The Supreme Court on Thursday struck down the integrated goods and services tax (IGST) levy on ocean freight, upholding the Gujarat HC decision that had gone in favour of taxpayers. The Supreme Court on Thursday struck down the integrated goods and services tax (IGST) levy on ocean freight, upholding the Gujarat HC decision that had gone in favour of taxpayers. “The Supreme Court has held that GST on ocean freight paid in case of import of goods is unconstitutional. As a corollary, the Indian importers who had paid such tax will be eligible to refund. Further, those importers who had not paid the tax on import of services will now not be required to pay tax because of this Supreme Court ruling,” said Abhishek A Rastogi, partner at Khaitan & Co, who argued for the companies. This judgment may change the landscape of those provisions under GST which are subject to judicial review. As the court has gone ahead to categorically hold that the GST Council recommendations have only persuasive value, there will be a pragmatic approach to the provisions which are subject to judicial review by way of challenge to the constitutionality of such provisions based on the GST Council recommendations, Rastogi added.
Source: Financial Express
NDB has so far approved 21 projects of India involving a funding of $7.1 billion, including $2 billion in emergency loans to support health and economic recovery in the aftermath of the Covid-19 outbreak. Finance minister Nirmala Sitharaman on Thursday underscored the importance of multilateralism and the spirit of global cooperation for economic recovery in the aftermath of the pandemic. The minister, who chaired the 7th annual meeting of the board of governors of New Development Bank (NDB) via video conference, also emphasised that developing innovative financial products and services, and incentivising strategic investments are crucial to maximising development impact, according to the finance ministry. NDB has so far approved 21 projects of India involving a funding of $7.1 billion, including $2 billion in emergency loans to support health and economic recovery in the aftermath of the Covid-19 outbreak. The theme of the annual meeting was “NDB: Optimising Development Impact”. Last year, India had called for expanding the funding horizon of the NDB, often referred to as BRICS Bank, so that resources could be utilised for bolstering social infrastructure in a post-Covid world, besides promoting the industrial sector. The NDB was set up based on the inter-governmental agreement among the BRICS nations (Brazil, Russia, India, China and South Africa) in July 2014. The purpose of this bank is to mobilise resources for infrastructure and sustainable development projects in BRICS and other emerging market economies and developing countries.
Source: Financial Express
Indian Texpreneurs Federation (ITF), a major textile body, on Thursday requested Tamil Nadu Chief Minister M K Stalin to introduce a production-linked incentive scheme, which can help the textile sector and SMEs in the State to scale up. With the scheme, textile companies can invest in new capacities and build scale and competitiveness. The State government spending on the scheme can be justified with increased revenue, new job creation and export growth. “We estimate that PLI in Tamil Nadu can bring an additional Rs 15,000 crore rhrough exports from the State in the next five years with an opportunity to create employment for three lakh people,” ITF convener Prabhu Dhamodharan said. The government is giving a lot of thrust to the manufacturing sector with progressive schemes and the PLI in the State for the textile sector can be a game-changer for the textile and apparel sector, he said after a meeting with Stalin.
