Plan includes setting up a dispute redressal bench with representation from states, the Centre, and independent law and tax experts The finance ministry is working on a detailed mechanism that can resolve goods and services tax (GST) disputes raised by states while avoiding distortions in the tax regime. The mechanism may be discussed with the states at the next GST Council meeting, expected sometime in June. The plan includes a Dispute Redressal Bench that will have representation from states, the Centre, and independent law and tax experts well versed in legal and economic implications. There will be detailed guidelines on which cases can be referred to such a process. The need for such a mechanism also follows a recent Supreme Court ruling that GST Council recommendations aren't binding on the states or the Centre. We are working on the procedures of the dispute resolution mechanism, which some of the states have been demanding," a senior official told ET. "This is under discussion. Once the draft is ready, we will take it up to the council, which will take the final call." There is a provision for voting in the GST legislation to resolve disputes. The Centre has a one-third vote while states make up the remaining two-thirds. In the case of a vote, a decision must be passed or rejected by a majority of at least three-fourths of the weighted votes of members present.
GoM Model of Resolution
The council has usually set up groups of ministers (GoMs) to address differences among states, whether it has been a flood cess levy or rate rationalisation. Through this route, over the last five years, all differences have been resolved by consensus except one, which the council decided by vote. Opposition-led states say they have little chance of swaying outcomes as most states are governed by the Bharatiya Janata Party (BJP), which holds power at the Centre as well. They have called for a mechanism that allows every state the chance of a legitimate hearing. A dispute resolution bench can potentially take independent decisions, beyond the influence of the Centre.
Supreme Court Ruling
The Centre is anticipating more disputes from July 1, when the cushion of GST compensation lapses and states start to look for ways to make up for the revenue loss. Without an acceptable mechanism in place, most matters may end up with an already overburdened judiciary. The Supreme Court ruling in a case relating to the levy of integrated GST on ocean freight imports last month has sparked greater urgency to the search for a dispute settlement mechanism. "GST Council is a product of collaborative discussion. It is not imperative that federal units must always possess a higher share," the apex court had said, adding that the recommendations of the GST Council are not binding on states or the Centre. The council is also expected to consider the report of a GoM headed by Meghalaya chief minister Conrad Sangma that has favoured the highest 28% rate on online gaming, racing and casinos. It may also consider the issue of integrated goods and serrvices tax on ocean freight, which the Supreme Court had struck down. "The Centre has not taken any decision and is just studying the case. It will take up any decision after discussing it with the council," another official told ET.
Source: Economic Times
Bilateral trade has increased to USD 154.73 billion in 2021-22 from USD 87.4 billion in 2020-21 India's bilateral trade with all the six members of GCC (Gulf Cooperation Council) group countries, including the UAE and Saudi Arabia, has increased significantly in 2021-22 on account of increasing economic ties between the two regions. India's exports to the GCC have increased by 58.26 per cent to about USD 44 billion in 2021-22 against USD 27.8 billion in 2020-21, according to the data of the commerce ministry. The share of these six countries in India's total exports has risen to 10.4 per cent in 2021- 22 from 9.51 per cent in 2020-21. Similarly, imports rose by 85.8 per cent to USD 110.73 billion compared to USD 59.6 billion in 2020-21, the data showed. The share of GCC members in India's total imports rose to 18 per cent in 2021-22 from 15.5 per cent in 2020-21. Bilateral trade has increased to USD 154.73 billion in 2021-22 from USD 87.4 billion in 2020-21 These increasing figures assume significance as India is looking at negotiating a free trade agreement with the grouping. The country has already implemented a comprehensive trade pact with the UAE on May 1, with an aim to boost bilateral trade to USD 100 billion in the coming years. The GCC was established in May 1981. Its members are Saudi Arabia Bahrain, Kuwait, Oman, Qatar and UAE. Mumbai-based exporter and founder chairman of Technocraft Industries India Sharad Kumar Saraf said that the GCC has emerged as a major trading partner for India and huge potential is there for increasing investments also between the two regions. "The trade relation is bound to grow in the coming years. Reasons for the growth include anti-China sentiments, increasing quality of domestic goods and improvement in international trade. A quantum jump will come when the trade pact will be operationalised properly," Saraf said. Another industry expert said that the GCC's substantial oil and gas reserves are of fundamental importance for India's energy needs and India can support in meeting the GCC's food security requirements.
