India’s textiles and leather industries are among the worst hit sectors as per the Index of Industrial production (IIP) for October 2022. The index of manufacture of textiles, wearing apparel and leather and related products recorded a double digit hit in the period under review. The data confirms what the textile value chain has been facing in the last couple of months. The manufacture of textiles index fell to 102.3 in October 2022 from 125.6 in August 2021. The cumulative index also came down from 107.6 to 116.6. The industry has recorded a negative growth of 18.6 per cent in October and 7.7 per cent in April- October 2022, as per the IIP data. The apparel index slipped by 37.1 per cent to 102.9 in October 2022 from 163.6 in the corresponding period of last year. However, cumulative index managed to register a growth of 5.6 per cent to reach 129.9 from 122.9 of October 2021. The index of leather and leather products fell by 24.3 per cent to 78.1 from 103.2 in the same month of last year. Cumulative index slipped 5.3 per cent to 94.3 per cent from 99.6 per cent in October 2021. IIP confirms the sluggish demand and price pressures on the textile value chain. Indian textile industry is facing added pressure as cotton prices did not go down as expected during the arrival season. Therefore, the entire value chain is facing the pressure from high cost of production, and at the same time, they are unable to increase the prices of their finished products as demand has remained weak for the last several months.
Source: Fibre 2 Fashion
India and Canada are negotiating a free trade agreement to boost bilateral trade and Indian textile industry has given its suggestions on various rules related to the agreement. Conditions of the proposed FTA will determine if it will be helpful in getting more export orders or not. Currently India’s apparel exports to Canada are negligible. Recently, officials from the Indian ministry of commerce and industry organised a consultation on the proposal. The representatives of textile industry, including the Confederation of Indian Textile Industry, clarified their stand. CITI has given some suggestions on rules of origin and product specific rules. The FTA can be expected to boost India’s exports to Canada. India’s share in Canada’s total apparel imports was just 3.6% during January-September 2022. Canada imported apparel worth $9.192 billion in the same period and its imports from India were merely $330.895 million which is negligible. However, India was among the top five suppliers for Canada. China, which had a lion’s share of 31.16% ($2.864 billion), topped the supplier’s list, according to Fibre2Fashion’s market insight tool TexPro. Canada’s home textiles imports were at $1.918 billion in the first nine months of this year. India was the third largest supplier of home textiles to Canada with a share of 13.26%, which amounted to $254.527 million. China exported home textiles worth $747.891 million (38.98%) to Canada in the same period.
Source: Fashion Network
The stability of any currency depends on the country's forex reserves and trade deficit. According to reports, India's foreign exchange holdings were USD 532.87 billion in October this year, significantly lower than USD 642.45 billion a year earlier. Since India’s export-to-import ratio is negative and with the dollar at its all-time high, our forex reserves are being extensively used, as the value of imported goods has gone up. Despite the rupee depreciating by about 10% against the US dollar in the last few months, the Indian Finance Minister’s statement on the rupee not weakening is not contradictory at all. It highlights the impact of external geopolitical factors like the war in Ukraine, the increase in crude oil prices, the exit of foreign investor portfolios as the dollar becomes a haven to invest in, etc. We have little to no control over these. However, in a positive light, a depreciating rupee value could potentially stabilize the economy if it is rightly enabled by Indian exporters. The stability of any currency depends on the country's forex reserves and trade deficit. According to reports, India' s foreign exchange holdings were USD 532.87 billion in October this year, significantly lower than USD 642.45 billion a year earlier. Since India’s export-to import ratio is negative and with the dollar at its alltime high, our forex reserves are being extensively used, as the value of imported goods has gone up. India’s exports need to be more competitive to move away from this fiscally challenging phase, as a weakened currency gives overseas buyers more purchasing power. On the other hand, a surplus of exports will open a window for the economy to gain more foreign reserves. Exports are closely linked to manufacturing. Therefore, to champion exports, India will need to spearhead its efforts to effectively implement PLI (Production Linked Incentive) schemes to reduce the current trade deficit. While the Indian economy has a strong foothold in sectors such as healthcare, textile, electronics, engineering goods, and e-commerce, through PLIs, the government can encourage other industries like gems and jewelry, chip manufacturing and plastic articles to further boost. The path towards India becoming the world’s manufacturing hub is not just restricted to large conglomerates but also the country’s booming startups, MSMEs and SMEs. Today, SMEs are riddled with challenges in seeking out the best ways to engage prospective customers, manage e-commerce sites and navigate customs and regulations. To tackle this roadblock, leading logistics players like DHL Express are equipping entrepreneurs with the knowledge to succeed in international e-commerce through its Yellow Yatra program as part of the Deutsche Post DHL Group’s Go Trade initiative. Entrepreneurs are also provided services such as trade automation to help them understand the landing costs in different countries to rightly price their products.
