NATIONAL

• LS passes bill to provide tax incentives for garments sector
• Make in India disastrous for textile sector, helping only handful of corporate: Asaduddin Owaisi
• Textile exhibition begins at Texvalley
• Welspun to launch smart home textiles with patented technology
• Procedure for filing anti-dumping duty cases to be simplified
• Ease of doing biz: World Bank to wrap up ranking of Indian states by Aug-end
• India writes to Singapore, Japan and South Korea to recast investment deals
•  ‘Full impact of Brexit on India may take some time to unfold’

INTERNATIONAL

• Tunisian textile industry at risk due to anarchic importation and smuggling
• European Union: The Future Of U.K.-EU Trade: The Bilateral Trade Agreement Model
• Loss of EU single market will shrink UK GDP by 4%: IFS

Textile Raw Material Price 2016-08-10

Source: Global Textiles

Note: The above prices are Chinese Price (1 CNY = 0.15013 USD dtd. 11/08/2016)

The prices given above are as quoted from Global Textiles.com.  SRTEPC is not responsible for the correctness of the same.

LS passes bill to provide tax incentives for garments sector

A bill to provide tax incentives to the garment sector and enable the government to raise customs duty on marble and granite from 10 to 40 per cent was approved by Lok Sabha today after Finance Minister Arun Jaitley said these measures will help in creating jobs and protect domestic industry from import surge. The Taxation Laws (Amendment) Bill, 2016 also seeks to expand the definition of “demerger” with a view to facilitate the splitting or reconstruction of erstwhile public sector companies. The changes in the Income Tax Act will give effect to the conditions attached to the transfer of shares by the government, Jaitley said, adding it would enable the Centre to make use of land belonging to the erstwhile VSNL which has remained with the government following privatisation of the telecom PSU 14 years ago. The taxation amendment bill, which provides for three changes, was passed by the Lok Sabha by voice vote after a short debate.

As regards the garment sector, the bill eases the condition for availing tax incentives under Section 80JJAA of the Income Tax Act, 1961. “In view of the seasonal nature of the business of the manufacturing of apparel, there is need to reduce the period of employment of an employee who is employed in this business from 240 days to 150 days,” said the state of objects and reasons of the Bill. The incentive, Jaitley added, is aimed at making Indian “apparel industry competitive, so that they are able to make the cost advantage. I am sure with these incentives, the industry would be able to contribute a large number of jobs.” As far as customs duty on marble and granite is concerned, he said the measure will give flexibility to the government to raise duty to WTO bound rate of 40 per cent with a view to protect domestic industry from the onslaught of import

SOURCE: The Financial Express

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Make in India disastrous for textile sector, helping only handful of corporate: Asaduddin Owaisi

Making a strong appeal to the government to remove anti-dumping duty on synthetic yarn, Hyderabad MP and All India Majlis-e-Ittehadul Muslimeen (AIMIM) President Asaduddin Owaisi on Wednesday said the government's 'Make in India' policy is proving disastrous for the local textile industry. "The government's Make in India policy is helping just a handful of corporate. It is destroying the local textile industry", Owaisi said in the Parliament on Wednesday. "Distressed people in Malegaon, Bhiwandi, Surat, Sholapur and other textile centers are looking at us with hope and anticipation. The government should without further delay remove the anti-dumping duty on the synthetic yarn imported from China", he said. Owaisi was referring to a government GR dated October 21, 2015 wherein it has imposed anti-dumping duty on imports of All Fully Drawn or Fully Oriented Yarn/Spin Draw Yarn/Flat Yarn of Polyester (non-textured and non POY). "Because of this government policy, the cost of grey fabrics produced in the country is going up by about 30%. On the other hand, countries like China, Sri Lanka, Bangladesh and Pakistan are given free run to export their produce in India.

Giving a brief overview of the textile industry, Owaisi said there are about 2.5 million power looms in India providing livelihood to more than 6.3 million people. "Textile sector is largest after agriculture. But today the sector is struggling because of governments disastrous policy", he said. "Local manufacturers cannot compete with them because they are forced to buy expensive yarn due to the anti-dumping duty", he said. "The government should remove the anti-dumping duty on yarn, and instead impose a duty on import of fabrics coming from China, Pakistan, Bangladesh and Sri Lanka", he reiterated. Demand to remove anti-dumping duty on yarn is being raised from various circles including Federation of Surat Textile Traders Association (FOSTTA), Malegaon Industries and Manufacturers Association (MIMA), Bhiwandi Powerloom Federation and other organisations working for the industry. The textile industry in India is in recession mode since two years now. Those associated with the industry said they had not seen such a situation in last 30 years.

