Poor demand from garment units has triggered a drop of Rs 30 per kilogram in price of cotton yarn across all categories. Poor demand from garment units has triggered a drop of Rs 30 per kilogram in price of cotton yarn across all categories. According to sources, combed and semi-combed yarn in the categories-20s count, 24s count,30s count, 40s count are mostly used in the garment industry in Tiruppur. Due to fall in demand, prices dropped Rs 40 per kilogram on July 1, 2022, and continued to drop to Rs 30 on August 1. As a result, all varieties of yarn which was hovering above Rs 470-490 per kilogram has come to around Rs 390-410 per kilogram. President of Tiruppur Exporters and Manufacturer Association MP Muthurathinam said, “As expected, the price has come down and there are many reasons, the most important one being reduction in offtake by garment units since May. This affected offtake of yarn from mills in Tiruppur, Coimbatore and Erode and many mills were forced to shed stock at throwaway prices. . In order to attract garment units, they reduced price across the board. But one must remember this is a business cycle, whatever goes up must come down.” Explaining the dip in demand for yarn, K Nagarajan, proprietor of Bhagwan Hosiery, said, “In March and April, mills increased price by up to Rs 30 and Rs 40 per kilogram respectively. Distributors from North India, Andhra Pradesh, Telangana placed orders in Tiruppur, cautiously. When the price fell in July, they reduced orders, expecting prices to fall further. So, garment units had to procure less yarn from mills.” South India Spinners Association president P Jagadesan said, “There are some reasons why mills were forced to reduce prices. Large mills couldn’t hold stocks for a longer period of time. So in order to avoid excess accumulation, they are offloading stocks. This is having a cascading effect.”
Source: New Indian Express
India will continue to work intensively towards its targets to conclude the talks by Diwali, said Nidhi Mani Tripathi, Joint Secretary Ministry of Commerce. India and UK have just concluded the fifth round of talks for the Free Trade Agreement (FTA). The agreement is estimated to double India-UK bilateral trade to $100 billion by 2030. "Two weeks of round five of India UK FTA negotiations draw to a close. Our teams will continue to work intensively throughout summer towards our targets to conclude the talks by Diwali," said Nidhi Mani Tripathi, Joint Secretary Ministry of Commerce. UK Permanent SecretaryTrade, James Bowler, met with Commerce Secretary BVR Subrahmanyam before the fifth round began a few days back. Three agreements were signed including recognising each others higher education. "Trade talks between India and UK are on track and the proposed trade deal is currently being negotiated and would be concluded by August 31st," Subrahmanyam had said earlier. “Irrespective of the party in power in the UK, the logic of FTA with India is irreversible," Subrahmanyam said. The UK is at present reeling under political instability after Prime Minister Boris Johnson stepped down. The race for the next Prime Minister is hotting up. However, this is not likely to impact the FTA negotiations, say experts. "Cookie-cutter style of trade deals won’t work with a diverse country like India. An agreement will mark a major step in a new direction of the 21st century. Negotiations can be tough but success comes with cooperation," tweeted Anne-Marie Trevelyan, UK Secretary of State for International Trade and President of the Board of Trade. The FTA is pertinent for both India as well as the UK as it will give a boost to overall trade. With issues that UK is battling at present regarding wages, there is a need for the FTA going through for UK as much as it is for India. While the FTA will double UK’s exports to India, it is also expected to boost Britain’s total trade by as much as £28 billion a year by 2035 and increase wages across the UK regions by £3 billion, according to industry estimates. "UK is going through a wage crisis at present and this infusion of funds with enhanced trade with India will help them. Statistics reveal that wages (despite a recent hike) don’t match up with the 6.2 per cent rise in the consumer price index," said an expert on FTA. In the past rounds of negotiations UK had agreed to eliminate duty on rice and textile goods while India is likely to allow duty free entry of British apples, UK manufactured medical devices and machinery. UK was India’s 17th largest trading partner (2021-22). The total trade between the two nations stood at $16 billion (April 2021-February 2022).