Source: Economic Times
India and the UK on Tuesday expressed commitment to expeditiously conclude the negotiations for the proposed free trade agreement (FTA), which would help boost twoway commerce. The agreement was discussed during the meeting between Commerce and Industry Minister Piyush Goyal and UK Secretary of State for International Trade Kemi Badenoch here. Both ministers reaffirmed their commitment to the ongoing India-UK FTA negotiations which would unlock the full potential of boosting jobs, investments and exports between the two countries, the commerce ministry said in a statement. “While expressing satisfaction on the state of negotiations it was agreed that the negotiations will continue further with the aim to conclude the same at the earliest,” it said. Both ministers urged their negotiating team to work together with an aim to iron out the differences by accepting each other’s sensitivities, for a balanced, mutually beneficial, fair and equitable outcome. The bilateral meeting was followed by the interaction of the two ministers with India and the UK businesses. Goyal asked the businesses in India and the UK to take advantage of initiatives taken by the government for the economic prosperity of both countries. The UK Trade Secretary is here to kickstart the sixth round of free trade agreement negotiations. The negotiations are happening after a brief gap due to recent political developments in the UK. The last round of talks was held on July 29. Negotiations for the FTA started on January 13 this year. In a free trade agreement, two countries either significantly reduce or eliminate customs duties on the maximum number of goods traded between them. The UK side is demanding a cut in import duty for different sectors including automobile and Scotch whisky, besides easing of Indian intellectual property regime. India and Britain launched negotiations with the aim to conclude talks by Diwali (October 24), but the deadline was missed due to political developments in the UK. There are 26 chapters in the agreement, which include goods, services, investments and intellectual property rights. Reduction or elimination of customs duty under the pact would help Indian labourintensive sectors like textiles, leather, gems and jewellery to boost exports in the UK market. The bilateral trade between the two countries increased to USD 17.5 billion in 2021-22 compared to USD 13.2 billion in 2020-21. India’s exports stood at USD 10.5 billion in 2021-22, while imports were USD 7 billion. India’s main exports to the UK include ready-made garments and textiles, gems and jewellery, engineering goods, petroleum and petrochemical products, transport equipment and parts, spices, metal products, machinery and instruments, pharma and marine items. Major imports include precious and semi-precious stones, ores and metal scraps, engineering goods, professional instruments, non-ferrous metals, chemicals and machinery. The UK is also a key investor in India. New Delhi attracted foreign direct investment of USD 1.64 billion in 2021-22. The figure was about USD 32 billion between April 2000 and March 2022. In the services sector, the UK is one of the largest markets in Europe for Indian IT services.
Source: The Print
With the country’s top two textiles and apparel export markets — the US and the EU — witnessing a sharp demand slowdown, shipments will continue to remain under pressure in the coming months. If India’s exports of goods fell 16.6% on year in October, the first monthly contraction in 19 months, the fall had begun in the two largest labour-intensive sectors — textiles & clothing and gems & jewellery — much earlier and was even sharper. Consider this: the country’s exports of readymade garments fell to a 28-month low of $988.7 million in October; cotton yarn exports plunged by 46% to $719 million in the month; knitwear exports from the largest hub Tirupur declined 17.4% on year in August, 33.1% in September and 39.8% in October. Textile and garment exports as a whole contracted 8.5% to $18.3 billion in the first half of FY23 from a year before, far under-performing a 17.8% growth in overall merchandise exports. Similarly, gross exports of gems & jewellery plummeted 22.4% in October to $3.135 billion. With the country’s top two textiles and apparel export markets — the US and the EU — witnessing a sharp demand slowdown, shipments will continue to remain under pressure in the coming months. Given the multiple shocks that weigh on the global economy and the forecast that growth in world trade volumes will fall to a dismal 1% next year, the short-term outlook for apparel exports is grim. A moderation in input costs, a fall in ocean freight and an easing of congestion at key shipping routes, may give some relief to exporters at this juncture, but may not suffice to avert a crisis. In fact, there has been an erosion of India’s export competitiveness in textiles and apparel segments in recent years and the target to accelerate the shipments to $100 billion in five years looks daunting, if not impossible. “The current fiscal is the worst in history for the entire textile value chain. Record high domestic cotton prices between April-August added to the woes,” says Rahul Shah, member, Textile Export Promotion Council. For the first time in history, India had to import cotton yarn in June and July, he notes. Sivaramakrishnan Ganapathi, executive vice chairman and managing director at Gokaldas Exports, however, remains optimistic. “Shipping constraints have reduced compared to last fiscal. Also, ocean freights have eased considerably,” he says, adding that the medium- to long-term prospects for Indian apparel exports are likely to remain strong. The company, he says, is “closely watching” the demand scenario in the US market. A top executive with a leading Ahmedabad-based company says that it will likely be a “long winter in Europe” due to the energy crisis. Moreover, high inflation and resultant tight monetary policy in the US and EU, possible recession in the west and continuous depreciation of euro will make things even tougher for India’s textile and apparel companies, he adds, on condition of anonymity. Industry players also note that cost of living in Europe has increased considerably in the wake of soaring gas and crude oil prices, caused by the Ukraine war. All these factors, they observe, have seriously dented the overall demand for products in the entire textile value chain — from yarn, fabrics, to made-ups and garments. Cotton yarn manufacturers are facing even bigger challenges. A sharp decline in exports has reflected on nearly 600-odd spinning mills in Gujarat, where 60% of the total production is exported, mainly to the US and EU, says Gautam Dhamsania, secretary, Spinners Association of Gujarat. Though domestic cotton prices have fallen compared to all-time high levels a few a months ago, these are still hovering at elevated levels of Rs 68,000-Rs 70,000 per candy (356 kg per candy), higher than international prices. According to Dhamsania, spinning mills in the state are incurring losses of Rs 15-20 per kg of yarn and are running below 