SOURCE: The Ummid

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Textile exhibition begins at Texvalley

Textiles and Garments Fair 2016, a buyers and sellers meet envisaging booking of garments for Deepavali by retailers with top-notch wholesalers, got off to a start at Texvalley Complex, India’s largest fully-integrated wholesale textile market at Gangapuram along the Salem-Cochin Highway. Nationally renowned garment manufacturers from all over Tamil Nadu, Ernakulam, Bengaluru, Ahmedabad, Mumbai, Jabalpur Nagpur, Kolkata, Amaravathi, Mangalagiri, Chanderi and Delhi have exhibited their products in 200 stalls.

Choices

Retailers will enjoy the advantage of making their choices out of all kinds of men’s, women’s and children’s wears in trendy designs and vast varieties that have been competitively priced. The three-day event culminating on Friday will be absolutely buyer-centric. Business trips for sourcing of garments and textiles by multi-brand outlets, large format stores, franchisees, retailers, wholesalers/ distributors, marketing agencies, chains stores, import agencies and liaison offices have been reduced to just a single visit to Texvalley, the organisers said.

Support

The event is supported by Trade Promoters, Tirupur Garment Manufacturer Association, Textiles and Garment Manufacturers Association and Ilam Vanikar Nalam Nadum Sangam in Erode, Tamil Nadu Readymade Garments Manufacturers Association, Tamil Nadu Textile Merchants Association Limited, Cumbum Area Apparels Manufacturer and Trader Association, and Hyderabad-based Garments Manufacturer and Wholesalers Association. fibre2fashion.com is the digital partner and The Textile Magazine the media partner.

SOURCE: The Hindu

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Welspun to launch smart home textiles with patented technology

Home textiles maker Welspun plans to launch a series of smart textiles with patented technology, the company said while formally announcing the patented HygroCotton technology by its premium brand Spaces Home & Beyond.  "We have filed for 26 patents globally and would launch smart textile products using this technology over the next three years," said Subrata Pal, business head (domestic and supply chain global) at Welspun Global Brands Ltd.  Although HygroCotton products were launched in the United States by Welspun about four years ago, the company recently introduced these to the Indian market. HydroCotton bed linen is all-cotton textile that regulates temperate while the towels with a hollow core cotton yarn are ultra-soft and get loftier with each wash, according to the company.  "HygroCotton products comprise 25% of our US portfolio currently and are recording a 15% year-0n-year growth," Pal said.

SOURCE: The Economic Times

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Procedure for filing anti-dumping duty cases to be simplified

After pruning the list of products under minimum import price (MIP) and imposing anti-dumping duty of select countries, the government will now work to streamline the procedure for filing and initiating anti-dumping duty cases. This is likely to benefit the $100-billion domestic steel sector, which is facing an onslaught of cheap imports, Steel Secretary Aruna Sharma told reporters here on Wednesday on the sidelines of the international conference on minerals, metals, metallurgy and materials. “The commerce and finance ministries have been very supportive and, for the first time, we've been able to bring such a large chunk under anti-dumping duties. Having said that, it is very important to do the homework well and bring as many as under anti-dumping duty,” said Sharma. She said the government would take at least two months to finalise the process. For safeguarding the domestic steel industry, the better way to go about is through ADD and safeguard duty. MIP is a short-term measure, it is like an SOS," said the secretary. "The government is analysing the models across the globe and will see which models are the fastest to get relief and better," Sharma added. The government recently extended the MIP norms to 66 steel items for two more months, pruning the existing list of 173 products. The government also imposed an ADD for six months on import of hot-rolled steel products from six nations, including China and South Korea, to shield domestic manufacturers.