Source: The Print
Say it will arrest shift away from Constitutional scheme Welcoming the Supreme Court’s ruling that the Goods and Service Tax (GST) Council’s recommendations are not binding on the Union government and states, several opposition-ruled states said they stood vindicated in highlighting what they called a shift away from its Constitutional mandate. The Centre and state governments have simultaneous powers to legislate on GST but the council must work in a harmonious manner to achieve a workable solution, the court said on Thursday. “I have been saying this since HCM @mkstalin nominated me to the GST Council in May 2021. I am glad this judgement clarifies the matter,” Tamil Nadu finance minister P Thiaga Rajan tweeted, reacting to the SC ruling. Advisor to West Bengal chief miniusrer and former finance minister of the state Amit Mitra said the spirit of the judgment upholds the need for consensus and the spirit of federalism. “Unfortunately, respect for federalism has steadily waned over the last few years and a majoritarian approach has emerged in the GST Council in recent times, which is in contradiction to the very ethos of the Council,” he said. Chhattisgarh health minister TS Singh Deo, who represents the state in the Council, said the SC has clearly brought focus on the federal nature of the Constitution. Thiaga Rajan also reiterated his submission shared with the GST Council on May 28, 2021: “We have arrived at a constitutional and historical oddity – a GST system and Council that function with an omni-potent and all-encompassing mandate not envisoned in the Constitution of India, yet deeply limited by a structural design and technology platform that are far from adequate to the important task. What makes this oddity truly alarming is that the actual Council is becoming in some ways a mere ceremonial seal, a rubber-stamp authority, with the real power to create policy abrogated to (Constitutionally) ad-hoc agencies such as the TRU of the CBIC, a feeble GST Secretariat, and the quasi-government GST Network.” Singh Deo said: “The guiding words in the judgment is that the GST Council is a reccomending body which has a pursuasive value. This is how the GST Council must view itself, it can’t think or act in a way which goes beyond the provisions of the Constituion. Even if it means some adjustment, we must make them.”
Source: Financial Express
Indian Denim Industry today finds itself in odds due to exorbitant cotton prices, but strong demand is quite supportive for future growth, and leading companies are planning to increase their production capacity to meet the demand. However, the industry is facing stiff competition particularly from China which has advantage of cheaper cotton. “Price increase in cotton is impacting the entire textile industry including denim segment. However, demand from end users is better along with increasing cost of raw material,” Bhuvan S Bundela, head (Product Development) of Oswal Denim told Fibre2Fashion during the Gartex Texprocess trade fair held recently in Mumbai. He said that demand remains strong when raw material prices increase. He added that the government has to strike a balance between the cotton growers and the textile industry. He expects cotton prices to remain on the higher side as the government may increase Minimum Support Price (MSP) for kapas (unginned cotton) but adds that the time is good for denim industry which can grow at annual growth of 10-20 per cent in next couple of years. He pointed out that the pandemic has changed the market a lot where exclusive retail stores and showrooms are struggling for survival, but big retails chains, malls and e-commerce platforms are flourishing. Therefore, marketing channels are changed drastically. Gurudas Aras, strategic advisor and independent director at A.T.E. Group, said that after the pandemic, Indian exporters have bagged good orders from foreign buyers, but costlier cotton has put them into trouble. “Today, exporters are reluctant to accept orders due to uncertainty about the prices of raw materials. The government should intervene to stabilise cotton prices. Traders, middlemen and MNCs have built up large stock of cotton. Normally the government has little role in free market economy, but if it can take some steps for the stability of the value chain, it will be welcome steps.” Speaking about sustainability, Aras said the use of natural indigo dyes is the need of time and the industry is aware of its responsibility towards the environment and the earth, but higher cost discourages few people. He expects impressive growth of 5-10 per cent for denim segment in next couple of years. According to him, huge youth population, and popularity of new wears of denim are supporting factors. He said that Indian denim exporters are getting stiff competition from neighbouring countries, particularly from Bangladesh which is performing well in terms of quality, cost and timely shipment of orders. He added that the recent trade agreements will help industry for greater access in global market, particularly Europe Union. Schemes like PLI, MITRA and others will benefit the industry to increase its capacity and sharpen competitiveness in the global market. Gunjan Mittal, director of Mahak Synthetic Mills Pvt Ltd, said that exorbitant price increase in cotton has dampened demand in the entire value chain. Jeans prices have gone up to around double in last one year, which has squeezed margins. “However, denim market is expected to grow at 5-10 per cent as jeans is attracting more and more people irrespective of age and gender. Our company is planning to add capacity by 10-15 per cent annually to our current production capacity