The Synthetic & Rayon Textiles Export Promotion Council

MARKET WATCH 16 SEPTEMBER, 2016

NATIONAL

 

INTERNATIONAL

 

Textile package yet to significantly boost jobs, productivity

Two-and-a-half months after being approved by the Cabinet, the textile package announced by the government is yet to take off in terms of significantly creating jobs and improving production. Announced in June, the special package involves a total outlay of Rs 6,000 crore aimed at improving competitiveness and generating higher number of jobs through a string of labour reforms. However, in apparel manufacturing, the specific sub-sector within textiles targeted by the package, a significant rise in hiring is yet to happen under the new norms. Industry sources said that the textile commissioner office is currently consulting with all stakeholders to iron out the difficulties in implementing the new norms. These include issues over wages, allowances and other statutory dues paid to workers. Also, the Textile Ministry has fixed overtime hours for workers, not exceeding eight hours a week, in line with International Labour Organization norms. Manufacturers claim all this needs time to be incorporated in their operations. The package paved the way for fixed term employment in apparel manufacturing looking at its seasonal nature. While manufacturers have welcomed the move saying it allows them to deal with excess demand and idle labour issues at different times of the year, workers have argued it affects their livelihood. The Labour Ministry notification formalizing the rules for such employment was rolled out in early August allowing a months time for public comments. However, one of the major factors expected to boost hiring - increased government funding for provident funds of new employees, has also not started. The government currently bears 8.33 per cent of the employer's contribution. The Textile Ministry, will now provide an additional 3.67 per cent amounting to Rs 1,170 crore for first three years for every employee.

Ministry officials, under conditions of anonymity, said that disbursements under the new norms are yet to be made as companies have to submit their updated roll of employees. Also, the government will only pay for 'new' employees hired by firms provided they do not already have a Employee Unique Identification Number (EUIN), Rahul Mehta, president, Clothing Manufacturers Association of India said. The manufacturing cycles in the garment sector, which see a spurt in hiring is also out of sync with the new package. For apparel manufacturers, the festive season beginning August is the biggest draw for which manufacturing has ended by July. On the other hand, hiring by apparel exporters may pick up only by October-January, when exporters aim to meet demand from the North American and European markets, Chandrima Chatterjee, advisor to the Apparel Export Promotion Council (AEPC) said. With demand in the global markets remaining sluggish, that is also under question. Export of ready made textile garments rose by 6.70 per cent in August. Industry insiders, however, cheered a decision to extend incentives under the amended Technology Upgradation Fund scheme from 15 per cent to 25 per cent. The scheme, amended in December 2015, allows subsidy on capital investment to enterprises in the medium, micro and small sectors subject to a ceiling of Rs 30 crore over five years. Textiles Ministry officials said that this would allow owners to employ more. However, the subsidy will be disbursed only after the expected jobs are created. Any accruing benefits thus arising out of the textile package will be clear only by November-December, Binoy Job, secretary general at Confederation of Indian Textile Industries said. Any benefits accruing out of the textile package will reach manufacturers only by January, he added.

Also, to boost exports, the government extended the duty drawback scheme to a number of state levies. Duty drawback is refund of duties on imported inputs for export items. This move would cost the exchequer Rs 5,500 crore but would greatly boost the competitiveness of Indian exports in foreign markets. The government hopes it will lead to a cumulative increase of $30 bn in exports. Industry is gearing up for the $20-bn target set for this year," Ashok G Rajani, chairman of the Apparel Exports Promotion Council, said. With major global markets still recording negative growth and the Brexit uncertainty looming large, the package is timely, he said.Eom

Textile package

  • Govt announced Rs 6,000 crore special package for textiles aimed in June.
  • Package aims to improve competitiveness, boost investments and generate higher number of jobs through a string of labour reforms.
  • Manufacturers say issues over wages, allowances and other statutory dues payable to workers, fixed overtime hours under discussion with Govt.
  • Additional government funding for provident funds of new employees yet to start as companies have to submit their updated roll of employees.
  • Export of readymade textile garments rose by 6.70 % in August.

