Polyester-cotton and poly spun yarn buying slowed down in north India due to higher prices and limited lifting of fabrics. The non-cotton yarn gained ₹5-8 per kg last week after increase in prices of cotton and cotton yarn. However, recycled polyester fibre found support from better demand as mills focused on cheaper raw material to control production cost. According to trade sources, many mills have reduced production of yarn, but demand was still poor. Last week’s increase in prices also discouraged buying of PC and poly spun yarn. A Ludhiana based trader Ashok Singhal told Fibre2Fashion, “Weaving industry was not in hurry for buying. It shows that they have sufficient stock to meet the limited demand from garment industry.” However, recycled polyester fibre was in a better position as it was attractive economical option for the industry. In Ludhiana market, polyester-cotton and poly spun yarn prices were noted at higher from previous week. But the demand weakened since the very beginning of this week. PC yarn prices increased by ₹5-10 per kg since mid of last week. Last week, higher cotton prices pushed up cotton yarn and PC yarn. However, demand for PC and poly spun yarn weakened as weaving industry reduced buying after slow demand of fabric by garment industry. Recycled polyester fibre (high tenacity recycled fibre) gained ₹2 per kg as weaving industry turned to cheaper options to control production cost. 30 count PC combed yarn (48/52) was sold at ₹265-280 per kg (GST inclusive), according to Fibre2Fashion’s market insight tool TexPro. 30 count PC carded yarn (65/35) was priced at ₹230-240 per kg. 20 count PC (recycled-O/E) PSF yarn (40/60) was traded at ₹190-200 per kg. 30 count poly spun yarn was sold at ₹172-180 per kg. High tenacity recycled fibre steadied at ₹89-94 per kg. Reliance Industries Limited had decreased the prices of purified terephthalic acid (PTA), monoethylene glycol (MEG) and MELT. Last Friday, RIL fixed prices of raw material as: PTA ₹85.80 (-1.20) per kg, MEG ₹52.30 (-1.50) per kg and MELT at ₹91.57 (-1.54) per kg. But the price of PSF remained steady at ₹116 per kg. Meanwhile, cotton prices slipped in north India as mills have reduced buying after production cut. Spinning mills are reducing or halting production due to poor demand from weaving industry and last week’s increase in cotton prices. According to traders, there was negligible arrival of cotton but demand too remained weak. Therefore, cotton prices dropped by ₹400-500 per maund of 37.2 kg. Cotton was sold at ₹10,000-10,100 per maund in Punjab, ₹9,500-9,800 per maund in Haryana and ₹10,000 -10,100 per maund in upper Rajasthan. Cotton was sold at ₹94,000-97,000 per candy of 356 kg in lower Rajasthan.
Source: Fibre 2 Fashion
India’s garment and knitting industries have been reserved for the small scale sector for the most part, preventing large-scale investments. India has almost everything it takes for exponential growth in the textiles industry, but that has not really been happening. the industry holds immense potential and has still has been generating the largest employment opportunities in our manufacturing sector, contributing significantly to our exports and, above all, meeting one of the basic needs of the masses. Given the role that textiles had played in our Freedom Movement, the 75th year of independence may be an appropriate occasion to examine what holds the industry back. We’re currently the largest producer of cotton and the second largest in manmade fibres globally. Despite the Covid-19 pandemic, we continue to have a relatively high GDP growth, a large and young workforce, and a large middle class with increasing appetite for lifestyle products. There has also been a huge expansion of organised retailing in recent years and textiles are a major product group on display. But all these have not really delivered commensurate growth to the textiles industry. On the policy front, successive governments seem to have approached this industry with a preconceived notion that small is beautiful. Experiences of countries which have actually achieved higher textile growth have shown us, instead, that scale is efficient. For around two decades from the mid 60s, expansion of the organised weaving industry was restricted; they were permitted to install a new loom only after scrapping an old one, so that the expanding demand could be reserved for the decentralised sectors-handlooms and power looms-which consisted of small units and were perceived to be more labourintensive. Given the differences in productivity, investment potential and return on investment (ROI), this was almost similar to restricting the automobile industry to provide growth opportunities for bullock carts! Decentralised sectors involve the livelihood of millions of workers and traditional artisans as well as their valuable heritage, and these need to be sustained. But countries like Pakistan, Bangladesh and Sri Lanka, which share the same textile heritage as ours, have been able to utilise technology more effectively and have all achieved significantly higher growth than ours. Importantly, their employment opportunities in this industry have also grown substantially. What is not commercially viable cannot be sustained in the market place, however valuable it may otherwise be. We need to retrain the workers in the unviable segments and redeploy both the workforce and resources in more viable segments. Sustaining heritage is important, but should be addressed outside the marketplace, or approached through the creation of niche and commercially viable opportunities. Technology has played its due role in our textiles production only in the case of spinning, where over 85% of production is in the organised sector. We are currently the second-largest producer and the largest exporter of yarn in the world. In fabrics, around 90% of our production is still in the decentralised sub-sectors and in garments, around two-thirds of our units continue in the SME sector. When the process of phasing out bilateral quotas under the Multi Fibre Arrangement (MFA) began in 1995, we were hopeful of expanding our exports considerably since quotas had been severely restricting our exports during the MFA regime of 1974-94. At that time, most of the gains were snatched away by countries like China, Bangladesh and Sri Lanka. Why did this happen? Even before the quota phase-out started, major textile-exporting countries started building up capacities and taking policy measures to align both production and trade to the changing needs of the free markets. China, Bangladesh, and Sri Lanka built up huge production capacities around their port cities and started sourcing raw materials from wherever they were available. By the time the phase-out programme was over in 2004, China was not only the largest exporter but also the third-largest importer of textiles globally. In India, we kept the garment and knitting industries reserved for the small scale sector for most part of the phase-out period, preventing large-scale investments. Raw material supplies were restricted through taxation and other means. Our industry had, therefore, to depend mostly on domestic raw materials. A complicated excise regime stymied growth in some segments and encouraged evasion in others. The process of rationalising the excise regime effectively fructified only by July 2004. On the part of the industry, there has been a reluctance to look at the whole value chain as one entity with the result that the segments often work at cross purposes and pursue conflicting interests. Many have focused on getting the benefits available for remaining small rather than on scaling up production, even after the excise reforms and introduction of subsidies under Technology Upgradation Fund Scheme (TUFS). The power loom sector continues to suffer from low scale and production on handlooms is inherently slow. China, the largest player in global markets, is currently facing supply side problems— mainly rapidly increasing wages—and has already been outsourcing some production. Vietnam and Cambodia have been the major beneficiaries of this so far. With the second largest integrated textiles industry in the world, we surely have more potential to take over the markets that China vacates.
