The Synthetic & Rayon Textiles Export Promotion Council

MARKET WATCH 15 APRIL, 2016

NATIONAL

 

INTERNATIONAL

 

Spinners against anti-dumping duty on VSF

The Indian Spinners Association (ISA) has asked the government to end anti-dumping duty imposed on imports of viscose staple fibre (VSF) because the levy could hit domestic textile manufacturers. The ISA's demand has come amid the Directorate General of Anti-Dumping & Allied Duties, under the commerce ministry, initiating a sunset review investigation for assessing the need for continuation of anti-dumping duty on viscose staple fibre (VSF) imported from Indonesia and China.

In a statement, the ISA that continuation of the duty on the fibre will have a "deleterious effect" on the textile sector, which is already reeling under high cost of production and sagging export demand. VSF is one of the major inputs for manufacturing of man-made fibre yarn in India and is mostly used for the manufacture of fabrics made of poly-viscose and viscose yarn. The ISA has also requested the Ministries of Textiles, Commerce and Central Board of Excise and Customs for removal of the duty to ensure fair competition and to make available the viscose at international prices in India. The ISA also alleged that anti-dumping duty is being used by the domestic VSF manufacturing industry as a shield to cover its inefficiencies and inadequacies in a competitive environment.

SOURCE: Fibre2fashion

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Textile ministry declares steps for welfare of Scheduled Caste workers

The textile ministry on Wednesday announced a raft of measures for the welfare of weavers, artisans, jute and sericulture workers, and entrepreneurs belonging to the Scheduled Caste (SC) category, and earmarked a budget allocation of Rs 167.5 crore for this purpose for 2016-17. The ministry has also decided to offer group insurance scheme to powerloom workers free of cost and will bear the maximum financial burden of such a scheme. The government will bear the weaver’s share of Rs 80 completely, taking its own share to Rs 370 per weaver, out of the total premium of Rs 470 per weaver. The remaining Rs 100 per weaver will continue to be paid from the Social Security Fund of LIC. The weavers belonging to the SC category will get higher subsidy to upgrade for powerloom under the modified scheme. The Central government will provide financial assistance to the extent of 75% of the cost of upgrade, subject to a subsidy cap of Rs 60,000 per loom, for attachment with rapier kit. The new scheme came into effect from April 1, 2016. The allocation for the welfare of the SC category in the handloom sector has also been raised to `40 crore for the current fiscal, compared to Rs 16.38 crore a year before. Similarly, in handicrafts, the budget outlay for the welfare of SC category artisans has been increased from Rs 14.6 crore in 2015-16 to Rs 43 crore for the current fiscal.

For imparting skills to the SC workers, the National Jute Manufacturers Corporation (NJMC) has decided to train about 75% of its total manpower from the SC category. A scheme for housing will soon be formulated for SC workers in jute mills, in which the government could offer 50% subsidy. In the silk sector, a special scheme covering all important beneficiary-oriented activities across the silk production chain has been prepared for SC beneficiaries, with an allocation of Rs 24 crore. The scheme will cover around 1,000 SC families in the states of Uttarakhand, Uttar Pradesh, West Bengal, J&K, Telangana and Andhra Pradesh.

SOURCE: The Financial Express

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Coimbatore textile industry demand govt to help improve competitiveness

The industries in Coimbatore especially textile industry want government to improve the competitiveness of the industries compared to those in other states for which they have some common demands that they want the elected representatives to address industry specific issues and some others. Even if the political parties do not include these in their election manifestos, they need to address the problems if elected to power, said industry representatives. For the textile industry here, one of the main demands is reduction of Value Added Tax (VAT) on yarn.

Tamil Nadu which has the largest number of spinning mills in the country has been urging for reduction of VAT to two percent, on a par with Central Sales Tax as mills from Andhra Pradesh sell yarn in Tamil Nadu at a lower cost compared to the mills here. It is because they pay two percent CST but the mills in Tamil Nadu pay five percent VAT. If the Central Government introduces GST this issue would be addressed. Otherwise the State Government should reduce VAT to sustain the entire textile value chain. Industry sources said that Tamil Nadu, despite its strength in textiles, did not announce a textile policy while States such as Maharashtra did so, offering incentives to the industry. Tamil Nadu should support development of textile processing and make project implementation easier, said the industry.

Investments to the tune of Rs. 2,000 crore were committed in the textile sector at the Global Investors’ Meet held in Chennai last year. Majority of this is expected to be in textile processing. The Government should also develop labour quarters and women’s hostels, especially in Tirupur as the industry attracts workers from other districts and states and nearly 25 percent of wages of a knitwear worker goes towards house rent. The elected representatives should interact with the textile industry on regular basis to address their grievances.

