INTERNATIONAL
Textile Raw Material Price 2016-07-20
|
Item |
Price |
Unit |
Fluctuation |
Date |
|
PSF |
1030.10 |
USD/Ton |
1.62% |
7/20/2016 |
|
VSF |
2239.35 |
USD/Ton |
0% |
7/20/2016 |
|
ASF |
1881.05 |
USD/Ton |
0% |
7/20/2016 |
|
Polyester POY |
1050.26 |
USD/Ton |
1.96% |
7/20/2016 |
|
Nylon FDY |
2224.42 |
USD/Ton |
0.68% |
7/20/2016 |
|
40D Spandex |
4254.77 |
USD/Ton |
0% |
7/20/2016 |
|
Nylon DTY |
2052.74 |
USD/Ton |
0.73% |
7/20/2016 |
|
Viscose Long Filament |
2052.74 |
USD/Ton |
0% |
7/20/2016 |
|
Polyester DTY |
1168.94 |
USD/Ton |
1.69% |
7/20/2016 |
|
Nylon POY |
2433.43 |
USD/Ton |
0.62% |
7/20/2016 |
|
Acrylic Top 3D |
5567.02 |
USD/Ton |
0% |
7/20/2016 |
|
Polyester FDY |
1283.89 |
USD/Ton |
1.78% |
7/20/2016 |
|
30S Spun Rayon Yarn |
2776.79 |
USD/Ton |
0% |
7/20/2016 |
|
32S Polyester Yarn |
1721.31 |
USD/Ton |
3.87% |
7/20/2016 |
|
45S T/C Yarn |
2396.10 |
USD/Ton |
0% |
7/20/2016 |
|
45S Polyester Yarn |
2926.08 |
USD/Ton |
0% |
7/20/2016 |
|
T/C Yarn 65/35 32S |
2209.49 |
USD/Ton |
0% |
7/20/2016 |
|
40S Rayon Yarn |
1791.48 |
USD/Ton |
0% |
7/20/2016 |
|
T/R Yarn 65/35 32S |
2134.85 |
USD/Ton |
0% |
7/20/2016 |
|
10S Denim Fabric |
1.33 |
USD/Meter |
0.34% |
7/20/2016 |
|
32S Twill Fabric |
0.82 |
USD/Meter |
1.11% |
7/20/2016 |
|
40S Combed Poplin |
1.16 |
USD/Meter |
0.91% |
7/20/2016 |
|
30S Rayon Fabric |
0.67 |
USD/Meter |
0% |
7/20/2016 |
|
45S T/C Fabric |
0.66 |
USD/Meter |
0% |
7/20/2016 |
Source: Global Textiles
Note: The above prices are Chinese Price (1 CNY = 0.14929 USD dtd. 20/07/2016)
The prices given above are as quoted from Global Textiles.com. SRTEPC is not responsible for the correctness of the same.
India’s textile and apparel industry is all set for an overhaul as the new National Textile Policy will soon be placed before the Cabinet for approval. The government has already accepted a Rs.60 billion special package for this sector with an aim to create 10 million new jobs in the next three years, attract investments of $11 billion, as well as generate an additional $30 billion in exports. The key measures that have been approved include additional incentives for duty drawback scheme for garments, flexibility in labour laws to increase productivity, and tax and production incentives for job creation in garment manufacturing. As part of the reform agenda, the Ministry of Textiles would also seek to lower excise duty on man-made fibre to 6 per cent from the existing 12 per cent. It has also placed on the table other specific interventions to encourage value addition so that India becomes an exporter of value-added (garment) products rather than just raw material (fibre and yarn).
Maze of labour regulations
Undoubtedly, the ‘textile package’ has set the ball rolling for a much-needed reform agenda. The organised textile industry has been facing a slowdown for quite some time, due to which a large number of mills are reported to have shut. Workers who have been displaced are left with no choice other than to move to the unorganised segment or work on a contractual basis. It has been reiterated time and again that the stringent labour laws and the cumbersome nature of compliance with labour regulations and norms act as a barrier to growth of the manufacturing sector. The textile industry is affected the most owing to its labour-intensive nature and hence high potential to absorb people. While the government has agreed to reform the archaic labour laws to generate more employment in this industry, in some cases it may require changes in the legislation, which is a challenge in itself. The system of labour regulations in India is quite complex, with over 200 labour laws, including 52 Central Acts. In their book India’s Tryst with Destiny, Jagdish Bhagwati and Arvind Panagariya maintained that it is impossible to comply with 100 per cent of the labour laws without violating at least 20 per cent. Each State has its own way of dealing with the industry and making amendments in the labour laws.
Among many laws, the biggest challenge is to bring reforms in the Industrial Disputes Act (IDA), 1947, that forms the basis for regulation of job security in the organised manufacturing segment, due to strict dismissal norms laid down under it. As per Chapter V-B of the Act, any firm employing 100 or more workers has to seek permission from the labour department, with jurisdiction over the firm, before any layoffs or retrenchment. The concerned labour department rarely gives such permission, even in cases where the unit is unprofitable and on the verge of closure. As a result, the industry may find it advantageous to either employ people on a contractual basis or shift to the unorganised segment.
Contract workers as an expedient
The restrictive impact of this Act and also other regulations impinge largely upon industries such as textiles majorly employing unskilled or low-skilled workers. The problem becomes more intricate knowing that the textile industry has a significant number of women workers on the rolls, which may require modifications in the existing laws along with new schemes and incentives to retain them.
Statistics show that India’s textile industry is the second largest employer after agriculture, providing direct employment to around 45 million people. The sector also accounts for 14 per cent of India’s total industrial production, which is close to 4 per cent of the country’s gross domestic product. The annual rate of growth in employment in the organised sector has been modest at 2 per cent since 2000-01 with some signs of deceleration, especially from 2007, a period that coincided with the removal of the Multi Fibre Arrangement that governed world trade in textiles and garments with quotas on exports from developing countries to developed countries. However, an increase in employment is accompanied by a growing share of contract workers in total workers from 8.42 per cent to 13.45 per cent (see graphic). The trend in organised manufacturing overall is similar to that observed in the textile sector, where the share of contract workers has risen from 21.3 per cent to 34.6 per cent during this period.
