Synopsis The finance ministry's economic review for January states that there is potential to enhance India's exports by adding more quality and complexity. Despite global trends affecting foreign direct investment (FDI) flows to India, the country remains an attractive destination. FDI inflows have increased to 2.5% of GDP in FY15-23 compared to 2.2% in FY05-14. There is scope to add more quality and complexity to India’s exports, given the existing capabilities, the finance ministry said in its economic review for January. It also said that despite subdued global trends dictating the course of foreign direct investment (FDI) flows to India lately, the country continues to chart its way forward and remain a preferred destination. The FDI inflows were 2.5% of GDP in FY15-23 as against 2.2% in FY FY05-14, it said.
Source: Economic Times
New Delhi: The textile ministry is expected to get a marginal budget increase of 2.5% for the fiscal year 2025, taking its allocation to ₹4,500 crore, two persons aware of the matter said. The proposed budget for the upcoming fiscal year shows an increase of ₹110 crore compared with the current fiscal year’s allocation of ₹4,389 crore. While the government aims to position India as a global player in textiles, the marginal uptick in allocation may pose a challenge to the ministry in utilizing its budget effectively. However, the continued budget boost, even though marginal, shows the government’s commitment towards developing and promoting the textile sector to enhance India’s global standing in this industry. Queries sent to the ministries of finance and textiles remained unanswered till press time. In fiscal year 2021-22, the ministry received a budgetary allocation of ₹11,059.81 crore, which was further increased by over 10% to ₹12,382 crore in 2022-23. However, the ministry faced a massive 71% cut in its revised budget estimate, plunging the outlay to ₹3,579 crore in 2022-23. The marginal rise in the budgetary allocation will not impact the progress of the Pradhan Mantri Mega Integrated Textile Region and Apparel (PM MITRA) scheme as its outlay of ₹4,445 crore is sanctioned for five years till 2027, one of the persons cited above said. The government is aiming to position itself as a textile sourcing and investment destination through seven PM MITRA parts and plans to seek an investment of ₹70,000 crore in the next five years, this person said. The government is also looking to attract foreign direct investment (FDI) through the PM MITRA and several other schemes. The domestic apparel and textile industry contribute approximately 2.3% to India’s gross domestic product, constitutes 13% of its industrial production and plays a pivotal role by contributing 12% to the country’s export revenue. India commands a 4% share in the international trade of textiles and apparel. To foster private equity investments and boost employment opportunities, the government has strategically introduced several initiatives, including the Scheme for Integrated Textile Parks and the Technology Upgradation Fund Scheme. The government is doing several other things as well to help the textile sector. The ministry has added 43 new partners under the Samarth scheme for capacity building in the textile sector, the second official said, adding that it has approved projects for research and development and is spending $7.4 million on it. Some of the major schemes implemented by the textiles ministry are the national handloom development programme, the mill gate price scheme/yarn supply scheme and the handloom weavers’ comprehensive welfare scheme, among others.
Source: Live Mint
The Indian textile industry, aware of the government's limitations in the proposed interim budget for fiscal 2024-25, still holds certain expectations that should be prioritised. Industry leaders have suggested that the Remission of Duties and Taxes on Exported Products (RoDTEP) scheme be extended until September 30, 2024, allowing the industry to continue functioning until a new government is formed following the upcoming general election. Key industry representatives have highlighted additional issues that need addressing in the upcoming Union budget. Sanjay Jain, managing director of TT Limited and former chairman of the Confederation of Indian Textile Industries (CITI) told Fibre2Fashion that the RoDTEP scheme is set to conclude in June 2024. He advised that the government should prolong the scheme until the end of September 2024, allowing the incoming government to make a final decision. This scheme offers rebates on various central, state, and local duties/taxes/levies not refunded under other duty remission schemes. Jain noted that the government, presenting a vote of account before the general election, might prefer maintaining the status quo but could address urgent matters. He also suggested the urgent removal of import duties on cotton and cotton waste, as Indian cotton prices might rise to global levels in the coming months due to a reduced domestic crop.