SOURCE: The Business Standard

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Ease of doing biz: World Bank to wrap up ranking of Indian states by Aug-end

The World Bank is likely to wrap up its ranking of Indian states by the end of August on reforms undertaken by them on the ease of doing business. “States have submitted about 7,000 items of information regarding the reforms they have undertaken on the ease of doing business. The World Bank team has already reviewed and approved some 3,000 items. We expect the whole process to be over by the end of this month. Till then, the rankings displayed on the portal are only temporary,” Ramesh Abhishek, department of industrial policy and promotion (DIPP) secretary, told FE. According to the real-time ranking of states displayed on a website run by DIPP, Jharkhand, Madhya Pradesh and Andhra Pradesh led the pack of states (as of 6.30 pm on Wednesday) in implementing reforms on the 340 issues flagged jointly by the states and DIPP. Though states were asked to submit relevant documents by July 7 on reforms undertaken by them until June 30, the window for the resubmission of clarifications would be open until August 16. Gujarat, which had occupied the top slot in last year’s ranking, is placed at number 7, up from the 12th spot around a month ago. Last year, NDA-ruled states occupied the top six slots. The Centre has asked the World Bank to rank states on the ease of doing business for the next three years to ensure non-partisan nature of such an exercise. Last year, when states were ranked for the first time on ease of doing business, DIPP, industry chambers CII and FICCI, and consultancy firm KPMG — apart from the World Bank — were involved in the rigorous exercise. The rankings are an assessment of the regulatory performance of states and a measure of how they improve over a period of time.

Importantly, the rankings don’t accurately reflect the level of business-conducive nature of the states; rather, it shows how the states fared in implementing an action plan adopted by them with the help of the Centre within a particular time frame. The ranking is based on indicators, including the ease of starting a business, registering a property, getting credit, paying taxes and resolving insolvency. Abhishek said India is also hopeful of improving its rank among other nations in the World Bank’s Ease of Doing Business Index. Last year, India was ranked 130th in the World Bank’s index covering 189 countries, an improvement of four notches from a year before. While India improved its rank on three counts — starting a business, getting construction permits and accessing electricity, it witnessed its performance worsen in two areas — accessing credit and paying taxes. “We certainly hope to better our ranking this year. There is a lot of progress on ground. The World Bank team had come and they have sought some more information (on the reforms undertaken) from us. We are in the process of providing those to them,” Abhishek said. The reforms by the states are expected to brighten India’s chances of a better rank this time around.

SOURCE: The Financial Express

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India writes to Singapore, Japan and South Korea to recast investment deals

India has turned its attention to comprehensive economic partnership agreements with Singapore, Japan and South Korea after having fixed the loopholes in the much-abused investment treaties with Mauritius and Cyprus. The government has written to the three nations, seeking recast of the existing investment deals to allow for national treatment to foreign investors only after they have established their businesses in India, officials said. The current pre-establishment provision in these agreements allows foreign investors to be treated on a par with domestic companies even before they invest in India, putting the country at risk of international litigation by potential foreign investors. Singapore, Japan and South Korea are likely to be big investors in India's infrastructure in the coming years. "We want to align all bilateral agreements with the new draft...The commerce ministry is taking up the issue with all trade partners with whom we have comprehensive partnership agreements to ensure they are in line with the new model," said a senior government official, who did not wish to be identified. The finance ministry, on its part, has already written to all the nations with which India had inked a bilateral investment pact, seeking to nullify it and to ink a fresh one. Since comprehensive economic partnership agreements are administered by the commerce and industry ministry, it has been entrusted with the job of amending the investment components in these pacts. After witnessing an increase in arbitration cases, India had in December 2015 amended the draft of model bilateral investment treaty that makes it mandatory for foreign investors to exhaust local judicial remedies before seeking arbitration. The model bilateral investment pact offers foreign investors treatment on a par with their local counterparts after establishment of their business in the country.

SOURCE: The Economic Times

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‘Full impact of Brexit on India may take some time to unfold’

The full impact of the UK’s decision to exit European Union on India may take some time to unfold, Commerce and Industry Minister Nirmala Sitharaman said today. “The opportunities for India would depend on Great Britain’s negotiations of terms of exit with the European Union and their future negotiated trade relations,” Sitharaman said in a written reply to the Rajya Sabha. India is negotiating broad-based Bilateral Trade and Investment Agreement (BTIA) with the EU.She said the BTIA negotiations began in 2007 with sixteen rounds of negotiations concluded so far.