Source: New Indian Express
Job creation is subdued though companies step up purchasing and report solid manufacturing activity India’s manufacturing activity in July expanded at the quickest pace in eight months on the back of new business orders and output, said a survey by S&P Global on Thursday. S&P Global India Manufacturing Purchasing Managers' Index (PMI) jumped to 56.4 in July from 53.9 in June. A reading above 50 indicates expansion while a print below that denotes contraction. The growth was a result of strong demand and pick-up in sales, the survey said. “Output expanded at the fastest pace since last November, a trend that was matched by the more forward-looking indicator new orders,” said Pollyanna De Lima, economics associate director at S&P Global Market Intelligence. New orders rose in July, recovering from the growth momentum lost in June, the survey said. International markets contributed to the upturn in total order books, as new export orders rose at a moderate pace, it said. Goods' producers registered a softer increase in their expenses during July, the survey said. Even as the cost for raw materials continued to rise, the rate of inflation slipped to an 11-month low, the survey said. Similar to input costs, the rate of increase in output prices in July was the slowest in four months, it said. "Purchasing activity growth ticked higher in July and firms were successful in their efforts to obtain inputs amid a second consecutive improvement in supplier performance. This in turn supported a near-record increase in inventories of raw materials and semifinished goods as well as a softer upturn in input costs,” said De Lima. Meanwhile, India's retail inflation in June had marginally eased to 7.01%, but stayed well above the Reserve Bank of India's tolerance limit for the sixth consecutive month. To contain inflation, the RBI has already hiked its key interest rate by a cumulative 90 basis points since early May, and is expected to raise it again later this week. The survey also pointed that companies stepped up input purchasing and reported solid manufacturing activity, however job creation remained subdued. The increase in employment was marginal and broadly similar to that seen in the five-month sequence of growth. About 98 per cent of firms kept workforce numbers unchanged amid a lack of pressure on operating capacity, the survey said. Future uncertainty constrained hiring activity as overall business sentiment remained muted. About 96 per cent of manufacturers forecast no change in output from present levels over the course of the coming 12 months, the survey said.
Source: Business Standard
Trade, import and export for MSMEs: India-Uzbekistan bilateral trade increased 38.5 per cent from $247 million in 2019-20 to $342 million in 2021-22 despite the pandemic, said Piyush Goyal. Trade, import and export for MSMEs: Commerce Minister Piyush Goyal has underlined the micro, small and medium enterprise (MSME) sector as one of the seven focus areas to enhance cooperation between India and the Central Asian nation Uzbekistan. Terming India-Uzbekistan relations as key to India’s vision of an ‘integrated extended neighbourhood’, Goyal noted digital payments, space cooperation, agri and dairy, pharma, gems and jewellery, and Inter-regional cooperation apart from MSME as the seven emerging areas of cooperation between both the nations. Addressing the 13th session of the India-Uzbekistan Inter-Governmental Commission (IGC) in New Delhi last week, Goyal called for taking the “relation forward in newer areas like technology, digital payment solutions and investment in startups.” India-Uzbekistan bilateral trade increased 38.5 per cent from $247 million in 2019-20 to $342 million in 2021-22 despite the pandemic, the minister noted while highlighting 2022 to be the 30th year of diplomatic relations between the two countries. Goyal’s address came ahead of Prime Minister Narendra Modi’s visit to Uzbekistan scheduled for September this year. Uzbekistan’s Deputy Prime Minister and Minister of Investments and Foreign Trade Jamshid Khodjaev in his comments at the event said the visit of PM Modi will be utilized fully for giving a significant boost to bilateral relations in several areas of mutual interest. In a separate event — India-Uzbekistan Business Forum organised by the Confederation of Indian Industry on Friday — Khodjayev invited Indian businesses to integrate and jointly produce pharma and IT products with Uzbekistan and also to work towards the development of several segments such as fintech and cybersecurity. According to data from Trading Economics, India’s exports to Uzbekistan in 2021 were topped by pharmaceutical products followed by machinery, nuclear reactors, boilers, tanning or dyeing extracts, etc. In terms of imports from Uzbekistan, gums and resins, medical apparatus, zinc, silk, cotton, etc., were the leading products purchased by India in 2021.