of one crore metre per day.” Rahul Shah, group managing director of Kanchan Group, said that the cost of raw materials increased due to costlier cotton, but the industry is unable to pass on higher input cost. He said that denim industry is facing stiff competition from China as Indian cotton is very costly compared to the Chinese fibre. However, the industry is doing well in domestic market. He said that the government delayed the removal of import duty on cotton, but now it should remove import duty of 10 per cent on cotton yarn. Shah said that the government should remove import duty on indigo too. “The industry needs to focus on eco-friendly process of dyeing for sustainability. We should reuse water and renewable power.” He said that Kanchan Group is setting up new plants in Ahmedabad as domestic demand for jeans is quite strong. He expected that the denim industry will grow at a very fast pace in next decade as the government’s schemes will yield result in couple of years. Shanmuha Raja, general manager (Product Development) of Vishal Fabric Ltd, said that denim industry is facing uncertainty regarding cotton prices, so the government should take steps to stabilise the prices. On market front, he said that demand is quite good in denim industry. He added that the customers’ taste is changing so the industry needs to keep itself relevant by making required changes in products. He said that his company will expand production capacity from 85 lakh metre to one crore metre to meet increasing demand. Aamir Akhtar, chief executive officer of Arvind Ltd, said “We need to find solution to costlier cotton through innovative approach. Denim industry should think to use other fibre to substitute the natural fibre. Government should ban cotton export to stabilise cotton prices.” He said that Indian industry produces around 1.6 billion metre denim fabric annually, of which, less than one billion metre fabrics is consumed locally, while the rest production is exported. Arvind Ltd is planning to expand production capacity to meet increasing demand. The company has 80 per cent sales in domestic market and the rest is sold in global market. Nishant Giri, senior general manager of Jindal Worldwide Ltd, told that demand for denim products jumped up after the pandemic but uncertainty about cotton prices is hampering industry’s growth. He too was of the opinion that the government should ban cotton export. On demand side, he said that domestic demand is likely to remain strong as festival season will begin after current marriage season. He said that denim demand is increasing because of higher popularity even among older population. Customers are keen to purchase denim upper wear also in tier-1 and tier-2 cities. But tier-3 cities will be the driver for further growth. He said that his company’s domestic to export sales ratio is 70:30. Speaking to Fibre2Fashion, Subir Mukherjee, business head of Bhaskar Industries, focused on fast transportation facilities in the country which is more needed than any subsidy. For example, if Indian exporters ship consignment to Bangladesh, it takes around one month for transportation through land route. Slow transportation adds cost and worries for the supplier. He said that the government should not give any subsidy, but it should develop dedicated corridor to ensure transportation of a consignment within 5 days. He said that higher cotton prices are impacting the entire value chain as the industry is facing not only lower supply but also poor quality of cotton. On eco-friendly dyeing process, he said that the industry can contribute by manufacturing jeans and other products which can be used longer. “If such products are made available at reasonable prices, people will buy lesser products. It means the industry will leave less footprint on our environment.” Pankaj Singh, vice president (Marketing) of Ginni International, told that the industry must find out solution to the problem of higher cotton prices. Innovative approach can open the door for man-made yarn. The industry should focus on polyester-cotton yarn for denim segment. Singh said that the production cost increased by around 25 per cent which is hampering growth. “However, we can expect 10 per cent annual growth in demand in next two years.” Ginni International is planning to increase production capacity. When asked about any demand from government, he said that GST on textile products should be reduced. Aditya Goyal, managing director of Anubhav Industries, said that the government should develop better transportation infrastructure. He said that the industry needs to find out a solution to the current high cotton prices, and the use of recycled fibre can be thought of. According to him, the industry will not get any respite from ban on cotton export (if it is announced) as outbound shipment has already slowed down. But banning cotton export till December this year may turn out to be beneficial. Goyal said that denim market is changing at a very fast pace because of changing in fashion and customers’ choice. The industry is receiving good demand, particularly in domestic market. PK Sharma, business head at Nandan Denim, said that cotton prices are proportionately higher, so the industry is suffering a lot. The government should incentivise garment export and raw materials import. He said that denim industry is likely to grow at the rate of 10 per cent annually. Nandan Denim is also planning to expand production capacity. About sustainability, he said that although synthetic dyes are more popular compared to natural dyes, the industry should be careful about effluent and follow norms of pollution control to protect the environment.