Source: Financial Express
The Ministry of Textiles in collaboration with Indian Chamber of Commerce (ICC) organized the Technical Textiles Conference on 23rd August 2022 in Imphal, Manipur. The Conference was inaugurated by the Chief Guest Shri N. Biren Singh, Chief Minister of Manipur and the Guest of Honour Smt. Darshana Vikram Jardosh, Union Minister of State for Textiles and Railways and the Distinguished Guests Smt. Nemcha Kipgen Minister for Textiles, Commerce and Industry Department and Co-operation Department, Government of Manipur. The conference focused on technical sessions related to Application and Usability of Geotextiles and Agrotextiles. The conference was participated by over 150 participants comprising of Officials and Representatives from Government of Manipur, Indian Army, Line Ministries and Departments of the Central Government, Eminent Industrialists from India and Research Associations. Speaking on the occasion, Smt. Darshana Vikram Jardosh, Minister of State for Textiles and Railways appreciated the active inter-ministerial collaboration in driving the application and usage of technical textiles mandate in India. Robust inter-ministerial coordination and cooperation including Ministry of Textiles, Ministry of Finance, Ministry of Road Transport and Highways and Ministry of Railways, Ministry of Commerce and Industry, Ministry of Agriculture, Ministry of Chemical and Fertilizers, among others will play a crucial role in paving a strong path for the development of technical textiles market in India. Talking about the various initiatives and schemes of Ministry of Textiles including PLI for Textiles, PM MITRA and NTTM to transform from a traditional cotton-based textiles hub to a technical textile and MMF hub in the world, the Minister said, “the Gati Shakti model provides that necessary impetus to States for undertaking infrastructure project with minimal approvals and permissions’’. The ease of doing business, business opportunities and investment ecosystem have grown significantly under the guidance of the Hon’ble Prime Minister of India in the last few years, she further highlighted. Smt. Jardosh also mentioned that from a Net-importer of PPE kits and masks to the 2nd biggest exporter, India has dramatically expanded its capabilities in medical textiles as well. From indigenous development of Carpets to Airbags to defence outfits to PPE Kits, India holds the production and export capabilities in becoming an Atma-Nirbhar nation in the segment. Another major crucial component to focus for development of technical textiles market is robust skilling and training wherein INR 400 Crores have been allocated under the NTTM scheme, she added. She encouraged the officials of the Government of Manipur to promote the usage of geotextiles and agrotextiles’ products through their respective departments. Speaking at the Inaugural session of the conference, Shri N. Biren Singh, Chief Minister of Manipur highlighted that the Manipur holds unique and tremendous possibilities in usage of technical textiles, particularly geotextiles, across its roads and railways, especially in the Imphal to Mao region of the state. The Geotextile technology is already in use in the railway tracks at Imphal – Jiribam Line in Manipur. He added that Northeastern states, especially Manipur, are prone to heavy rainfall throughout the year leading to flooding, landslides and soil erosion thereby creating opportunities for usage of geotextiles. He emphasized that the Government and Industry stakeholders should prioritize on understanding the need of the state and requested officials and industrialists to visit the state for identification of unique infrastructure opportunities. Under the vision and guidance of the Hon’ble Prime Minister, the state of Manipur has changed substantially in the last five years, he further added. The Chief Minister also requested the Central Government to establish dedicated teams to manage the development of roads along the Imphal – Jiribam region and Imphal – Dimapur region for ease in logistics and transportation in the state. He invited eminent industries to the state to capitalize on the accelerating growth in the areas of agriculture, sports, infrastructure, handicrafts. Smt. Nemcha Kipgen Minister of Textiles, Commerce and Industry Department and Cooperation Department, Government of Manipur highlighted the importance of technical textiles in India, especially in the North-East region, which has grown significantly as one of the sunrise sectors. She said the usage of technical textiles will grow in future with application usage in Agriculture, Forestry, Railways, Horticulture, Roadways, among others. It is high time to promote technical textiles widely in construction projects in improving the quality of infrastructure segments, especially geotextiles. Geotextiles can be instrumental for the betterment of economic life of Manipur as well as other NorthEastern States, She added. Shri Giridhar Aramane, Secretary, Ministry of Road Transport and Highways said that the Government has been consistently creating 30-40 Kms of road in the last 3 years which has provided ample opportunities for the usage of geotextiles. With the usage of geotextiles, roads are constructed quickly, optimally, and qualitatively. .Usage of Geotextiles to increase the life of pavements