SOURCE: Yarns&Fibers

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Tamil Nadu textile companies now look to conserve air

After cutting trenches on the ground to collect rainwater sliding off their roofs, textile manufacturers in Coimbatore and Tirupur have turned to air now, trying to conserve its flow from compressors in their spinning and weaving machines to plug leakages and save energy. A three-day pilot of about 30 mills conducted over the last few months proved the textile machines had a lot to gain by regulating compressed air, which is a key input for modern machines from spinning to weaving. Sealing off weak portions and optimising compressor capacity will reduce draw of power by textile machines, which are power guzzlers. "Air is a utility by itself now and its reckless utilisation means a higher cost of production. More air you use, more is the power consumption. Industries like foundries and even rice mills had realised this. Now, the textiles are catching up," says G Ramesh Kumar, who heads Channel Sales at ELGi Equipments, a manufacturer of compressors helping mills with the pilot.

In TN's textile belt, a large portion of the spinners belong in the category of SMEs. For an average mill of capacity 25,000 spindles, the energy savings through air monitoring stand at 750 units every day. For the state's spinning industry, the annual savings are estimated at Rs 200 crore. "We have implemented robust air monitoring systems in many mills now. The idea is to expose the advantages to more mills and create a model for effective air-monitoring and corrective action," said Prabhu Damodharan, secretary of entrepreneur forum Indian Texpreneurs Federation. Modern textile machines are operated by pneumatic systems, which use gas or compressed air for key processes.

In weaving machines of this day, compressed air ejected from fine nozzles moves weaved threads from one end of the machine to another, a process that was done manually earlier. Compressed air needs to be clean, dry and devoid of impurities like oil or moisture, both capable of impacting performance of the machine. It could lead to increased number of defective garments, higher power consumption or even a sudden breakdown, risking higher capital costs for entrepreneurs.

"Maintenance costs of a compressed air system will equal the price of the product in three years. A full-fledged service once for every 8,000 hours, and it will cost over Rs 4 lakh. Between these services, every time compressed air leaks out of the numerous joints in the air pipeline, I lose money," said Manojh Jhajhariaa, joint MD of Salona Cotspin, who had conducted a six-month air audit at his mills.

SOURCE: The Economic Times

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Maritime India Summit 2016: What Narendra Modi government expects from the initiative

Maritime India Summit 2016: India’s maiden flagship initiative of the Shipping Ministry, the Maritime India Summit 2016, is all set to attract massive investment in the sector. Modi government has laid special emphasis on the need build shipping and port infrastructure. According to Shipping Minister Nitin Gadkari, the Summit provides a unique platform for participants to explore potential business opportunities in Indian maritime sector. MIS 2016 is being organised from April 14-16, 2016 at Mumbai and will be inaugurated by Prime Minister Narendra Modi. India is also set to double its ports capacity to 3000 million tonnes (MT) by 2025, Gadkari has said. The capacity of ports stood at 1,500 MT in 2015. “We will double the capacity of our ports to 3000 MTPA by 2025,” Gadkari said recently. According to Gadkari, the MIS is in pursuance of the government’s policy of giving prime importance to developing the countries infrastructure. We take a look at some interesting facts about the Maritime India Summit:

  1. PM Modi will release a national perspective plan on the Sagarmala Project with details of investments
  2. At the three-day summit, agreements entailing investments of over Rs 82,000 crore will be signed. This includes 35 concession agreements of Rs 5,900 crore, 20 work orders of Rs 8,250 crore and 86 MoUs involving an investment of over Rs 68,700 crore.
  3. More than a dozen union ministers are expected to address the summit, for which 3,000 delegates, including 300 from 41 countries, have registered.
  4. To be held at NSE Grounds in suburban Goregaon, the summit will have 13 technical sessions, 200 exhibitors and 52 participants from South Korea, which is the partner country for the event.
  5. It will also have a museum resembling a ship displaying the maritime history of the country, made by art director Nitin Desai.
  6. India and South Korea also signed a memorandum of understanding for cooperation and mutual assistance in the port sector.