Sanjay Garg, managing director of Longowalia Yarns Limited and president of the North India Textile Mills Association (NITMA), stated that restructuring import duties on knitted fabric is an urgent concern. The industry suffers from the dumping of cheaper knitted fabrics from China and other countries, damaging local industry. Garg also highlighted the revenue loss to the government exchequer from under-invoicing imported knitted fabrics, exploiting gaps in current policy. He urged Union Finance Minister Nirmala Sitharaman to come up with certain provisions to regulate imports in the industry. Although GST is not within the central government's purview, he believes the government should address the long-standing issue of the inverted tax structure on textile products.
Kailash K Lalpuria, executive director & CEO of Indo Count Industries Limited told Fibre2Fashion, "We are eagerly anticipating the upcoming budget and hope for a visionary approach that meets the diverse needs of the textile industry. We look forward to measures supporting sector growth and addressing key challenges.”
Lalpuria highlighted the importance of initiatives that foster industry expansion and tackle prominent obstacles. “Stabilising raw material prices, strengthening supply chains, and improving textile infrastructure are crucial for business empowerment and contributing to the nation's economy. We trust that the budget will reflect these expectations, leading to a strong and sustainable future for the textile industry,” he added.
Speaking to F2F, Dr. Yamunadutt Agarwal, chairman, Jindal Textile said that no major policy decisions can be taken in interim budget. “Full-fledged budget can only take a call on this by the new government. Interim budget however will talk about the performance vis a vis budgeted for fiscal 2023-24. It may also talk about buoyancy in tax collection etc and make known its intention to invest heavily in infrastructure sector and more particularly in ports and airports and it will also talk about employment generation because of such investments.”
He said that the government is also expected to target fiscal deficit of 5.3 per cent of GDP and if that indeed happens then inflation can be curbed, and rate cut cycle can start. At the time of full budget (after general election), there could be many expectations like increase in IT limits, higher allocation for MANEGRA, more interest subvention for exports, increased import duty on imported goods to encourage Indian manufacturers to produce in India, higher MSP for agricultural products, more thrust on employment generating industries by increasing subsidy amount and many such measures.
Source: Fibre2fashion
Prices may go up because of higher energy costs, caused by the rise in shipping charges, with commercial vessels taking a longer route to avoid the troubled Red Sea region, the finance ministry said on Monday. Iran-backed Houthi rebels of Yemen are repeatedly attacking ships in the Red Sea. While the global economy is grappling with challenges such as sticky inflation, sluggish growth, and mounting fiscal pressure, India’s external sector could face “potential risks” due to the ongoing geopolitical tensions, according to the finance ministry’s report on the review of the Indian economy. The Red Sea is vital for 30 per cent of global container traffic and 12 per cent of global trade. As much as 80 per cent of India’s merchandise trade with Europe passes through it. While freight and insurance premiums have risen, taking the Cape of Good Hope route has resulted in a longer transit time. According to Nomura, so far, the automotive and retail sectors are most affected by shipping delays, with production cuts in the auto sector. Europe is most impacted, given its dependence on Asia for supplies. “The economic impact (on Asia) depends on the duration of these disruptions (which is uncertain) and whether it also extends to oil prices (not yet seen). We see some downside risks to near-term growth, due to higher import costs and delayed export shipments, as well as potential production delays, while firms may want to maintain higher inventory,” Nomura said in note.
EXPORTS, BALANCE ON CURRENT ACCOUNT
The finance ministry further said though India’s export performance had been “remarkable” as outbound shipments hit a record high in the last two financial years, the pace of growth moderated in FY23 due to persisting geopolitical tensions, such as the Russia-Ukraine conflict. The moderation further continued till November 2023 mainly on account of weaker global demand. The share of exports in gross domestic product (GDP) is also estimated to moderate from FY23 to FY24, as a slowdown in global demand has led to a decline in the demand for India’s exports, it said. “Despite global shocks, India’s merchandise trade balance improved markedly from a deficit of $189.2 billion in April-November 2022 to $166.4 billion in April-November 2023 as a result of the decline in imports,” the report said.