Source: Fibre2 Fashion
One such attempt by the Income tax (I-T) department to lift the 'corporate veil' was struck down this week by a court which ruled that the tricky subject of 'beneficial ownership' (BO) of the Mauritian entity cannot be linked to capital gains. Foreign investors coming from Mauritius are often denied capital gains tax relief on the grounds that persons controlling the tax haven companies are based in other countries. This may change now. One such attempt by the Income tax (I-T) department to lift the 'corporate veil' was struck down this week by a court which ruled that the tricky subject of 'beneficial ownership' (BO) of the Mauritian entity cannot be linked to capital gains. The ruling by Income tax Appellate Tribunal (ITAT), a quasi-judicial authority, relating to Blackstone FP Capital Partners Mauritius V Ltd, pertains to financial year 2015-16 when it booked capital gains of over ₹900 crore after selling stocks of NSE 1.09 % The tax officer's contention was that the effective control of the company in Mauritius lay with entities in the Caribbean tax haven Cayman Islands. Thus, Blackstone cannot derive the capital gains tax benefits - with no tax required to be paid for sale of stocks bought before 2017 - as provided in the amended treaty between India and Mauritius. The tax officer believed it was a fit case to lift the proverbial corporate veil to point fingers at the real BOs. 'Certificate of Residence Enough' However, ruling on the appeal by Blackstone, the Mumbai bench of the Tribunal, comprising judicial member Pavan Kumar Gadale and vice president Pramod Kumar, said the "concept of BO of the capital gains" cannot be read into the scheme of Article 13 (dealing with capital gains) of the treaty. "The Tribunal has held that the Treaty does not require the BO test to be met for capital gains tax exemption. The (apex tax body) CBDT had already issued Circular no. 789 in 2000 stating that wherever a Certificate of Residence is issued by the Mauritian Authorities, such a Certificate will constitute sufficient evidence for accepting the status of residence as well as BO for applying the Treaty. This circular has been upheld by the Supreme Court in the case of Azadi Bachao Andolan as well as in Vodafone. This circular does not appear to be dealt with in the ruling," said Shefali Goradia, Partner (Business Tax) at Deloitte Touche Tohmatsu India. While the ruling has gone down well, ITAT's decision to send the matter back to the assessing officer (AO) has evoked mixed feelings. According to Parul Jain, who heads international tax practice at Nishith Desai Associates, tax jurisprudence in the past has also unequivocally upheld that corporate veil of an entity can be pierced only in instances when the transaction appears to be a sham. “Simply because the Mauritius entity is held by a Cayman parent cannot be a prima facie reason for lifting the corporate veil. However, once ITAT established that the beneficial ownership criteria cannot be read into Article 13, the remand of the case back to the AO seems unwarranted, and may prolong litigation,” said Jain. There is a raging debate globally on BO in the context of treaties. Against this backdrop, ITAT feels it’s not at the whim or fancy of a tax authority to decide what constitutes BO. Agreeing that the Tribunal has rightly observed that requirement of being a BO is not present under Article 13(4) of the Treaty, Sanjay Sanghvi, partner at Khaitan & Co, said it would be interesting to find out what parameters or principles the tax officer apply to see if the requirement of BO is really inbuilt under Article-13 of the Treaty. The tax officer will now have to show, based on facts, as to why the Mauritius entity should not be treated as BO of the shares and its corporate veil should be lifted, said Goradia.