SOURCE: The Financial Express

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Port investments can add 1.4 per cent to GDP growth: Amitabh Kant

Investments in setting up ports and large industrial cities near them can help push economic growth by up to 1.4 percentage points, Niti Aayog CEO Amitabh Kant said. “GDP can grow by 1.3-1.4 per cent more if we can do several things like investing in ports and port connectivity and also by creating very large industrial cities linked to the ports,” Kant told PTI on the sidelines of the maiden Maritime India Summit here. He said a huge number of containers can be handled at such cities and there can be other backward linkages as well on manufacturing and logistics. Inaugurating the Maritime India Summit, Prime Minister Narendra Modi said the government will invest Rs 1 trillion in the ports sector over the next decade to make the 7,500-km long coastline an “engine of growth”. “Our vision is to increase port capacity from 1,400 million tonne to 3,000 million tonne by 2025. We want to mobilise an investment of Rs 1 trillion in the port sector to enable this growth,” Modi said, adding the government will be setting up five new major ports. The country is the fastest growing major economy in the world and is slated to clock a GDP growth of 7.5 per cent in 2016-17, as per RBI estimates. The government, however, wants to take it beyond 8 per cent in the medium-term and into double-digits over the long-term, given the very unique position the country is in in terms of demographics and faster urbanisation. When asked about the slump in exports, Kant said irrespective of such data flows, we should continue to push our exports. Kant further said the world economy will not be the same forever and once the conditions improve, India can benefit the most. To a query on divestments, Kant said the Niti Aayog is working on a comprehensive report and has started collecting the data. “Niti Aayog has just been given the task of working on this and we’ve done a lot of spadework and we will be sending our recommendations,” he added.

SOURCE: The Financial Express

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Sagarmala project to be completed in 5 years

The government will halve the previously estimated 10-year timeframe to complete the Sagarmala port development project, Union Minister Nitin Gadkari said. The minister for shipping, road transport and highways also spoke about an agreement with the defence ministry that could potentially lead to orders worth Rs 50,000 crore for Indian shipyards, including private ones. The Sagarmala project is estimated to create 10-million jobs, he said at the Maritime India Summit here. Developing India's 7,500-km coastline will boost merchandise exports by $110 million and increase coastal shipping volumes by as much as five times of the current levels to about 330-420 million tonne per annum, he said. It could mobilise investment of about Rs 4 lakh crore in India's infrastructure sector over the next 10 years. The National Perspective Programme for Sagarmala was launched here by Prime Minister Narendra Modi on Thursday. "The programme could lead to annual logistics cost savings of close to Rs 35,000 crore, and of the 10-million new jobs that will be created, 40 lakh will be direct employment," Gadkari said. This plan is based on four strategic levers — optimising multi-modal transport to reduce cost of domestic cargo, minimising time and cost of export-import cargo logistics, lowering costs for bulk industries by locating them closer to the coast, and improving export competitiveness by locating discrete manufacturing clusters near ports.

The Sagarmala project is an amalgamation of 150 projects categorised into port modernisation, connectivity, port-led industrialisation and coastal community development, with the government planning to invest Rs 12 lakh crore under various programmes. Under the port modernisation drive, 53 projects are expected to be undertaken to ensure the port handling capacity is increased by 1,000 million tonne per annum. This includes six new mega port projects. "The projects under this sub-category are expected to come at an investment of $15 billion," the minister said. In the connectivity category, $30-billion investment is projected for 10,000 km of new connectivity infrastructure projects as well as seven new dry ports. Under port-led industrialisation, 27 industrial clusters will be develop growth not enough for India’s ed by investing $15 billion.

Gadkari spoke of eight new ports including ones at Sagar, West Bengal; Paradip Outer Harbour in Odisha; Enayam in Tamil Nadu and Vadhavan in Maharashtra. "In addition, potential has been identified for new ports to come up in central Andhra Pradesh, south eastern Tamil Nadu and possibly northern Karnataka," he said. Gadkari also spoke about 12 proposed industrial clusters which would entail an investment of Rs 85,000-90,000 crore in land and an additional Rs 12,000-15,000 crore in basic infrastructure. He said this would lead to addition in GDP of Rs 3 lakh crore. Gadkari spoke of 14 coastal economic zones in Gujarat, Maharashtra, Karnataka, Kerala, Tamil Nadu, Andhra Pradesh, Odisha and West Bengal.

SOURCE: The Economic Times

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7.5 per cent growth not enough for India’s requirement: Arun Jaitley

India’s current growth rate of 7.5 per cent is not enough as per its own requirement standard and the country has the “potential” to do “better”, Union Finance Minister Arun Jaitley has said. Expressing concern over the decline in India’s exports, Jaitley said the country’s growth parameters were on track and the government is moving ahead on its reform agenda with inclusiveness and successfully meeting all its fiscal parameters. “On 7.5 per cent by global standards or by world standards in the current situation are we doing well? The answer is Yes. But by our own requirement standards are we doing well enough? I think, we can do better,” Jaitley said yesterday at the Carnegie Endowment for International Peace, a global American think-tank. “The fact that in this otherwise a globally adverse environment by putting some domestic policies in place, by using investments and surpluses cleverly we have managed to sustain some growth. One of the biggest areas of worry has been the declining exports,” he said.