An increasing informalisation of employment within the formal sector could be explained by the labour market rigidities and growing competition, among other factors. The industry may employ temporary or contract workers in a bid to escape Chapter V-B of the Act despite the contract labour system being more expensive. Furthermore, the share of contract workers in total workers is much higher in firms employing less than 100 workers, and not falling under the ambit of Chapter V-B of the IDA. The share has significantly gone up in two segments, viz. preparation and spinning of textile fibres and weaving of textiles, from 8.21 per cent to 20.72 per cent and 18.38 per cent to 24.95 per cent in a span of 11 years. It is much higher compared to the firms employing more than 100 workers falling outside the domain of Chapter V-B. This clearly indicates that the organised industry could be following an escape route by employing contract workers to replace the regular workers. Since firms employing less than 100 workers do not fall under the ambit of the Chapter V-B, they have an incentive to remain outside by hiring more contract workers. On the other hand, the firms which have already crossed this threshold of 100 workers have a much lower incentive to hire contract workers.
Towards gainful employment
Such informal arrangements may hamper the industry’s growth in productivity and development in the long run. The trend, which has been continuing since the nineties, needs to be reversed. The Economic Survey 2016 has rightly pointed out that stringent labour regulations act as “regulatory cholesterol”, inhibiting the industry from generating employment and hiring regular workers. It is therefore important that as part of the ‘textile package’ the government should at least try to reduce, if not remove labour market rigidities for creation of gainful employment. Provision of better wages to casual workers, along with social security and other benefits, will contribute to higher productivity. The industry would also avoid hiring contract workers, be able to reduce contracting cost and move towards expansion. Some propositions have been in the offing, such as considering fixed-term workers on a par with permanent workers in terms of wages and allowances, providing tax benefits to firms employing permanent workers for at least 150 days, making provident fund contribution by employees earning less than Rs.15,000 per month optional, and the government contributing on behalf of the employer towards Employees’ Provident Fund Organisation for the first three years. These initiatives, if implemented, can go a long way in reviving growth and generating gainful employment in the textile industry. The government must also focus on bringing amendments in the IDA which may otherwise act as a stumbling block. Rajasthan, Gujarat, Madhya Pradesh and Haryana are making some headway in this direction. There are provisions to reform labour laws in the new textile policy. It is hoped that the Ministry of Textiles under Smriti Irani will get the new National Textile Policy approved and speed up the reforms. Much depends on how capably she would fast-track flexibility in labour laws and regulations with cooperation from the Ministry of Labour and Employment.
SOURCE: The Hindu
A court has ordered a pay rise of up to 30% for garment workers in Tamil Nadu, the first minimum wage hike in more than 12 years. But lawyers for 500 clothing manufacturers and exporters, who supply many international brands, said the new wages would be "practically impossible" to introduce given the tough global market conditions. Under the ruling, workers would see their pay rise from a monthly average of Rs 4,500 to Rs 6,500 - which campaigners say is comparable to wages for textile jobs in most other states. "It is a huge victory in a long drawn (out) battle to get workers their due," said Sujata Mody of Penn Thozhilalargal Sangam, a women's workers' union. "Workers have been living in impoverished conditions with inflation and prices on the up." Campaigners demanded the state government ensure immediate compliance with the court ruling by textile firms.
Under the Minimum Wages Act, introduced in 1948, state governments are required to increase the basic minimum wage every five years, but textile manufacturers have repeatedly challenged these pay rises in Tamil Nadu. The last time the state government revised pay was in 2004. But the matter went to court immediately and the increase was not implemented. During a lengthy legal battle judges at the Madras High Court dismissed over 500 petitions filed by manufacturers and exporters, opposing a subsequent 2014 government order to increase wages. In its July 13 ruling, the court asked manufacturers to immediately pay the revised wage as well as arrears backdated to December 2014. The workers - including cloth cutters, tailors and button makers - will also get an additional inflation-linked allowance. Shirt seamstress A Dhanalakshmi welcomed the ruling, saying she struggled to get by on the Rs 6,000 she earns each month, working an average 45-hour week at an export firm near Chennai. "My workload increases but the salary barely does," she said. "The court verdict has given me hope." Lawyers for the government accused the manufacturers of having "unclean hands" and told the court that many had never paid their employees the minimum wage. But the manufacturers and exporters, who are considering an appeal against the ruling, argued in court that the wage rise was unrealistic given the stiff competition they faced from neighbouring countries like Bangladesh and China.
SOURCE: The Times of India
The Southern Gujarat Chamber of Commerce and Industry (SGCCI) proposes to set up a Rs 800 crore state-of-the art textile processing cluster housing about 100 dyeing and printing mills in Surat district and has approached the central government for 50 % funding. Even as the proposal for land allotment for the ambitious project on 50 lakh square metre land in Pinjrat village project is pending with the state government, SGCCI office bearers submitted a letter to visiting Textile Commissioner Dr Kavita Gupta seeking Rs 400 crore grant for developing the cluster. The total project cost for the cluster is pegged at Rs 800 crore. The SGCCI is eyeing 50 per cent grant from the central government and 25 per cent each from the state government and the industry, according to a newspaper report. "This is going to be an ambitious project to boost the manufacturing capacity and quality of textile processing sector in Surat. At present, only eight to 10 textile processing units manufacture finished fabrics as per the requirement of the garment sector, while the rest lack the technical know-how. We want to set up a processing cluster having big units with hi-tech technology and upgradation," SGCCI president B S Agarwal told the Times of India.