Three rounds of stocktaking meetings have also been held recently, she added. On other FTAs, she said that India is negotiating a trade pact with Israel. The eighth round was held in Israel from 24-26 November 2013 wherein discussions took place on market access in goods, rules of origin, custom procedures and trade in services, she said. Also, the minister informed that a Joint Study Group (JSG) has been set up for considering the feasibility of entering into an FTA between India and Eurasian Economic Union (EaEU) comprising of five countries – Russia, Belarus, Kazakhstan, Armenia and Kyrgyzstan. The first meeting of the JSG with EaEU was held on July 31, 2015. An FTA is also being negotiated with the Gulf Cooperation Council (GCC) which comprises Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and United Arab Emirates. Replying to a separate question, she said as on March 31, 204 Special Economic Zones (SEZs) are functional. Maximum number of operational zones are in Tamil Nadu (36) followed by Telangana (26) and 25 each in Maharashtra and Karnataka.

SOURCE: The Financial Express

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Tunisian textile industry at risk due to anarchic importation and smuggling

The Tunisian textile industry’s local production that currently accounts for only 20 percent of the goods available for purchase on the local market is threatened by uncontrolled imports and smuggling, said Habib Hzami, general secretary of the general federation of textile, clothing and leather and footwear at the Tunisian General Labour Union (UGTT), on Sunday. He added that more than 300 companies operating in textile, clothing, leather and footwear were closed during the last five years and about 40,000 employees lost their jobs due to anarchic importation without respecting the quota principle. The proliferation of smuggling and parallel trade today has created threaten to the survival of several companies in the sector, including those producing mainly for the local market. Hzami also said that Tunisia's textile industry continues to survive thanks to exports , which translates exports worth 1.2-1.6 billion euros, or four per cent of Tunisia's total exports. Tunisian textile industry that has approximately 1,000 fully exporting companies of which 50 percent of companies operating in the sector show over three percent annual growth.

SOURCE: Yarns&Fibers

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European Union: The Future Of U.K.-EU Trade: The Bilateral Trade Agreement Model

In the aftermath of Brexit, the United Kingdom is faced with the challenge of negotiating a relationship with the European Union that balances Single Market access with national control over the movement of goods and workers. This article is the last of a four-part series examining the three models for a future U.K.-EU relationship. Previously we have provided an overview of the three models as well as close-ups on the “Norway Model” and the “Swiss Model.” Here, in our final installment, we analyze the “Bilateral Trade Agreement Model.” We identify the main features, benefits and drawbacks.

What is the Bilateral Trade Agreement Model?

Under the Bilateral Trade Agreement Model, the United Kingdom would negotiate a comprehensive free trade agreement (FTA) with the European Union, as opposed to a series of bilateral treaties (e.g. the Swiss Model). This model may offer some flexibilities not afforded in other models. Recent EU FTAs with South Korea and Canada provide two prominent examples of what could be possible for the United Kingdom. The EU-South Korea FTA took effect in July 2011, and eliminated duties for industrial and agricultural goods in a progressive approach. The agreement also addresses non-tariff barriers to trade, specifically in the automotive, pharmaceutical, medical device and electronics sectors. South Korea agreed to liberalize access for some services sectors, namely some professional services, telecommunications, environmental, transport and financial services. While the EU-Canada Comprehensive Economic Trade Agreement (CETA) is not yet in force, it could be the closest approximation to the final outcome of an EU-U.K. agreement. The proposed text of the agreement will eliminate nearly all tariffs; open bids for government contracts to cross-border entities; liberalize financial, investment and some professional services sectors; harmonize some professional qualifications; and strengthen cooperation between European and Canadian standard-setting bodies. Canada has committed to upholding EU standards for goods and services traded in the EU markets.

What are the potential benefits for the United Kingdom?

An U.K.-EU FTA would likely at least provide for tariff-free trade in goods. Recent EU FTAs have provided for liberalization in some, but not all, services sectors—a concession the United Kingdom would want to push heavily for, given the importance of its services industries. Under an FTA, the United Kingdom would be bound by EU standards for any goods or services supplied to the EU, but it would not otherwise be subject to EU policies or the four fundamental freedoms—free movement of goods, services, workers and capital. The United Kingdom would regain control over its immigration policies. New migrants, including those from the European Union, would need to qualify under United Kingdom Immigration Rules. This would likely stem or cease the net in-flow of unskilled workers. The United Kingdom could concurrently relax immigration requirements for skilled workers to attract skilled migrants. The United Kingdom would also gain greater control over regulatory policies, which could result in some cost savings relative to current EU regulations. Policy areas with the greatest increase in self-determination would include social, employment, health and safety, environment and climate change. The United Kingdom would not be obligated to contribute to the EU budget, an annual cost savings of approximately £96 per capita, based on last year’s net United Kingdom contribution.1

What are the potential drawbacks for the United Kingdom?