Noting that both in value terms and volume terms, the global situation has impacted export, Jaitley, who is on a week-long visit to the US, said that things could improve if some of the variables change. “On 7.5 per cent by global standards or by world standards in the current situation are we doing well? The answer is Yes. But by our own requirement standards are we doing well enough? I think, we can do better,” Jaitley said. “Does 7.5 per cent satisfy either the Indian government, me or the Prime Minister or India’s political opinion, the answer is no. I think, by our own yardstick, we realise that we have potential in a helpful environment to do better,” he said, adding that in an adverse global situation, probably one does settle for that rate. “But if hopefully with any of these variable factors growth returning to the rest of the world at some stage, better Indian monsoon, and continued favourable environment of oil prices and the impetus of policy direction in India, if the reforms go on…if we are able to cross those hurdles, our ability to do much better would be there,” Jaitley said. Earlier welcoming Jaitley, Carnegie’s president William Burns, who is the former Deputy Secretary of State, said that India had a very important role to play globally, particularly in Asia. India has surprised China by emerging as the fastest growing emerging economies of the world. “Two years after the BJP came into power there is change in India’s economic situation. Under the leadership of Prime Minister Modi and Jaitley India today is the world’s fastest growing major economy,” Burns said, adding that inflation was moderated and government was committed to reforms.

Jaitley said that about two years ago, when the current government had taken over the situation looked quite challenging, but since then the global situation has never been helpful. In the 21 months the key emphasis of the Modi government has been decisiveness, consistency in terms of policy direction and transparency in functioning, he said. “In terms of economic direction, this government is yet to commit a major mistake,” he said. Jaitley arrived in the US capital yesterday to attend the annual spring meeting of the International Monetary Fund (IMF) and the World Bank, in addition to meeting his Chinese and American counterparts. During his week-long stay, Jaitley would also travel to New York to meet with private sector leaders with an objective to attract foreign direct investments to India.

SOURCE: The Financial Express

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Govt officials, experts to brainstorm on FTAs

Senior officials of the commerce ministry, experts and academicians will brainstorm on Thursday on the impact of free trade agreements (FTAs) on the domestic market and suggest ways to deal with issues and concerns. Besides Commerce and Industry Minister Nirmala Sitharaman, participants include three former commerce secretaries, G K Pillai, Rahul Khullar and Rajeev Kher. Trade experts from think tank Research and Information System for Developing countries would also participate in the discussion. In the session, a detailed presentation on FTAs which have already been implemented and those under negotiations would be given by the officials of the Commerce Ministry, an official said. The deliberation assumes significance as a section of industry and exporters have raised concerns over the impact of free trade agreements on Indian market and industry.

SOURCE: The Business Standard

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Looking forward to RCEP deal at earliest: Nirmala Sitharaman

India has submitted its offers for the proposed 16-nation Regional Comprehensive Economic Partnership (RCEP) and is looking forward to an early conclusion of such negotiations, commerce and industry minister Nirmala Sitharaman said on Wednesday. “India is keen on having these regional arrangements. We look forward to concluding the RCEP at the earliest,” she said at an event. The next round of RCEP talks are in Perth, Australia from April 22. Though India is keen on an early clinching of a deal, sources had earlier told FE that the RCEP talks might stretch longer due to a lack of consensus over services. Some members are unwilling to show flexibility in discussing liberalisation of the services sector, and are instead seeking more relaxation in goods, while India wants a greater commitment from them on services, as it has shown in offering to remove barriers in goods trade.

The RCEP negotiations have already missed the 2015 deadline for conclusion, even as pressure piles up on the bloc to clinch a deal following the Trans-Pacific Partnership between the US and 11 others. The RCEP negotiations formally began in November 2012 and members expect it to be concluded by September this year. India is learnt to have offered to abolish 80% of tariff lines for 10 ASEAN members for goods imports, 65% of tariff lines for Japan and South Korea, and 42.5% for China.