SOURCE: The Business Standard

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Exports contract 0.3% to $21.51 billion in August

Merchandise exports fell for the second consecutive month in August, going down by a marginal 0.30 per cent. Exports fell to $21.51 billion in August, against $21.58 billion in the corresponding period last year, government data showed on Thursday. In the month of July, exports had contracted 6.84 per cent, to $21.68 billion. Cumulative exports for the April-August period of FY17 stood at $108.51 billion, compared with $111.85 billion for the corresponding period in FY16. Imports also declined by 14.09 per cent to $29.19 billion in August, compared with the year-ago period, when it was $33.98 billion. Cumulative imports in the current financial year reached $143.18 billion, compared with $170.23 billion in the previous year.

Exports had contracted for 19 consecutive months till May this year, before rising marginally by 1.27 per cent in June. Compared to this, during the 2008-09 global financial meltdown, the decline was for nine months in a row.  In the last financial year (2015-16), total exports had stood at $261 billion. This was a 15.85 per cent decline from the over $310 billion worth of trade conducted by the country in the year before. While the government had targeted $300 billion of exports, the figure had to be revised downwards to $260-270 billion after merchandise trade remained negative throughout the last financial year. The fall in exports had reached its lowest possible levels and would start growing soon, commerce ministry sources said. Besides a global slowdown, the severe fall is attributed to global factors such as a decline in commodity prices and sluggishness in the Chinese economy, among others. Among major export items, outbound trade fell for 16 items, against 22 items in July.

Exports contract 0.3% to $21.51 billion in August Export of engineering goods made a comeback in the growth charts in August, rising 8.47 per cent after remaining depressed for months. It had fallen by 12.11 per cent in July.  Also, the fall in exports of drugs and pharmaceuticals, which had been mellowing in recent months, finally gave way to growth in August. It rose 0.67 per cent in August after a 0.07 per cent fall in the previous month. On the other hand, petroleum products continued to fall by 14.08 per cent, albeit lower than the 21.78 per cent fall seen in July. Exports of major exchange earners like ready-made textile goods and gems and jewellery also rose by 3.72 and 7.58 per cent, respectively. While textiles had fallen by nearly six per cent in June, gems and jewellery had risen by 8.80 per cent. “Non-oil exports recorded a small rise on a y-o-y basis in August 2016, led by items such as gems & jewellery, iron ore and engineering goods, although the sustainability of this trend remains to be seen.” Aditi Nayar, senior economist at ICRA said.

Reacting to the latest fall in export, President of Federation of Indian Exports Organization S C Ralhan said global trade outlook has improved but economic indicators from some advanced economies continue to be troubling. Non-oil and non-gold imports, taken as a proxy for an indicator of industrial demand, continued to decline, albeit at a slower pace of 1.52 per cent, reaching $ 21.34 billion in August from $ 21.67 billion a year before. It had declined by 9.9 per cent in the previous month of July. Gold imports continued to fall by a large margin for the seventh consecutive month, going down by 77.45 per cent to 1.11 billion as compared to the $ 4.95 billion worth of imports registered a year ago. Prices of the yellow metal had fallen by a large 63.65 per cent in the previous month of July. The cumulative deficit in merchandise trade for the current financial year for the months leading up to August was $34.66 billion. This was more than 40 per cent lower than the figure for the corresponding period in FY16, which was $58.38 billion. With net oil imports remaining relatively stable on a Year-on-Year basis, 80 per cent of this sizable fall can be attributed to lower gold imports, Nayar said.

SOURCE: The Business Standard

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Rupee swings on devaluation buzz

The rupee pared losses after a day of high drama that saw the finance ministry denying reports that the government may discuss a plan to devalue the currency. The rupee had risen to as high as 67.07 per dollar earlier in the day after a television channel reported that the finance and commerce ministries would discuss a calibrated devaluation of the rupee on September 20 to boost exports. Later, a wire agency quoted Commerce Minister Nirmala Sitharaman confirming this. The finance ministry, however, was quick in its response. "The value of rupee is determined by the market and there is no plan to change policy," Economic Affairs Secretary Shaktikanta Das told reporters. "Reports that the government wants to devalue the rupee are false."

Commerce Minister Nirmala Sitharaman also tweeted that she had not said that the government was discussing a devaluation. But her comments stopped short of denying the commerce ministry was weighing such a proposal. After the denials, the rupee started recovering and ended the day at 67.02 per dollar - a two-week low. Sources in the commerce ministry, however, said the ministry was insisting on a correct value of the rupee against other major currencies of leading trade partners. They are also planning to make a case for this with the finance ministry. But, no plan for devaluation was afoot yet.