As noted above, the United Kingdom would still be required to implement EU standards on goods or services traded in the EU markets. As with the other models, the United Kingdom would have no voice in the creation of those standards without representation in Brussels. Increased regulatory independence in the United Kingdom could also result in divergence between U.K. and EU regulatory policies over time. This could result in increased non-tariff barriers to trade. FTA negotiations with the EU could be lengthy. CETA is one of the most comprehensive modern trade agreements, which is reflected by the length of negotiations. CETA talks began in 2007 and concluded in late 2014, but the date of signing was just proposed by the European Commission earlier this month—a total duration of almost eight years. The EU-Korea FTA talks were significantly shorter, beginning in May 2007, and concluding just three years later in October 2010. Under an independent FTA with the European Union, it is unclear the extent to which the United Kingdom could remain party to EU trade agreements with other countries. The United Kingdom would likely need to assess its status and position with respect to each agreement. If these agreements were not applicable to a future United Kingdom, trade with the implicated countries would revert to the less favorable World Trade Organization (WTO) terms.

Overall Assessment

Negotiation of an FTA may provide additional flexibilities for U.K.-EU trade relations. However, it is also the approach most vulnerable to the domestic political environment. It remains unclear whether the United Kingdom would be willing to reduce tariffs to zero, particularly in sectors, such as agriculture, that have powerful lobbies. With respect to the European Union, any U.K. terms would need to pass muster with all 27 remaining member states, which would be far from a frictionless process. An agreement could be comprehensive or limited to certain sectors. As with the Swiss Model, the more substantial the agreement, the more the United Kingdom would need to be abide by EU regulations. The strength of the United Kingdom’s bargaining position with respect to the inclusion of services, specifically financial services, in an FTA is unclear. At best, the United Kingdom could achieve the same level of access its firms currently enjoy. At worst, an FTA would leave out services entirely, which would undermine the attractiveness of the United Kingdom as a financial and business center.

SOURCE: The Mondaq

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Loss of EU single market will shrink UK GDP by 4%: IFS

One of the U.K.'s leading research institutions has placed the value of European single market membership at an additional 4 percent to the country's economy. The EU single market goes further than most trade deals, allowing the free movement of both goods and services between countries. It also seeks to tackle regulatory barriers such as licensing. On 23 June the U.K. public voted in favor of leaving the European Union , throwing in to doubt whether Britain can retain full membership of the single market or if the country will now seeks an 'access only' deal. If the U.K. can join the European Economic Area (EEA) this would allow near-full benefits of the single market but would also mean an EU budgetary contribution and would likely oblige Britain to accept free movement of people. A new report by the Institute of Fiscal Studies (IFS) has put a GDP value on the single market status for the U.K when compared to access achieved thorough the World Trade Organization (WTO), such as is enjoyed by the US, China or India. "Maintaining membership of the single market as part of the EEA could be worth potentially 4 percent on GDP – adding almost two years of trend GDP growth – relative to WTO membership alone," the report reads. Financial services are a famously strong aspect of the United Kingdom's economy. The study suggest that the financial sector could be 'disproportionately damaged' outside the single market, placing it some 7 percent smaller by 2030.

Public finances impact

The IFS report also spells out the implications for the UK's public finances by leaving the EU. "On top of the £24–31 billion weakening of the public finances by 2020 from the short-term impacts of leaving the EU for an EEA or FTA scenario, WTO membership would leave the government needing to find a further £4–8 billion, and more in the long term." The IFS paper is also skeptical that the United Kingdom can fully compensate for the lack of EU membership by fostering new deals with other countries. "Even if U.K. exports to China grow in line with strong Chinese economic growth through to 2030, export levels are unlikely to reach anywhere near current levels with the U.S. or EU."

SOURCE: The CNBC

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