Source: Economic Times
The Indo-Pacific Economic Framework (IPEF) proposed by the United States as part of its Indo-Pacific Strategy will help further enhance the country's economic relations with countries in the region, according to White House press secretary Karine Jean-Pierre, who recently said the new framework will promote investment in green economy as well. This, in turn, will help level the playing field for workers and businesses both in the United States and in the Indo-Pacific region, she said. President Joe Biden is scheduled to travel on a three-day visit to Seoul on May 20, where he is expected to unveil the details of the US-led economic framework. He will depart Seoul on May 22 for a visit to Japan. "So as it relates to our economic framework, it's going to focus on building agreements with Indo-Pacific partners, and one, developing a modern digital economy, including opening the door for small and medium businesses," she said in a daily press briefing. IPEF will seek to reduce supply chain vulnerability and drive investments that will create good jobs for people on both sides. It will promote investment in the green economy, she said, adding that investment in green economy and building an economy with fairer tax and anti-corruption practices will level “the playing field not just for workers, but also for businesses”. "The United States has strong economic, trade ties in the Indo-Pacific, and so we agree it is essential for us to step up economically in the region and to do it fast," said Jean-Pierre. The proposed IPEF will develop new approaches to trade that meet high labour and environmental standards; govern digital economies and cross-border data flows according to open principles, including through a new digital economy framework; advance resilient and secure supply chains that are diverse, open and predictable; make shared investments in decarbonisation and clean energy; promote free, fair, and open trade and investment through the Asia-Pacific Economic Cooperation (APEC); and close the region’s infrastructure gap through Build Back Better World with G7 partners.
Source: Fibre2 Fashion
Sri Lanka is facing its worst economic crisis since gaining independence from Britain in 1948 In view of difficulties being faced by exporters in getting payments from crisis-hit Sri Lanka, the RBI on Thursday allowed settlement of trade transactions in Indian rupee outside the Asian Clearing Union (ACU) mechanism. In March, the government had guaranteed a term loan of USD 1 billion extended by the State Bank of India (SBI) to Sri Lanka for financing purchase of essential goods by the island nation from India. "In view of the difficulties being experienced by exporters in receipt of export proceeds from Sri Lanka and SBI's credit facility...it has been decided that such trade transactions with Sri Lanka, falling under the said arrangement, may be settled in INR outside the ACU mechanism," the RBI said in a circular. Under the arrangement, financing of export of eligible goods and services from India would be allowed subject conditions and whose purchase may be agreed to be financed by SBI under the agreement. Sri Lanka is facing its worst economic crisis since gaining independence from Britain in 1948. The crisis has been caused in part by a lack of foreign currency, which means the country cannot afford to pay for imports of staple foods and fuel, leading to acute shortages and very high prices.
Source: Business Standard
The third advance estimates of production of major agricultural crops for the year 2021- 22 have been released by the Union Ministry of Agriculture and Farmers Welfare. The production of Foodgrains in the country is estimated at record 314.51 million tonnes which is higher by 3.77 million tonnes than the production of foodgrain during 2020-21. The production during 2021-22 is higher by 23.80 million tonnes than the previous five years’ (2016-17 to 2020-21) average production of foodgrains. Record production is estimated of rice, maize, pulses, oilseeds, gram, rapeseed and mustard and sugarcane. Agriculture and Farmers Welfare Minister Shri Narendra Singh Tomar has said that, this record production of so many crops is the result