by 30-50 years, he added. Shri Armane stated that on 14th December 2020, the Ministry of Road Transport and Highways brought out a circular emphasizing on the use of technology in construction of roads, with a dedicated section on use of geosynthetic products for construction of National Highways and other structures. Various codes and standards have been developed for utilization of different geotextiles for road development, embankment, etc., he highlighted. Geotextile Products which are used in the Ministry projects include Woven and Nonwoven geotextiles, Biaxial and Multiaxial Geogrids, Geocells, Geonets and Geocomposites, etc for reinforcement for pavements, stress-relief for slopes, barriers, separation, filtration, drainage, protection and stabilization. Most of the Geotextile products are manufactured in India, he further added. Ministry of Road Transport and Highways are also conducting various studies related to Geosynthetics, Geogrids, Geonets, Natural fibres etc. with premier institutes of India including IIT Hyderabad and IIT Chennai. Industry, Academia and Government should work together in widening the utilization of Geotextiles in India. He suggested that a collaborative event between Ministry of Textiles and Ministry of Road Transport and Highways may be envisioned wherein Manufacturers and Contractors can come together to address the existing challenges. There was a presentation on the components of the National Technical Textiles Mission (NTTM) scheme by Shri Rajeev Saxena, Joint Secretary, Ministry of Textiles. He emphasized on the four components of the scheme including Research, Development and Innovation; Skilling, Training and Education; Promotion and Market Development; and Export Promotion. Various initiatives have been undertaken under the scheme including sanctioning 31 research projects worth INR 108 Crores in the areas of Specialty fibres and Geotextiles; developing 31 new HSN codes dedicated to technical textile products; and developing 500+ standards in collaboration with BIS, among others.
Source: PIB
India to incentivize rupee-settled exports to boost Russia trade: Sources Synopsis The move is designed to boost Russian trade after the Reserve Bank of India (RBI) put in place a mechanism for international trade settlements using the rupee last month. Indian companies are already swapping out the dollar and euro for Asian currencies to settle trades to avoid Western sanctions imposed on Russia. India may give incentives to exporters settling trades using rupees to boost the acceptability of the currency and increase the sales of goods to Russia, which has fallen because of western sanctions, according to government and industry sources. The move is designed to boost Russian trade after the Reserve Bank ofIndia (RBI) put in place a mechanism for international trade settlements using the rupee last month. Indian companies are already swapping out the dollar and euro for Asian currencies to settle trades to avoid Western sanctions imposed on Russia after their invasion of Ukraine. The most likely incentive that will be granted would apply a current program for trades using fully convertible currencies such as the dollar and the euro to the rupee, which is only partially convertible, according to the three sources.
Under the existing programme, Indian exporters receive rebates on a portion of the taxes and customs duties accumulated during the entire process of manufacturing a good. The new incentive would apply those rebates to goods exported using the rupee as a currency, the sources said. "The department of commerce is working with the central bank and the revenue department to ensure facilitation of rupee-related transactions as foreign exchange realization in accordance with RBI's notification last month," said one of the sources, a senior government official who did not want to be identified as the discussions are private. "Steps will be taken to extend foreign trade policy benefits for such realization," he added. India's commerce ministry, finance ministry and the RBI did not immediately respond to requests seeking comment on the incentives.
So far bankers and traders have not increased their use of the rupee for settlements as they are awaiting more details from the central bank and the government on the incentives to use the rupee, the sources said. Guidelines are expected "soon" and will help boost trade with Russia, the sources said without elaborating on the timeline. Another one of the sources, also a government official, said India is aiming to add trade worth $6 billion to $7 billion with Russia in the next two months. India's imports from Russia, mainly crude oil, increased five times to more than $15 billion from Feb. 24, when Russia invaded Ukraine and the end of July, compared to the previous year, Reuters reported earlier this month. However, exports fell to $852.22 million from $1.34 billion in the same period.
Source: Economic Times
Synopsis National Highways Logistics Management Limited (NHLML), Inland Waterways Authority of India (IWAI), and Rail Vikas Nigam Limited (RVNL) will jointly develop MMLPs under Bharatmala Pariyojna across the country with an objective to centralize freight consolidation and reduce logistics cost from 14% to less than 10% of Gross Domestic Product (GDP), at par with International Standards.