60% capacity. Knitwear exports from Tirupur cluster, one of Asia’s largest export hubs, have been hit hard by the slowdown in the US and the EU, which conventionally accounted for over 70% of the shipments. Year-on year decline in shipments started in August and has since been sharper. Export of knitwear from the hub fell to $0.264 billion in October from $0.329 billion in August. While new orders have dried up, many buyers in the US and EU have withdrawn past orders citing unsold stocks. Exporters in the town hope that with in the Christmas and Thanksgiving season, the EU and US buyers will be able to clear the stocks and book fresh consignments. Kumar Duraiswamy of Eastern Global Clothing, one of the major exporters from Tirupur, says: We have been impacted since August. Around 30-40% of the exporters are working with half the capacity, but are still not resorting to layoffs.” Apart from the summer season orders from western markets, Tirupur exporters are also pinning their hopes on demand from West Asia, which accounts for 15% of the exports. Chintan Parikh, founder and chairman of of Ahmedabad-based Ashima, believes uncertainty is prevailing due to recession in the US market. “It is difficult to forecast exports prospects in the current situation, but we are hoping for things to improve in coming months,” he adds. Amidst all these odds, the easing of the global logistic movements, a narrowing of the spread between international and domestic cotton prices, and fresh arrival of the fibre are a few positive factors, says Chintan Thaker, group president at Welspun Group. While export sales are down, the ongoing wedding season in the country too has come to the rescue for the Indian textile and garment sector, says Himanshu Bodawala, president of Suratbased South Gujarat Chamber of Commerce & Industry. Given the difficult situation, the Tirupur exporters have started exploring possibilities in “man-made fibre” (MMF) based exports, shifting away from the traditional cotton-centric approach. Big US and EU retailers and brands may scale up buying from India if the MMF is used for knitwear manufacturing, according to Tirupur industry circles. “We are going to create an ecosystem to develop MMF-based products,” Duraiswamy adds. Also, thanks to India’s free trade agreement with Australia, the Tirupur exporters are now looking at making a footprint Down Under. The UK market also look promising for exporters from the garment hub. However, it is clear that the textile and garment industry, the largest employment creator after agriculture, needs policy support to meet the targets set. A historical policy bias towards the cotton-based value chain when global consumption pattern veers towards manmade fibre and technical textiles products, domination of small and medium businesses with limited scale, inflexible labour rules for decades, and high logistics costs have hurt this sector. The government came out with a Rs 6,600-crore package for garments exporters in 2016. It also allowed fixed-term employment to address the issue of seasonality in order flows. However, the relief hardly paid off, as other structural bottlenecks continue to persist. The government announced a Rs 10,683-crore production-linked incentive scheme for only manmade fibre-based and technical textiles products, and selected eligible companies this year. Since the incentive offtake is now expected to be lower, it’s planning to roll out a second PLI scheme for the sector.
Source: Financial Express
Exports contracted in October after a gap of 19 months. Merchandise exports slipped below the level of $30 billion for the first time in the last 20 months. This marked a contraction of 16% on a sequential basis and a hefty 17% on an annualised basis. The impact of slowing globaltrade is beginning to show on credit demand from Indian exporters, with export credit by banks shrinking nearly a quarter year-on-year at the end of October, pointing to a further likely slowdown in overseas merchandise shipments. Exports contracted in October after a gap of 19 months. Merchandise exports slipped below the level of $30 billion for the first time in the last 20 months. This marked a contraction of 16% on a sequential basis and a hefty 17% on an annualised basis.
Source: Economic Times
The RBI had in July notified the new mechanism for settling international trade in the rupee The countries that are keen on rupee trade also include neighbours such as Sri Lanka, Bangladesh, Nepal and Myanmar, and Mauritius. (IE) As many as 17 vostro accounts have been opened so far to facilitate rupee trade with not just Russia but also Sri Lanka and Mauritius, sources told FE. A dozen of these accounts are meant for trade with Moscow. Russian banks like Sberbank, VTB, Gazprom, MTS and Tinkoff have opened such accounts with either Indian banks or their own branches here, said the sources. Banks from Mauritius and Sri Lanka have opened vostro accounts with State Bank of India, said the sources. Sri Lankan banks have also opened such accounts with Indian Bank, and with a branch of Bank of Ceylon here, they added. To be sure, no specific Indian bank has been authorised by the government for facilitating rupee trade with any particular country and that all interested banks are allowed to open such accounts with any country of their choice, said one of the sources. Given that about 30-35 countries, including those from Asia, Scandinavia and Africa, have expressed interest in better understanding the proposed rupee trade mechanism for possible adoption, the number of vostro accounts is expected to rise in the near future. As FE has reported, the finance ministry has asked the Indian Banks’ Association (IBA) and the Federation of Indian Export Organisations (FIEO) to spearhead an awareness campaign to sensitise stakeholders about the rupee trade. The IBA will be guided by the Reserve Bank of India (RBI) in this exercise. The countries that are keen on rupee trade also include neighbours such as Sri Lanka, Bangladesh, Nepal and Myanmar, and Mauritius. These countries have been grappling with a shortage of dollar reserves. The RBI had in July notified the new mechanism for settling international trade in the rupee. This was aimed at not just reducing the rupee against the dollar but also internationalising the domestic currency. Subsequently, the commerce ministry notified guidelines that will enable exporters to get stipulated benefits under the foreign trade policy even if the export realisation is in the domestic currency, and not dollar. According to the notification of the directorate general of foreign trade, domestic firms undertaking imports through this mechanism will make payment in the rupee, which will be credited into the special vostro account of the correspondent bank of the partner country, against the invoices for the supply of goods or services from the overseas seller/supplier. Similarly, Indian firms undertaking exports of goods and services through this mechanism will be paid the export proceeds in the rupee from the balances in the designated vostro account of the correspondent bank of the trade partner.