Source: Business Standard
Tamil Nadu economy may grow to $2.6 trn by 2047-48: Report Videos Synopsis Tamil Nadu's GSDP is projected to reach USD 2.6 trillion by 2047-48, requiring a capital expenditure of USD 111 billion. The state is the second-largest economy in India, contributing 8.8% to the nation's GDP. To achieve the projected growth, the state needs to increase its allocation for capital expenditure to 5.7% of GSDP. Tamil Nadu's nominal Gross State Domestic Product (GSDP) is estimated to expand to around USD 2.6 trillion by 2047-48, from USD 294 billion last fiscal, but the state will need to allocate capital expenditure of USD 111 billion to realise this potential growth, according to a report by CREDAI and Knight Frank. Real estate consultant Knight Frank in association with realtors' body CREDAI's Tamil Nadu Chapter on Monday released a report 'Tamil Nadu: Unveiling Economic Dynamism and Future Potential'. "Tamil Nadu stands as the second-largest state economy in India, contributing 8.8 per cent to the nation's GDP. In FY 2023, the state GDP is estimated to have expanded to USD 294. "Over the 10-year period before the onset of the COVID-19 pandemic (FY 2009-2019), Tamil Nadu's economy experienced an average annual growth rate of 11 per cent," the report said. At this pace of growth, Tamil Nadu's Gross State Domestic Product (GSDP) is likely to expand to USD 2.6 trillion by 2047-48, it added. "Currently, the state government of Tamil Nadu has been allocating 4.8 per cent of its GSDP towards the Capital expenditure (capex), which largely includes allocation towards infrastructure development in the state. "To achieve its projected economic growth of USD 2.6 trillion by FY 2047-48, it is essential to enhance the allocation for capital expenditure (CapEx) to 5.7 per cent of the GSDP. Over the cumulative period spanning from FY 2025-48, the state should undertake a total CapEx of USD 111 billion," the report said. Shishir Baijal, Chairman and Managing Director, Knight Frank India, said Tamil Nadu has consistently stood out as one of the most economically advanced states in India, making substantial contributions to the national GDP. Its economic structure is well-balanced across primary, secondary, and tertiary sectors, fostering stable growth. "To realize this growth potential, the state must strategically invest in industrialisation and urbanisation... This investment will facilitate the envisioned economic growth across sectors including real estate," he said. Agriculture, services, manufacturing, and others play crucial roles in driving the state's economic prosperity. Presently, the services sector stands out as the primary catalyst, contributing 53 per cent to the overall economic growth of Tamil Nadu.
Source: Economic Times
The Indian economy is expected to expand at around 7 per cent in FY25, the finance ministry’s review of the economy estimated on Monday.This, the government said, will mark the fourth consecutive post-pandemic year for the Indian economy to register growth at or over 7 per cent. “It now appears very likely that the Indian economy will achieve a growth rate at or above 7 per cent for FY24, and some predict it will achieve another year of 7 per cent real growth in FY25 as well. If the prognosis for FY25 turns out to be right, that will mark the fourth-year post-pandemic that the Indian economy will have grown at or over 7 per cent. That would be an impressive achievement, testifying to the resilience and potential of the Indian economy. It augurs well for the future,” the finance ministry said in a report titled “The Indian Economy: A Review”. However, the finance ministry clarified the report was not the customary Economic Survey, which will be presented after the Lok Sabha elections and before the full Budget. Union Finance Minister Nirmala Sitharaman will present the Interim Budget for FY25 on Thursday. The National Statistical Office, in its First Advance Estimates, has estimated India’s economy to grow at 7.3 per cent in FY24, higher than the forecast made by various national and international agencies. The report, authored by a group of economists in the finance ministry led by Chief Economic Adviser V Anantha Nageswaran, said there was “considerable scope” for the growth rate to rise well above 7 per cent by 2030 on the strength of the financial sector and other recent and future structural reforms. “Only the elevated risk of geopolitical conflicts is an area of concern. Exporting one’s way to growth will not be easy. This reinforces the need to lower logistics costs and invest in product quality to hold on to and expand market share in areas where India has an advantage,” it added. The report said the Indian economy would face three key challenges in the coming years — slower growth in global trade; impact of artificial intelligence on trade in services, and employment; and energy transition. “The Indian economy is better placed than ever to take on these three key challenges because of the policies adopted and implemented in the last decade,” Nageswaran wrote in the preface to the report.
