The Synthetic & Rayon Textiles Export Promotion Council

MARKET WATCH 13 DEC, 2016

NATIONAL

 

INTERNATIONAL

 

Textile Raw Material Price 2016-12-12

Item

Price

Unit

Fluctuation

Date

PSF

1132.75

USD/Ton

0.19%

12/12/2016

VSF

2193.11

USD/Ton

0%

12/12/2016

ASF

1852.93

USD/Ton

0%

12/12/2016

Polyester POY

1165.32

USD/Ton

0.62%

12/12/2016

Nylon FDY

2895.20

USD/Ton

2.04%

12/12/2016

40D Spandex

4299.37

USD/Ton

0%

12/12/2016

Polyester DTY

5464.69

USD/Ton

0%

12/12/2016

Nylon POY

1404.17

USD/Ton

1.04%

12/12/2016

Acrylic Top 3D

2707.01

USD/Ton

1.08%

12/12/2016

Polyester FDY

2026.64

USD/Ton

0%

12/12/2016

Nylon DTY

1505.50

USD/Ton

0.97%

12/12/2016

Viscose Long Filament

3068.91

USD/Ton

1.44%

12/12/2016

30S Spun Rayon Yarn

2851.77

USD/Ton

0%

12/12/2016

32S Polyester Yarn

1766.07

USD/Ton

0.41%

12/12/2016

45S T/C Yarn

2605.68

USD/Ton

0%

12/12/2016

40S Rayon Yarn

1910.83

USD/Ton

0.76%

12/12/2016

T/R Yarn 65/35 32S

2214.83

USD/Ton

0%

12/12/2016

45S Polyester Yarn

2996.53

USD/Ton

0%

12/12/2016

T/C Yarn 65/35 32S

2243.78

USD/Ton

0%

12/12/2016

10S Denim Fabric

1.33

USD/Meter

0%

12/12/2016

32S Twill Fabric

0.82

USD/Meter

0%

12/12/2016

40S Combed Poplin

1.15

USD/Meter

0%

12/12/2016

30S Rayon Fabric

0.65

USD/Meter

0%

12/12/2016

45S T/C Fabric

0.64

USD/Meter

0%

12/12/2016

Source: Global Textiles

Note: The above prices are Chinese Price (1 CNY = 0.14476 USD dtd. 12/12/2016)

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

 

Government mulls imposing dumping duty on Chinese cloth

The government is working on a policy to limit the flow of cheap cloth in India for which it is contemplating imposing a “dumping duty” on cloth that comes from China. A policy regarding the issue would soon be made in the Parliament, said Union Textile Minister Smriti Irani on Saturday. The minister also visited several powerlooms in Bhiwandi in Maharashtra and interacted with the workers ensuring them about reviving the sector. The minister, while talking about her meeting with the textile councils, scheduled for next week, said that she would also be meeting industry representatives from the textile towns in Bhiwandi, Malegaon, Icchalkaranji and Coimbatore.

Kapil Mital, BJP MP from Bhiwandi was a part of minister’s delegation on Saturday. Talking about the hardship workers have to face because of cloth imported from China, he said that the government is working on changing the existing policy where cloth is imported from China and instead impose a dumping duty on imports. According to one of the powerloom owner, Sharandram Sejapal Irani was the first union textile minister to ever visit Bhiwandi. Irani was shown around the plant where she inspected the machines that were shut down due to these problems. Sejpal demanded that the sector sees a boost in exports and Chinese cloth is stopped from entering the country. He said that the minister has also promised to address the issue of hike in electricity prices.

According to Purushottam Vanga, Vice Chairman, Powerloom Development & Export Promotion Council, about 60 percent of the 7 lakh powerlooms are lying shut because of demonetization and around 80 percent of their workforce are migrants and half of them have returned home simply because their payments, which is made in cash, twice a month, could not be made. Vanga also said that the minister has promised to address the issue of decreasing sales of readymade cloth in the market following demonetisation. Irani during her visit finding that many of the workers do not yet have a bank account said that she would be speaking to the district magistrate and chiefs of all banks to quickly open accounts. She also said that forms of 2,000 workers has already been submitted to banks and once the bank accounts open, she assured that the workers would be taught to operate the services through smartphones.