Source: Business Standard
In an interview with CNBC-TV18, Upendra Prasad Singh, Secretary, Ministry of Textiles, spoke about a refreshed production-linked incentive (PLI) scheme for the textile industry and said 6-7 lakh bales of summer cotton will help soften prices. The government is in the process of formulating a 2.0 version of the production-linked incentive (PLI) scheme for the textile industry, Upendra Prasad Singh, Secretary, Ministry of Textiles, told CNBC-TV18. As part of PLI 1.0 for the textiles sector, 64 applicants were approved. But to be a successful applicant, the government had sought a minimum investment of Rs 100-300 crore and a minimum turnover of double the investment amount. “By and large, there is kind of a consensus that next round of PLI should be for apparel and garments, with suitable investment and turnover limits because investment in the garment and apparel is usually less, even though output versus investment ratio is usually pretty high," he said. This means the minimum investment criteria of Rs 100-300 crore could see a tweak in PLI 2.0 for the textiles sector. The textiles ministry secretary said as and when PLI 2.0 gets approved, it would be for garments and apparel, and "whether it is knitted or woven will not make a difference." Cotton prices have started softening of late after being high for a while and Singh told CNBC-TV18 that more availability, especially 6-7 lakh bales of summer cotton, will further help correct the soaring prices. "It's not only cotton prices, almost all raw material prices are high. Cotton prices are high all over the world. Being an internationally traded commodity, cotton prices generally move in tandem with the prices in the international market," Singh mentioned. "Having said that, prices, of late, have started softening. To give you an example, a common variety of cotton, called Shankar-6 (28-millimeter staple cotton grown in Gujarat) was costing Rs 1,01,500 per candy as of May 20, and now that has come down to about Rs 93,500 per candy," he said. He added, "About 6-7 lakh bales of summer cotton and some early cotton from northern states like Punjab should mean softening of prices over the next few months till new crops arrive towards the end of September or beginning of October." The situation in the textile industry became grave when some southern spinning mills shut shop due to the non-availability of cotton at affordable rates. Cotton prices more than doubled in the past year. He highlighted that overall textile exports witnessed a growth of 8-10 percent for the first two months of FY23, with the apparels and garments segment seeing a growth of 20 percent. However, at the current prices, exports of raw cotton and cotton yarn have witnessed a fall, he said. The reduction in cotton exports has partially been by design as the domestic industry’s needs are being prioritised and also because, at current prices, exports may not be feasible since the domestic rates are on par with the global prices. “Yes, right now with this price, raw cotton and cotton yarn, their exports have fallen and one can say that it's required because we need more raw cotton in the country. So, the reduction has been because of the lesser export of raw cotton and cotton yarn but overall textile exports have shown growth,” Singh said. Singh reassured that there was no dearth of cotton yarn and, with softening of raw cotton, yarn prices will soften as well.