Source: Business Standard
Kanpur: Superhouse Group, a renowned name in the global leather and textile industry, on Monday signed a memorandum of understanding (MOU) with Uttar Pradesh Textile Technology Institute with an aim to foster research and promote entrepreneurial activities in the field of textile. Yusuf Amin, director of the Superhouse Group, stated that this partnership with Uttar Pradesh Textile Technology Institute marks a significant step forward in our commitment to innovation and sustainable practices in the textile industry. "By combining our industry insights with UPTTI's academic excellence, we aim to drive positive change and contribute to the evolution of technical textiles," Amin said. Nalankilli, director of UP Textile Technology Institute said UPTTI has a legacy of over a century in shaping the textile landscape. “Our collaboration with the Superhouse Group is a testament to our dedication to staying at the forefront of technology. Together, we will create a robust platform for research, innovation, and entrepreneurship in the realm of technical textiles,” he said. Tnn.
Source: Times of India
The National Conference on Technical Textiles served as a platform for knowledge exchange, networking, and the exploration of avenues to propel the Technical Textiles sector forward. The Ministry of Textiles, in collaboration with the Government of Andhra Pradesh, orchestrated a one-day National Conference on Technical Textiles. This significant event, supported by the Indian Technical Textile Association, took place on January 29, drawing attention to the evolving landscape of Technical Textiles and aiming to pave the way for progressive policy frameworks. The collaborative efforts between the Ministry of Textiles and the Government of Andhra Pradesh are expected to contribute significantly to the growth and development of this dynamic industry.
Insights from Rajeev Saxena, Joint Secretary, Ministry of Textiles
Rajeev Saxena, the Joint Secretary at the Ministry of Textiles, Government of India, took the opportunity to provide a comprehensive overview of the diverse applications of Technical Textiles. He underscored the potential markets that exist for these textiles and encouraged industries to actively participate in the upcoming BHARAT TEX 2024 mega event. Saxena urged companies to leverage this platform to showcase their innovative ideas and contribute to the advancement of Technical Textiles.
Panel Discussions Unveil Key Topics
The conference featured panel discussions that delved into various critical topics, including:
Strategies for Circular Economy Experts explored strategies to promote a circular economy within the Technical Textiles sector, emphasizing sustainability and efficient resource utilization.
Sustainability in Technical Textiles Discussions centered around sustainable practices, highlighting the importance of environmentally friendly approaches in the production and application of Technical Textiles.
Trends of Technical Textiles in the Future Eminent speakers, scientists, and industrialists explored the future trends in Technical Textiles, discussing innovations and potential breakthroughs. G Amarnath, Minister of Industries, Infrastructure, Investment & Commerce, Information Technology, and Handlooms & Textiles, Government of Andhra Pradesh, emphasized the paramount importance of Technical Textiles. He extended a warm welcome to prospective investors, including Foreign Direct Investment (FDI), recognizing the sector's potential for economic growth.
K Sunitha, Principal Secretary to the Government of Andhra Pradesh for Handlooms & Textiles, Industries & Commerce Department, provided insights into the state's initiatives for the development of the Micro, Small, and Medium Enterprises (MSME) sector in Handlooms & Textiles. She also highlighted emerging opportunities within the Technical Textiles domain.
Source: Krishi Jagar
Industries Minister Gudivada Amarnath has said the government is prepared to provide necessary incentives for the development of the technical textiles sector in the State, while asserting that Andhra Pradesh (AP) has land and other resources and a conducive business environment needed for the flow of foreign investments. Participating as the chief guest at a one-day conference organised as part of the National Technical Textiles Mission here on Monday, Mr. Amarnath said the Central government should be more flexible in attracting foreign investments and make certain changes in the EXIM policy in order to realise India’s potential as a global investment destination.