Emphasizing on environmental friendly features of the proposed cluster, Mr Agarwal, said the textile processing units will be connected with a common boiler system to discourage the use of chimneys. There will also be a set-up for wind and solar power generation, common drainage, CETP plant, tertiary treatment plant and other state-of-the-art facilities. It's not just the processing and weaving units, but also garment units that were proposed to be included in the Pinjrat cluster, Mr Agarwal said adding that they were planning to visit the textile cluster in Trichy for tips and looking for investors in the project.
SOURCE: Fibre2fashion
SVP Global Ventures, a diversified yarn manufacturing company, has commissioned one lakh spindles textile plant at Jhalawar in Rajasthan. The fully automated plant has manufacturing capacity of 22,000 tonnes per annum. The first phase of the project will employ 500 people and provide a stable source of livelihood to over 30,000 farmers, said the company in the BSE statement on Wednesday. The plant will manufacture combed compact yarn which will be exported to many countries, including China. The project will generate higher margins as compared to other spinning mills, it said. As part of the Rajasthan government’s package, SVP has derived significant advantages like interest subsidy, VAT benefit and electricity duty rebate Chirag Pittie, Managing Director, SVP Global Ventures said the textile plant is commissioned under resurgent Rajasthan project on 25 acre land in nine months.
SOURCE: The Hindu Business Line
The Union Cabinet has approved the incorporation of Sagarmala Development Company (SDC) under the Companies Act, 2013, with an initial authorised share capital of Rs. 1,000 crore and a subscribed share capital of Rs. 90 crore. Under the administrative control of the Shipping Ministry, SDC, will provide equity support to the project Special Purpose Vehicles (SPVs) and funding support to the residual projects under the Sagarmala Programme. The company will take up some projects that will form part of Sagarmala, but do not fall under the purview of departmental undertaking or State-led development. “The company will fund residual projects. The process is on to identify such projects. There could be projects that require support infrastructure to start ferry service – say by the maritime board. There could be some road projects for port connectivity which could require initial support as there would be no takers,” Rajive Kumar, Secretary, Shipping Ministry, told BusinessLine . Implementation of the Sagarmala projects will be taken up by the relevant ports, State governments/Maritime Boards, Central Ministries, mainly through private or PPP mode. Since the identified projects will be undertaken by multiple agencies, SDC will also work as the nodal agency for coordination and monitoring of all the currently identified projects as well as other projects emerging from the master plans or other sources.
As part of the coastal community development objective of the Sagarmala Programme, the Ministry is taking up a number of initiatives/projects including coastal community skill projects and projects for development of marine fisheries sector — as part of Deen Daygl Upadhyaya Grarneen Kaushalya Yojana (DDU-GKY) and marine fishermen skill development projects. It will in collaboration with the Department of Animal Husbandry, Dairying and Fisheries (Ministry of Agriculture), will part-fund select fishing harbour projects under the Sagarmala Programme. Ministry of Shipping is also preparing a coastal community development scheme, in convergence with the existing Central/State Government schemes.
Dock at Cochin Shipyard
Additionally, Cabinet Committee on Economic Affairs has given its approval for construction of a new dry dock within the existing premises of Cochin Shipyard Ltd (CSL) at an estimated cost of Rs. 1,799 crore to augment the shipbuilding, repair capacity of the country. The objective is to augment the shipbuilding/ ship repair capacity essentially required to tap the market potential of building specialised and technologically advanced large vessels such as Liquefied Natural Gas (LNG) vessels, indigenous aircraft carriers of higher capacity, jack up rigs, drill ships, large dredgers and repairing of offshore platforms and larger vessels. The project will be funded through internal and extra budgetary resources (IEBR) of CSL and the funding requirements are fully tied up. The project proposal would generate employment within the country. Apart from direct employment of 300 personnel, about 2,000 personnel would be indirectly employed when the project becomes fully operational.
SOURCE: The Hindu Business Line
Minister of State for Finance Arjun Ram Meghwal expressed hope that the Rajya Sabha would clear the Constitutional amendment for a proposed national goods and services tax (GST), with support from regional parties. On the sidelines of an Assocham event, he said the Congress party's demand for capping the GST rate in the Constitution was "not practical" and the government was trying for a consensus. “There are many chief ministers — of UP, Odisha, West Bengal, Bihar — who all want GST to come fast...We hope the Rajya Sabha will be able to pass the Bill in the third week of the session," he said. The current session of Parliament began on Monday and ends on August 12. The Congress, which originally mooted GST in the Budget for 2006-07, to replace all indirect taxes, has been demanding the overall rate be capped at 18 per cent and an additional one per cent tax designed to compensate manufacturing states that fear loss of revenue be scrapped. Recently, it indicated it was open to have the cap in the accompanying GST Bill, rather than in the Constitutional amendment.
Janata Dal chief and Bihar chief minister Nitish Kumar met finance minister Arun Jaitley on Tuesday. He supported the government position that the tax rate not be mentioned in the Constitutional Bill and be left to the proposed GST Council to determine. Talking to the media after his meeting, Kumar said any cap on the GST rate would be discriminatory on states, as it would take away their powers to generate revenue. Bihar's tax revenue has plummeted after Kumar's government imposed prohibition on liquor in April. The Centre had earlier planned to introduce the GST, which intends to convert 29 states into a single market through a new indirect tax regime, from April 1 this year. However, the legislation has yet to pass the opposition-dominated Rajya Sabha, after having passed the Lok Sabha.
Information & broadcasting minister Venkaiah Naidu said: "We want to get the GST passage through consensus. Although we feel the adequate numbers are there, we would like to see the House approve it unanimously." Naidu said the biggest beneficiaries of GST will be the states, and the chief ministers want it to be passed at the earliest. "The signals I am getting from all sides is positive." The government has agreed to a five-hour debate on the Bill in the Rajya Sabha in the current session.