SOURCE: Yarns&Fibers

Back to top

Telangana to soon announce handloom policy

The Telangana government will soon announce a handloom policy that will incorporate establishment of 12 handloom clusters in the state, Telangana minister for textile and handlooms KT Rama Rao has said. This policy will also focus on the development of handloom products and the weaver community in the state along with the welfare of workers. The handloom policy will provide health insurance and pension facilities to the workers and their family members, according to media reports. Of the 2,000 textile looms in Pochampally Textile Park, only 250 looms are working. The government will grant aid for the development of the Textile Park, said Rao during his trip to Pochampally Textile Park in Yadadri-Bhuvanagiri district. He also visited the textile parks in Malkapur and Dandu Malkapuram.

Retailing of handloom products will be expanded via e-commerce websites and special outlets will also be opened at Yadadri and Malkapur, he said. Further, the local handloom items will also be sold at 'Golconda', the handicrafts showroom being established in New Delhi by the state government. In order to develop the handloom and textile sectors of the state, government will ask political representatives and officials to wear handloom clothes at least once in a week. The government will directly purchase handloom fabric from the weavers and will also provide better marketing facilities for handloom products.

SOURCE: Fibre2fashion

Back to top

 

Board of Surat Textile Mills agrees to infuse Rs 30 crore in Garden Silk Mills

Surat Textile Mills announced that the Board of Directors of the Company at its meeting held on 24 October 2016 approved the proposal for investment of Rs 30 crore in convertible securities / warrants to be issued by the Garden Silk Mills, a group company. The Board approved the proposal and agreed to infuse the funds of Rs 30 crore in Garden Silk Mills to support the debt rework scheme being appraised by the consortium member banks in Garden Silk Mills and to enhance its long term resources.

SOURCE: The Business Standard

Back to top

 

Spinning mills grapple with cash crunch, falling demand

Spinning mills are cutting yarn production due to demonetisation, rise in cotton prices and fall yarn exports to China. Some mills have reduced output up to 20 per cent, depending upon their capacity, and they will face severe crisis if the situation continues. Spinning mill owners say they are unable to buy cotton as farmers are demanding only cash, which is in short supply in the wake of demonitisation of high value notes. According to industry sources, farmers are not accepting cheques or electronic transfer of money to their account. Farmers on the other hand, fear that the money credited to their account by cheques or electronic remittances from mills might be adjusted by banks towards the crop loans they had availed. Hence, they are only accepting cash in cotton sales.  The price of cotton too has increased by about Rs 1,000 from Rs 4,000 a few weeks back. Demonetization has also dealt a blow to mills in another aspect too. Traders who purchase cotton yarn in the market are not paying cash to the spinning mill owners immediately due to cash crunch.

Besides paying in cash to farmers to buy cotton, the spinning mill owners need cash for freight charges in cash as lorry owners do not accept other modes of payment. For payment of wages to the workers, the mills have opened bank accounts. The spinning mills are already in crisis following fall in demand for yarn caused by reduction in demand for garments. Around one lakh people are working in over 250 spinning mills in the State. Guntur district Chamber of Commerce and Industry president and spinning mill owner Atukuri Anjaneyulu said, “Due to cash crisis, we are gradually reducing yarn production. If the same situation continues, industry will plunge into serious crisis.  We are unable to pay cash to the farmers. On the other hand, yarn stocks are piling up. Workers are wages in cash. We need some more cash to meet daily expenses" .

Viswateja Spinning Mill executive director Dasari Chandrasekhar said, “Demonetisation is having a cascading effect on spinning industry. Due to shortage of cash, it is difficult to pay cash to the farmers and workers. We are opening bank accounts to the workers to pay wages into their bank accounts. Demand for fabrics is gradually coming down. Spinning industry is passing through a severe crisis. The government has to release Rs.800 to Rs.900 crore subsidies.