SOURCE: The Financial Express

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Big boost to India – US ties & step to check rising Chinese aggression

Giving a shot in the arm to defence and strategic relations with the US, the Modi government has agreed to conclude a Logistics Exchange Memorandum of Agreement (LEMOA)—one of the three agreements—that had been hanging fire with the UPA government since 2006. The India-specific LEMOA will allow Indian and American military units to use facilities in each others’ bases for re-fuelling and berthing of aircraft and warships subject to mutual agreement in each instance, on a reimbursable basis. During the 1991 Gulf War, the Chandrasekhar government had for a brief while allowed US military aircraft to refuel in Mumbai on their way to Operation Desert Storm—this is not a new thing. But while that was one-off and revoked quickly, this time round it is a formal agreement. The agreement, though, does not entail stationing of any US troops in India as defence minister Manohar Parrikar pointed out. While the agreement is reciprocal, one needs to keep in mind the dynamics between a global power and an aspiring regional power. Of the two other agreements, the Communication Interoperability and Security Memorandum Agreement (CISMOA) and the Basic Exchange and Cooperation Agreement for Geo-Spatial Cooperation (BECA), that are being discussed, CISMOA that involves deploying encrypted communications equipment is reportedly close to finalisation, but not much headway seems to have been made on BECA.

What is, however, left unsaid in the discussions between defence minister Manohar Parikkar and US defence secretary Ashton Carter is that the agreement would be a means to ensure that India emerges a counter-balance to the rising China show in the Asia-Pacific region. That is happening primarily due to the aggressive stand that China has taken on the South China Sea—the two ministers have specifically talked of freedom of navigation and flight in the region, including the South China Sea. Apart from putting some degree of pressure on China, the two countries have expanded the scope of the Defence Technology and Trade Initiative by announcing joint development of two projects over and above the six that are already under way. The much-delayed agreement could pave the way for closer collaboration with the US in the defence arena. So long as the agreement ensures that there are no American boots on the ground in India for any extended period of time, it is difficult to see how the Opposition parties can make a big thing out of it either. For an aspiring regional power, this is a big step forward and part of the process that began, but then got stuck, with the Indo-US nuclear accord.

SOURCE: The Financial Express

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Iran ends sanction-era deal for free shipping of crude oil to India

Iran, no longer under sanctions, has ended free shipping of crude oil to India and has terminated a three-year old system of getting paid for half of the oil dues in rupees. The Persian Gulf nation is now insisting on being paid in Euros for the oil it sells to Indian refiners. It also wants refiners like Essar Oil and Mangalore Refinery and Petrochemicals Ltd (MPRL) to clear nearly $6.5 billion of past dues in Euros, officials said. Iran had in November 2013 offered free delivery of crude oil to Indian refiners as tough Western sanctions crippled its exports. With shipping lines refusing to transport Iranian crude for fear of being sanctioned, Iran used its shipping line for the delivery and did not charge for transportation. “National Iranian Oil Company (NIOC) has written to Indian firms saying it will no longer be shipping oil for free,” an official said. “It will continue to ship the oil in its tankers but will charge a discounted tariff,” he said. The transportation fee will for now be less than half it takes to ferry oil from Iran. “May be in future this 50 per cent discount too may go,” he added. Iran however has continued with its liberal fiscal terms of offering 90-day credit period – i.e payment becomes due only after three months of invoice being raised. With US lifting sanctions in January, Iran has told Indian authorities that the three-year old mechanism of paying 45 per cent of oil import bill in rupees and keeping the remaining 55 per cent pending for payment channels to clear, stands terminated. The pending payments now total to nearly USD 6.5 billion which Iran has agreed to receive in instalments over the next six months, officials said. “NIOC is raising invoice for oil it is now exporting to Indian refiners in Euros,” he said.

Since February 2013, Indian refiners like Essar Oil and MRPL paid 45 per cent of their import bill in rupees to UCO Bank account of Iranian oil company. The remaining has been accumulating, pending finalisation of a payment mechanism. With the lifting of sanctions, the payment channels will reopen and Iran is seeking the pending USD 6.6 billion in Euros. The payments would be done in instalments to prevent a run on the rupee with MRPL likely to be asked to clear its outstanding dues of close to USD 3 billion first. Indian Oil Corp (IOC), which owes over USD 580 million to Iran, may be the second in the queue followed by smaller payments by HPCL-Mittal Energy Ltd (HMEL) and Hindustan Petroleum Corp. Essar Oil may be the last to clear its about USD 3 billion dues. Officials said Iran has not yet decided on utilisation of the USD 3 billion which has accumulated in the rupee account with UCO Bank. It could use the money to make payments for imports of steel and other commodities from India.