Source: Financial Express
Among the top-selling UP products are leather goods, carpets, hand woven textiles, brassware, glassware, sports goods, etc The Uttar Pradesh government will tap the Indian embassies in the US and European countries in its bid to double merchandise shipments to Rs 3 trillion in the next 4-5 years. The Indian embassies in the US, UK, Germany, Australia, Israel, Singapore, etc. will promote the micro, small and medium enterprises (MSME) products, apart from traditional handicrafts and indigenous products, under the state’s flagship One District One Product (ODOP) scheme. “Indian embassies will provide the much-needed traction and visibility to our traditional products in key export destinations across the globe,” UP Additional Chief Secretary (MSME and export promotion) Navneet Sehgal told Business Standard. Bucking the pandemic headwinds, the UP merchandise exports had jumped 30 per cent from Rs 1.07 trillion in 2020-21 to more than Rs 1.40 trillion in 2021-22, of which the ODOP basket contributed 72 per cent. The UP MSME department had already tied up with leading e-commerce platforms viz. Flipkart and Amazon to market the state’s merchandise basket and would make a similar pact with e-bay as well, Sehgal said. The state will also utilise the Open Network for Digital Commerce (ONDC) channel to foster merchandise exports. Promoted by the Centre, ONDC is mandated to promote the exchange of goods and services over digital networks. It is based on open-sourced and open network protocols, independent of any specific platform, thus providing an expansive selling-buying experience for institutional entities. Among the top-selling UP products are leather goods, carpets, hand woven textiles, brassware, glassware, sports goods, etc. ODOP scheme, which was launched during the maiden UP Foundation Day celebrations in January 2018, is themed at promoting the state’s traditional products and creating local level jobs. In fact, the state government has been organising virtual global buyer-seller meets over the past two years to augment MSME and ODOP exports. “We are also looking at launching exclusive ODOP marts at fuel retail pumps, railway stations, airports, and bus terminals in the country. We will invite bids from private companies to set up such marts and work on a commission basis,” Sehgal said. The Yogi Adityanath government is bullish on the potential of the MSME and ODOP verticals to create employment opportunities, and actively contribute to achieving the ambitious goal of UP becoming India’s first $trillion economy in the next few years. The state is promoting the ‘flatted factory’ concept to economise on space for nonpolluting MSME industries. A flatted factory is a multi-storied industrial building, accommodating a host of industrial and assembly units, apart from serving as industrial warehouses.
Source: Business Standard
The Federation of All Trade and Industry Associations of Erode District has urged the State government to withdraw the proposed hike in electricity tariff as it would further affect the functioning of industries. The federation’s executive committee meeting was conducted recently and was chaired by its president V.K. Rajamanickam, in which other office bearer’s general secretary P. Ravichandran, treasurer R. Muruganantham and members took part. A resolution said that the proposal would affect all the industries in the State that were facing many challenges due to high cost of raw materials and labour cost and unhealthy competitions. Hence, considering the plight of the industries, the government should withdraw the proposed hike in electricity tariff, the resolution added. Another resolution urged the Central government to withdraw the GST council’s decision to impose 5% GST on pre-packed, labeled food items like atta, paneer and curd. Another resolution urged the Corporation to expedite the construction of a vegetable market on R.K.V. Road and shift the vegetable shops that were temporarily functioning at V.O.C. Park Ground. A resolution wanted the State government to intensify patrolling on national and State highways as shops and establishments function during night hours. “Since people travel at night, their safety and protection is priority and patrolling should be intensified”, the resolution said. A resolution said that frequent traffic congestion prevails at Palayapalayam Junction on Perundurai Road and wanted a flyover to be constructed till Thindal. Though the Dedicated Water Supply Scheme works that supplies water to the corporation was completed, house service connection is yet to be given to many households. The resolution called for laying pipelines and providing connections to all the households. Imposing 1% service cess for traders from other States who procure from agricultural regulated marketing committees would discourage them and wanted service cess to be withdrawn. The resolution also wanted a textile park to be established in the district.