SOURCE: The Hans India

Back to top

 

Cash crunch sparks worker exodus, turns Bhiwandi into g-loom town

Demonetisation has completely changed the face of Bhiwandi, from a bustling industrial city which attracted thousands of migrant labourers for work from across the nation to a ghost town where work is scarce and money inaccessible. A walk around the chain of power-looms units here revealed that the ban on high-value currency notes of Rs.1, 000 and Rs.500 has cast a deathly shadow on the labour-intensive and completely cash-driven yarn and loom industry . While the shortage of cash, and thus non-payment of weekly salaries, has forced over 50% of the members of the weaver community to migrate to their hometowns in Uttar Pradesh and Madhya Pradesh, the shortage of labourers has led to the shutting down of many looms and even the specialised cheap canteens or bishis for these workers.

Mohommad Azeem, one of the few remaining labourers here said, "I used to work in the loom with four other people, all of whom left for their village in Jaunpur in UP three weeks ago because of the low cash payment. The ban on these notes has made life hell for me. Now that I work alone, I have to start the machines first and work from 8am to 7pm. I get paid Rs 450 a day , of which I save most and look for something cheap to eat. With many bishis shut, my options have also become limited." "When the ban on high denomination notes was announced, the loom owner told us that he would be paying us our weekly Rs 6,000 through online transactions. As most of my fellow labourers did not have bank accounts, they went back to their homes in MP ," said Jaffar Hussain, a power-loom labourer in Bhiwandi West. "Though we have our jobs, the fact that we cannot use our money is infuriating. We stand in queues outside ATMs and banks for eight to ten hours only to get Rs 2,000 denomination notes which are not accepted anywhere. As we cannot access any money , we cannot send it home to our families."

With labourer migration on the rise, many owners have had to shut down their looms. Sharaff Master, a 79-year-old owner of 45 power-looms in Bhiwandi West, said, " All my labourers have left as it is impossible to pay them in cash. I then thought of renting out my power-looms, which is a common practice here. However, there are no takers for that too. I had to shut them all down. This is worse than any riot, fire or other tragedy we have had till date. Hopefully , things will get better soon." As most of the finished cloth produced in these powerlooms, which contribute to around 70% of the city's economy , has always been sold to wholesale dealers in cash, the cash crunch has also led to a drop in the sale of these goods and in turn impacted the entire industry . Ehsaan Ansari, owner of 700 power-looms in Bhiwandi's Roshan Baugh area is in Kolkata discussing ways to boost sale with customers. He said, "I had over 100 labourers before demonetisation. This number has gone down to 15. Our sales have frozen as wholesalers have cut down on purchasing cloth with cash."

SOURCE: The Times of India

Back to top

 

Textile commissioner’s office seeks data on workers’ exodus from Surat

The textile commissioner's office has intimated the weavers federation of Ved-Road, Katargam and Pandesara to send daily report on the situation prevailing in Surat's textile industry including the payment of wages to the textile workers and the decrease in the number of workers. Sources said that the textile commissioner's office had submitted a report on the exodus of migrant workers employed in the city's textile sector after demonitization to the Prime Minister's Office (PMO). Textile commissioner Kavita Gupta spent two days in the Southern Gujarat Chamber of Commerce and Industry (SGCCI) last month to study the impact of demontization on the textile sector. It is learnt that the PMO directed the textile commissioner's office to gather information on the mode of wage payment in Surat's textile sector and the reason behind the sudden decrease in the number of workers in the city.

However, the regional office of textile commissioner in Ahmedabad asked the weavers federation to gather data on the number of textile processing mills, their names, number of textile workers employed, workers employed through contractors, wage payment mode to the workers, how many workers have bank accounts, reason behind the decreasing number of workers in the industry, etc., on daily basis. "After demonitization was announced, tens of thousands of migrant textile workers have moved out of the city. Around 80 per cent of the textile workers are paid wages in cash. Thus, the textile commissioner's office has sought data on the payment method, use of cashless method in the industry and the exodus of workers," said president of Katargam-Ved Road Weavers Federation, Devesh Patel.