Devaluation is a policy of reducing the currency value against foreign currencies. Depreciation refers to change in the value because of market forces. The rupee was last devalued in two phases in the early 1990s, when India was hit by a balance of payments crisis. It was first devalued from Rs 19.64 to the dollar in March 1991 and then to Rs 31.23, a year later. The total devaluation was 59.01 per cent. Rupee swings on devaluation buzz At present, commerce ministry officials said they were pressing for better exchange rate policy, along with the alignment of freight rates with global standards and a liberalised visa regime to boost shipments as there was been a continuous fall in the merchandise exports. The ministry had earlier also proposed a mechanism to ensure that the rupee-dollar exchange rate reflected the realistic value of the domestic currency and circulated a Cabinet note in June to seek views of different ministries. According to the proposal, such a mechanism, which would involve officials from the commerce ministry, the finance ministry and the Reserve Bank of India, should be under the department of economic affairs in North Block. "We have to adjust our exchange-rate policy. This is very important to increase competitiveness of our products. The exchange-rate policy should be based on inflation differential and trade deficit," a commerce ministry official said. However, finance ministry sources said the proposal was rejected outright by Finance Minister Arun Jaitley. Sources in the commerce ministry suggested the ministry might reach out to the finance ministry on the issue again. The commerce ministry had always supported a move to properly evaluate the current value of the currency, rather than supporting outright devaluation, said one source. The possibility of such a meeting has heightened after the issue was been debated in public. Commerce ministry sources refused to comment over the possible date of such a meeting. A finance ministry official, however, told Business Standard there is no such meeting scheduled on September 20. "Commerce Ministry pushes for all these things. There is no proposal to devalue," a key finance ministry official said. "Exporters would have come to the commerce ministry with this issue. However, there is nothing to discuss from our side," he said. The Cabinet note, floated by the commerce ministry in June, referred to a study by the economic policy think tank, Indian Council for Research on International Economic Relations, which had pointed out that as of March, 2015, the rupee was 10 per cent overvalued against the US dollar.

Professor Jaimini Bhagwati, one of the authors of the study, had told Business Standard, "We need to have a fairly balanced currency, which has implications across trade, investments and income. It is important to assess the conditions of the currency and appropriately value it, moving away from the debate over whether it should be weakened or strengthened." Bhagwati had pointed out the current time may be opportune for revaluating the rupee as oil prices were still low. Experts cautioned that weakening the value of the rupee would make imports costlier as well.

SOURCE: The Business Standard

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Rupee should weaken, but may not help exports: Experts

Amid the debate about whether the rupee should be depreciated sharply to benefit exporters, currency market participants are not sure it will boost India’s prospects of cornering a larger slice of the global market. However, the underlying message to the Reserve Bank of India (RBI) could be to lower rates. A low interest rate makes the country less attractive for foreign investors, which exerts further pressure on the rupee to depreciate. Going by the real effective exchange rate (REER), which measures the rupee’s strength against a currency basket of India’s trading partners, the rupee is overvalued. According to the Reserve Bank of India (RBI), the rupee’s REER value in a 36-currency export and trade basket was 115.43 at the end of the August. This means the rupee was overvalued by 15.43 per cent that month. In July the REER was 115.35, while in August 2015 the value was 114.81. In a six major currency basket, the rupee’s REER was 125.79, but to gauge export competitiveness, the 36-currency basket is the more apt. The rupee has always remained overvalued and the central bank is rarely seen allowing the REER value to cross 110. Whenever this level is crossed, the RBI has intervened to make the rupee stronger as that brings down import costs. And India always has been a net importer. However, now that import costs are low, thanks to cheap oil, there could be a case for bringing down the rupee’s value to aid exporters. “It is doubtful if a weak rupee really helps in boosting exports,” said Jamal Mecklai, head of Mecklai Financial Services. “This seems to be more political than anything else. It could be a way of pushing the RBI for a rate cut,” he added. Satyajit Kanjilal, head of Forexserve, said, buyers of Indian goods rarely allowed exporters to enjoy the benefits of a depreciating currency. If the rupee depreciates by, say, 10 per cent, the buyer usually offers 90 cents for the good he earlier bought at $1. “It is a zero-sum game. When we talk about sharp depreciation, we have to keep in mind a sharp reversal of fund flows too. The yen was 600 against the dollar in the 1990s and now it is 100, does that mean that Japan’s exports have fallen substantially? The quality of export matters,” said Kanjilal.