Source: CNBCTV18
Sitharaman was speaking at a virtual meeting of the finance ministers and central bank governors of the BRICS group. Finance minister Nirmala Sitharaman on Monday said economic growth will continue to be supported by fiscal spending along with an investment push. This will “impart momentum to the economy based on the idea of growth at macro level complemented by all inclusive welfare at micro level”, she added. Sitharaman was speaking at a virtual meeting of the finance ministers and central bank governors of the BRICS group. The statement underscores the government’s continued focus on capex, as it bets big on its high multiplier effect. The Centre has budgeted a capex of Rs 7.50 trillion for FY23, up 27% from the actual spending of Rs 5.93 trillion (including Rs 62,057 crore capital infusion into Air India) in FY22. The finance ministry has already asked various infrastructure ministries to keep spending. Several agencies have trimmed their projections for India after the Ukraine war triggered a global commodity price rise. They now forecast India’s FY23 growth to remain the range of 7.2% to 8.5%, compared with 8.7% in FY22 (Last fiscal’s growth was aided by a sharplycontracted base). Several analysts have stressed the need for sustained growth in the Centre’s capital expenditure, especially when private capex is yet to see a broad-based resurgence and there are significant downside risks to growth from elevated oil prices, supply-chain disruptions due to the Ukraine war and a rising interest rate scenario. It will also have to nudge CPSEs to raise their capex. In FY22, CPSEs fell just short of their revised capex target of Rs 5.75 trillion. BRICS, the minister said, should continue to serve as a platform to facilitate exchange of experiences, concerns and ideas for rebuilding a sustainable and inclusive growth trajectory. The participants also discussed other legacy finance issues, such as infrastructure investment, New Development Bank (NDB), BRICS Contingent Reserve Arrangement (CRA) etc, the finance ministry said in a statement.
Source: Financial Express
Patel said exporters of Uttar Pradesh can use these FTAs as an instrument to promote outbound shipments in areas like garments, engineering, handicrafts, handloom textiles, agri processed products and sports good Free trade agreements (FTAs) with the UAE and Australia will help promote exports of goods such as garments, engineering products, handicrafts, textiles, and agri processed items, Minister of State for Commerce and Industry Anupriya Patel said on Monday. Department of Commerce organised a stakeholders outreach programme on FTAs for the exporting community in Agra. Speaking at the event, she said the government is committed to taking all necessary efforts to increase exports from the country. Patel said exporters of Uttar Pradesh can use these FTAs as an instrument to promote outbound shipments in areas like garments, engineering, handicrafts, handloom textiles, agri processed products and sports goods. Also speaking at the event, Sanjay Leekha, Chairman, Council for Leather Exports (CLE), said some of the pending demands like exemption of duty on imports of wet blue, crust and finished leather should be considered by the government. FTAs with the UAE and Australia are going to help the Indian leather and footwear exporters to explore these markets in a big way, Leekha added. Anant Swarup, joint secretary, Department of Commerce, said duty free access is one of the instrument that helps in making domestic exports competitive compared to competing countries like China, Bangladesh, Vietnam and Thailand. "India-UAE and Australia FTAs have been signed to facilitate the duty-free access for exporters," he added. Srikar K Reddy, joint secretary in the department, gave a detailed presentation on the FTAs.
Source: Economic Times
Ludhiana among state’s 3 clusters exporting textiles, garments worth Rs 12K crore a year The upcoming textile park over 1,000 acres at Koom Kalan near here will be a game changer for the textile and garment industry and will further boost exports from Ludhiana, which was one of the three major textile clusters in the state, the government has claimed. The state’s three clusters — Ludhiana, Jalandhar and Amritsar — export textiles and garments worth almost Rs 12,000 crore every year. In 2019-20, the three clusters in Punjab, which was among top 10 states for textile and garment exports in the country, had logged exports worth Rs 11,639.63 crore, the official figures have revealed. Major export destinations include the USA, UAE, UK, and Australia. Sharing details of the textile ecosystem, Director-cum-Secretary, Industries and Commerce, Sibin C, told The Tribune, that Punjab had a strong presence of the textile sector in various regions of the state and possesses a complete textile value chain. “Over 1,200 units of textile and wearing apparel are there in the state, employing about 1.2 lakh persons directly. The state is home to major textile players such as Trident, Nahar, Vardhman, Shingora, Sportking, Nivia, Savi, Avani Textiles, JCT Mills, and Indian Acrylics,” he said. Divulging the raw material information, Sibin said there was abundant availability of variety of quality raw material in Punjab, both natural and