary policy in 2015 helped to anchor inflation expectations, with headline inflation expected to remain within the target band of three to five per cent in 2016. But they urged a cautious approach to monetary easing. Indonesia's central bank cut its benchmark interest rate in February by 25 basis points to 7 per cent. "While the recent easing is appropriate, (IMF directors) agreed that it should be gradual and cautious to safeguard financial stability, keep inflation within the target band and support external adjustment," the IMF said, adding that bond yields should remain market-driven. The Fund applauded cuts in Indonesia's energy subsidies in 2015 but warned that low oil prices were causing government revenues to underperform their targets. It said that this would require steps to diversify revenues so that the government can continue to make infrastructure and social investments to boost the economy's growth potential.

SOURCE: Fibre2fashion

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