SOURCE: The Business Standard
Goods and Services Tax (GST), which aims to simplify indirect tax regime, will be a ‘game- changer’ for the country and its implementation is likely to take place from April next year, says a report. According to Japanese financial services major Nomura, GST is a game changing indirect tax reform and its implementation would have a positive for growth in the long term. “While short-term macroeconomic implications of GST should be mixed, longer term, implementation should lift growth and enable greater general government fiscal consolidation,” Nomura said in a research note today. While the government has been trying to implement a GST for the past five-six years, it has never been so close, Nomura said, adding “political consensus now seems to be changing in favour of GST and we expect it to become a reality soon.” The global brokerage believes, apart from simplifying the indirect tax structure, the GST should help to create ‘One’ India by eliminating geographical fragmentation.
The GST is facing hurdles in the Upper House (where the ruling NDA government is in minority). “We expect these hurdles to be cleared soon and implementation to take place from April 2017,” Nomura said. While the fine print of the GST is still awaited, Nomura’s sector impact analysis suggests implementation of the GST will be generally positive for consumption-related sectors (like auto, consumer durables and FMCG) and cement, given the potential reduction in tax incidences. For sectors like utilities and pharma, GST implementation will have a ‘neutral to negative’ impact, while the services sector is likely to see a negative impact from higher tax burdens, it added. The Constitution amendment bill for roll-out of GST is pending in Rajya Sabha for a long time and the government is keen to ensure its passage. The Goods and Services Tax seeks to bring a uniform tax structure subsuming a number of imposts and the government claims that it will help add 1 to 2 per cent to the country’s GDP.
SOURCE: The Financial Express
Pressure is slowly mounting on the rupee with the currency failing to sustain its break above 67. The rupee touched a high of 66.85 on Friday, but reversed sharply lower from there, to below 67 once again. The currency hit a low of 67.25 before closing at 67.20 on Wednesday, down 0.2 per cent for the week. Inability to sustain above 67 and the subsequent reversal in the past week keeps the broader bearish outlook intact.
Strong dollar
A strong rise in the dollar index capped the rupee’s upside in the past week. After consolidating between 95.5 and 96.5 for more than three weeks, the dollar index broke above 96.5 and surged to a high of 97.3 in the past week. The break above 96.5 has increased the momentum for the index. A decisive close above 97 will add further strength. With strong support around 96.5, a further rise to 98 and 98.5 looks likely in the short term. Such a rise will also increase the possibility of the index revisiting 100 levels in the coming weeks.
Weak euro
The outlook for the euro (1.10/$) is negative. The euro has been broadly range-bound between 1.05 and 1.16 since 2015. After testing 1.16 in May this year, the currency has been falling, thereby keeping the broader range intact. An immediate fall to 1.08 looks likely. A strong break below 1.08 can drag it to 1.05 — the lower end of the range. Such a fall in the euro supports the bullish view for the dollar index. Could the European Central Bank (ECB) meeting due this evening have triggered this fall? We will have to wait and see. The negative outlook for the euro and the strong possibility of the dollar index revisiting 100 levels are negative for the rupee. There is no major macroeconomic data release on the domestic front in the coming week. So, the rupee’s movement will be completely influenced by global dollar movement. Inability of the rupee to sustain above 67 is a negative. Technically, the 200-day moving average resistance (66.88) has halted the rally in the currency. The sharp reversal from 66.85, taking the rupee below 67, is turning the short-term outlook negative. A fall to 67.5 is possible in the coming days. Further break below 67.5 can drag it further lower to 67.7. It will also increase the possibility of the rupee falling below 68 and revisiting the previous lows, going forward. Key resistances are at 67 and 66.85, which can limit the upside in the near term Also, the strength in the rupee could be capped at 66.5 even if it breaks above 66.85. The presence of a strong long-term trend resistance at 66.5 will continue to keep the medium-term outlook bearish for the currency.
SOURCE: The Hindu Business Line
Job creation in labour-intensive and export-oriented sectors, including textiles, automobiles, IT/BPO, declined 67.93 per cent in 2015, with net addition of employment coming down to 1.35 lakh during the year, Parliament was informed today. "According to Labour Bureau's Quarterly Quick Employment Survey (QES), estimated employment experienced a net addition of 4.21 lakh (persons) and 1.35 lakh (persons)... In January 2014 to December 2014, and January 2015 to December 2015, respectively," Commerce and Industry Minister Nirmala Sitharaman said in a written reply in the Rajya Sabha. The estimated employment for export-oriented sector saw a net addition of 1.22 lakh persons in January-December 2015, she added. The Labour Bureau conducts quarterly QES in select labour-intensive and export-oriented sectors such as textiles, including apparel, metals, gems and jewellery; automobiles; transport; IT/BPO; leather and handloom/powerloom to assess the effect of economic slowdown on employment in India. She said data pertaining to the whole of manufacturing sector is not collected under the QES of the Labour Bureau. "However, out of the eight selected sectors, textiles, including apparels, metals, gems and jewellery; automobiles; leather and handloom/powerloom are part of the manufacturing sector," she added.
SOURCE: The Business Standard
The almost imminent exit of the United Kingdom from the 28-member European Union, commonly referred to as Brexit, provides an opportunity for India to negotiate a favourable Generalised System of Preferences (GSP) with the United Kingdom, feel experts from the Indian textile industry. “This development (Brexit) is positive for the Indian textile industry. The EU currently provides duty free or concessional GSP benefits to Bangladesh, Pakistan and Sri Lanka for textile and apparel products, which is seriously affecting Indian exports of textile goods,” B Sriramulu, managing director at KG Denim, told Fibre2Fashion. “With UK leaving the EU, the country will renegotiate trade pacts within the WTO ambit with all nations including India. India can take this opportunity to negotiate a favourable GSP similar to our neighbours without offering the same benefit as demanded by EU on behalf of Germany,” he explained.