Source: The Hindu
Aiming to provide financial support to the bereaved families of handloom and power loom weavers in Telangana, the state government will launch the ‘Nethana Beema’ scheme on August 7, said minister KT Rama Rao on Monday. “Telangana government is implementing various welfare schemes to uplift the weaver’s community in the state,” KTR said. “On the lines of Rythu Beema Scheme, the government is introducing the “Nethana Beema” scheme to provide financial support to the bereaved families of handloom and powerloom weavers. This scheme will be launched on National Handloom Day on August 7, 2022,” he added. “The amount will be credited into the bank account of the family member within 10 days after the death of the weaver,” the Minister said. The Department of Handlooms and Textiles of the state government will be the nodal agency for the implementation of this scheme. KTR further informed that the state government has entered into an agreement with the Life Insurance Corporation (LIC) for this scheme. He also added that the Telangana Govt will be paying the premium amount to the LIC. The government has allocated Rs 50 crores for this scheme, and out of this Rs 25 crores has already been released. Weavers below the age of 60 years are eligible for the scheme. About 80,000 handloom and powerloom weavers are beneficiaries under this scheme. Minister KTR said that state and district level committees will be formed soon for the implementation of the Nethana Beema scheme. “The Telangana Govt every year is allocating a special budget (from BC Welfare) of Rs 1,200 Crores since 2016-17 to strengthen the handloom and powerloom sectors. This is in addition to the regular budget allocated to the Department of Handlooms and Textiles,” he said. “The Telangana Govt has allocated Rs 55.12 Crores as a regular budget to Dept. of Handlooms and Textiles for the FY 2022-23. Another Rs 400 Crores were allocated for the welfare of the weaker sections,” the Minister added. Minister KTR stated that the Telangana government is implementing welfare schemes for the weaver’s community like no other state government in the country. He added that officials from Odisha, Karnataka, and Madhya Pradesh toured Telangana and appreciated the schemes being implemented by the state government. KTR also held a review meeting on the Neethana Beema Scheme ahead of its launch on August 7. The officials informed the minister that they are creating awareness amongst the weavers about the scheme. During the meeting, Minister KTR gave directions to the officials for successful implementation of the scheme.
Source: The Print
“India should focus on promoting apparel export on mission mode. There is no reason why India should lose out on export opportunity in this sector to neighbouring countries as our country has been a global hub for textile manufacturing since time immemorial. It is time we leverage our policy initiatives such as mega textile parks to aim for increased exports not only in yarn and fabrics, but also in apparel and clothing,” said Mr. Suman Bery, Vice Chairman, NITI AAYOG at an event to launch MVIRDC WTC Mumbai Research Study on ‘India’s Export Competitiveness’. The study highlighted that India’s share in world export of high value added items such as apparel & clothing has remained stagnant around 2.3% since 1990, even as our share in low value added items such as yarn, fabrics, made-up articles improved from 2% to 6% between 1990 and 2018. Mr. Bery welcomed the idea of encouraging foreign trade settlement in local currency and suggested that RBI and banks may resolve practical difficulties such as free convertibility of local currencies, availability of hedging and trade finance in local currencies, development of alternative payment infrastructure etc. Mr. Bery suggested WTC Mumbai and other export promotion organisations to handhold MSMEs in integrating in global value chain in the new world order where they have to comply with strict sustainability standards involving environment, labour and product traceability norms. These sustainability standards are important issues in our negotiation of trade agreement with large partners such as European Union, Mr. Bery pointed out. Mr. Bery suggested that India should consider imports as an essential strategy to boost export competitiveness, instead of worrying about its consequence on trade deficit. He said, “For a relatively open economy like India, competitiveness is linked to imports. In certain value chain such as precision engineering, India is dependent on imports. It is tempting to impose tariff on imports to reduce trade deficit. However, a tax on import is a tax on exports and hence there is a need to reconsider import tariff to support our MSME exporters. India, which has a surplus on services account and remittances in the balance of payment, has had a reasonably manageable trade deficit in