SOURCE: The Financial Express

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China SMEs plan to invest $1 billion across Indian states

Hoping to give a leg up to the Chinese investments in India, small and medium-sized enterprises (SMEs) from China are planning to invest $1 billion across various states in sectors ranging from telecommunications to electrical equipment to appliance manufacturing and machinery as part of President Xi Jinping's announcement in 2014 of investing $20 billion in India in five years. While there was a decline of Chinese investments in India in 2015, Beijing is hoping to increase the quantum of its foreign direct investment (FDI) in India in the current year to boost economic partnership, notwithstanding differences over strategic issues including Pak-based terror. Ahead of what can be described as a China week, with the defence minister and NSA travelling to Beijing and External Affairs Minister Sushma Swaraj's meeting with her Chinese counterpart in Moscow, senior Chinese government sources told ET that China is revising its proposal for two industrial parks in Gujarat and Maharashtra with additional capital and planning to invest $6.8 billion in these two facilities.

In the electricity-industrial park of Gujarat, certain factories such as Tebian Electric Apparatus have been launched. In the automobile-industrial park of Maharashtra, some additional capital has been invested, according to the Chinese government sources. Besides these parks and new industrial city by Dalian Wanda Group in Haryana, China Small and Medium Enterprises Investment Group (CSMEIG) has signed MoU for setting up an industrial park with the Gujarat government. The total investment plan in this industrial park is $1billion. The amount of non-financial investment from China to India has been registered at $589 million between May 2014, when Narendra Modi government came to power, and until January 2016, according to the Chinese government sources familiar with the developments. Prime Minister Modi has also assigned officials to specifically deal with Chinese investments. There is a specific China desk in the Department of Industrial Policy & Promotion (DIPP), besides dedicated desks for Japan, South Korea, USA and Canada.

While admitting that the investment from China to India witnessed a decline in the first half of 2015, Chinese officials claimed that the rapid growth came back in the second half. "Throughout the year 2015, the non-financial direct investment from China to India was $143 million," an official informed. In 2014, non-financial direct investment from China was $220 million. And at the end of 2015, the cumulative non-financial direct investment from China to India touched $3.55 billion. According to Chinese government, there are currently more than 300 Chinese companies in India that includes Huawei, TBEA, ZTE, Sany, LiuGong Machinery and Haier Group. The footprints of Chinese firms are expanding in textile, food processing and automobile sectors.

China is relatively satisfied with the pace of reforms under the Modi government. "The Modi government is not only making efforts in improving the governing capacity, simplifying administration and moving forward the reforms internally, but is also paying high attention in developing external outlook of the government. 2016 will see higher FDI in India from China," a Chinese official said. However, China feels that there is still some room for improving business environment in India.

SOURCE: The Economic Times

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India is keen to resume FTA talks with EU: Nirmala Sitharaman

Asserting that India is keen on resuming long-stalled talks for trade pact with the European Union, Commerce and Industry Minister Nirmala Sitharaman today said she has approached the 28-nation bloc for a meeting of chief negotiators of the two sides. While speaking with reporters here, the minister said that after returning from the India-EU Summit in Brussels, she wrote a letter to her (EU) "counterpart seeking from her dates for the chief negotiators to meet". "We are keen on resuming the talks," Sitharaman said. "The EU Ambassador (Tomasz Kozlowski), I am aware, has spoken in Mumbai about we are not ready yet to resume the talks, but I want to make it plain here that India is keen on resuming the talks," she said further. The minister has written the letter to EU Trade Commissioner Cecilia Malmstrom. In Mumbai, Kozlowski said that the EU was very much interested to have free trade agreement (FTA) with India. The negotiations for the Bilateral Trade and Investment Agreement (BTIA) have been held up since May 2013 as both the sides are yet to bridge substantial gaps on crucial issues, including data security status for the IT sector.

Launched in June 2007, the negotiations for the proposed BTIA have witnessed many hurdles with both sides having major differences on crucial issues like intellectual property rights, duty cut in automobile and spirits, and liberal visa regime. On the ongoing negotiations for the FTA with Australia, Sitharaman said both the sides have gone into all the details about goods, services and investments. "I would like to believe that we are closer in concluding the talks," Sitharaman said. She was speaking after chairing a meeting on free trade agreements. The meeting was attended by trade analysts, specialists, former commerce secretaries and academicians. "All have come together to talk about India's trade, trade negotiations, FTAs and the way forward," she said adding the exercise is done so that there will be a two way communication. "Government has been repeatedly asked as to why FTAs are not getting concluded (fast)," she said, citing the example of free trade pact with the EU and Australia. "We were able to explain lot of things in the meeting (as in) what is dominating the negotiations of FTAs, how we should move forward and how India's strengths has to be leveraged," she said. In the meeting, a detailed presentation on FTAs was given. The deliberations assumes significance as a section of industry and exporters have raised concerns over the impact of free trade agreements on Indian market and industry.