SOURCE: The Times of India

Back to top

 

Indian khadi sales to get ecommerce boost

The Khadi and Village Industries Commission (KVIC) which promotes the khadi fabric industry in India, is planning a big way foray into ecommerce sales, to enable it to reach its revenue target of Rs 5,000 crore by 2018. For this, KVIC is in talks with several online fashion retailers, with the aim to derive 10 per cent of all sales through online retailing. “Other than the ecommerce initiative, KVIC is also planning to open 'Khadi India Lounge’s', which will sell premium khadi products in major Indian cities,” Usha Suresh, KVIC's chief executive officer told a media agency.

KVIC is set to open Khadi India Lounges in metro cities across India like Delhi, Jaipur, Mumbai, etc, within the next few months and will open these lounges in other cities by the next fiscal. In order to boost sales from the current Rs 1,500 crore to Rs 5,000 crore, the agency is also exploring taking the franchise route, under which it will start around four stores in each of the state capitals and two more in other districts.

SOURCE: Fibre2fashion

Back to top

 

Crude oil price will not rise beyond $55/bbl: Oil India chief

Oil industry experts don’t expect the price of crude oil to breach the $55 a barrel threshold, according to Oil India (OIL) Chairman Utpal Bora. Speaking to BusinessLine , Bora said, “In a recent presentation, even top energy analysts such as Daniel Yergin of IHS did not see crude oil going beyond $55/bbl.” Bora assesses the upward movement of crude price as being positive for upstream oil companies. He said, “Brent has just crossed $50/bbl. This is good news for the upstream companies like Oil India and ONGC because our margins will be better. The cost of production is also lower due to our aged oil fields; we are comfortable in the $50-$55 range.”

Increasing output

OIL is also evaluating a strategy for increasing production from its ageing fields in the North-East through tie ups with Schlumberger. Commenting on the roadmap, he said, “The plan is that they will take over the field and we will come to an agreement that aims to double the production in three years. Any incremental oil will be shared on a dollar per barrel basis. The Jorajan field is an old field and by doing something with Schlumberger, we will increase production there.” The country’s largest crude oil producer, ONGC has recently signed a statement of understanding with Schlumberger for enhancing production at its Geleki field in Assam. OIL will be looking to forge a similar production enhancement contract with Schlumberger, according to Bora.

SOURCE: The Hindu Business Line

Back to top

 

 

GST Council meet cut short, no roll-out in April, 2017

The country’s journey that started more than seven years ago towards an indirect tax system that militates against cascading of taxes, seemed to prolong further on Sunday, after the sixth session of the Goods and Services Tax (GST) Council was cut short for want of any signs of a consensus on the sharing of administrative powers between the Centre and states. While the council was to meet on Monday too, it has now been convened on December 22-23.

With some states alleging the demonetisation move undermined the spirit of cooperative federalism that has hitherto guided the council, the earlier the relevant laws can be taken up by Parliament now is in the Budget session in January, as the ongoing Winter Session ends on December 16. Given that states also need to endorse the principal law that will define the central GST and state GST, there are very remote chances now of the proposed tax system being rolled out from April 1, 2017. As there is a constitutional compulsion to get the GST running latest by September 16, 2017, however, the new regime can’t be delayed beyond that.

When asked whether the contentious cross-empowerment issue will be resolved in the next session, finance minister Arun Jaitley said, “yes, if time permits,” adding that concluding the legislative agenda — that is, the fine-tuning of three draft laws — would be on top priority.

Kerala finance minister Thomas Isaac was, however, categorical in saying that he saw no possibility of the GST hitting the road before September. “We are unwilling to give up our position (that businesses with turnover up to Rs 1.5 crore should be under the states’ exclusive control. Unless the Centre (relents on) its stance that all service taxpayers should remain with it, there won’t be any compromise (by states).” He claimed that many states have hardened their positions post-demonetisation, referring to his state’s problems with the RBI directive undermining the cooperative banks. Jaitley said of the 195 sections of the model GST law, the first 99 have been finalised while it was decided to redraft one. The remaining chapters of this principal draft and two other draft laws — one pertaining to integrated GST (IGST) and the compensation for states — would also be finalised in the next session, Jaitley said, adding that he still “stood by the April 1 time-line for GST rollout.” “In any case, the discretion available (on GST commencement) is limited due to the Constitutional provision,” he remarked.