Single window system
He said the Andhra Pradesh government was giving approvals through a single window system, like no other State in the country has been able to do, to give a fillip to the State’s industrial sector, and that there was abundant land that was well-connected for the establishment of industrial units. Textiles Ministry Joint Secretary Rajiv Saxena said efforts were being made to spread awareness on the technical textiles sector and encourage entrepreneurs, and stressed the need for skilled manpower. A sum of ₹1,000 crore was allocated for R&D in the area of technical textiles that have a wide range of applications, he said, adding that special attention was paid to the development of markets and promotion of exports and start-ups. AP Government Principal Secretary (Handlooms and Textiles) K. Sunitha said there was tremendous scope for the promotion of agro-textiles in the State and there were proven means to increase the production of crops, reduce water consumption by up to 45%, and fertilizer use by at least 25%. Indian Textile Association president Avinash Misar said there was no dearth of marketing if technical textile products were brought out in accordance with national and international regulations and laws. AP Government Commissioner of Handlooms and Textiles M.M. Naik noted industrialist Ajay Shiroshi and others spoke.
Source: The Hind
The central government has implemented a new rule for the assessment year 2024-25 under which buyers must pay for goods bought from MSMEs within 45 days of delivery and clear all dues to MSMEs before March 31, 2024, failing which the pending payment will be deemed to be income on which tax will be levied. While the government’s intent is to protect MSMEs, this has caused uncertainty in the market and Ahmedabad’s textile markets are seeing cancellation of orders. Some chemical traders are also feeling the effect. Some buyers have decided not to buy goods before Feb 16 to ensure that their payment deadline comes after March 31. The textile value chain on the other hand operates on a credit period of up to 120 days, so this rule has affected it the most. One of the expert said, “We will call a meeting of all associations to discuss the situation emerging from this rule. There are many order cancellations being witnessed. “Former chairman of the Powerloom Development and Export Promotion Council (PDEXCIL), said, “The move intends to help MSME units but the immediate reaction is totally different. In the textile business, the norm is a credit period of 120 days, so making payments within 45 days to MSMEs will be difficult and impractical. We have seen that several traders have cancelled recent orders, and many have stopped buying goods from MSME manufacturers at least till Feb 16, so that their payments fall due only in the next financial year. These issues need some clarity.” Another expert said, “New purchases have dipped after the rule was introduced. Customers are now buying goods from large and medium units. Many trades operate on credit periods of up to 120 days, so many such businesses have cancelled orders. “Secretary of the Gujarat Dyestuffs Manufacturers’ Association (GDMA), said, “In the chemical industry, the credit period offered is about 60 days but as demand is low this period is often extended. As the new rule has been implemented, many buyers are inquiring with sellers if they are registered as MSMEs or not.”
Source: A2Z News
The Ministry of Textiles organised one day National Conference on Technical Textiles with Government of Andhra Pradesh for Advancing Policy Pathways in Technical Textiles today in Vijayawada, Andhra Pradesh. The event was supported by Indian Technical Textile Association. Shri Rajeev Saxena, Joint Secretary, Ministry of Textiles, Government of India, briefed about different applications of Technical Textiles and emphasized the prospective markets in Technical Textiles. He urged the industries present to participate in the upcoming mega event BHARAT TEX 2024 to showcase their ideas and innovativeness in Technical Textiles with increased participation. The panel discussions covered various topics viz. Strategies for Circular Economy, Sustainability in Technical Textiles, Agrotextiles, Geotextiles in Engineering Applications for Infrastructure Development along with Trends of Technical Textiles in future. The event augments the presence of eminent speakers, scientists, industrialists from different parts of India including Andhra Pradesh. Shri G Amarnath, Minister of Industries, Infrastructure, Investment & Commerce, Information Technology and Handlooms & Textiles, Government of Andhra Pradesh emphasized on the importance of Technical Textiles and welcomed prospective investors in Technical Textiles including FDI. Smt. K Sunitha, Principal Secretary to the Government of Andhra Pradesh for Handlooms & Textiles, Industries & Commerce Department enlightened the details of initiatives taken by the State Government for development of MSME sector in Handlooms & Textiles and specifying the emerging opportunities lying with Technical Textiles.