The centre has prioritized swift development of modern Multi Modal Logistics Parks (MMLPs) through a tripartite agreement signed between roads, shipping, and railway ministries arms on Wednesday. An official statement said this agreement has been signed by National Highways Logistics Management Limited (NHLML), Inland Waterways Authority of India (IWAI), and Rail Vikas Nigam Limited (RVNL). The three will jointly develop MMLPs under Bharatmala Pariyojna across the country with an objective to centralize freight consolidation and reduce logistics cost from 14% to less than 10% of Gross Domestic Product (GDP), at par with International Standards. Road Transport Minister Nitin Gadkari said that this agreement will facilitate seamless modal shift. “MMLPs will ensure that cargo is swapped or shifted from and to Waterways, Dedicated Freight Corridors and Road Transport,” he noted. Speaking at the event, Shipping Minister Sarbananda Sonowal said that the agreement proposes to put the letter and spirit of Bharatmala Pariyojana into effect. “MMLPs are designed to untie the cobweb of logistics movement and enliven the logistics sector to put the economy into the fast lane of growth,” he added. An official statement noted that a MMLP will be a freight handling facility with rail and road accessibility. It will also comprise of container terminals, cargo terminals (bulk, break-bulk), warehouses, cold storage, and facilities for mechanised material handling. Value-added services such as customs clearance with bonded storage yards, quarantine zones, testing facilities and warehousing management services among others will feature along with other associated facilities. The MMLPs are developed under a ‘Hub & Spoke’ model and will integrate multiple modes of freight transport through highways, railways and inland waterways. “Many value-added services like packaging, repackaging and labelling will be available in these projects,” the statement added.
Source: Economic Times
The Central Board of Indirect Taxes and Customs (CBIC) on August 22 notified the amendments to the Customs (Compounding of Offences) Amendment Rules, 2022, by including offences under Section 135AA of the Customs Act The Finance Ministry has made the unauthorised publication of import-export data a compoundable offence, wherein an offender can avoid prosecution by paying Rs 1 lakh compounding amount. The Budget 2022-23 inserted Section 135AA in the Customs Act that made unauthorised publishing of information, like value or quantity, relating to export or import a penal offence, inviting a jail term of up to 6 months or a fine of Rs 50,000. The Central Board of Indirect Taxes and Customs (CBIC) on August 22 notified the amendments to the Customs (Compounding of Offences) Amendment Rules, 2022, by including offences under Section 135AA of the Customs Act. As per the amendment, the compounding charges to be paid by the offender would be "Rs one lakh for the first offence, to be increased by 100 per cent of this amount for each subsequent offence". Compounding allows the person to accept his offence and pay specified charges to avoid prosecution. As per the amendment, the compounding authority would be required to satisfy itself that full and true disclosure has been made by the applicant for the compounding of the offence. The authority will be required to dispose of the compounding application within 6 months. Further, the CBIC has directed field offices to hold periodic outreach programmes to educate on the benefits of compounding provisions. KPMG in India Partner Indirect Tax Abhishek Jain said the concept of compounding allows an assessee to avoid prosecution in case of specified instances of non-compliance, subject to payment of applicable compounding fees. "These changes seem to have been made in an endeavour to prevent unnecessary litigation, which is the principle intent behind incorporating compounding provisions in the law," Jain added.
Source: Economic Times
Worried about India's precarious external accounts and the weakening rupee, domestic importers are hedging a lot more of their currency exposures than they are required to. The rupee is down about 7.5% versus the U.S. dollar this year and headed for what could be its worst year in four. Trading just shy of its 80.0650 per dollar record low reached last month, the rupee has been under pressure from a ballooning oil import bill, high domestic inflation and the Federal Reserve's aggressive interest rate rises that have elevated yields on the U.S. dollar. That is in spite of the Reserve Bank of India's (RBI) concerted and steady efforts to defend the currency. "We have a clear view right now. Considering India's trade deficit issues and Fed rate hike view, we think rupee will depreciate more, possibly up to the 82 level," said Rohit Maheshwari, CFO of Hero International B.V. "Our normal policy is that 50% of the exposure should be hedged. But right now, we are hedging imports near to 80%, while leaving a large part of the exports unhedged." Hero International is a subsidiary of Hero Cycles Ltd, the largest manufacturer of bicycles in India. Hero Cycles, an exporter to various countries in the Middle East, Africa, Asia, and Europe, is part of the Hero Motors Company. India posted a record trade deficit of $30 billion in July, after exports contracted for the first time in almost one-and-a-half years. Economists expect the current account deficit to widen significantly, with little or no support from investment flows. Foreign investors have withdrawn almost $25 billion from Indian equity and debt markets so far in 2022, as money rushes back into higher yielding dollars.
Forwards, options hedges
The Fed has raised rates by 225 basis points so far this year and economists expect it to increase rates by a further 100 basis points in 2022. "Right now, there are a lot of risks around India's current account deficit and uncertainty about the Fed. This is why we are hedging almost 100% of our imports while leaving exports open to the extent allowed by our risk management policy," Anil Agarwal, CFO at New Delhi-based J.K. Fenner (India) Ltd, said. "We are handling both imports and exports separately with the main aim of protecting margins and the budgeted rate." J.K. Fenner is part of the India-headquartered J.K. Organisation. The group has a footprint in various countries across the globe with an annual turnover $4.5 billion, according to its website. Given the risks, importers seem fine with the high cost of hedging. A simple forward contract to buy dollars for rupees in three months costs around 3.1%. "The overall risk of rupee depreciation from current levels remains elevated. We are very worried about India's trade deficit," said Samir Lodha, managing director at QuantArt Market Solutions, a Mumbai-based firm that advises several large and medium-sized companies. "We are advising importers to remain hedged with a relatively high hedge ratio. A bination of forwards and options works well for hedging purposes." For companies that have some exports to offset their dollar liabilities, Lodha recommends a low to medium hedge ratio. Hero's Maheshwari reckons forwards are better for hedges, since they are easier to cancel. "Options are done selectively, and that too only simple structures like call spreads." Agarwal, meanwhile, said he used seagull option structures and call spreads. A call spread involves buying an option with the right to buy dollars, and offsetting its cost by selling another option. A seagull option reduces the cost further with the company making another option sale, alongside a call spread.