While the cross-empowerment issue is about how to divide the 10-million indirect tax assessee base between the Centre and states for administrative and audit purposes, some possible solutions to the vexed issue are already their on the council’s table. These include keeping assessees with turnover below Rs 1.5 crore with the states and the larger ones with the Centre, leaving below-Rs 1.5-crore-revenue taxpayers with states and others under cross-empowerment, retaining below-Rs 1.5-crore assessees with states and others under cross-empowerment but all service taxpayers with the Centre. Other two formulas under discussion are cross-empowerment where every year both the Centre and states will decide who will audit whom on the basis of risk parameters and a complete vertical division for 3 years, with a Centre-state ratio of 4:6; with a mirror image approach favouring the Centre for large taxpayers.

With demonetisation causing a shake-up in the economy, sources said the transition pains of GST could be deferred. “Even for the Centre, September would now look a more realistic timeline,” said a source. It was decided earlier that in order to compute the states’ revenues losses from GST, a 14% annual growth over their 2015-16 revenue base (from relevant taxes) would be assumed. Although the states say they are worried about revenue losses due to demonetisation, it is not relevant to the GST compensation talks as 2015-16 was adopted as the base year, analysts said. “States don’t have anything to lose on the revenue front,” said Pratik Jain, partner and leader, indirect tax, PwC.

While industry in general is worried about an enabling non-profiteering clause in the model GST law and e-commerce firms fret about the retention of the tax collected at source obligation on them, both the Centre and states are inclined to endorse both. The anti-profiteering provision — which could be implemented only with the setting up of a designated authority — compels businesses to pass on the benefits from any reduction in output tax and rise in input tax credit as a result of GST roll-out. Analysts are also concerned about the likely compliance burden on large players in services sector in the GST regime. Even though the GST principle that tax will be paid where the consumption takes place is welcome, more clarity is required on the place of supply rules, they feel.

SOURCE: The Financial Express

Back to top

 

IIP falls 1.9% in October, demonetisation may mean worse is yet to come

Industrial production shrank an annual 1.9% in October — worsening from a 0.7% rise in the previous month — suggesting an industrial recovery was elusive even before the November demonetisation move disrupted economic activities in November. If the Purchasing Managers’ Index in manufacturing and services and indirect tax collections are any indication (they either slowed down or contracted in November), the Index of Industrial Production (IIP) may have fallen steeply in November. However, as Icra’s principal economist Aditi Nayar points out, since electricity generation, auto sales and even coal output showed decent expansion of 10%, 11% and 5.5%, respectively, in November, there is a chance that the damaging impact of demonetisation could be somewhat masked in the case of the IIP.

Nevertheless, what is particularly worrisome is that capital goods — a gauge for fixed corporate investment — contracted for 12 months in a row. Without the 25.9% plunge in capital goods output, the IIP would have grown 2% in October. Within the capital goods segment, rubber insulated cable — which contracted as much as 92.9% in October — alone knocked almost 3.8 percentage points off the IIP. Demonetisation is expected to only worsen the situation as economists warn of companies deferring investment plans in times of demand compression.

Although the Diwali holidays may have contributed to the fall in output, consumer non-durables dropped a worse-than-expected 3% in October, down from a 0.1% expansion in September. The sector had witnessed marginal expansion in September after 10 straight months of contraction. This suggests rural demand continues to remain tepid. Consumer durables, too, suffered from an unfavourable base (it had grown 41.9% in October last year) and rose just 0.2% in October, compared with 13.9% in the previous month, despite the festive demand.

With demonetisation expected to have hurt the informal sector (which accounts for roughly 45% of the country’s GDP) more, rural demand may continue to suffer for some more time even if the country harvests a better kharif crop after two straight years of drought through 2015. This means the bad news will continue for the consumer goods segment in the coming months as well. Already, the latest tax collections data also confirmed the economy’s demonetisation pangs. Although annual growth levels were robust, indirect tax collections for November 2016 showed a decline of 13.9% over October 2016. Much, however, depends on government spending to kick-start the economic engine now.