Speaking on the same subject, Sanjay Jain, managing director of TT Limited, said “We anyway had no advantage with EU while our competitors had. UK is a big market for us and after Brexit we all shall be on equal footing and chances of an Indo-UK trade agreement are much higher than an India-EU trade deal.” In fact, UK's business minister and now communities secretary, Sajid Javid, has already expressed a desire to start informal talks on a trade treaty, so that, as and when UK completes the EU exit process, both countries would be ready with a trade treaty. Manish Mandhana, joint managing director at Mandhana Industries Ltd said, “UK has been more of an importer than exporter. With a big economy and low resources it is dependent on Europe, China and India for its imports.” “The pound rate might fall against the dollar and thus, the rupee and the companies which have income from UK and Europe are going to be hit, at least for shorter term and if we look at indirect impact, foreign investors may exit Indian investments to rush back to the dollar,” he added. “While this may impact financial markets in the short term there will not be major effects on India as India's economic fundamentals are strong,” Mandhana observed. Even Moody's Investors Service, in its latest report said UK's decision to exit the European Union will not have any significant credit impact on India and other countries in the Asia Pacific region. “While the fiscal and monetary policy space is constrained in India its exposure to external financing is limited,” the ratings agency added in the report.
SOURCE: Fibre2fashion
Even as the immediate effect of Brexit is likely to be negative and affect Indian exports especially of textiles, clothing, machinery, auto ancillaries, and pharmaceuticals, it offers new growth opportunities for India, according to an analysis by a market research and consulting group. Brexit creates future growth opportunities for India. A nimble UK may be in a better position to provide more tax concessions, financial incentives, and preferential treatments thereby giving a new thrust to Indo-UK trade ties, the impact analysis by Frost and Sullivan said. Initially the impact on exports is likely to be negative as individuals, markets and businesses come to terms with the results and the new British leader kickstarts the process of withdrawal from the 28-nation bloc later this year. Until the dust settles and a clear picture emerges, business entities are most likely to avoid risks resulting in currency volatility and a flight of foreign capital to safe havens and assets, the report said adding that lack of a precedent makes it difficult to predict the ultimate outcome. Nonetheless, it suggested that in the medium term, India Inc. may revisit its European business plans and overhaul or calibrate them, as the case may require. Although the region is not without opportunities, Indian manufacturers and service providers may have to adjust to lower demand in the UK, increased costs of operations including compliance requirements of two separate regulatory frameworks, and restrictions on mobility of employees across EU countries.
Indian investors with factories in the UK and the country acting as a gateway to Europe may rearrange their investment plans, resulting in a lower flow of foreign direct investments to the UK – India is the third biggest source of FDI for UK - and higher to the EU. At a global level, increased political risks emanating from the fragmented UK, other EU exits, protectionist measures, and a weakened European economy might result in 'lost years', the report said but insisted that the impact of Brexit will not be felt in the same way and to the same degree by various sectors and countries. For instance, withdrawal of subsidised rates for EU citizens in UK universities will open up funds to provide scholarships to students from other countries. Equally, it may lead the UK government to ease immigration rules for non-EU students. These welcoming conditions coupled with lower costs of higher education is likely to entice more Indian students to the UK and reverse the trend of falling admissions.
SOURCE: Fibre2fashion
The government today said it has started the process of setting up a national committee to coordinate and implement the WTO's trade facilitation agreement (TFA). The cabinet has approved the constitution of the national committee on trade facilitation (NCTF) under the chair of cabinet secretary, Commerce and Industry Minister Nirmala Sitharaman said in a written reply to the Rajya Sabha. The committee will facilitate the ease of doing trade through effective cooperation between custom authorities and relevant stakeholders, she said. "yes," she said on a question whether it is a fact that government has started the process to set up the committee. She also said that through TFA, WTO members are encouraged to share information on best practices in managing customs compliance. TFA will lead to simplification of trade procedures and help promote cross-border trade, bring greater predictability to traders and reduce transaction costs.
Replying to a separate question, the minister said the government has taken various steps to track the trade restrictive measures of other countries through various mechanisms such as regular interaction, organizing workshops on important issues like standards and monitoring of draft notifications of member countries. "India's position is that issues related to labour and environment should be dealt in the appropriate forum," she said adding India have also maintained that in the WTO negotiations first the agenda of Doha round of trade negotiations should be completed. At the WTO ministerial conference held at Nairobi in December 2015, some members wished to identify and discuss issues other than the remaining issue in the Doha Development Agenda and mostly developing country members did not agree. It was agreed in Nairobi that any decision to launch negotiations multilaterally on such issues would have to be taken by consensus, she said.
SOURCE: The Economic Times
Armed with the text of a model bilateral investment treaty (BIT) that explicitly bars any enterprise from a treaty partner country from seeking relief on tax disputes under the treaty, India has fast-tracked the process of replacing several existing accords with fresh BITs and clinching such deals with countries outside India’s current treaty framework. While the Cabinet note has already been circulated for a BIT with Cambodia, new treaties with countries with which India has strong economic ties will follow, sources said. However, talks with the US —one of India’s largest trading partners and a big investor in defence and several other sectors — the path to the deal could turn out to be a bit long. This is because the US is not one among India’s existing Bilateral Investment Promotion and Protection Agreement (BIPA) partners and the BITs have no defined foundation to stand on.
People privy to the early talks with Washington in this connection told FE that the US has demanded its companies be given the right to seek international arbitration rather than seek remedy through local courts in case of disputes, something which goes against the grain of India’s BIT text and so, it is not inclined to accept. India has over 80 BIPAs with its trading partners. Sources said the US has also redefined its investment protection accords with major partners and so aligning these norms with India’s BIT would be necessary. The US has asked for “high standard” pacts like the ones India has with Japan and South Korea, they added.