Source: Business Standard
The Reserve Bank of India, which has raised interest rates by a total of 140 basis points in three moves this year, has signaled future tightening would be calibrated to ensure there isn’t a massive slowdown in the economy, and sees price pressures moderating from its recent peak. India’s business and consumption activity showed conflicting signs of recovery in July as elevated inflation, rising borrowing costs and fears of a global slowdown weighed on Asia’s third-largest economy. Demand for Indian goods and services softened, a crosssection of high-frequency indicators compiled by Bloomberg News showed. The needle on a dial measuring so-called animal spirits, however, remained steady at 5 last month as the gauge uses a three-month weighted average to smooth out volatility in the single month readings. The Reserve , which has raised interest rates by a total of 140 basis points in three moves this year, has signaled future tightening would be calibrated to ensure there isn’t a massive slowdown in the economy, and sees price pressures moderating from its recent peak. A pulse-check of the economy is due next week, with gross domestic product data for the April-June quarter likely to show a double-digit growth, reflecting demand thanks to a wider reopening from the pandemic.
Source: Economic Times
India is set to export goods worth $2 trillion by 2030, and restructuring its commerce department will help in making it a key player in global trade, said union minister of commerce and industry, consumer affairs, food and public distribution and textiles Piyush Goyal. Goyal has released the ‘Department of Commerce Restructuring Dossier’ at Vanijya Bhawan, New Delhi. “Restructuring of the entire department of commerce aims at preparing India to become a key global player in world trade. The restructuring rests on five major pillars: increasing India's share in global trade, assuming leadership roles in multilateral organisations, democratising trade, creating 100 Indian brands as Global Champions, and setting up economic zones in India to strengthen the manufacturing base and attract greater investments to India,” Goyal said, according to a press release by the ministry of commerce and industry. The minister mentioned that the focus on exports has been one of the most defining features of the government's efforts to make India a developed country by 2047
Source: Fibre 2 Fashion
Bianca Home plans to open 50 shops of Nautica Home pan-India and will sell products such as bedsheets, comforters, blankets, etc. Indian textile manufacturer Bianca Home on Wednesday said it has partnered Authentic Brands Group (ABG), a brand development, marketing and entertainment company and owner of the Nautica brand to manufacture and distribute Nautica Home products in India. Products such as bedsheets, comforters, blankets, pillows, towels, bath rugs, bathrobes, bath accessories and area rugs will be sold via both e-commerce and offline retail stores. Bianca Home plans to open 50 shops of Nautica Home pan-India; the brand expects to clock revenues of about ₹100 million by the end of 2023. Bianca Home LLP, a division of Mangal Exports Group, operates in the Indian home décor space. Established in 2008, Bianca Home designs and manufactures bedsheets, comforters, pillows, mattresses, towels, curtains, bathmats, cushion covers, and many more home products. The company counts Walmart, JCPenny, Crate and Barrel, Pier 1, William Sonoma, Home Goods as its clients. The Nautica Home collection features a premium bedding and bath range, inspired by Nautica’s iconic nautical aesthetic. “Recent trends have shown that consumers have an increased interest in elevating their home décor. We are eager to bring Nautica’s premium designs and high-quality products to this important market," said Henry Stupp, President EMEA & India, ABG. Consumers are spending more time at home and are looking to update their living space, said Devang Dalal, Partner, Bianca Home. “In line with the market trend for higher homeware shopping and Nautica being globally recognized and a trusted lifestyle brand, Nautica Home products will resonate with the personality of aspiring Indian consumers," he said. Tapping into the trend, brands such as H&M and Marks & Spencer have also launched their home decor collections in India. Authentic Brands Group is a brand development, marketing and entertainment company, which owns a portfolio of global media, entertainment and lifestyle brands. ABG’s portfolio of brand include Elvis Presley, David Beckham, Sports Illustrated, Reebok, Eddie Bauer, Spyder, Volcom, Airwalk, Nautica, among several others
Source: Live Mint