Although the Reserve Bank of India said demonetisation “could result in a possible temporary reduction in inflation of the order of 10-15 basis points in Q3” in the Fifth Bi-monthly Monetary Policy Statement Resolution of the Monetary Policy Committee this week, it has lowered growth forecast from 7.6% to 7.1% for the current fiscal. Already, GDP grew 7.1% in the second quarter, compared with 7.3% in the previous quarter, with investment contracting 5.6%, falling for a third straight quarter.

SOURCE: The Financial Express

Back to top

 

India to host IBSA summit next year

India will host a summit of a trilateral grouping involving Brazil and South Africa next year to promote South-South cooperation, reactivating the group in the shadow of the more powerful BRICS. Unlike BRICs, which includes China and also Russia, the IBSA, with a trade target set at $25 billion from the present $23 billion over the next few years, is purely countries either in the southern hemisphere or near it. The expectation from this grouping is that it will focus on their economies more than BRICs, dominated by heavyweights China and Russia. The 2017 summit will be first in six years. Senior MEA officials told FE that dates and schedule for the summit would be decided after consultation among the three participant countries.

When Prime Minister Narendra Modi and South Africa’s President Jacob Zuma met earlier this year, the two countries discussed intra-investment of the group, which needs to be given greater thrust. IBSA members’ investments shift towards other developing countries than among themselves. The grouping that has been dormant for a while now recently got a fresh lease of life with the launch of a fellowship programme by Indian think-tank Research and Information System for Developing Countries, with support from the ministry of external affairs. The first IBSA Visiting Fellowship Programme will have two scholars each from Brazil and South Africa conducting research in India for three-to-six months.

According to Preeti Saran, secretary (East) MEA, “IBSA brings together three like-minded countries that were committed to inclusive and sustainable development in pursuit of well-being for their people and other developing economies.” “The IBSA Facility Fund for Alleviation of Poverty and Hunger, which was established in March 2004 and became operational in 2006, is funded by a contribution of $1 million annually by each of the three countries,” she stated, adding that the fund was operated by the UNDP. The fund has contributed to development interventions and capacity building in several countries in Asia, Latin America and Africa. “It has been widely recognised as a successful experiment of South-South cooperation,” Saran said.

The IBSA Dialogue Forum brings together three large pluralistic, multicultural and multiracial societies from three continents as a purely South-South grouping of like-minded countries. IBSA was formalised and launched via the adoption of the Brasilia Declaration in June 2003.

SOURCE: The Financial Express

Back to top

 

 

Forex reserves decline by $1.4 billion to $363.9 billion

Forex reserves declined by $1.431 billion to $363.9 billion in the week to December 2, RBI data released on Friday showed. The country’s foreign exchange reserves had touched a record high of $371.99 billion at the end of September. Forex dealers said the decline was primarily due to the Reserve Bank of India selling dollars in the market to stem the fall of the rupee, which almost closed at a record low at 68.77 on November 28. The last time the rupee closed lower than this level was on August 28, 2013, when it had closed at 68.8250, a lifetime low. The fall in the rupee was primarily due to the dollar’s phenomenal rise ever since Donald Trump won the US presidential election earlier this month. The dollar index, which measures the strength of the greenback vis-a-vis a basket of other currencies, has gained nearly 4% since the day of the election, and is currently hovering around at 101.50 level, after having touched a 13-year high of 101.70 on November 24.

President-elect Trump’s spending plan for infrastructural development has pushed the market to factor in a higher probability of rate hikes by the US Federal Reserve. That is why the dollar has been trading strong against all emerging-market currencies. In fact, Fed fund futures on Friday showed a 100% probability of a 25-50 bps rate hike and a 94% probability of a 50-75 bps rate hike being announced at the December FOMC meet . Foreign currency assets, which constitute a significant portion of the overall reserves, fell by $957.9 million to $340.131 billion in the week under review, the data showed. Gold reserves came in at $19.982 billion, down $477.9 million from the previous week.