Source: India Education Diary
The 'Denim Technologies Special Section', which was opened for the first time at the ITM 2022, pleased its exhibitors with the number of visitors and sales figures. Hall 11A was opened at the ITM 2024 for denim technologies upon the high demand from companies that want to enlarge their stands. ITM 2024 International Textile Machinery Exhibition, which will be organized in partnership with Tüyap Tüm Fuarcilik Yapim A.S. and Teknik Fuarcilik A.S. and in cooperation with Textile Machinery and Accessories Industrialists Association (TEMSAD), will open its doors to its visitors between 4-8 June 2024 at Tüyap Fair and Congress Center. Exhibitors, which have achieved visitor numbers and sales figures above their expectations in the exhibitions they participated in the past years, have requested to enlarge their stands for ITM 2024.
Source: Fibre2fashion
Bangladesh Prime Minister Sheikh Hasina yesterday sought large-scale investments from British investors, promising to offer them a dedicated special economic zone (SEZ) if the latter show interest. She said this when a British cross-party parliamentary delegation led by vice chair of All Party Parliamentary Group (APPG) on Bangladesh and chair of APPG on Indo-British Virendra Sharma met her in Dhaka. The delegation is on a visit to the country from January 27 to 31, a news agency reported.As Bangladesh is well connected to South East Asia and South Asia, British investors will face no problems in finding markets for their goods, Hasina said. Her government has been trying hard to cut the procedural time to invest in Bangladesh, she informed the delegation.
Source: India Education Diary
The European Commission recently adopted five initiatives to strengthen the European Union’s (EU) economic security at a time of growing geopolitical tensions and profound technological shifts. The package aims at enhancing the EU's economic security while upholding the openness of trade, investment and research for the bloc’s economy, in line with the June 2023 European Economic Security Strategy, the Commission said in a release. The proposals are part of a broader three-pillar approach to EU economic security by promoting the EU's competitiveness, protecting against risks and partnering with the broadest possible range of countries to advance shared economic security interests. The initiatives aim at further strengthening the protection of EU security and public order by proposing improved screening of foreign investment into the EU and stimulating discussions and action for more European coordination in the area of export controls, in full respect of existing multilateral regimes and member states' prerogatives. These also aim at consulting with member states and stakeholders to identify potential risks stemming from outbound investments in a narrow set of technologies and proposing that the European Council recommends measures aimed at enhancing research security at national and sector level. Future EU actions will continue to be informed by the on-going risk assessments and by strategic coordination with member states to reach a shared understanding of the risks that Europe faces and of the appropriate actions, the release noted. The proposal ensures that all member states have a screening mechanism in place for foreign investments, with better harmonised national rules. It allows extending EU screening to investments by EU investors that are ultimately controlled by individuals or businesses from a non-EU country. The Commission's white paper on outbound investments has proposed a step-by-step analysis of outbound investments to understand potential risks linked to them.
Source: Fibre2fshion
Hanoi (VNA) – The garment and textile sector has set a target of 44 billion USD in export turnover this year, up 10% year-on-year. According to the Vietnam Textile & Apparel Association (VITAS), garment and textile exports last year reached 39.5 billion USD, down 10% year-on-year. VITAS Chairman Vu Duc Giang said that in 2023, Vietnam's textile and garment products were exported to 104 countries and territories – a record number. Businesses underwent significant changes, but they made efforts to diversify their exports with 36 items. The main markets of Vietnamese garment and textile exports were the US, Japan, the European Union (EU), the Republic of Korea, China, and Southeast Asia, together with some new markets such as Africa and Russia. VITAS Vice Chairman Truong Van Cam said that 2024 will still see many challenges for the industry, pointing to the extended producer responsibility (EPR) and the EU's carbon border adjustment mechanism (CBAM), as well as the strategy of “sustainable fashion” instead of “fast fashion”. To achieve its set goal, the industry is implementing various solutions, with a focus on diversifying customers, markets, and products; speeding up digital transformation; and greening production, said Cam.