of the farmer-friendly policies of the Central Government under the able leadership of Prime Minister Shri Narendra Modi as well as tireless hard work of the farmers and the diligence of the scientists. The assessment of production of different crops is based on the data received from States and validated with information available from other sources.The estimated production of various crops as per the 3rd Advance Estimates for 2021-22vis-à-vis the comparative estimates for the years 2007-08 onwards is enclosed. As per 3rdAdvance Estimates, the estimated production of major crops during 2021-22 is as under:Foodgrains 314.51 million tonnes, Rice 129.66 million tonnes. (record), Wheat106.41 million tonnes, Nutri / Coarse Cereals 50.70 million tonnes, Maize33.18million tonnes. (record), Pulses27.75 million tonnes.(record), Tur4.35 million tonnes, Gram13.98 million tonnes.(record), Oilseeds 38.50 million tonnes. (record), Groundnut10.09 million tonnes, Soyabean13.83 million tonnes, Rapeseed and Mustard 11.75 million tonnes.(record), Sugarcane430.50 million tonnes(record), Cotton 31.54 million bales (each of 170 kg), Jute & Mesta 10.22 million bales (each of 180 kg). As per 3rdAdvance Estimates for 2021-22, total Foodgrains production in the country is estimated at record 314.51 million tonnes which is higher by 3.77 million tonnes than the production of foodgrain during 2020-21.Further, the production during 2021-22 is higher by 23.80 million tonnes than the previous five years’ (2016-17 to 2020-21) average production of foodgrains. Total production of Rice during 2021-22is estimated at record 129.66 million tonnes. It is higher by 13.23 million tonnes than the last five years’ average production of 116.43 million tonnes. Production of Wheatduring 2021-22is estimated at 106.41 million tonnes. It is higher by 2.53 million tonnes than the last five years’ average wheat production of 103.88 million tonnes. Production of Nutri / Coarse Cereals estimated at 50.70 million tonnes, which is higher by 4.12 million tonnes than the last five years’ average production of 46.57 million tonnes. Total Pulses production during 2021-22is estimated at record 27.75 million tonnes which is higher by 3.92 million tonnes than the last five years’ average production of 23.82 million tonnes. Total Oilseeds production in the country during 2021-22is estimated at record38.50 million tonnes which is higherby 2.55 million tonnes than the production of 35.95 million tonnes during 2020-21. Further, the production of oilseeds during 2021-22 is higher by 5.81 million tonnes than the average oilseeds production. Total production of Sugarcane in the country during 2021-22is estimated at record430.50 million tonnes which is higher by 57.04 million tonnes than the average sugarcane production of 373.46 million tonnes. Production of Cotton and Jute & Mestais estimated at 31.54 million bales (each of 170 kg) and10.22 million bales (each of 180 kg), respectively
Source: PIB
Textiles, commerce and industries minister Nemcha Kipgen on Thursday stressed that an efficient industrial and investment policy is the need of the hour to attract investment and to spur robust economic activity for industrial development in the state. Speaking at a meet on “Framing of Industrial and Investment Promotion Policy (IIPPM)- 2022” at the Institute of Cooperative Management (ICM), Nemcha said at present, there are 34, 293 units in micro, small and medium enterprises (MSME) against 1,085 units in 2015. This clearly shows that Manipur is marching ahead in the field of industrialisation, he added.
Source: Times of India
Textiles, commerce and industries minister Nemcha Kipgen on Thursday stressed that an efficient industrial and investment policy is the need of the hour to attract investment and to spur robust economic activity for industrial development in the state. Speaking at a meet on “Framing of Industrial and Investment Promotion Policy (IIPPM)- 2022” at the Institute of Cooperative Management (ICM), Nemcha said at present, there are 34, 293 units in micro, small and medium enterprises (MSME) against 1,085 units in 2015. This clearly shows that Manipur is marching ahead in the field of industrialisation, he added.