US ambassador to India Richard Verma recently said “things have become a bit more difficult” after India revising BIT text. He is reported to have said that the new model substantially narrows the scope of investments to be covered by the treaty. As per India’s revised BIT text, foreign investors have to exhaust domestic legal remedies before seeking international arbitration in disputes. This provision is understood to have put off some countries, including the US. Among others, it also limits the investment protection and other benefits accorded to foreign-owned companies under bilateral treaties only to the firms that are incorporated in India, comply with domestic legislations and government decisions at all levels. The model excludes matters such as government procurement, taxation, subsidies, compulsory licences and national security to preserve the regulatory authority of the government. Tax matters, New Delhi contends, can be resolved through the double taxation avoidance agreements.
In the case of Japan and South Korea, the BIT elements have collapsed into New Delhi’s Comprehensive Economic Partnership Agreement (CEPA) with these countries. In case of South Korea pact, for instance, the restrictions on foreign direct investments have been considerably cased from what is autonomously done for other countries. Under Indo-Japan CEPA, import duties on most products are nil and access for Indian professionals and contractual service suppliers to the Japanese market has been enhanced and investment rules eased. With business ties with India increasing, the US wants a robust pact with India that benefits its companies. The trade between the US and India has nearly doubled over the last few years — from $60 billion in 2009 to $107 billion in 2015. FDI inflows from the US to India has more than doubled to $4.2 billion in FY16 from $1.8 billion in FY15.
SOURCE: The Financial Express
Kenya and India do not have a Preferential Trade Agreement (PTA). So, for Kenya to have duty access to India and vice versa, a Preferential Trade Agreement would be required. Such an agreement would lower or remove duties and enhance access of goods and services between the two countries or regions. The Kenyan government and the private sector are pushing for a PTA with India, Kenya says will help bridge the huge trade imbalance that is in favour of India, her second-largest source of imports and it will also allow Kenya for the entry of locally made goods, and especially privileged ones, to the Indian market. This is in the wake of renewed trade ties with the world’s seventh-largest economy following Prime Minister Narendra Modi’s three-day state visit to Kenya that started on July 10.
According to Economic Survey 2016 data , the value of imports from India stood at Sh252.5 billion last year, a slight 2.3 percent drop from Sh264.5 billion a year earlier, This was against Sh8.9 billion in exports, although this was a marginal rise from Sh8.7 billion in 2014. KAM chief executive Phyllis Wakiaga said that such a deal will increase Kenyan exports to India. The manufacturers aim to increase leather and textile exports to India if the proposed PTA is agreed on. During Modi’s visit, the Kenya National Chamber of Commerce and Industry chairman Kiprono Kittony, who was re-elected for a second three-year term on Thursday, said that both countries stand to benefit from a preferential trade deal. Kittony said that the business community is asking for a one-way market access to India. That will be the best way to level out the balance of trade that today is largely in favour of India.
Industry, Trade and Cooperatives Cabinet secretary Adan Mohamed said that their business community would like to explore a situation where they can get an African Growth and Opportunity Act type of preferential market access to Indian market given the size of their market here. Kenya can also import fabric from India to promote its textile industry which will be a win-win situation.
SOURCE: Yarns&Fibers
The international crude oil price of Indian Basket as computed/published today by Petroleum Planning and Analysis Cell (PPAC) under the Ministry of Petroleum and Natural Gas was US$ 43.68 per barrel (bbl) on 20.07.2016. This was higher than the price of US$ 43.63 per bbl on previous publishing day of 19.07.2016.
In rupee terms, the price of Indian Basket increased to Rs. 2934.22 per bbl on 20.07.2016 as compared to Rs. 2929.81 per bbl on 19.07.2016. Rupee closed weaker at Rs. 67.17 per US$ on 20.07.2016 as against Rs. 67.15 per US$ on 19.07.2016. The table below gives details in this regard:
|
Particulars |
Unit |
Price on July 20, 2016 (Previous trading day i.e. 19.07.2016) |
Pricing Fortnight for 16.07.2016 (June 29, 2016 to July 13, 2016) |
|
Crude Oil (Indian Basket) |
($/bbl) |
43.68 (43.63) |
45.17 |
|
(Rs/bbl |
2934.22 (2929.81) |
3043.55 |
|
|
Exchange Rate |
(Rs/$) |
67.17 (67.15) |
67.38 |
SOURCE: PIB
Textile Standards & Legislation (TSL) is a 100 page printed booklet which includes easy-to-read snapshots and concise summaries of the key points of each third-party label, standard, framework or individual piece of legislation. If you want your business to comply with relevant social and environmental issues, need to minimise risk in your supply chain, avoid reputable damage to your brand, or have decided to source your products in a more responsible manner, this guide is an absolute must-have. Textile Standards & Legislation is published to complement the associated TSL website – www.textilestandards.com – a fully searchable, regularly updated online tool which guides brands through the myriad of standards currently pertaining to the global textile industry. "Since we have a longstanding and positive relationship with the European Outdoor Group on sustainability initiatives, it was natural that both organisations would work together on the creation of the new Textile Standards & Legislation website. Combining the best elements of our well-known Eco-Textile Labelling Guide and the EOG's online SIGNS tool has now resulted in a powerful new web portal by two leading organisations that have sustainability embedded into their DNA," said John Mowbray, Founder and Director of MCL Global. "If you want your business to comply with the relevant social and environmental issues, need to minimise risk in your supply chain, avoid reputable damage to your brand, or have decided to source your products in a more responsible manner – then TSL is a fantastic and trusted information resource for your business," he said.
TSL is a partnership between MCL News & Media – the leading media platform for the textile supply chain – and the European Outdoor Group, which with over 80 brand and retail members, undertakes a number of innovative projects for the benefit of the European outdoor industry. TSL combines all the best elements of the previously published Eco-Textile Labelling Guide from MCL and the SIGNS tool developed by the European Outdoor Group. The guide was first published back in 2009, then known as the Eco-Textile Labelling Guide. There is currently no other printed guide of this nature in the market place, but with a limited print run we encourage people to order now in order to avoid disappointment.