Source: Vietnam Plus
Bangladesh Textile Mills Association (BTMA) Chairman Mohammad Ali has said that the production in the country’s textile mills has declined to 40 percent as a result of the ongoing gas crisis.“The country’s textile sector is facing extreme uncertainty due to high-interest rates on bank loans and the ongoing gas crisis,” Ali said while addressing a seminar in Dhaka on Monday.Ali expressed concern saying that if the crisis is not resolved immediately, the production capacity may decline further. Not only in the textile sector but owners of other factories are also compelled to halt their machines for half a day due to the gas crisis, he said. Both production capacity and export orders are equally declining, raising concerns about employment opportunities in the textile sector, said the business body leader. Specially, the factories located in Savar Ashulia and Dhamrai area are facing an acute crisis of gas, Ali said. Besides, household users are suffering immensely from low gas pressure because even if the gas is available in the line for a while at night, the stove gas disappears in many houses before the start of the day. To cope with the situation, some households choose to cook late at night, others wake up before dawn amid the severe winter, and some have already purchased electric stoves, while others have bought LPG cylinders for their homes.
Source: Daily Sun
KARACHI: The All Pakistan Textile Mills Association (APTMA) has devised a roadmap for the new government after general elections next month to take the country’s textiles and apparel exports to $50 billion from $25 billion in the next five years, the industry body said on Monday. A Pakistan textile labourer fixes broken threads at a power loom in Karachi, the financial capital and the largest industrial city of Pakistan. — AFP/File “The textiles and apparel sector, being the largest contributor to the country’s export earnings, possesses immense potential to drive Pakistan’s economic resurgence and to position itself as a global leader in textiles and apparel”, APTMA stated in a report representing a comprehensive and strategic roadmap towards realizing its vision.By focusing on export diversification, expanding manufacturing capacity, and fostering a competitive environment, the textile body aims to double its export manufacturing capacity from $25 billion to over $50 billion annually over the next five years.“This goal, while ambitious, is grounded in the reality of our capabilities and the untapped potential of our sector. This transformation is also critical, not just for the economic health of the sector, but for the overall stability and growth of Pakistan’s economy."It is one that requires us to leverage our strengths, confront our challenges head-on, and collaborate effectively across all levels of government, industry, and international partnerships. However, achieving this vision will require concerted efforts to address key challenges such as uncompetitive energy prices, liquidity shortages, high borrowing costs, and bureaucratic inefficiencie. The implementation of this policy agenda will demand unwavering commitment, innovative thinking, and collaborative action. It is a journey that we must embark on together – as an industry, as a nation, and as part of the global economy.
The textile body proposes that export diversification in the textiles and apparel basket to align with global market trends must be one of the top priorities of the government. A two-pronged approach must be taken in this regard. "The first step is to eliminate distortions and opportunities for rent-seeking by rationalizing the import duty on PTA and PSF and removing the anti-dumping duties. This will allow the industry to import cheap and high quality PSF and focus on downstream value addition, without having to invest billions of dollars in setting up PSF manufacturing capacity and increasing global value chain integration at the same time," APTMA said. "Second, the government must facilitate investment in developing MMF-based manufacturing capacity that is discussed in greater detail in the following section."APTMA also proposes that the government must engage international testing firms to facilitate domestic and foreign partnerships to increase the availability of testing facilities in Pakistan. "These facilities may be offered inside free commercial and industrial zones to facilitate agglomeration economies and well as create incentives for foreign testing firms to enter Pakistan, ultimately leading to knowledge transfers to domestic testing firms." It also calls for improving the efficiency and procedures related to transport and logistics which can significantly offset these costs, leading to improved export competitiveness. The textile body emphasizes the need for rationalizing power tariffs at levels that stimulate the economy and allow for sustained levels of higher power consumption and therefore higher power sector revenue. It also suggests the rationalization of the taxation regime, export marketing, dwell times at ports, supply chain traceability, etc. to boost the textile and apparel exports.
Source: PK The News