the past, except in the current circumstance when energy prices are abnormally high. There is little reason to consider a significant trade deficit to GDP ratio as worthy of policy attention.” India’s trade deficit doubled to USD 70.8 billion in April-June 2022 compared to USD 31.4 billion in the comparable quarter of last year because of increase in import bill of crude oil, coal, edible oil and precious metals. Mr. Bery explained that we should not be too rigid in our distinction between merchandise exports and services exports as a lot of service component is embodied in merchandise exports as well. He said, “Various digital initiatives that facilitate exports represent embodiment of services in goods exports. Trade facilitation by itself is services intensive. So, it is not appropriate to draw sharp distinction between goods and services exports in supply chain. We need to identify the services provided by MSMEs that are embodied in goods exports.” Mr. Bery informed that there have been policy focus on exports and Government of India has taken several initiatives in the recent past, which have started bearing fruit. He said, “The agenda of the central government is defined by a High Level Advisory Committee Report in 2017, which not only discussed trade but also logistics and taxation which influence exports.” Earlier in his welcome remarks, Dr. Vijay Kalantri, Chairman, MVIRDC World Trade Center Mumbai suggested that the central government may set up a task force under NITI AAYOG to revive local MSME units that became sick due to unfair competition from imports, especially in printed circuit boards, white goods and electronic components. Dr. Kalantri remarked, “This is the right time to revive our MSMEs under the Aatmanirbhar program by rethinking on import substitution. India should also reduce cost of logistics, which stands around 8% of GDP to less than 6% so that we can compete in the international market” Dr. Kalantri also suggested the need to promote local currency settlement for trade within SAARC, BIMSTEC and Asia-Pacific region to reduce transaction cost, price competitiveness and grow overall trade volume within these blocs. The MVIRDC Research Study on 'India's Export Competitiveness' is an outcome of an extensive primary survey and meticulous analysis of foreign trade data from authentic sources such as UNCTAD, ITC, Geneva and India's Ministry of Commerce. The study made more than 8 policy recommendations for boosting exports based on primary survey with representatives of gems & jewellery, leather, ceramics and special economic zones (SEZs) in India. The study identified 100 champion products for exports, highlighted export potential in North Eastern states and examined trends services exports. During the event, Mr. Suman Bery also launched WTC Mumbai’s Connect India Trade Show 2022, which aims to facilitate global market access for more than 50,000 MSMEs through a digital platform during August 1, 2022 to November 30, 2022.
Source: Free Press Journal
Vietnam's textile industry is working on adapting to new requests for materials traceability from international markets. Vietnam's textile industry is working on adapting to new requests for materials traceability from international markets. According to experts in the textile industry, many companies right now are facing great difficulty with the high demand for traceability of raw materials in multiple parts. If companies want to trade in markets with whom Vietnam has signed a Free Trade Agreement (FTA), they have to ensure that the materials that are used to make their products are in line with the FTA environmental regulations in the importing countries. Officials of the textile industry are currently working with the Ministry of Industry and Trade to build industrial compounds with wastewater treatment systems to ensure environmental protection. Textile companies, especially those who are original design manufacturers (ODM), should carefully research Vietnam and the importing countries' traceability rules and standards. ODMs are those that will be responsible for the direct development of the goods, purchasing raw materials, manufacturing the products, and then selling the products to other brands. Vo Manh Hung, head representative of Cotton Council International (CCI) in Vietnam, said that cotton traceability is something that every company must account for when bringing their product to the world. Currently, there are a lot of brands requesting that all their products have to be produced with sustainable cotton materials by 2030. Truong Van Cam, Deputy Director of Vietnam Textile and Apparel Association (VITAS), said that if the industry wants to sustainably develop, companies will have to invest in sustainable development themselves and bring back economic benefits to the industry. The industry has significantly contributed to Vietnam’s economic growth