KARACHI: Textile exporters have indicated that if the approved regionally competitive power tariff of nine cents per kilowatt-hour (kWh) is discontinued, it will lead to further decline in textile as well as total national exports.Exporters have appealed to the prime minister to continue the regionally competitive power tariff for the export-oriented textile sector to sustain and uplift exports, as per a letter written by Pakistan Hosiery Manufacturers and Exporters Association (PHMA) Chairman Abdul Rehman. The exporters are shocked to learn that the Cabinet Division has issued a corrigendum dated August 19, 2022 stating that the government of Pakistan has revised its decision taken on July 27, 2022. This is with regard to the federal cabinet’s approval of the rate of nine cents per kWh for the exportoriented industry applicable till the end of FY 2022-23. “This is a very alarming and unfortunate news which brings forth disastrous impact on the cost of manufacturing goods meant for exports as even the existing cost is already higher as compared to regional countries, whereby Pakistan exporters do business on a very narrow margin of 2% to 3%,” he said.“These rates should continue till at least FY23 to bring the sustainability factor as the textile sector contributes significantly to overall national exports. If this sector gets no relief, that will ultimately impact the overall economy,” said Topline Securities textile sector analyst Saad Ziker. The results from these subsidised rates reflect the growth in exports during FY22, he added. Countries that compete with Pakistan in global textile exports including Bangladesh, India, China and Vietnam give reduced quotations of up to 15% to foreign buyers as compared to those given by Pakistan. In contrast, exporters in Pakistan are battling hard to survive and compete on a very low profit margin, noted Abdul Rehman. The withdrawal of the approved power tariff of nine cents per kWh shall turn out to be hugely disastrous for exports and must be continued in the national interest and for the sake of survival of export industries. This is all the more required given the uncertain economic conditions prevailing in the country, he added. The government should encourage exports and export-oriented sectors to have long-term sustainability in the balance of payments, noted Arif Habib Limited (AHL) Head of Research Tahir Abbas. “However, the textile industry should also invest in efficiency and technology-oriented projects to make them competitive enough to compete in the international markets,” he added. The value-added textile industry had previously achieved a milestone in exports with total national exports in FY22 amounting to $31.79 billion, of which textile exports were worth an impressive $19.4 billion. Likewise, hosiery exports touched the highest value of $5.12 billion, said Abdul Rehman. Crucially, more than 40 industries are associated with the value-added textile export industry. However, due to recent economic uncertainty, national exports have declined 22.74% and textile exports declined 13.21% during the first month of FY23. The value-added textile sector is the backbone of the economy, earning the highest foreign exchange and generating urban employment as a labour-intensive industry, emphasised Abdul Rehman. “Regionally competitive power tariff is necessary for an export-oriented sector such as textile so that it can be competitive in the international market. The results are also justified as textile exports touched the government target of $20 billion,” said Aba Ali Habib Securities textile sector analyst Ali Asif. “In order to make exporters regionally competitive, the government should continue with subsidised rates of electricity and gas, otherwise our exports will start showing negative growth as buyers want to purchase products at the cheapest rates,” said textile analyst Arsalan Hanif.
Source: Tribune
The first China-Vietnam freight train route linking northwest China’s Shaanxi province to Vietnam has become operable after a freight train from Xi’an international port recently started its journey to Hanoi, the capital of Vietnam. The new train enroute to Hanoi is stocked with 41 carriages of asbestos, which were sent from Kazakhstan to Xi’an through the China-Europe freight train service, according to Chinese media reports. Earlier it would take around 20 days to ship goods from Xi’an to Vietnam through the combined rail-sea transport route. The China-Vietnam freight train route which goes via Guangxi's Pingxiang port has enabled the trip to be shortened to eight days — a distance of 2,384 km. The total trade volume between China and ASEAN from the month of January to July in 2022 added up to 3.53 trillion yuan (around $514.3 billion).
Source: Fibre2fashion
At the 5th meeting of the Vietnam-Japan Joint Committee on Cooperation in Industry, Trade and Energy in Tokyo recently, both sides agreed to strengthen regional and global supply chains, improve industrial competitiveness, promote cooperation in energy transformation towards carbon neutrality and accelerate the progress of a number of key energy projects. Japanese minister of economy, trade and industry Yasutoshi Nishimura and his Vietnamese counterpart Nguyen Hong Dien co-chaired the meeting. They also agreed to enhance the utilisation and effective implementation of free trade agreements (FTAs) and coordinate and support each other in multilateral frameworks. Japan agreed with Vietnam’s proposal on the former’s continued support for the latter in training industrial human resources and improving industrial competitiveness, and the early signing of a memorandum of understanding on cooperation in energy transformation to implement projects to support Vietnam in energy transition with funding from the Asia Energy Transition Fund. Japan will also support training and share experience related to liquefied natural gas (LNG) with Vietnam, according to a news agency. A joint committee mechanism was established in July 2015 to remove business difficulties and ensure stable and continued growth of trade and investment.