Source: Financial Express
Maharashtra, which generates 28 per cent of the country's overall cotton production, has plans to build textile hubs in the underdeveloped regions of Vidarbha and Marathwada The Maharashtra government is taking up initiatives to boost investment and employment in the textile sector. According to sources close to the textile department, the government has set the objective of investing Rs 36,000 crore in the industry, which is anticipated to create 10 lakh jobs in the state. To aid the business, the state government has announced a variety of incentives, including reduced power tariffs and stable cotton prices, as revealed by textile minister Chandrakant Patil. Maharashtra, which generates 28 percent of the country’s overall cotton production, has plans to build textile hubs in the underdeveloped regions of Vidarbha and Marathwada. In total, 42 lakh hectares of land are dedicated to cotton farming in the state, and between 40 and 45 lakh farmers are engaged in the industry. The government has also taken note of the varying rates of cotton, which significantly impact the textile industry. The state government has promised to get involved and fix the issue in order to address the cost volatility. The government will purchase cotton at predetermined rates before transferring it to the textile industry for sale at such prices, as per a report in The Indian Express. In addition, it will also deal with the challenge of recruiting qualified personnel. The state government has recommended building a brownfield park in Amravati (Vidarbha area) and Aurangabad under the PM Mega Integrated Textile Region and Apparel (PM MITRA) project (Marathwada region). Prior to this, for the development of textile centres, the Maharashtra government had chosen 115 tehsils across 18 districts in Vidarbha, Marathwada, and areas of North Maharashtra that cultivate cotton. The mismatch of locating textile hubs in areas other than those where cotton is produced has damaged the sector over time, despite the fact that it is still ranked second in terms of employment generation. However, the sources believe that the BJP-Sena (BSS) alliance will find meeting the target in two and a half years difficult.
Source: First Post
Though India’s GDP outlook is better than that of its peers, there is no escaping the fallout of the global slowdown Risks to global growth are amplifying as we enter 2023. S&P Global is forecasting world gross domestic product (GDP) growth to slip to 2.2 per cent in 2023 from 3.4 per cent in 2022. The slowdown is even more acute when seen from the vantage of 2021, when global growth posted 5.7 per cent. That growth would slip—with geopolitical issues at play and global central banks sharply raising the cost of borrowing—was known. But where there is still uncertainty is the depth and the length of the slowdown, especially in countries leading the deceleration—mainly the US, the EU, the UK, and China. India’s economic growth will inevitably slow as well, as the countries at the forefront of the slowdown are some of our larger trading partners. Indeed, India’s growth cycle has shown high synchronicity with advanced countries, with deepening of trade and financial sector linkages over the years. Thereby, we cannot avoid the short-term pain of a sharp slowdown in advanced countries. The fallout is already being seen in industrial activity. Consequently, CRISIL recently revised the country’s GDP growth forecast downwards to 7.0 per cent for the current fiscal from a previous estimate of 7.3 per cent. Still, domestic demand remained supportive for the better part of this fiscal—helped by a catch-up in contact-based services, government capital expenditure (capex), relatively accommodative financial conditions, and overall normal monsoon for the fourth time in a row. But the resilience of domestic demand is now being put to the test. Demand is expected to wane in the coming months as some of the one-time-lift effect, especially in contactbased services, begins to fade and higher interest rates bite. Exports are likely to see a bigger hit next year. For fiscal 2024 therefore, CRISIL has revised down India’s GDP growth forecast to 6.0% from 6.5% estimated previously. That said, high frequency indicators suggest that although the overall growth momentum is slowing, the pattern of growth is uneven across sectors. For instance, export-oriented sectors such as textiles, leather, gems and jewellery, engineering goods and some of our services exports could face a larger hit than others. This is because put together, the US, the UK, the EU and China comprise ~42 per cent of our merchandise exports (2021), while the US, the UK and the EU account for majority of our IT/ITeS exports. However, with government infrastructure capex expected to remain strong in the current and next fiscal, sectors that complement infrastructure activities—such as steel and cement—are likely to hold up as well. In fact, the government’s role in driving capex and creating an environment that crowds in private investment will remain crucial in the year of a slowdown. Now let’s take a look at the private space. While demand will somewhat weaken at the overall level, capex is expected to be pick up. Encouragingly for private capex, several factors have turned supportive, marking the start of a gradual, steady pick-up in the investment climate. Deleveraged corporate balance sheets and improved bank appetite to lend, are overall supportive to private investments. In the manufacturing sector, with capacity utilisation on an improving trend, investments are expected to gradually start picking up, too. Then again, sectors that are supported by the government’s Production Linked Incentive scheme, such as automobiles, solar energy, pharmaceuticals, and electronics, are likely to see increase in investment activity as the scheme enters its second year of full-fledged implementation. But not all sectors are firing in unison. Some pockets that could see slower consumption demand are sectors such as housing, consumer durables, consumer services, such as travel, tourism, hospitality, etc. In these, while some would see the impact of fading one-time-lift effect, in others such as housing and consumer durables, faster pass-through of higher interest rates could take the steam off demand. A protracted Russia-Ukraine war and uncertainty on crude oil and commodity prices, and the global slowdown impacting India’s exports could put some private capex plans on the back burner, curtailing higher overall investment growth. Then there is slow recovery in consumption demand, which will also keep capex from picking up substantially in the near term. But the medium-term outlook is more upbeat. India is expected to remain an outperformer. CRISIL expects the country’s GDP growth to average 6.6 per cent in fiscals 2025 and 2026 vis-à-vis the International Monetary Fund’s forecast of 3.1 per cent global growth over this period. Stronger domestic demand—mainly led by an improving capex environment—will drive India’s growth premium over its peers.