and exports. In particular, in the first half of 2022, the industry's export revenue reached 22 billion USD, up 23% compared to the same period last year. The textile industry is one of the key manufacturing industries of Vietnam’s economy, accounting for 12-16% of the country’s total export turnover. This industry also helps to create many jobs for labourers. Digital transformation Digital transformation plays an important role in improving the competitiveness of textile and apparel businesses, and businesses need to adopt it, a conference heard in HCM City late last week. Nguyen Thi Tuyet Mai, Deputy General Secretary of the Vietnam Textile and Apparel Association, said more and more international textile and apparel companies are pursuing green production, which is posing a great challenge to Vietnam’s textile industry. Vietnamese businesses also need to satisfy transparency requirements related to origin, domestic material use, labour, and environment commitments, she said. Other experts told the conference that digital transformation is essential for improving businesses’ competitiveness, allowing them to meet customers’ demands related to quality and transparency. Businesses should look at investing in technologies such as artificial intelligence and automation to improve production capability, and in training their workforce to use them, they said. However, Mai said: “80% of businesses in the field are small- to medium-sized, and so they have limited access to capital needed for digital transformation and green production.” The conference was held as part of the International Exhibition of Textile and Garments and Fabric and Garment Accessories (SaigonTex & SaigonFabric) being held at the Saigon Exhibition and Convention Centre in District 7 until August 6.
Source: Vietnam Plus
The Japan Textile Federation recently announced guidelines encouraging companies to pay more attention to human rights abuses in supply chains. The guidelines include a checklist for company executives to ensure their supply chains are free of rights abuses like forced labour, child labour, harassment, long working hours and delays in wage payments. It is important that textile companies make internal rules and human rights policies, the guidelines, issued following allegations of forced labour in cotton production entities in China’s Xinjiang region, said. “We hope that the guidelines will be used to make the industry more attractive for workers,” Federation president Masanao Kanbara was quoted as saying by a Japanese media outlet. The government plans to draw up guidelines this summer on human rights due diligence. The way in which some foreign technical trainees are treated in the country’s textile manufacturing industry has reportedly raised concerns.
Source: Fibre 2 Fashion
Ted De Innocentis, co-founder of 1620 Workwear in Amesbury, Massachusetts, knows a thing or two about the textile and apparel business. Before De Innocentis and his buddy, co-founder Josh Walker, founded 1620 Workwear, De Innocentis spent five years in China manufacturing high-end activewear and apparel. "It all starts with the fabric," De Innocentis said. "The best fabric makes the best workwear." When the two launched their own product six years ago, De Innocentis knew they wanted to make fashion-forward clothing for the job site, and it had to be made out of the best materials available. One example is a fabric used in the shoulder pads of an on-field NFL jersey. "So, it's designed for high impact abrasion resistant and to be washed a bunch of times," De Innocentis said. Walker and De Innocentis said that this is not your father's workwear. "Our goal at 1620 is to create a fresh brand that young guys coming into the trades can identify with," Walker said. Championing the labor market is only one of the goals at 1620. "We always wanted to make as much as much stuff as we could in Massachusetts," Walker said. "Some products in our line that are 100% made in Massachusetts. The fabric is milled here. The clothing is stitched and put together here and we're super proud of that because there's amazing heritage of clothing manufacturing in Massachusetts." Using best-in-class fabrics does come at a price, but according to De Innocentis and Walker, they're experiencing constant growth with a 60% repeat customer rate. They see that as the framework for building a successful business moving forward. "We're still a very small company that's not known in a lot of places," Walker said. "I'm sure a lot of people seeing this show have never heard of us, but it's exciting to just continue on the growth path and work hard at it." 1620 Workwear is a direct-to-consumer company, which means people won't find them in a clothing store. That said they do have a showroom in Amesbury where people can go to try items on for size. They just ask that people call first to set up a time to visit.