SOURCE: The Ecotextile
Voicing concern over sharp decline in cotton production and area under cotton cultivation, Senate Standing Committee on Textile Sector in Pakistan has called on the government to take up special measures to arrest the downward trend. Pointing out that 80 % of cotton crop was used for generating export-oriented products, Senator Mohsin Aziz, who presided over the committee meeting on Tuesday said, farmers were switching over to other cash crops such as maize and sugarcane as they were not receiving fair price for their produce. Already the Textile industry was facing severe hardship due to the absence of an exclusive textile policy, he said and warned that the declining trends would affect exports adversely. The committee was informed that cotton production in Punjab last year fell 43 % compared to the preceding year, mainly due to unprecedented rains in the area. In Punjab, cotton cultivation acreage fell to 430,000 acres this year as compared to 540,000 acres last year, media reports said. Noted Textile industrialist Mr Akbar Seth, who was invited as special guest in the committee, claimed that last year growers had to face Rs 22 billion worth of losses due to price variation in the open market.
Arguing that per acre cotton yield was among the lowest in Pakistan compared to other nations. mainly because there was no genuine seed company in Pakistan, Seth said government should focus on introducing latest seed technology and distribute certified seeds among growers to increase per acre yields. According to the Cotton Commissioner, Mr Khalid Abdullah there were about 750 registered seed companies in Pakistan that were meeting 50% of the demand, while the remaining demand was being met by sowing of uncertified seeds. Keeping in view the shortage of raw cotton in the country, the committee recommended the Federal Board of Revenue (FBR) to review the 5 % import duty on cotton and place it in the zero-rated regime. While the Chairman of FBR, Mr Nisar Muhammad Khan said that the import duty on raw material used for textile industry was entitled to refund, the committee argued that the process of refund was very cumbersome.
SOURCE: Fibre2fashion
All Pakistan Textile Mills Association (APTMA) has urged the government to immediately remove 4 percent customs duty and 5 percent sales tax on the import of cotton in order to enable the spinning industry function properly. “The destruction of local industry is not in the interest of growers as well as the downstream sector, and such temporary benefits will result in long-term losses,” APTMA chairman said in a statement issued on Wednesday. He said the export of cotton yarn had come down by almost 32 percent in the first 11 months of 2105-16 as compared to the corresponding period of the last year. The chairman also expressed surprise and disappointment over the statement of the FBR chairman in which he had hinted that further tax could be levied on the unregistered sector. He said the zero-rating facility had also been given in the past and was nothing new. “The reason for seeking this facility is that billions of rupees (refunds) of the exporters are still held up by the FBR and the industry is not able to compete because of severe liquidity crisis,” he said, and added, “It is the responsibility of the FBR to ensure that refunds of exporters are released in time, but since this is not being done the industry has no choice but to demand zero-rating.” The APTMA chairman also said that during discussions with the government in the presence of all textile sector associations, representing the entire chain and attended by Finance Minister Ishaq Dar and Special Assistant to the Prime Minister on Revenue Haroon Akhtar, zero-rating had been agreed upon for both registered and unregistered sales, and that all industrial raw materials, both imported and local, would be exempted from the sales tax. “It seems this agreement is now being overlooked to prevent zero-rating facility from becoming successful,” he apprehended. He urged the finance minister to ensure that the spirit, in which this facility had been offered, should remain intact to ensure its success.
Furthermore, the APTMA chairman also criticised PRGMEA’s for demanding removal of regulatory duty on the import of cotton yarn. He said that India was dumping yarn in Pakistan at subsidised rates, which is why the government took the step to impose regulatory duty. He said that more than 80 percent of yarn was imported under DTRE scheme, and, therefore, the duty was not a problem for genuine exporters belonging to the value-added sector. He urged the government to provide an enabling environment to the local industry so that it could be able to compete with its regional competitors and work for the enhancement of exports.
SOURCE: The Nation
The prices of cotton yarn 10 count single yarn have increased by around 25 percent to reach Rs11500 per bag of 100 pounds from Rs9950 during the last one-and-a-half months and same is the case with other varieties of yarn, including 16 count 30 yarn and 16 count 20 yarn due to cartelization of local manufacturers who are taking advantage of 10 percent additional regulatory duty on the import of yarn. Pakistan Readymade Garment Manufacturers and Exporters Association (PRGMEA)Chief Coordinator Ijaz Khokhar asked the government to take preventive measures, as the export target of $25 billion could not be achieved in the last fiscal year, 2015-16, due to high energy cost and discriminating import duties on industry raw material. Prgmea appealed to the government to abolish additional regulatory duty on cotton yarn so that it could be imported from anywhere in the world, as the whole value-added apparel sector had been hit hard, especially due to limited availability of cotton which was being exported without any hindrance. Ijaz demanded that the government should also impose a ban on the export of raw cotton and cotton yarn for a short period till the arrival of new crop to rationalize the rates of yarn in the local market. Since the apparel sector already had a very limited production line owing to lack of latest fabric varieties at local level, harsh duties had resulted in a significant decline in apparel exports. Ijaz said that apparel industry was already confronted with low productivity due to shortage of cotton, high energy cost, and discriminating import duties on the industry’s raw material. He urged PM Nawaz Sharif to personally direct policymakers to work for reduction in all input costs; otherwise the export-oriented industries would not only close down, but millions of workers would also lose their joy. The PM had committed to hold meetings with people associated with export-oriented industries on a quarterly basis. However, no such meeting has been held so for, leading to massive decline in exports. They don’t see any improvement in the present scenario; rather further deterioration is on the cards, as the textile ministry is still without its minister. The government is called upon to take drastic steps for enhancing exports and addressing the problems of the industrial sector.