SOURCE: The Economic Times

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European Union says keen to conclude FTA talks with India

Within a fortnight of Prime Minister Narendra Modi's visit to Brussels to attend the Indo-EU Summit, the European Union today said it is keen to conclude the long-pending FTA with India but both partners should first establish their objectives clearly. "We are very much interested to have such an agreement (FTA). There are certain interests on the European side as well as on the Indian side and let's first discuss them at a proper level to establish what are our objectives, what are our levels of ambitions to fix the main elements before we go into more negotiations," EU Ambassador to India Tomasz Kozlowski told reporters here. Talks for the free trade agreement (FTA), officially known as the Broad-based Trade and Investment Agreement ( BTIA), have been stalled since May 2013 as both sides are yet to bridge substantial gaps on crucial issues, including data security for the IT sector. At the 13th Indo-EU Summit held in Brussels late last month, Modi and his Belgian counterpart Charles Michel had pitched for resumption of FTA talks on "mutually agreed terms". Kozlowski said there are certain issues which are high on agenda for FTA to be completed but both partners are very far apart.

On the EU side there are concerns surrounding industries like auto components, wines and spirits, while on the Indian side there are issues related to visas for professionals, especially those from the IT sector. He, however, said discussions are going on at official and political levels, and there is great commitment from both the sides to continue talks for concluding this agreement. The ambassador said European companies consider India as a prospective market and this is the reason why they are making investments here. There are around 6,000 European companies present in the country. "Some EU companies have flagged to me that for them it would be good to use India as a production hub and to produce not only for India but for international markets as well. So, from that point of view, trade liberalisation will be perceived favourable by the international community," he said. According to Kozlowski, for decades the 28-member block and India have developed their co-operation and have achieved a lot but it is much below potential. "We have to think much more pragmatically on what are our common interests, how to transform our common values, and to clearly identify common interests. Such a process should take into account each others' expectations and priorities as well," he said.

SOURCE: The Economic Times

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China exports jump most in a year

China's exports jumped the most in a year and declines in imports narrowed, adding to evidence of stabilisation in the world's second-biggest economy. Overseas shipments rose 11.5 per cent in dollar terms in March from a year earlier, compared with a 25 per cent slump in February, when factories and offices were closed for a week-long holiday. Imports extended declines to 17 months with a 7.6 per cent drop, data showed on Wednesday. The trade surplus decreased to $29.9 billion, the least in a year. The export rebound may suggest China's economy fared better than expected in the first quarter, with data due on Friday expected to show a 6.7 per cent expansion for the period. The increase in shipments may indicate more than seasonal factors and could show a pickup in demand, said Iris Pang, a greater China economist at Natixis SA in Hong Kong. "This is quite encouraging indeed," she said. Still, it's too soon to conclude that the worst is over for the nation's exporters, and "we need more evidence to confirm that the whole manufacturing sector is on track again."

The Shanghai Composite Index advanced 1.4 per cent to close at a three-month high, paring this year's decline to 13 per cent. Shares also gained from Hong Kong to Tokyo. "The steep decline in trade is coming to an end, but whether such a recovery can be sustained is still questionable," said Liu Dongliang, a senior analyst at China Merchants Bank in Shanghai. The data "reflects improving external demand, a rebound in commodity prices and recovering domestic demand." Seasonal factors aided the recovery. The week-long lunar New Year holiday fell in February this year, closing factories and curbing shipments. That saw exports tumble 25.4 per cent in US dollar terms from a year earlier, the biggest decline since May 2009. "Figures around this time of year are enormously impacted by seasonal factors," said Ben Simpfendorfer, founder of research firm Silk Road Associates in Hong Kong. "Exports are weak and likely to remain so over the coming months." In yuan terms, overseas shipments rebounded 18.7 per cent from a year earlier and imports slipped 1.7 per cent, the Customs General Administration said. The narrower decline in imports reflects a pickup in commodity prices and improving demand from China's consumers, said Xia Le, chief economist for Asia at Banco Bilbao Vizcaya Argentaria SA in Hong Kong. "The economy is starting to stabilise not only on the domestic side but also on the external one."