Source: Times of India
Prospects for the world’s textile and garment industry are expected to be brighter in 2022 and Vietnam continues to maintain its position as a leading textile and garment exporter in US and EU markets. Figures from the General Department of Customs showed that in the first quarter of 2022, the country’s export value of textiles and garments reached $8.68 billion, up 20.3% yearon-year, marking the highest increase in the past 10 years. The US continues to be the largest textile and garment import market from Vietnam with a value of US$4.3 billion, followed by the EU with US$896 million, and Korea with US$754 million. The positive signal of the market and the initial control of the COVID-19 pandemic will help Vietnam's textile and garment industry fulfill its set export target of over US$43 billion by 2022, according to Vietnam Textile and Apparel Association. Besides, Vietnam will also have opportunities to catch up from the trend of shifting the world’s textile and garment supply out of China and Vietnam is one of the most potential and favorable destinations for manufacturers, import and export distributors, wholesalers and retailers worldwide. To maintain the leading position and tap up opportunities post COVID-19, textile enterprises are accelerating to upgrade technology in production chains as well as increase labour productivity. Take Hung Yen Garment Corporation (Hugaco) for instance, the company has focused on investing in equipment, modern technology and digital transformation, helping to increase productivity by about 20%. However, in order to create a synergy to maintain the leading position, it is not only the efforts of textile enterprises themselves, but also the contributions of industrial real estate developers to the textile industry. Located in the northern Nam Dinh province, the cradle of the Vietnam’s textile industry, Aurora is one of the very few IPs in Vietnam that meets the legal and utility infrastructure requirements qualified to accommodate fabric-dyeing establishments. Developed by Cat Tuong Real Estate Group, one of the country’s leading real estate developer, Aurora’s infrastructure is synchronously designed with the country’s largest capacity of water supply and wastewater treatment system as well as the development of complex social infrastructure. In 2020, even though the world was undergoing many challenges and difficulties caused by the COVID-19 pandemic and other complexities, Aurora IP still proves its attractiveness and unique value as a well-invested industrial park by closing two deals with a total investment surpassing $200 million for land lease contracts with two FDI investors to develop high-tech textile and dyeing projects. With the EVFTA coming into effect, duty was lifted from 65% of EU exports to Vietnam and 71% of Vietnamese exports to the EU. Therefore, it is expected that Vietnamese exports to the EU by 2025 will see a 42.7% increase by 2025, according to Vietnam’s Ministry of Planning and Investment. “Aurora IP is pleased to be an important part of Vietnam's leading position in the world's textile market. Aurora IP understands that attracting foreign investment along with the participation of domestic textile and garment enterprises plays an important role in the sustainable development of the industrial park and the textile industry of the country,” said Mr. Tran Quoc Viet - Chairman & CEO of Cat Tuong Group.
Source: Globe News Wire
China’s yuan retained its position as the fifth most active currency for global payments by value in April this year behind the US dollar, euro, pound and Japanese yen, with a share of 2.14 per cent global payments currency—down from 2.20 per cent in March, according to global payment services the Society for Worldwide Interbank Financial Telecommunication (SWIFT). An official Chinese newspaper cited experts as saying that short-term fluctuation is normal and the yuan is expected to play a rising role on the global stage over the long term. Everbright Bank macroeconomic analyst Zhou Maohua said due to fluctuations in the global economy and financial markets, major currency experienced a short-term monthly fluctuation in the share of international payment and settlement. Zhou attributed a slowdown in China’s foreign trade in April amid the COVID-19 outbreaks as well as market fluctuations amid divergent policies of major economies and geopolitical conflicts to the slide of yuan share in global payment in the month. The share of US dollar expended to 41.81 per cent in April from 41.07 per cent in March, remaining its position as most used global payment currency. It was followed by euro which edged down to 34.74 per cent in April from 35.35 per cent in March and British pound which dropped to 6.26 per cent from 6.47 per cent a month ago. As China further steps up efforts to promote the internationalisation of the yuan, and accelerate its dual circular economy mode, opening up to international economy, the Chinese currency is expected to play a rising role in global payments, settlements and foreign exchange reserves over the long term, Zhou added.