Source: Outlook India
Rajasthan has traditionally exhibited strength in the export of handicrafts, gems and jewellery, dimensional stones, agro & food, and textile products The Rajasthan government is finalising initiatives, such as providing technology support and holding trade fairs for industries, to realise its exports target of Rs 1 trillion in the next two years. “The exports from the state in 2021-22 increased to Rs 72,000 crore from over Rs 52,700 crore a year earlier, and the state is making efforts to take this figure to Rs 1 trillion in the next two years,” said Rajiv Arora, chairman of Rajasthan Small Industries Corporation and Rajasthan Export Promotion Council (REPC). The REPC, an autonomous body, provides export facilitation across sectors. It offers inputs to the central and state governments on matters, such as infrastructure and policy formulation. “Despite not having a port, the state is seeing robust growth in exports thanks to the government’s industry- and exports-friendly policies,” he said. In the past year and a half, more than 9,000 exporters have registered themselves with REPC. Rajasthan has traditionally exhibited strength in the export of handicrafts, gems and jewellery, dimensional stones, agro & food, and textile products. To impart impetus on exports, measures targeted at the promotion of export-oriented units have been included in earlier notified industrial and sectoral policies of Rajasthan. Rajasthan’s current share in India’s total merchandise exports is estimated at 2 per cent. The state exports to more than 200 countries with top destinations like the US, UK, Hong Kong, Germany, the UAE, China, Korea, Japan, and Bangladesh accounting for around 50 per cent of the importing nations. A senior industry department official said workshops were being organised under Mission Niryatak Bano (Become Exporter Mission) programme and efforts were being made to provide platforms to new exporters. The REPC, under Mission Niryatak Bano, will organise mega trade fairs if all majorly exported commodities of the state, provide quality/technology support to industries and skill training. In this line, the International Export Expo to be organised in Jodhpur on March 20-22 next year will likely be a milestone.
Source: Business Standard
The Confederation of Indian Industry (CII) will be organising Texcon 2022, the 14th edition of the conference, on December 23 at Eros Hotel in New Delhi, India. The theme of this year’s conference is ‘capitalising the emerging opportunities to create a competitive textiles & apparel sector’. Fibre2Fashion, the leading B2B, Market Intelligence and Media portal for the textile and fashion companies globally for the last 20+ years, is the Digital Media Partner of the conference. The conference will cover topics such as the changing landscape of the global textile industry, global geo-political shift, diversification of supply chain, free trade agreements (FTAs) and textile recycling among others. The inaugural session of the conference will highlight and focus on the changing landscape witnessed by the global textiles industry. In addition, it will help strategise the approach and way-forward towards tapping the growth prospects and opportunity for the Indian textiles and apparel industry. The session on ‘Global Geo-Political Shift: India’s Growth Opportunity’ will discuss the shift in global geopolitical landscape and how the search for an alternate market to China has opened and provided many growth and development opportunities for the Indian textiles and apparel sector. India's journey to become a global leader will entail two milestones—achieving best-in-class manufacturing capability and optimised processes that augments service levels. This session will deliberate on the impact of the global geopolitical and macroeconomic changes on the Indian textiles and apparel sector, and how India can leverage the opportunities it presents, CII said. ‘Diversification of Supply Chain: Scaling up MMF and Cotton’ will be the next session at Texcon. This panel will direct the focus towards addressing the issues related to supply chain in MMF and cotton and highlight the initiatives undertaken by the government of India. A session on FTAs will address the key question on whether FTAs can prove to be a key driving force for future investments in India and how industry players need to align to take advantage. Another session on textile recycling will focus on the challenges and opportunities in India’s circularity and sustainability journey. The conference is likely to end with a special address by Piyush Goyal, Indian minister of textiles, commerce and industry, consumer affairs, food and public distribution.