Indian exporters need the rupee to weaken to compete against Bangladesh and some other Southeast and East Asian nations that keep depreciating their currencies. But to do that, no outside mechanism is needed. In the face of increased inflows, which averaged about $1.5 billion a month in the last six months, the rupee will have to depreciate anyway. “It will happen and there is no need for a mechanism to depreciate the currency. So far the RBI has been intervening to prevent the rupee from depreciating sharply, now it may not want to intervene as much. But, the depreciation will have to be a gradual and guided one,” said Samir Lodha, managing director of QuantArt, a currency and risk management firm. Lodha sees the rupee hitting 70 to a dollar level in a few months if aggressive intervention is not pursued by the RBI. The rupee hit its record low of 68.85 a dollar on August 28, 2013.  The rupee has fallen 1.3 per cent in the year to date, whereas most other Asian currencies have appreciated against the dollar. The South Korean won and Indonesian rupiyah have appreciated more than 4 per cent each against the dollar. On Thursday, the rupee closed at 67.02, down from its previous close of 66.895 as talk of a possible rupee depreciation started doing the rounds.

SOURCE: The Business Standard

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India, Russia to put in place a 'Green Corridor' to enhance bilateral trade

India and Russia are trying to put in place a 'Green Corridor' between the two countries for smooth facilitation of goods to enhance bilateral trade that has performed far below potential despite the strong political ties. The issue figured -- ahead of the October annual Summit -- during the meeting between Russian Deputy PM Dmitry Rogozin and Indian foreign minister Sushma Swaraj here on Tuesday. The idea of Green Corridor was mooted by Russia's Federal Customs Service. It has proposed that the two countries create a list of entrepreneurs or companies whose goods, on a reciprocal basis, will not have to pass customs inspection during border crossings, according to sources familiar with the subject. Russia is already implementing the Green Corridor project with Finland and Turkey. Moscow has also signed such agreements with China and Italy. The Russian government considers Green corridors as one of the most important levers for increasing mutual trade. It has been learnt that India has shown interest in the project. The volume of current Indo-Russian trade is about $10 billion. Both countries have set a target to raise it to $30 billion by 2025, and mutual investment from $10 billion to $15 billion. "The main advantage of the 'green corridor' is that goods being transported by entrepreneurs will not have to undergo customs inspection and examination when crossing the border -- measures now commonly used to minimize risks. This also applies to documents. Samples and specimens will not be taken. The provision of original copies of documents is not needed, and so on," explained a person familiar with the matter.

Both parties would have lists of entrepreneurs or companies that customs services of the two countries characterize as "bona fide participants in foreign economic activities". To include one's name on the registry, a number of criteria need to be met: the company must have no outstanding unpaid customs duties and absence of rulings on administrative violations in the countries among which the project is being implemented. The mechanism itself should work as follows - an electronic pre-declaration is issued for the cargo, it is assigned a unique individual number in accordance with the identifier in the "green corridor" registry. The customs inspector thus already knows what goods are being shipped and does not need to inspect them -- then without stopping, the cargo passes through the customs clearance post. In addition, it is assumed that for green corridor participants, there would be a separate post and a special inspector to serve them at the customs terminal.

Meanwhile, Russia is keen to expand its footprints under the Make in India initiative. During the 5th meeting of India-Russia Working Group on Modernization and Industrial Cooperation here in August, both sides expressed interest in expanding cooperation between Russian and Indian companies in different sectors including mining, fertilizers and civil aviation. In the civil aviation sector, Russia is willing to develop Indian technical and production capabilities in this field, and potential supplies of the jointly produced equipment to third countries. Moscow has sought more information about Russian companies participating in the $90 billion Delhi-Mumbai Industrial Corridor. Russian truck manufacturer Kamaz wants to set up unit in India. India has expressed interest to jointly develop iron ore and coal mines in Russia, which will be high on the Modi-Putin summit agenda besides expanding Indian presence in the oil and gas sector of Russia. The volume of Indian investments in Russia's oil and gas sector could reach $15 billion in the next five years. Swaraj and Rogozin also discussed the issues of fast-tracking negotiations of the Joint Study Group on the proposed Free Trade Agreement (FTA) between India and the Custom Union (Russia, Belarus, Kazakhstan), hasten development of the International North-South Transport Corridor (INSTC), and upgradation of Chabahar seaport as scheduled by 2018 to improve connectivity to Central Asia and Russia.