man-made. The state has been recording the highest yield (kg/ hectare) for cotton in the country with 690 kg per hectare yield recorded in 2020-21. Further, Punjab accounts for 23 per cent of national cotton production. The state also has availability of man-made fibre, yarn, and fabric, including polyester staple fibre and polyester fibre fill, from companies such as Reliance Industries Limited in Hoshiarpur, Shiva Tex Fabrics in Ludhiana and Aqua Fiber Industries in Mohali, besides acrylic yarn from firms, including Vardhman and Arisudana. With HPCL-Mittal Energy Limited (HMEL) operating a state-of-the-art crude oil refinery of 11.3 million MT per annum capacity in Bathinda along with a polypropylene (PP) unit having a production capacity of 467 KTA, units for polyethylene (PE) production were also being established. “Both these products, PP and PE, can be converted in raw material for the textile sector, especially for technical textiles such as geotextiles,” he said. On the skilled manpower front, Punjab has 10 major specialised institutes engaged in the textile sector. Besides, there were 349 ITIs offering over 70 courses, including textile and apparel sector courses, with an intake capacity of about 80,000 students. Ludhiana, being the industrial capital of Punjab, has 33 ITIs of which 13 ITIs offer textile and apparel sector courses. Besides 130 diploma and polytechnic colleges, the state also has 193 engineering colleges with an annual capacity of 28,000 students. Additionally, there were more than 1,000 skill development centres in the state with a total training capacity of 60,000. Under textile and apparel sector, Punjab Skill Development Mission (PSDM) has empaneled 250 training partners. Divulging incentives on offer, Sibin said textile was identified as a thrust sector for the state under the Industrial Business Development Policy (IBDP), 2017. As per the policy, attractive incentives such as net GST reimbursement and employment subsidy were offered to ultra-mega, mega projects, anchor units, thrust sector units and MSMEs. As many as seven mega industrial estates were coming up under the entire textile value chain, touted as the textile park, at the cost of Rs 4,445 crore, in Ludhiana. The ambitious industrial project, which has been approved under the PM Mitra scheme, will be a joint venture between the Centre and the state. The project will be established over a period of five years, up to 2027-28, for which the requisite funds have been approved under the scheme.
Seven mega industrial estates coming up
Source: Tribune India
New business orders in defence, shipbuilding & oil refining The Russia-Ukraine war and the stringent sanctions on Russia by the West have thrown up more opportunities for India’s businesses than earlier anticipated. Defence production and maintenance, shipbuilding and oil refining are three areas where Indian firms are already beneficiaries or have at least received enquiries from potential importers. India’s petroleum products exports, which surged 161% in FY22 to $67.5 billion, partly driven by a rise in prices, will get a further fillip in the current year with several European countries resorting to India to source refined products from Russia’s Urals crude, which is out of bounds for them. Currently, discounted Russian crude allows private Indian refiners Reliance and Nayara to realise over $15-$18 per barrel from the export of refined products to Europe and the US. This compares with $7-$9 per barrel in March-April when the majority of discounts were taken by traders. Given the possibility of a prolonged stand-off between Moscow and the West and the chances of a steady supply of Russian crude to India at relatively lower rates, India’s private oil refiners may go for capacity expansion in the short term to raise supplies to Europe. Eventually, the changed structure of crude sourcing could even let India realise its goal of becoming a refinery hub. Anish De, partner at KPMG India, said: “There is strong potential for India to emerge as a refinery and petrochemical hub for Europe as they look for an alternative to China. India has an advantage in terms of scale, location, skillsets and technology to play the part that China had played for Europe in the past.” De believes that the change will happen in the coming decade even with the transition to electric vehicles. However, analysts say the gains from oil exports to Europe may largely be limited to private refiners as state-run oil marketing companies have the obligation to cater to domestic demand first. Among the top importers of oil products products from India last fiscal, only Netherlands figured from Europe, while the bulk of the shipments were to Singapore, the US, Australia, South Korea and Indonesia. According to sources, hit by supply disruptions, Russia’s defence companies have approached Indian firms seeking to buy various components for naval shipbuilding and defence equipment. These firms are also looking to recruit Indians as the exit of skilled shipbuilding professionals, post the breakout of war, has created a manpower shortage. Some European companies, which purchased defence and shipbuilding articles from Russia, now want India to assemble these products and supply them. Further, firms from Africa and South East