Source: Fibre2 Fashion
The latest from the Ministry of Trade, Industry and Cooperatives (MTIC) is that Uganda is set to revamp her textile industry, which as of today is in limbo at two levels. On the primary production level lint cotton from the farm), the quantities in terms of bales are a far cry from the era of the three Cs (Coffee, Cotton, Copper) that drove our growth half a century ago. The second level of limbo is that even this little lint is exported raw, thus we ‘die twice like charcoal’. The MTIC initiative is therefore welcome, but should not be spearheaded directly by the ministry. My humble take is this: for starters, the entire focus and effort should shift from the ministry to Uganda Development Corporation (UDC). It becomes easier and faster that way, very much like Uganda National Oil Company (UNOC) is implementing what is passed at policy level by the parent/supervising ministry in the oil and minerals sector. Actually, even with UDC, the corporation should remain the holding company (or lead investor in partnership with local investors such as NSSF or foreign industry experts wakina Yamato), into three laterally integrated companies: spinning into yarn, weaving into textiles and fabrics and sewing into garments, linen and related products. On a light note, wouldn’t Uganda Airlines need company, an ‘age-mate’ from the old bluechip league? What better opportune time than now to revive UGIL? For the dotcom generation, UGIL is Uganda Garments Industries Ltd, one of the many companies under UDC, and till the early 90s, it produced world-class cotton garments. UGIL, managed by a business-savvy dream team under the overall supervision of UDC, is what will drive the resurrection of the cotton sector, in a value-chain structure with producers, principally through cooperatives as of old: Lango Cooperative Union, Bukedi Cooperative Union, Nyakatonzi Cooperative Union of the old league, and perhaps new ones. And talking of production, in line with the times, cotton can be intercropped with mulberry trees for silk production, plus seasonal crops for food security. The key role of the ministry at this stage would be both policy and lobbying. This lobbying will be critical at two levels, namely the Ugandan Parliament to legislate against importation of mitumba/mivumba (secondhand if not fourth-hand fabrics, garments, linen and related products); reinforced by a global campaign against this heinous practice. The current dumping and damping of used underwear, rugs, and other domestic and factory rejects in Uganda cannot allow the revival of the textile sector. It is only when we have effective aggregate demand at the local level that we shall be able to revive our textile sector and the cotton industry in general. And this will not come easy as we have recently witnessed. A reaction from one foreign mission here a few months back is a pointer that we may need a dose of Gandhism. As cited in the opening dialogue above, it took a national boycott of English textiles and garments in India for the Indian sector to grow, in the face of such draconian colonial laws such as the Calico Act. In the dialogue, a factory owner in Manchester is literally begging The Mahatma to allow English yarn and fabrics into India, pleading for his 300 employees, to which Gandhi retorts with his 300 million unemployed citizens in India.
Source: Monitor
Frugi, a sustainable UK-based brand, has announced a new partnership with the Circular Textiles Foundation (CTF), making it the organisation’s first childrenswear member. The brand will be following a series of circular design workshops with the foundation, working towards key circular principles to apply throughout the company and ultimately creating a range of fully recyclable clothing for spring/summer 2023. The CTF certification mark will be present on 22 percent of Frugi’s SS23 collection, with the label’s end goal being to establish the mark on its entire future collections. The certification tells consumers that the garment has been made to be recycled by a specific facility, which will then process it into new fabric, with more information on the activation available via a QR code on the garment’s tag. Its key aim of partnering with the CTF, Frugi said in a release, is to prevent clothing going into landfill or incineration, falling in line with its ‘end of life’ plan for its garments. “Sustainability is at the heart of the Frugi brand,” said Sarah Clark, CEO of Frugi Group. “Our clothes are already designed to grow with children, using reversible prints, interactive appliques, and clothes with extendable cuffs, waistbands, and shoulder straps.” Clark continued: “Our commitment to eliminating waste is further strengthened by our partnership with the Circular Textile Foundation, especially as the first childrenswear brand to do so. We can’t wait to launch our spring/summer ‘23 range with the new certification and to show that we are serious about making a genuinely circular product, and to protect the planet we play on.”
Source: Fashion United