Source: Fibre 2 Fashion
Leaders from the European Union and the 10-member Association of Southeast Asian Nations (ASEAN) are kicking off their first ever in-person summit in Brussels on Wednesday, commemorating 45 years of diplomatic relations. "I see it as an opportunity for the EU and ASEAN to commit to their strategic partnership and shared commitment of following the rules-based international order amid current geopolitical tensions," an EU official told reporters prior to the summit. "We are glad, too, that our ASEAN partners share our concerns on Russia's aggression in Ukraine," the official said, adding that Europeans also need to pay attention to security challenges in Myanmar, the Korean Peninsula and the South China Sea. However, geopolitical and economic tensions in the Indo-Pacific region are centered firmly on China. Amid icy relations with Beijing, boosting trade relations with ASEAN is a priority for EU leaders. Charles Santiago, chairman of the ASEAN Parliamentarians for Human Rights (APHR), told DW that countries in Asia need a counterweight against China's influence in the region, particularly the South China Sea, and the EU is looking to lure ASEAN away from forging stronger ties with Russia. However, Santiago said that an ASEAN-EU free-trade agreement is not yet on the negotiating table. "Europe wants to keep its trade relations with ASEAN based around a couple of things. First, the EU is looking for a source of raw materials like lithium, which ASEAN can provide. At the moment, any trade talks will focus on containing China and Russia's overwhelming influence," he said. No EU-ASEAN free-trade deal, for now ASEAN is the EU's third-largest trading partner after the US and China, trading goods worth more than €215.9 billion ($229.9 billion) in 2021. Chemical products, machinery and transport equipment are the EU's main exports to ASEAN countries, while imports include machinery and transport equipment, agricultural products, textiles and clothing. Both blocs began negotiations on a free trade agreement in 2007, but instead opted for bilateral trade deals. However, according to the European Commission, these bilateral trade and investment agreements could serve as a foundation for a future EU-ASEAN trade agreement. The EU began trade negotiations with individual ASEAN countries like Singapore and Malaysia in 2010, Vietnam in 2012, Thailand in 2013, the Philippines in 2015 and Indonesia in 2016. While agreements with Singapore and Vietnam have been completed, at the summit tomorrow, the EU hopes to resume trade talks with Thailand and the new governments of the Philippines and Malaysia. Ongoing trade talks with Indonesia are also expected to be discussed bilaterally. "There is still a lot of untapped potential in the ASEAN, which is on track to become the fifth largest economy in the world in the next four or five years, and we want to complete more bilateral trade agreements. It is also important for us to diversify our supply and demand chains," an EU official told reporters. European Commission President Ursula Von Der Leyen is also expected to put forward an EU investment package to develop renewable energy, transportation, the digital sector and infrastructure with ASEAN countries, the official added. Human rights taking a back seat? Human rights organizations like Frontline Defenders have issued a statement calling on ASEAN leaders to also discuss human rights issues during the summit. The coup in Myanmar, and the recent passing of a new criminal code in Indonesia that criminalizes criticism of the government and sex outside marriage, are two of several human rights issues confronting ASEAN countries. However, according to Santiago, human rights and democracy issues are not a priority when trade and economics are on the agenda. "Democracy takes a back seat, and good governance and human rights take a back seat, when the priority is trade," he said. "Whether it's ASEAN or the Europeans, amid the current geopolitical situation of containing China for the ASEAN and weaning off dependency from Russia for the EU, boosting trade ties and connectivity are on the main agenda both blocs are keen to push," he added. "But regarding Myanmar, I was in touch with a European commissioner, focusing on the situation in Myanmar and talks on the country's future in ASEAN and human rights violations will be held at the summit. Whether it will lead to a final agreement between both blocs on dealing with Myanmar is still unknown," Santiago said. An EU-ASEAN joint statement which will also focus on boosting multilateral ties, is expected to be issued after the summit.
Source: Taiwan News
Bangladesh textile millers recently urged the central bank to extend the repayment tenure of loans from the Export Development Fund (EDF) up to 270 days as they often do not receive timely payment from exporters. They also sought continuation of foreign currency support to export-oriented manufacturing sectors, especially textile and apparel exporters. Companies in these sectors import raw materials like cotton, synthetic fibre and dyeing chemicals. The repayment tenure is generally 180 days now and an additional 90 days are allowed subject to approval by the Bangladesh Bank. Many banks allegedly are unwilling to offer additional time. In a few cases, the mills cannot pay back the EDF loan on time as they do not get timely payment from exporters, Bangladesh Textile Mills Association (BTMA) president Mohammad Ali Khokon told a press briefing. The current limit of the EDF—set up with only $300 million in 1988 and with a corpus of $7 billion now—for textile millers is $25 million. The export-oriented sectors, especially the members of BTMA, the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), are the beneficiaries of the special loan facility. "The local textile and RMG sector is passing through an unusual situation now due to the high prices of raw materials, energy and dollar amid the Russia-Ukraine war and a declining trend in remittance inflow," the BTMA president was quoted as saying by Bangladeshi media reports. Readymade garment exporters pay for yarn and fabric using US dollar after receiving the export proceeds and textile millers repay the EDF loan accordingly, Khokon added.