Asia, which have conventionally been reliant on Russian defence platforms, now want India to provide the maintenance repair and operations (MRO) services for such equipment. “We have been approached by original equipment manufacturers from Russia and Europe for joint venture participation. The firms have agreed to give the technology support needed for creating manufacturing and assembling facilities in India,” an industry source said. Russia-made naval ships may be repaired in India, with that country’s consent to share technology. According to people in the know, Russian collaborators are more than eager to join hands with India for the Atmanirbhar Bharat plan. They are also keen to participate in the civil mercantile marine area to build platforms and ships for the Inland Waterways Authority projects — National Waterways-I from Varanasi to Paradip and other infrastructure building activities, the sources added. In the decade between 2011 and 2021, India imported $22.8 billion worth of arms from Russia, its largest supplier. The purchases during the period were up 42.5% over the previous decade. Of course, as far as supplies to Europe are concerned, India refiners will have to face stiff competition from those in West Asia. “The options available to Indian firms would be to sell on the high seas as long as the discounts on Russian crude continues. India will also have to increase it refining capacity going ahead as the current capacity is good enough only up to 2030,” a consultant said. The government had a decade ago announced a plan to make India a regional refinery hub. Since then refining capacities have been enhanced both on the eastern and western coasts, but the rise in exportable surplus has been moderate due to a steep rise in domestic consumption. Indian crude oil refiners — IOCL, HPCL, BPCL, RIL and Nayara — are currently sourcing more than 0.8 million barrels per day of Russian Ural crude that is discounted at a huge $35 per barrel. India’s refinery throughput is roughly 89% of the installed capacity of 249.88 million metric tonne per annum (mtpa). This leaves significant capacity to serve new export markets, mostly in the private sector. Analysts say India will have around 1.5 to 2 times its current refinery capacity in the next 20-25 years. India’s consumption of petroleum products stood at 202.7 mtpa in FY22, up from 194.3 mtpa in FY21, but lower than the pre-pandemic level of 214.1 mtpa (FY20). The country exported 61.8 mtpa of petroleum products worth $42.3 billion in FY22, while imports touched 40.2 mtpa ($24.2 billion).
Source: Business Standard
Chief minister Nitish Kumar will formally launch the Bihar Industrial Investment Promotion (Textile and Leather) Policy, 2022 or Bihar Textile and Leather Policy on Wednesday. The new policy, approved by the state cabinet on May 26, is aimed at opening new doors for establishment of textile and leather industries in the state. For this purpose, the state industries department has made several provisions for various types of incentives, including capital investment subsidy, employment generation subsidy, power tariff subsidy, freight reimbursement incentive, patent registration and skill development subsidy. “With all such provisions like interest subsidy on loan, reimbursement of SGST, exemption on stamp duty, registration and exemption on land conversion, companies from the leather and textile sector will definitely be attracted for investment in Bihar,” industry minister Syed Shahnawaz Hussain told reporters on Monday. Shahnawaz said after the ethanol policy, investors have approached for the textile and leather policy. “It seems the textile companies are looking at Bihar as the best investment destination. We have enough land. The chief minister has given the closed sugar mills and another 2800 acres of land to the industries department. We want to provide land to textile companies coming to Bihar with ‘plug and play’ facilities, so that industries can be established at a faster pace,” he said. “It seems, for the first time, the intention of people from the textile and leather sector across the country is to invest in Bihar. We have made the best policy of the Country,” he added. The minister further said Bihar will become a major textile hub of the country. “Only Bihar can give a tough competition to countries like Bangladesh and Vietnam in the textile sector,” Shahnawaz said. He further said the biggest strength of Bihar is its trained manpower. He said in the textile companies across the country, including at Tiruppur, Surat, Ahmedabad, Mumbai and Chandigarh, most of the skilled or semi-skilled workers are from Bihar. “The population of Bihar is 14 crore, but whichever companies invest in Bihar will get a big market for the population of about 54 crores of neighbouring countries like Nepal, Bhutan and northeast states. Now, we have given another slogan of ‘Now come back to Bihar’. This is for those who are from Bihar but are doing big business in other parts of the country or abroad,” Shahnawaz said. The industry minister claimed that the industrialists coming to Bihar will be given a red carpet welcome. “We are working a lot on ease of doing business. We are providing land and other things required not in months, weeks or days but in hours,” he said.