Exports to the US increased 9 per cent, while those to EU nations jumped 17.9 per cent. Shipments to Brazil plunged 39.4 per cent. Imports from the US fell 2.8 per cent, while those from Canada tumbled 32.3 per cent. China's imports from the EU rose 1.4 per cent. Many economic indicators improved in the first quarter, Premier Li Keqiang said in a recent meeting with Germany's foreign minister, according to a report last week by Chinese state television. The improving trend in the economy is not solid, impacted by a sluggish global economy and market volatility, Li said.

China investment in US touches record high

Chinese direct investment in the US rose to a record last year, driving the total number of jobs linked to it to the highest ever, according to a report by the National Committee on US-China Relations and Rhodium Group. Investors from China put more than $15 billion into 171 transactions in the US in 2015, and more than $30 billion of deals and projects are already pending for this year, according to the study. The report cited data compiled by Rhodium's China Investment Monitor, which has tracked mainland Chinese-owned firms' direct investment in the US since 2000. They helped add 13,000 full-time jobs for Americans last year, bringing the total number over the past 15 years to more than 90,000, according to the report.

SOURCE: The Business Standard

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Chinese textile exports see first fall in 6 years

China's textile exports fell for the first time in six years in 2015, dragged down by the sluggish economies of export destinations, rising labor costs in China as well as an increase in overseas investment. According to the Nikkei Asian Review, China's textile exports fell 5% to $286.8 billion in 2015. Textile exports had been growing for years, except in 2009, in the wake of the global financial crisis. In the first two months of this year, the country's textile exports dropped 16% on the year. The decline is partly due to a slowdown in Europe and Southeast Asia's sluggish growth.

SOURCE: The China Economic Review

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China Agrees to End Export Subsidies

After months of negotiations, China has agreed to put a stop to the export subsidies it has been granting for years to a host of industries, giving them an unfair advantage when competing with other companies around the world. On April 14, the United States and China signed a memorandum of understanding to end China’s export subsidies distributed to seven manufacturing sectors that included apparel, textiles and footwear; hardware and building materials; light industry and agriculture. In 2015, the United States filed a challenge with the World Trade Organization over that subsidy. “We have signed an agreement with China to eliminate export subsidies that the United States challenged because they are prohibited under WTO rules. This is a win for Americans employed in seven diverse sectors that run the gamut from agriculture to textiles to medical products, who will benefit from a more level playing field on which to compete,” said U.S. Trade Representative Michael Froman. “This agreement addresses all elements of the massive and complex export subsidy program.” The National Council of Textile Organizations (NCTO) applauded the agreement to terminate subsidies under the program called “Demonstration Bases-Common Services Platform.” “There is no doubt that China’s rise to become the world’s largest exporter of textile and apparel products has been aided by a pervasive series of illegal state-sponsored subsidies,” said Augustine Tantillo, NCTO’s chief executive and president. The agreement was praised by the American Apparel & Footwear Association. “AAFA is pleased to see that the United States and China were able to resolve the long-standing dispute over China’s export subsidies that are not consistent with international trade obligations and a balanced business model,” said Rick Helfenbein, the association’s president and chief executive.

SOURCE: The Apparel News

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TPP to bring long-term benefits to New Zealand

With six of its top 20 global markets represented in the Trans Pacific Partnership (TPP), New Zealand kiwifruit marketer Zespri anticipates the multi-national trade pact to deliver long-term benefits to its industry. Sales into Japan, Malaysia, the United States, Singapore, Australia, and Canada – all TPP member nations – currently generate a combined total of around NZ$500m. Zespri's chief operating officer Simon Limmer told New Zealand’s foreign affairs, defence and trade select committee that the TPP's ratification would help drive that figure towards NZ$750m by 2020, with the benefits continuing to multiply over time. “It's not an immediate benefit back into growers' pockets, but the direct indirect benefit from that long-term investment and a sustainable position in that long term market is going to be very valuable,” Limmer said, according to Scoop Independent News. Zespri has calculated a NZ$15m saving in tariffs on exports to the Japanese market under the TPP, with the benefits set to trickle through the entire business. “The $15m is the exact quantum in terms of what the tariff represents, but it will flow through in the market in terms of our ability to be more competitive,” he explained. “Now that flows through into additional volumes, additional run rates, our ability to build volume in the market, which does have an indirect financial benefit for us through the supply chain.”

Philip Turner, director of global stakeholder affairs at dairy giant Fonterra, also addressed the select committee, suggesting the real benefit for New Zealand exporters could be closer relationships with fellow member nations. “The tariff savings are simply a crude proxy for trade opportunities which would result from greater market access,” Turner told Scoop Independent News. “More market access will benefit our farmers, but trying to quantify that is very hard.”

SOURCE: The Fruit net

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