SOURCE: The Economic Times

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Mauritius hopes to remain major FDI source to India

Mauritius today expressed hope to remain one of the biggest investment routes to India post revision of the bilateral tax treaty, as the two nations move ahead with talks on trade liberalisation pacts. After meeting Finance Minister Arun Jaitley, Mauritian Minister of Finance and Economic Development Pravind Kumar Jugnauth said the negotiations on Preferential Trade Agreement (PTA) and Comprehensive Economic Cooperation Partnership Agreement (CECPA)are moving ahead. "In fact, there is now a delegation from Indian side visiting Mauritius. There has been a preliminary draft agreement which will need to be further looked up and discussed. "We are looking forward that through that agreement we can extend opportunities for both Mauritius and India. We have to increase trade and investment," he said. When asked if FDI inflows to India from Mauritius will reduce following revision of the bilateral Double Taxation Avoidance Convention (DTAC), Jugnauth expressed hope that the island nation will continue to "play the role of the biggest investment route to India" because it benefits both the nations. "We need to monitor the situation and we will review and discuss as and when there is necessity," the visiting minister added. He said the two countries have successfully agreed for changes and the protocol on DTAC has already been signed. "We are looking now how to consolidate the relationship between India and Mauritius," he said.

After long-drawn negotiations, the amendment to the 1983 DTAC was signed by India and Mauritius in May. With the changes, India can impose capital gains tax on investments routed through Mauritius. For two years starting April 1, 2017, capital gains tax would be levied at 50 per cent of the prevailing domestic rate and after that, full rate would be applicable. Mauritius accounted for 33 per cent of the total FDI inflows to India during April 2000 to March 2016. Jugnauth also expressed hope that India would support Mauritius in number of major projects it was implementing.

SOURCE: The Economic Times

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Global Crude oil price of Indian Basket was US$ 44.44 per bbl on 14.09.2016

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$ 44.44 per barrel (bbl) on 14.09.2016. This was lower than the price of US$ 44.66 per bbl on previous publishing day of 13.09.2016.

In rupee terms, the price of Indian Basket decreased to Rs. 2975.88 per bbl on 14.09.2016 as compared to Rs. 2987.78 per bbl on 13.09.2016. Rupee closed weaker at Rs. 66.96 per US$ on 14.09.2016 as against Rs. 66.90 per US$ on 13.09.2016.. The table below gives details in this regard:

Particulars    

Unit

Price on September 14, 2016 (Previous trading day i.e. 13.09.2016)                                                                  

Pricing Fortnight for 01.09.2016

(Aug 11, 2016 to Aug 29, 2016)

Crude Oil (Indian Basket)

($/bbl)

                  44.44              (44.66)        

   46.20

(Rs/bbl

                 2975.88        (2987.78)       

3095.40

Exchange Rate

  (Rs/$)

                  66.96              (66.90)

   67.00

SOURCE: PIB

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Taiwan textile firms set sights on Muslim world

Two Taiwanese textile firms have set their sights on the Muslim world, which accounts for about a fifth of the global population, by introducing new technology and innovative designs to appeal to the demographic, market sources said Friday. The population of the global Muslim world ranges between 1.2 billion and 1.6 billion, the sources said, adding that the two firms have embraced high hopes about the Muslim market and have faith that local technology and designs will attract buying in that segment. One of the two Taiwanese firms is Rui Yuan Co., which has sent a delegation to demonstrate its products to appeal to potential Muslim buyers at Texworld Paris, one of the most important trade shows for the global textile industry, which kicked off on Sept. 12 and will run through Sept. 15. The Taiwanese company, which specializes in garments made from functional fabrics, has brought Muslim headscarves to the trade exhibition in Paris. "A female Muslim owns an average of 40-50 headscarves. They tend to buy new headscarves to replace some of their old ones every two to three months, so we have spotted the tremendous business opportunities in this regard," Rui Yuan executive Li Chih-ming told CNA Friday.