Source: Times of India
The move to shash garmenting capacity in the African country is set to be compensated by fresh capital expenditure plans in India With uncertainty looming over extension of the African Growth and Opportunity Act (AGOA) Treaty, Arvind Limited is gradually cutting down its garment capacity in Ethiopia. “During the year we completed a restructuring of some of our facilities across India and also started to gradually bring down capacity in Ethiopia. We had shared that the AGOA Treaty has been kind of cancelled for now and hence duty-free exports from Ethiopia to the US have been halted. As such, the traffic for that location has come down, so we have started kind of reducing the footprint there. So, our installed capacity has come down to about 50 million pieces or so,” Samir Agrawal, chief strategy officer at Arvind, told analysts in a post-earnings call recently. Enacted in 2000, the treaty, which offers duty-free access to the US from sub-Saharan African countries, was renewed till 2025 in 2015 but faces uncertainty over its further renewal. However, for Arvind, the move to shash garmenting capacity in the African country is set to be compensated by fresh capital expenditure plans in India. According to Agrawal, during FY23, the company set aside Rs 200 crore towards capacity augmentation in its advanced material division and garmenting businesses, as well as certain cost optimisation projects for fabric business.
Source: Business Standard
The move assumes significance, as there has been no official estimate of logistics costs in India, and one of the key objectives of the new policy is to bring down such costs, which have long been blamed for eroding the country’s export competitiveness. As it works out a national logistics policy, the commerce & industry ministry is weighing a proposal to roll out an index to gauge the country’s logistics costs. The move assumes significance, as there has been no official estimate of logistics costs in India, and one of the key objectives of the new policy is to bring down such costs, which have long been blamed for eroding the country’s export competitiveness. “We are actively considering working out a framework for the assessment of logistics costs and also the possibility of having an index, which can help us in the determination of and/or monitoring of logistics costs at any point of time,” a senior official told FE.Some private agencies have pegged India’s logistics costs at 13-14% of its gross domestic product (GDP).But some experts have raised questions over the methodology used by the private parties to arrive at such costs, given the fragmented nature and the complex dynamics of the logistics sector, and opaque pricing models adopted by relevant players. However, for these very reasons, estimating the actual logistics costs will warrant an elaborate exercise. The new policy will likely set an ambitious target of reducing the costs by up to five percentage points over the next five years. Encouraged by the Centre and acknowledging the growing importance of keeping logistics costs at reasonable levels, eight states have adopted their own logistics policies.These states are Gujarat, Uttar Pradesh, Haryana, Assam, Telangana, Kerala, Bihar and Chhattisgarh, official sources said. More states are following suit. An earlier draft of the national logistics policy, firmed up in 2019, had aimed to reduce such costs to 9-10% of GDP but the ministry had then flagged the absence of an official logistics indicator. The logistics sector in India remains very complex, with the involvement of more than 20 government agencies under various ministries, 40 partnering government agencies and 37 export promotion councils. They deal with 500 certifications covering 10,000 commodities. The renewed thrust on reducing logistics costs came after the government created the new logistics division in the commerce department to develop and coordinate the implementation of an action plan for the integrated development of the logistics sector, by way of policy changes, improvement in existing procedures, identification of bottlenecks and gaps and introduction of technology in this sector. According to a 2016 HSBC report, domestic bottlenecks, including high logistics costs, accounted for a half of the slowdown in the country’s exports. The Economic Survey for 2017-18 had estimated that a 10% reduction in indirect logistics cost could lead to an export growth of 5-8%. India improved its ranking in the World Bank’s Logistics Performance Index (LPI) from 54 in 2014 to 44 in 2018. However, it trailed countries like Singapore (rank 7), South Korea (25), China (26), Taiwan (27), Thailand (32) and South Africa (33). Also, while it has done relatively well on “tracking and tracing” and “timeliness”, its scores on “customs”, “infrastructure” and “logistics competence” parametres of the LPI were lower than its headline LPI score in 2018. A customs officials said several initiatives have since been taken to improve the performance, which would reflect in future ranking.The country’s road logistics market alone is estimated to grow at a compounded annual growth rate of 8% to reach $330 billion by 2025, driven by factors, including a rapidly growing e-commerce sector and a growing retail sales market, according to a study by an arm of consulting firm RedSeer.