Source: Fibre 2 Fashion
Bangladesh’s home textiles sector crossed the US $ 1 billion mark in fiscal 2020-21, registering 49 per cent Y-o-Y increase in export earnings. Several big-ticket players from across the world have started sourcing home textile products from Bangladesh, which corroborates the country’s rising popularity in the global arena. The numbers say it all! According to Bangladesh’s Export Promotion Bureau (EPB) — the home textile export basket of the country includes bed linen, bed sheet and other bedroom textiles, bath linen, carpets and rugs, blankets, kitchen linen, curtains, cushions and cushion cover and covers for quilts — home textiles raked in US $ 1.62 billion in the recently concluded 2021-22 fiscal year from exports, marking a year-onyear growth of 43.28 per cent. Here, one would like to add that in the last fiscal year, home textiles had earned US $ 1.13 billion from exports. Also, considering the fact that several big-ticket players from across the world have started sourcing home textile products from Bangladesh, only corroborates the country’s rising popularity in the global arena. Continuing the good run The sector first crossed the US $ 1 billion mark in fiscal 2020-21, registering 49 per cent Y-o-Y increase in export earnings. “We have been witnessing increased demand for home textiles from the last fiscal year,” opines Shahidullah Chowdhury, Executive Director of Noman Group, which is a major player in Bangladesh’s home textile sector. Like most other home textile players in Bangladesh, it counts European Union countries along with Canada, United Kingdom and Japan as the major export destinations. More and more people resorting to work from home pushed the demand up for home textile products. So even if sales of garments may have taken a hit, home textiles sales in retail stores across Europe and America, have been on the rise even if many within the industry doubted if the same trend would continue once normalcy returned and people went back to the grinds of daily life amidst reopening of office and workplaces. Fortunately though, contrary to the fears, home textile exports from Bangladesh have managed to maintain the good run stepping into FY ’22. Reasons aiding rising popularity “Shifting orders from Pakistan during the Covid-19 outbreak was the prime reason for increase in Bangladesh’s exports,” reasoned Md Harun-Ar-Rashid, President of the Bangladesh Home Textile Manufacturers and Exporters Association. Being able to keep production going amidst the pandemic, only helped Bangladesh’s cause while also strengthening the buyers’ confidence in Bangladesh since, underlined industry people. Bangladesh, which entered the market of home textiles in the 1980s and managed to earn only around US $ 150 million by exporting home textile products in the initial days (FY 2004-05), also managed to bag orders shifting from China and Turkey (production in both these countries took a hit owing to the pandemic), thanks to its rising popularity amongst the global buyers. Opportunities and challenges going ahead Despite the steady and gradual rise in popularity, Bangladesh’s share in the global textile export market is still only somewhere around 7 per cent — according to Technavio, the global home textiles trade was valued at US $ 118 billion in 2017, US $ 131.5 billion in 2020 and is expected to reach US $ 170- US $ 180 billion by the end of 2025, growing at a CAGR of 3.5 per cent or more during 2018-2025 period — and much needs to be done to capture more market share, felt people in know of things. They emphasised on a host of focus areas including investments in research, product quality and innovation, adapting latest technology, sustainable development along with adequate Government support including increasing the cash incentive for exports to 10 per cent from the current 4 per cent, to give that added thrust. There are some unforeseen challenges too! Global supply chain disruption and rising inflation are some of those, which Bangladesh has very little control over. “A number of home textile factories have shut down while many had to reduce production by 30 per cent to 50 per cent due to the price hike of raw materials and transportation issues,” claimed Managing Director of Momin Tex, Momin Miah. Momin felt the market could have recovered from the pandemic, impacts of supply chain disruption, raw materials price hike and ripple effects of the Ukraine-Russia could still apply the brakes in the sector’s growth. Adding to these is the current power scenario in the country — Bangladesh has recently resorted to power rationing in the form of load shedding — which not too long ago made many buyers to move orders out of Pakistan for good. No matter the current challenges, industry players are more than hopeful that the sector is poised for growth going forward as there aren’t many that can match Bangladesh in terms of price points, proficiency and commitments. Besides, having served many of the clients during the pandemic period successfully, who had shifted orders from other destinations to Bangladesh, the country’s home textile sector has been able to instil that much-needed confidence amongst the global buyers which will only hold the sector in good stead in days to come.
Source: Apparel Resources
Governments and clothing companies have a critical role to play in tackling the fast fashion industry and creating a more sustainable circular economy Fast fashion is having a devastating impact on the planet. According to Business Insider, fashion production makes up 10% of global carbon emissions and is the secondlargest consumer of the world’s water supply. Since 2000 the rate of clothing production has doubled; not only a result of people buying more products, but also throwing them away much sooner. Considering the alarming rate at which fast fashion has grown in recent years – no thanks to the COVID-19 pandemic paradoxically driving e-commerce alongside the rising cost of living – it’s not surprising that 85% of all textiles end up in landfill every year. Every second, the equivalent of one garbage truck full of clothes is burned or dumped in a landfill. At the same time, washing clothes releases 500,000 tonnes of microfibers into the oceans. Many of these fibres, including polyester, are plastics that release two to three times more carbon emissions than cotton, and of course they don’t break down while they float around in the sea. Overall these microplastics account for 31% of the oceans’ plastic pollution, a major global problem that threatens to totally overwhelm marine life in the future. If the fashion industry doesn’t change, the Ellen MacArthur Foundation expects it will account for 26% of the world’s carbon emissions by 2050. Creating a circular fashion economy is the ultimate sustainable solution The Textiles Action Network connects businesses, supply chains and governments in the mission to tackle the environmental impact of the fashion industry. Encompassing the UK’s Textiles Action Plan 2030 and Lifestyle & Design Cluster (LDC), the network is run by climate activist group WRAP and ultimately aims to create a global circular economy for fashion and textiles. WRAP says the collaborative network is the best option for driving sustainability in fashion, because it forces governments and