Source: Fibre 2 Fashion
The Bangladesh high commission in South Korea has urged its own government to consider signing a free trade agreement (FTA) or a preferential trade agreement (PTA) with the country to ensure trade benefits after graduation from the least developed country (LDC) status in 2026 and overcome likely export shocks from the developed South Korean market. The Bangladesh government should fix its position and devise the next course of action by conducting a feasibility study with various stakeholders, said its mission in Seoul. It called for requesting South Korea to continue the duty free, quota free (DFQF) facility for Bangladesh products until any FTA or PTA is signed, according to Bangladeshi media reports. South Korea has expanded its DFQF facility for LDCs and provides duty-free market access to Bangladesh in 95 per cent of tariff lines now. But it will not offer DFQF market access to products from Bangladesh on its own after Bangladesh graduates from LDC status as it might come under pressure from countries that have such trade deals with it, according to an embassy letter sent earlier. In March last year, the Bangladesh mission requested the South Korean trade, industries and energy ministry to form a joint feasibility study team for any prospective FTA. The latter, however, has not informed the former anything regarding that till now
Source: Fibre 2 Fashion
A delegation from 60 import firms, members of the Federation of Israeli Chambers of Commerce (FICC), travelled to Istanbul to meet with representatives of 450 Turkish companies. Some of Israel’s largest retail chains including Supersol, Rami Levy, Yohannoff, Electra participated in the talks, which were organized by the Turkish Exporters Association (TIM). Senior officials from the Israeli Ministries of Foreign Affairs and Economy, Israel’s Ambassador to Turkey Irit Lilian, Israel’s Economic Attaché to Turkey Matan Safran, Turkish Ministry of Economy Director General Mehmet Kilichalia and Turkish Exporters Assembly President Mustafa Gültepe were among diplomats and regional chambers of commerce heads who also attended the event. Turkey is the fifth largest source of imports for Israel, followed only by China, the United States, Switzerland and Germany. 2.5% of the total goods imported to Israel come from Turkey, accounting for $8.4 billion last year. According to an Israeli government statement, the main types of imported goods are textiles, machinery, electrical and mechanical products, as well as building materials such as steel, iron, cement, rubber and plastic. Conversely, Turkey is the seventh largest recipient of Israeli goods, representing 2.3% of the total that Israel exports to the world. “The significant increase of imports from Turkey, which has already reached $6.2 billion, in a wide variety of products, will reduce the cost of import to Israel. This is another way for us to contribute to combat the rising of the cost of living in Israel and to upgrade relations between the two countries. The warm welcome affirms the close bond between the two countries,” said FICC President Uriel Lynn, adding that “the positive balance of Israeli trade stands at about $21 billion and this will of course continue, thanks to meetings of the kind we are holding today.” Emphasizing that this is the only the dawn of a new era in bilateral economic and diplomatic relations, Lynn predicted that within one to two years the volume of mutual trade with Turkey will reach $10 billion. Ambassador Lilian hailed the summit for strengthening “the good faith” between Israel and Turkey. “For a decade there has not been a meeting that comes close to this. Both sides are willing to take risks and the last few years have proven that the economic ties between Israel and Turkey can be spoiled. It is our duty to find further ways to enhance future collaborations that will serve the importers and exporters of both Turkey and Israel; benefiting the economies of both countries,” she said. FICC Vice President Amir Shani remarked during a presentation that there had never been another delegation similar to this one. “In the last four years there has been an 80% increase in trade between the countries and this is for three main reasons: quality of the products, the attractive prices and of course the transportation of the goods from a destination close to Israel,” he said, while pointing out that shipment from Turkey “has a great distance advantage over the USA, China and Europe.” “The rapprochement between the two countries helps to balance the trade relations between the countries. This meeting is further proof that this is a historic event, creating another turning point for trade relations,” said Gültepe. While asserting that the Turkish Exporters Assembly and the FICC contribute much to the success of the ongoing trade between the countries, he affirmed intent to promote further trade in the various sections of the economy. Israel and Turkey restored full diplomatic relations in August after more than a decade of tensions. Onetime warm bilateral ties between the Jewish State and its strong Muslim ally were severely damaged by the 2010 Mavi Marmara incident in which 10 pro-Palestinian extremists from Turkey were killed when they violently attacked Israeli commandos trying to enforce the naval blockade of the Hamas-run Gaza Strip. Israel later paid Turkey $20 million in compensation as a key component of a deal signed in June 2016 to restore ties. The row widened again when Turkish President Recep Tayyip Erdoğan condemned Israel as a “terrorist state” after 60 Palestinian rioters believed affiliated with the Islamist- Hamas terror group were killed in 2018 by the IDF during violent protests on the Gaza border against the opening of the United States Embassy in Jerusalem. Israel has also long condemned Turkish support of the Islamist Hamas rulers of Gaza, including an office operated by the Palestinian terror group in Istanbul. The breakthrough rapprochement between the two US allies followed “positive developments in Israel-Türkiye ties over the past year,” said a statement from the Israeli Prime Minister’s Office (PMO) in August; finalized in a congratulatory conversation Israeli Prime Minister Yair Lapid and Turkish President Erdoğan, as well as “understandings” Lapid reached during his visit to Ankara with Turkish Foreign Minister Mevlut Çavuşoğlu.” “Upgrading relations will contribute to deepening ties between the two peoples, expanding economic, trade, and cultural ties, and strengthening regional stability,” said the PMO statement. Israeli President Isaac Herzog also contributed to the de-escalation of hostilities during a diplomatic visit to Ankara in March, after which foreign ministers of both states conducted reciprocal visits. Welcoming the development, Herzog stressed, “Members of all faiths—Muslims, Jews, and Christians—can and must live together in peace.”