Source: Financial Express
In conjunction with this year's World Environment Day, the US-based leading silk brand Lilysilk is celebrating with zero-waste initiatives to champion a sustainable lifestyle, and contribute to a greener, better world. As an important part of Lilysilk's green and zero-waste initiatives, the Free Recycling Program is a long-term project to recycle non-donatable Lilysilk textiles including bedding, apparel and sleepwear made from silk and cashmere. As of end-April, more than 150 units of material have been collected and recycled. This number is increasing every month, the company said in a statement. "We only have one earth, and it is important that we live in a sustainable manner that is in harmony with nature," said David Wang, CEO of Lilysilk. "Lilysilk has always been committed to pushing for sustainable practices and initiatives and we are happy to invite more consumers to take part in it!" The spun silk is Lilysilk's other innovative and sustainability initiative. Spun silk is made by twisting short silk fibres obtained from damaged cocoons or waste silk during processing to form yarn. Spun silk is more economical and possesses all the general features of reeled silk. It is soft and silky yet anti-bacterial and anti-allergic, which makes it safe and comfortable enough to wear against the bare skin. Furthermore, the brand also engages in Re-Lilysilk pillowcase, which recycles surplus silk fabrics. Lilysilk's designers repurpose leftover textiles into pillowcases in a variety of forms and colour combinations, transforming them into pillowcases. The Re-Lilysilk initiative allows discarded materials to be resurrected and repurposed into one-of-a-kind, trendy and useful items. Lilysilk hosts a variety of programmes to encourage people to incorporate sustainability into their daily life. For example, for every order made, customers will randomly receive a product from Lilysilk's ‘zero waste series’, which features products made from leftover materials.
Source: Fibre2 Fashion
Less than 1% of textile waste is recycled into fibres for new clothes, notes Global Fashion Agenda. The fashion industry is producing twice as many emissions as permitted if it is to meet UN climate targets in less than eight years, and must urgently reform its recycling and waste practices as well as pay systems, a report from a non-profit industry group has found. The sector is falling well short of the UN sustainability goals for 2030 that more than 150 brands have signed up to, concludes the Global Fashion Agenda, a wide coalition that includes the Ellen MacArthur Foundation and trade body Textile Exchange. While there was progress in resource stewardship, work environments and material choices, the industry was behind on wage systems and so-called circularity, based on anonymised data collected by the Higg industry reporting tool. Only 10 per cent of brands disclosed the number of workers in their supply chain that were covered by collective bargaining agreements, while only 9 per cent reported how many of their suppliers had elected trade unions. Just 14 per cent said their company’s products were made with materials that could be recycled where they were sold. While longevity, reuse and recycling of clothing were crucial to reducing emissions and plastic pollution, the GFA noted that less than 1 per cent of textile waste was being recycled into fibres for new clothes. Clothing production doubled between 2000 and 2015 but the use of an item of clothing decreased by 36 per cent, according to the Ellen MacArthur Foundation. About 200 brands used the Higg system to measure their performance in 2020, while 500 more have committed to implementing it by 2024. Swedish fashion giant H&M disclosed its Higg scores for the first time this week, pledging to increase its total scores by 2 per cent next year. On its present trajectory, by 2030 the industry will have produced about twice the volume of emissions permitted to align with the Paris climate agreement, according to a recent McKinsey report. To reach its targets, it would have to reduce its emissions by 45 per cent by 2030. Globally, the industry was responsible for about 4 per cent of the total greenhouse gas emissions in 2018, McKinsey calculated. At least two-thirds of a brand’s environmental footprint was attributed to its choice of materials. Fossil fuel-based synthetic materials and recycled synthetics make up more than half of total fibre production, according to the European Commission, and up to 500,000 tonnes of synthetic fibres from textiles were released into oceans every year. At the UN COP26 in Glasgow last year, about 150 brands, including luxury groups Kering and LVMH, updated the targets laid out in the 2018 Fashion Industry Charter for Climate, pledging to halve emissions by 2030 to limit global warming. However, the signatories represent just a fraction of the huge apparel and footwear industry.