Source: WCVB
Textile millers and garment exporters also bought raw materials in additional quantities thanks to a brighter outlook of the garment trade because of the global recovery from the severe fallout of Covid-19. The import of basic raw materials used to produce garment items in Bangladesh surged in the first six months of 2022 on the back of a rise in demand in the export markets, even contributing to the dollar crisis in the country. The imports of yarn, cotton, knitted and woven fabrics rocketed in such a way that their combined value in the January-June period this year almost equalled that of the entire 2021. It came after global retailers and brands poured orders after they received an uninterrupted supply of goods from Bangladesh even during the peak of the coronavirus pandemic, which brought the global supply chain to a standstill. Textile millers and garment exporters also bought raw materials in additional quantities thanks to a brighter outlook of the garment trade because of the global recovery from the severe fallout of Covid-19. But the Russia-Ukraine that broke out in February has put a damper on the projection. Textile millers purchased yarn worth $2.66 billion in January-June, accounting for 76 per cent of the total import value of $3.5 billion in 2021, data from the Bangladesh Textile Mills Association (BTMA) showed. Knitters bought $1.29 billion worth of fabrics in the first half of 2022 from international sources, more than three-fifth of the $2 billion they spent throughout last year. Another $2.21 billion worth of woven fabrics was imported in the first half of this year, representing nearly 70 per cent of the item procured in 2021. Millers imported raw cotton worth $2.26 billion in January-June of 2022. It was $3.8 billion in the last calendar year. Currently, local spinners can supply nearly 90 per cent of the raw materials needed for the export-oriented knitwear sector and 40 per cent to the woven sector. Mohammad Hatem, executive president of the Bangladesh Knitwear Manufacturers and Exporters Association, said the import value of raw materials surged in January-June because of the spike in their prices in the international markets. “The prices of yarn, fabrics and cotton have almost doubled.” The lower pressure of gas turned acute in January, February and March this year. As a result, textile millers were not able to run their factories in full swing to produce yarn and fabrics. The energy situation forced many garment manufacturers to import fabrics and even knitted fabrics from China to meet the increased demand. Mohammad Ali Khokon, president of the BTMA, said cotton imports rose sharply in January-June because of the congestion that hit international ports last year as global economies recovered from the pandemic. The cotton that was supposed to arrive at the Chattogram port in December last year came in January or February because of the delay caused by container shortage globally, he said. “As a result, cotton import in terms of both value and volume increased in the JanuaryJune half.” “The increased price and higher volumes drove up raw materials imports,” said Mustafizur Rahman, a distinguished fellow of the Centre for Policy Dialogue. Cotton price escalated to $3.48 per kilogramme in the April-June quarter this year, up 71.48 per cent from $2.03 in the identical period a year ago, commodities price data of the World Bank showed. Various studies suggest an investigation can be conducted to see whether money is being siphoned off through under-invoicing and over-invoicing during exports and imports, said Prof Rahman. Because of the blistering imports, which include industrial raw materials, capital machinery, fuel and edible oil, and wheat, Bangladesh’s foreign currency reserves have slipped below $40 billion, sending the taka to a new low against the US dollar amid a shortage of the American greenback. M A Razzaque, research director of the Policy Research Institute, accredited higher global inflation, the increase in raw materials prices and stockpiling of goods fearing supply disruption for the surge in the import value. However, the gloomy outlook on Europe and the US means the export boom may not continue in the current fiscal year, he said. Garment shipment clocked 35.47 per cent year-on-year growth in the last fiscal year that ended in June, netting $42.61 billion. Of the sum, $23.21 billion came from knitwear shipment, up 37 per cent and $19.39 billion from woven item exports, an increase of 34 per cent, data from the Export Promotion Bureau showed. Although Bangladesh has attracted higher volumes of orders in recent months, it has not lived up to its expectation because of the war. Still, the country will be able to reach its garment export target of nearly $47 billion set for the current fiscal year, according to Hatem. “The demand will not decline despite the war since Bangladesh produces basic and semi-high-end garment items. These products will always be high in demand.”
Source: The Statement