Source: TV7 Israel News
The November US logistics managers’ index reads in at 53.6, down by 3.9 from October’s reading of 57.5. This is the third month out of the last four that the overall index has read in below 60. It is also the second lowest overall reading in the history of the index, only surpassing the reading of 51.3 from April 2020 at the height of COVID-19 lockdowns. In a change from what researchers from leading logistics and supply chain schools who conduct the survey have observed throughout 2022, inventory metrics in the United States are now settling into more sustainable rates of growth. Inventory levels have decreased significantly, particularly for upstream respondents. This is likely indicative of goods being positioned downstream for the holiday season, and more importantly for supply chains, being purchased by consumers. Despite the reductions in inventories, warehousing capacity remains tight, which in turn ensures continued expansion in warehousing prices. On the flipside, the transportation market continues to fall from the dizzying heights that had become the norm during 2021. Researchers at Arizona State University, Colorado State University, Rochester Institute of Technology, Rutgers University, and the University of Nevada, Reno, and in conjunction with the Council of Supply Chain Management Professionals (CSCMP) issued these information recently. The slowdown in the overall index is largely due to the long-anticipated wind down in inventories. The inventory levels metric, which came in over 80 in February, reads in at 54.8 in November, down significantly from October’s reading of 65.5. This is indicative of two things: the movement of goods downstream towards retailers, and the sale of those goods as holiday spending picks up. Spending growth remained strong to kick off the holiday season. Online consumers spent just over $35 billion during the period from Thanksgiving to Cyber Monday. Respondents seem to expect a meager rate of expansion over the next 12 months, predicting a growth rate of 51.5, down from October’s future prediction of 55.2. The weak levels of expansion are pulled down by expected contractions in both inventory levels and transportation prices.
Source: Fibre 2 Fashion
Cambodia’s apparel exports of $758.532 million in the first three quarters of this year have already crossed the total exports of $613.344 million in 2021. At this rate, the exports are likely to touch the $1 billion mark by December 2022. The two countries are planning to sign a memorandum of understanding (MoU), as per Cambodia’s ministry of commerce. Cambodia’s apparel exports to the UK were $729.940 million in 2020, $906.820 million in 2019, $1,062.281 million in 2018 and $919.337 million in 2017. On a quarterly basis, the exports were at $276.038 million in Q3, $247.153 million in Q2 and $235.340 billion in Q1 2022. Last year, the country’s shipment was $186.807 million in Q4, $154.342 million in Q3 and $124.671 million in Q2, according to Fibre2Fashion’s market insight tool TexPro. However, the exports of home textiles from Cambodia to the UK were negligible. The shipment decreased from $13.480 million in 2019 to $5.041 million in 2020 and $8.035 million in 2021. Cambodia exported home textiles worth $8.615 million in the first three quarters of this year. The MoU is expected to boost the bilateral trade and investments between the two countries. It will help promote apparel and home textile exports from Cambodia to the UK.
Source: Fibre 2 Fashion
Scientists and manufacturers are charting a path toward material sustainability At a family gathering in August, I gave a brief tribute to my mother on the occasion of her 90th birthday. As the guests sipped their coffee in the warm summer air, I ticked off a dozen or so pieces of wisdom that she has imparted to her family over the decades. One insight that I credited to her was an aversion to waste. In our household, items such as clothes and toys would have multiple lives before being thrown out, and leftover food would be transformed into tomorrow’s lunch. In other words, my mother was an early advocate of the circular economy, in which materials and products have multiple iterations, and the waste of one process loops back and becomes the input for another. For people of her generation, these are commonly held values. But younger generations have largely strayed from these ideas, opting instead to produce and consume more and more. Some of the waste is recycled, but that only goes so far towards addressing the problem that the planet has limited resources to offer. The finiteness of this supply distinguishes materials from energy. There’s little doubt that in the future we will be able to capture more solar power and even build nuclear fusion reactors to abolish energy scarcity forever. But for material resources, no such technology is in view. That’s what makes the research reported in this Outlook so important. As the world sets out to put its economies on a sustainable footing, this Outlook looks at the progress and barriers to the sustainable use and re-use of plastics; electronic devices such as mobile phones; building materials; and clothing and other textiles. It also examines the transition of biofuels to a more environmentally friendly form that will foster less soildepleting and carbon-producing agriculture, and the urgent need to become better stewards of Earth’s water resources. Two researchers also debate whether plastic recycling is central to the advancement of the circular economy, or a counterproductive distraction from the need for more fundamental change. We are pleased to acknowledge the financial support of Google in producing this Outlook. As always, Nature retains sole responsibility for all editorial content.
Source: Scientific American