Source: Fibre2 Fashion
Global Fashion Agenda (GFA) has released The GFA Monitor — a new report to guide fashion leaders towards a net positive fashion industry. The non-profit organisation fosters collaboration on sustainability in fashion to accelerate impact. It consulted over 30 partners and organisations to form a cohesive resource that presents expert insights on the status of the industry, available solutions, clear actions to take, and proven best practices. Less than eight years remain to align with the 1.5-degree pathway and achieve the Sustainable Development Goals laid out by the United Nations. If the fashion industry does not accelerate its response to climate change, by 2030 it will be responsible for producing approximately twice the volume of emissions permitted to align with the Paris Agreement global warming pathways towards net zero emissions by 2050. Meanwhile, the global pandemic and volatile geopolitical climate are dramatically disrupting the global economy, exacerbating social dilemmas, and disrupting commodities and value chains around the world. Bold alliances are needed to redesign the fashion system and establish pervasive change, the GFA said in a media release. In a bid to accelerate progress, The GFA Monitor presents guidance according to the five sustainability priorities of the Fashion CEO Agenda: Respectful and Secure Work Environments, Better Wage Systems, Circular Systems, Resource Stewardship, and Smart Materials Choices. Building alliances through shared industry knowledge, each priority includes expert insights from GFA's Impact Partners including: Fair Labor Association (FLA), the Social & Labor Convergence Program (SLCP), Ellen MacArthur Foundation, Apparel Impact Institute, and Textile Exchange, respectively. Through action on these priorities, GFA believes that the industry will progress towards achieving a living wage and fair compensation for all, a significant reduction of conventional virgin resources, and decreased emissions that will lead to a net positive fashion industry. Federica Marchionni, CEO, Global Fashion Agenda, said: "With such an array of information circulating about sustainability, it can be challenging for leaders to identify which actions will lead them on the path to progress. Through this report, we aim to create an aligned resource for the industry. We have created alliances with multiple expert organisations with different specialties to combine existing knowledge and reduce complexity. The solutions and tools that the fashion industry needs to improve already exist. It's time to use them ambitiously. I hope this report can be a companion for the industry on its journey to reach a net positive industry by 2050." Through a newly formed partnership with sustainability insights platform, Higg, GFA is working to establish a measurement baseline to improve the availability, reliability, and consistency of data to measure industry progress. Data from the brands and retailers that completed the Higg Brand & Retail Module (BRM) indicates that they have made more progress in areas of Resource Stewardship, Respectful and Secure Work Environments, and Smart Material Choices, whereas there are still significant improvements to be made related to Better Wage Systems and Circular Systems. The data demonstrates that more action is urgently needed across all five priority areas to improve industry performance. Building on the inaugural 2022 edition, GFA intends for The GFA Monitor to become an annual gauge of the fashion industry; to monitor industry progress to increase accountability, present the latest insights and impact data, and identify critical actions required to meet its objectives. GFA welcomes further cooperation with other industry organisations as the annual report evolves and responds to industry and scientific developments. GFA and its Impact Partners will discuss the findings during Global Fashion Summit: Copenhagen Edition, the leading international forum for sustainability in fashion, taking place on 7-8 June at the Royal Opera House, Copenhagen.
Source: Fibre2 Fashion