Li said that the company has found many female Muslims in Asia own headscarves which are not good at dispersing heat. He added that his company can use niche technology to develop products made from functional fabrics which keep the wearer cooler. Li said that Rui Yuan has recruited designers from Malaysia to produce headscarves with special patterns for female Muslims, adding that the new headscarves are expected to allow these female Muslim clients to feel comfortable while wearing them. "The large Muslim population has strong buying power. To my knowledge, many of them are willing to spend and it is a market which is worth exploring for us," Li said. "Taiwan has technology to produce functional fabrics but many Taiwanese firms simply cater to sports brands, so Rui Yuan is determined to introduce innovative headscarves to female Muslims." So far, Rui Yuan has started its marketing campaign in the China and Malaysia markets for its female Muslim headscarves.

In addition to participating in Texworld Paris for the first time ever to boost its global visibility, Rui Yuan is planning to extend its reach to the U.K. market in the near future to secure more orders, Li said. For its part, Universal Textile Co. showcased its "abaya", which is a simple, loose over-garment, essentially a robe-like dress commonly worn in the Muslim world, at Texworld Paris. Traditional abayas are black and are made from a large square of fabric which may be draped from either the shoulders or head. Chen Yi-hsiang , a manager with Universal Textile, said that since the Jasmine Revolution, which ousted Tunisia's dictator in 2011, many consumers in the Muslim world have started to favor abayas with more colors and various patterns. Chen said that customers of Universal Textile have made requests to buy newly designed abayas instead of the traditional low-profile black pattern and the company is trying hard to meet the changing demand.

SOURCE: The Focus Taiwan

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Federal Government of Nigeria to use local textile for military, paramilitary uniforms

The federal government says plans are underway for Nigerian military and para-military personnel to use made in Nigeria textile for their uniforms. The Minister of Trade, Industry and Investment, Hajiya A’isha Abubakar,  said this, yesterday, in Benin at the 28th Annual National Education Conference of the National Union of Textile, Garment and Tailoring Workers of Nigeria (NUTGTWN) and the Nigerian Textile, Garment and Tailoring Employers Association (NTGTEA).

Represented by a director in the ministry, Barnabas Jattau, Hajiya A’isha said:  “The government is presently discussion with the Nigeria Customs Service (NCS) on how to stop smuggling of textiles materials into the country through the nation’s border posts.” “The other plan is to reduce production cost, especially the cost of gas. We are working out ways to change gas pricing from dollar to naira.” She said that the government, worried by the state of textile industry in the country, would revive the sector by ensuring that made in Nigeria textile was patronised by Nigerians. Earlier, the President of the NUTGTWN, John Adaji, urged the federal government officials to wear clothing from fabrics made in Nigeria to encourage local textile manufacturers. He advised President Muhamadu Buhari to shift from rhetoric to practical actions on the nation’s textile industry, saying that his achievement would be measured by the success he recorded in reviving the textile sector. Also speaking, the Director General of the NTGTEA, Hamman Kwajjaffa, said that poor electricity supply remained major challenge in reviving the ailing textile sector. He condemned smuggling of textile goods from Asia and other parts of Europe into Nigeria.

On his part, the General Secretary of NUTGTWN and National Vice President, Nigerian Labour Congress (NLC), Isa Aremu, said that the recent re-orientation campaign launched by Buhari should be embraced by especially  members of his cabinet.  “The new change mantra must start from the textile industry with the president, vice president and ministers wearing made in Nigeria textiles,” he said.  “Our school uniforms, military and para-military uniforms, uniforms of the NYSC should be made in Nigeria with Nigerian fabrics, we must patronise our produce at home.”

SOURCE: The Daily Trust

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Smart textiles to give $130 billion boost to flagging wearables market by 2025

Smart textiles are creating a fourth industrial revolution for the textiles and fashion industry worth over US$ 130 billion by 2025, according to the recent report from technology consultancy Cientifica. Advances in fields such as nanotechnology are creating a range of textile–based technologies with the ability to sense and react to the world around them. According to Cientifica, the rapid adoption of smart textile technologies has the ability to make the current generation of wearables from Apple and Samsung quickly obsolete, while providing significant opportunities in the sportswear market.

From wearables to disappearables

Instead of attaching a sensor to a garment, the sensor is increasingly the garment itself, providing significant opportunities in health and wellbeing, sports, medical monitoring, fashion and entertainment. The report tracks over a hundred of the leading companies in a sector predicted to show triple digit growth, and examines issues ranging from data acquisition to energy storage and generation. “With most people never out of Bluetooth range of their smartphones, the use of smart textiles makes the idea of miniaturising a subset of smart phone components and wearing it on the wrist completely unnecessary. As a result, wearables will become disappearables,” commented Tim Harper, report lead author.