The value-added textile industry demands that the government appoints textile minister immediately, as uncertainty was negatively affecting the whole textile sector, which had more than 54 percent share in total exports of the country. Ijaz said that all the regional competitors, including India, China and Bangladesh had separate ministries for the textile sector, and Pakistan must follow suit. PRGMEA strongly feels that if the Ministry of Textile is given full powers, and a minister is appointed immediately, it can alone, in consultation with the stakeholders, reduce trade deficit by enhancing textile exports sharply. PRGMEA chief pointed out that the textile had become the most important sector, especially after grant of the GSP Plus status to the country by the EU countries, as 80 percent items, having free market access, were related to this sector and, therefore, it needed an extraordinary focus.
SOURCE: Yarns&Fibers
The US looking towards doubling its export of cotton to Bangladesh over the next five years, which we feel is possible as Bangladesh is the number one importer of cotton now, said CCI President Keith T Lucas Lucas. Last December, Bangladesh became the largest cotton importer worldwide with China stopping cotton imports due to its previous stockpiling. Moreover, with the country's aim to hit $50 billion in garment exports by 2021 is also an important factor for higher cotton consumption. They are expecting the global demand for textile will increase between 5 to 6 percent year-on-year and the cotton demand to 1 or 2 percent globally every year, Lucas said. According to Bruce A Atherley, executive director of CCI, the export arm of National Cotton Council of America, currently, the US exports 160,000 bales of cotton in a year to some Bangladeshi spinning mills, which is only 3 percent of the total consumption of cotton by the country in a year. If Bangladesh's garment exports increase at the targeted rate of 12 percent, the country's cotton consumption will increase by 10 percent, Atherley said. Cotton consumption in Bangladesh has been increasing because almost all globally renowned apparel retailers like H&M, Zara and Walmart purchase garment items from Bangladesh in bulk.
With higher demand for garment items from international retailers, the backward linkage industries like spinning, dyeing, finishing, weaving and printing industries have developed lots in Bangladesh. The local spinners can meet 90 percent of the demand for raw materials by the knitwear sector and the weavers can supply 40 percent of the demand for woven sector, according to industry insiders. Atherley said that they have the opportunity to expand their business in Bangladesh as the US produces one of the finest varieties of cotton. Bangladesh has a rich history in cotton use. It is very important for the US cotton. Bangladesh imported 5.75 million bales of cotton last year and it may cross 5.9 million of bales in next year. The cotton year starts on August 1 and ends on July 31. Since 2009, when the prices of cotton increased abnormally, China started stockpiling cotton and last year they stopped importing altogether to clear the stock. Currently, China has 60 million bales of cotton in stock, which is nearly half the global demand. However, China will have to import its minimum quota of cotton at 4.5 million bales to help maintain stability in the global market, as per the revision done this year to the law of cotton trade, according to Atherley. China uses 30 million bales of cotton in a year, making it the biggest consumer of the natural fibre in the world. But 10 years ago, China used to consume 50 million bales for having higher number of mills. China is also the highest consumer of polyester fibre, and currently China alone manufactures 75 percent of the global demand for polyester. They like Bangladesh because cotton consumption here has been increasing every year, whereas in other countries it is decreasing because of the use of polyester fibre. Atherley said that the demand for US cotton is higher because the fibre is very consistent, clean and dependable. Cotton export by the US varies with production, he said.
Domestic consumption of cotton in the US is 3.6 million bales a year, while production last year was 12.5 million bales. In the upcoming harvest, the US is expecting cotton production at 15.8 million bales. At present, Bangladesh imports 50 percent of its total demand for cotton from India, which might change in the near future seeing the neighbouring country's spiral in consumption.
SOURCE: Yarns&Fibers
Thailand’s Ambassador Suchart Liengsaengthong disclosed at a meeting with Lahore Chamber of Commerce and Industry (LCCI) Vice President Nasir Saeed at the chamber on Monday that the two countries, Thailand and Pakistan are in the midst of talks on a Free Trade Agreement (FTA) which is expected to be signed by the end of this year. The ambassador said that after signing of the FTA between the two countries trade would flourish. Such tools were important in today’s world because they would bring down the cost of doing business and remove non-tariff barriers. He noted that the SouthEast Asian nation is already investing in Pakistan and more Thai companies are keen to start their operations in the Asian country. Also a high level business delegation from Thailand would be visiting Pakistan in the first week of August. The delegation would have people from various sectors. He invited the LCCI to take a trade delegation to Thailand to explore trade, investment and joint venture opportunities there. He said that textile and tourism sectors of Pakistan were vibrant and that Pakistan could learn a lot from Thailand in the tourism sector.
Although Pakistan faces unfavourable balance of trade with Thailand, consistent rise in bilateral trade is considered a positive sign. Thailand is 34th among the top exporting countries for Pakistan, while it ranks 12th among the top importing countries. From 2013 to 2015 the bilateral trade increased from $833 million to$ 973 million. This expansion was largely caused by a considerable change in imports, which swelled from $716 million to $853 million. However, Pakistan’s exports could only scale up from $117 million to $120 million in this period. The two countries established diplomatic ties back in 1951 and both countries enjoyed steady economic and trade relations.
SOURCE: Yarns&Fibers
Origin Africa 2016 trade show is Africa’s Premier Trade Event that highlights the creativity and innovation of the African cotton, textile, clothing industries, home décor, machinery and technology, with a specific focus on business, trade and investment both regionally and internationally while capturing the spirit, style and innovation of modern Africa. Following a successful 2015 show in Addis Ababa-Ethiopia, Africa Cotton & Textile Industries Federation (ACTIF), Publi-Promo Ltd together with partners Madagascar Export Processing Zone Association (GEFP) are organizing ORIGIN AFRICA 2016 which will take place from the 3rd - 5th November, 2016 at the Forello Centre in Antananarivo, Madagascar. The Event promises you the most comprehensive International Trade Exhibition held in Africa, giving you an opportunity to understand the benefits of preferential trade agreements, the development of regional trading blocs & the encouraging investment conditions that make Africa "The Next Major Sourcing Destination".
SOURCE: Yarns&Fibers