businesses to address their environmental responsibility head on. The activist group marked the recent industry collaboration between the Textiles Action Network and the Danish government as a pivotal event in the sustainability movement. “We welcome this ambitious move by the Danish government to tackle the environmental impacts of textiles with a national programme of work under this new industry collaboration. WRAP has played an important role in bringing together the key stakeholders who are launching this ground-breaking international initiative, sharing our extensive experience of voluntary sector collaborations and of setting circularity goals,” said David Rogers, Head of International Programmes at WRAP. Bettina Simenson, Managing Director at LDC, added: “WRAP has played an integral role in convening the key stakeholders who are launching this ground- breaking international initiative and sharing their extensive experience of voluntary sector collaborations with us. We look forward to working closely with them and will be drawing on their knowledge and technical expertise to help us to go further and faster in Denmark.” The first step of the collaboration involves WRAP and the government working together to map out existing circular clothing initiatives and fill in any gaps. After that, they will collaborate to define a national fashion industry framework based on establishing a circular economy, underpinned by government funding and interventions, that all Danish businesses will be expected to follow. A slow fashion supply chain solution for the circular economy The antithesis of fast fashion, slow fashion is one way governments and businesses can start to counter the industry’s devastating impact. By tackling unnecessary production levels and discouraging mindless consumption, the slow fashion movement puts people, animals, and the environment first. As well as reducing material waste, slowing down the fashion supply chain would have a constructive impact on society. With 80% of clothes currently being made by underpaid young women in underdeveloped countries, a slow fashion solution would offer scope for businesses to put human welfare above profits on their priority list. The World Resources Institute suggests that companies need to invest in business models based on longevity – or slow fashion initiatives. Secondhand sellers like USbased ThredUp Inc. and Poshmark are leading the way in the slow fashion movement. At the same time, clothing companies like Rent the Runway and Gwynnie in the US, Girl Meets Dress in the UK, and Mud Jeans in the Netherlands are based on renting schemes that give customers flexibility and security in their clothing investments. Older companies like Patagonia have had slow fashion initiatives in place for many years. The outdoor clothing manufacturer offers customers a lifetime guarantee, repairs damaged items upon request, and uses recycled clothing and plastics to make new products. Still, there’s plenty more that governments and clothing manufacturers can do to better support the development of a circular economy. As WRAP states in its many campaigns, changing the way things are produced, consumed and disposed of is the only way we can protect the future of our planet.
Source: Sustainability Magazine
As the economy of Bangladesh is growing rapidly, the Netherlands is looking to enhance bilateral trade and utilise investment opportunities here with a strong focus on digitalisation and sustainability. "As longstanding partners in the multilateral sphere, we also seek collaboration with Bangladesh in promoting a rules-based international order and human rights," said the Netherlands embassy in Dhaka ahead of a visit by a delegation. The 10-member delegation led by Birgitta Tazelaar, deputy director general for international cooperation from the Ministry of Foreign Affairs, will visit Bangladesh from August 28 to August 31. The delegation would focus all aspects of Dutch policies for Bangladesh, such as social and economic development, water and climate adaptation, business development and issues of justice and human rights. "In the new policy strategy…the Netherlands combines trade with development cooperation activities," said the statement. It said the Netherlands has been contributing to sustainable development in areas such as garments, agriculture, water, women empowerment, sexual and reproductive health and rights and the strengthening of civil society. The delegation will speak with private sector partners, government actors and the civil society, take a look into different private sector initiatives and development projects and visit the Rohingya refugee camps and local communities in Cox's Bazar. The delegation will identify pathways for sustainable cooperation concerning climate change, trade and investment opportunities, climate action, gender equality and youth empowerment, the strengthening of civil society and labour rights. The delegation will also look at opportunities for trade and investment, but also underline the importance of international responsible business conduct, anticipating Bangladesh's country status graduation and the consequences of new European Union legislation on associated due diligence. The Netherlands will also continue providing cooperation on working towards a sustainable solution to the Rohingya crisis, the statement said.
Source: The Daily Star
China is exerting increasing pressure on foreign companies doing business in its markets to bring them into line with its political agenda, broadening the “red lines” for issues to which it is allergic, a German study seen by Reuters shows. A survey of more than 100 companies by the Berlin-based Merics think tank for China studies and the BDI industry association showed that the threshhold for exerting pressure on companies is falling. The number of known cases rose significantly from 2018, it found. “It was about recognizing a pattern of when and how China exerts pressure,” co-author Max Zenglein said. The researchers said that in addition to issues of national sovereignty, reports on the emergence of COVID-19, sanctions against Chinese companies like telecoms equipment maker Huawei or support for parties classified as anti-Chinese are now seen as “new red lines”. In one case, German carmaker Daimler apologised several times to China in 2018 after running advertising with a quote from the Dalai Lama. China’s foreign ministry said it could only comment once it had seen the full report. China has consistently denied allegations that the COVID-19 virus was leaked from a specialist laboratory in the city of Wuhan, where it was first identified at the end of 2019. Washington sees Huawei as an arm of the Chinese Communist Party’s global surveillance machinery, but Huawei has repeatedly denied spying for the Chinese state. Foreign consumer goods companies in particular have been subject to boycotts in China, with Western textile firms targeted on social media in response to Western criticism of China’s treatment of the Uighur minority in the Xinjiang region. “For fear of being targeted, companies may avoid addressing unfair treatment of foreign firms in China. Or they may consider it safest to align themselves with the Chinese government’s positions and goals,” the researchers wrote.
Source: Euro News