Textile–based technologies

Advances in fields such as nanotechnology, organic electronics and conducting polymers are creating a range of textile–based technologies with the ability to sense and react to the world around them. This includes monitoring biometric data such as heart rate and respiration, or environmental factors such as temperature and the presence of toxic gases. These textiles also have the ability to provide real time feedback in the form of haptic feedback, changes in colour, temperature or electrical stimuli. The report identifies three distinct generations of textile wearable technologies. First generation is where a sensor is attached to apparel and is the approach currently taken by major sportswear brands such as Adidas, Nike and Under Armour. Second generation products embed the sensor in the garment as demonstrated by products from Samsung, Alphabet, Ralph Lauren and Flex. In third generation wearables the garment is the sensor and a growing number of companies including AdvanPro, Tamicare and BeBop sensors are making rapid progress in creating pressure, strain and temperature sensors. The report identifies third generation wearables as representing a significant opportunity for new and established textile companies to add significant value without having to directly compete with Apple, Samsung and Intel.

Rise of textile wearables

The rise of textile wearables also represents a significant opportunity for manufacturers of the advanced materials used in their manufacture. Toray, Panasonic, Covestro, DuPont and Toyobo are already suppling the necessary materials, while researchers are creating sensing and energy storage technologies, from flexible batteries to graphene supercapacitors which will power tomorrows wearables.

SOURCE: The Innovation in Textiles

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FTA With Vietnam Set To Boost European Retailers

The EU’s free trade agreement with Vietnam will boost European growth and job creation in the retail sector, as well as the development of Vietnam, according to EU trade negotiators, experts and business leaders. Speaking at an event by the Mission of Vietnam to the EU and BusinessEurope on 14 September in Brussels, the chief negotiators and ambassadors from both sides were joined by leading EU trade association representatives in urging for the speedy ratification and entry into force of the agreement. “The EU retail sector has a double interest in Vietnam as it is our second largest source of fast-moving consumer goods after China and because of growing interest for investment in retail stores in Vietnam,” said Pierre Gröning, trade policy director at the Foreign Trade Association. The scale of the potential gain for the sector is enormous. “For retail, the FTA with Vietnam is more important than TTIP [with the US], CETA [with Canada] and the Japan agreement combined,” said Mr. Gröning.

EU retailers currently import 8% of fast-moving consumer goods from Vietnam, a figure still well behind the 50% imported from China, but growing fast and set to get a boost from the elimination of tariffs under the FTA, which would lower costs for importers and European consumers. Among key export items, garments and textiles witnessed an increased turnover of $15.5 billion, up 4.2% year-on-year in the first eight months of 2016, and footwear ($8.6 billion, up 8.1%). Even without the FTA, EU clothing imports from Vietnam increased by 3.2% in 2015. Given the sensitivity of the sector, the full elimination of the tariffs will be staged over seven years. Rules of origin conditions for garments will require the use of fabrics produced in Vietnam, with the only exception being of fabrics produced in South Korea, another FTA partner of the EU.

The Vietnamese market is also increasingly attractive to European producers and retailers. The FTA will give tariff-free access to a market of 90 million consumers – with a middle class expected to reach 30 million by 2020 – to European products including cars and motorbikes, pharmaceuticals and alcoholic beverages. Goods produced in Vietnam will have duty-free access to the 630 million plus strong Asian Economic Community and with the impending Trans-Pacific Partnership to the largest free trade area in the world. “Vietnam is a very attractive destination for investment,” said Vietnamese Vice-Minister for Trade and Industry Mr. Tran Quoc Khanh. “Anything produced in Vietnam enjoys tariff-free export to most of world.” The agreement is also expected to boost Vietnam’s development, already considered an exceptional success story, with per capita income rocketing from US $100 in 1986 to US$2,100 in 2015. “Development has been driven by economic growth and economic growth has been driven by exports. We [the EU] pushed for a move from development aid to trade and Vietnam responded,” said EU Ambassador to Vietnam Bruno Angelet. The first comprehensive trade agreement the EU concludes with a developing country, the FTA includes a strong chapter on sustainability.

SOURCE: The Textile World

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