SOURCE: The Financial Express

Back to top

 

India, Indonesia to boost maritime relations in China’s ‘backyard’

To counter China’s increasing claims over the disputed South China Seas (SCS), India and Indonesia have vowed to bolster maritime ties. Both nations have also decided to maintain a maritime legal order based on the principles of international law, as reflected in the United Nations Convention on the Law of the Sea (UNCLOS). “Both leaders recognised the importance of freedom of navigation and overflight on the high seas, unimpeded lawful commerce, as well as resolving maritime disputes by peaceful means, in accordance with universally recognised principles of international law including the UNCLOS,” said a statement on India and Indonesia Maritime Cooperation. The statement was issued after a bilateral meeting between Indonesian President Joko Widodo and Prime Minister Narendra Modi here on Monday. In an unstated but clear reference to China, both leaders also asserted that India and Indonesia share common interests in ensuring maritime security and the safety of sea lines of communication.

Indonesia has been vociferously challenging Chinese aggression in some of the disputed islands located in the South China Sea. Indonesian warplanes have been showcasing their strength in close proximity to a region in the SCS, which is claimed by China. Although India has not yet taken any sides officially on the matter, it has made it amply clear that it is against such aggression that adversely impacts trade and commerce over the SCS. According to the joint statement, both sides emphasised the importance of further consolidating the security and defence cooperation. As a result, both leaders directed their respective Defence Ministers to secure an early convening of a Defence Ministers’ Dialogue and the Joint Defence Cooperation Committee (JDCC) Meeting to review and upgrade the existing ‘Agreement on Cooperative Activities in the Fields of Defence’ to a substantive bilateral Defence Cooperation Agreement.

Trade ministers’ forum

For the first time ever, both countries decided to set up a Biennial Trade Ministers’ Forum in an effort to “remove impediments to trade and investment,” the joint statement said.

SOURCE: The Hindu Business Line

Back to top

 

Netherlands Ambassador Alphonsus Stoelinga wants India, EU meet for FTA

India and the European Union should meet at the political level at the shortest notice to resume negotiations for India-EU Free Trade Agreement that would also safeguard investments from both sides, said Netherlands Ambassador to India Alphonsus Stoelinga. Following Delhi’s decision to terminate the India-Dutch bilateral investment protection treaty on November 30, current Dutch investments in India and vice versa will be protected for a 15-year period under the old treaty, according to the Ambassador. “The Netherlands is the fourth largest investor in India, and India is the fifth largest investor in the Netherlands. The Indian government has decided unilaterally to terminate bilateral investment protection treaties with all European nations. The Indo-Dutch bilateral investment treaty ended on November 30 and Holland became the first country whose treaty was terminated,” Stoelinga told ET in an exclusive interaction, days after the expiry of the pact. The envoy pointed out that existing Dutch as well as Indian investments currently have 15 years protection in each other’s country after November 30. However, no new investments from either side to each other’s country will now have any protection, he noted.  “We had urged the Indian government to give a window of six months after November 30, but that was not agreed to. We hope that the political leadership here and in the EU now expedite the Indo-EU FTA which will offer protection to European investments in India and vice-versa,” said Stoelinga.

Delhi’s decision is not the right signal, especially when India is pitching for the Make in India initiative and ease of doing business, senior Dutch government officials told ET.  “While some progress has been made during the past two years in the ease of doing business in India and states are offering more incentives to foreign investors, we are hoping for additional reforms now that India is the brightest spot in the economy globally,” said the senior diplomat. The total investment from Netherlands between April and September 2016 is $1,615 million, according to DIPP. India has announced that in general it wishes to adjust some bilateral tax treaties as well. This has been done with regard to Singapore, Cyprus and Mauritius. The tax treaty with the Netherlands is different in the sense that the Netherlands does not allow double non-taxation of capital gains.

SOURCE: The Economic Times

Back to top

 

Endless trouble if India opposes China-Nepal connectivity: Chinese official

Describing India's $one billion aid to Mongolia as a "bribe", Chinese official media said there may be "endless trouble" in Sino-India ties if New Delhi viewed China's cargo service with land-locked Nepal as a threat to the sale of Indian goods. Highlighting China's efforts to step up rail-road connectivity with Nepal, an article in the state-run Global Times said India is also boosting its relations with China's neighbour Mongolia with a one billion dollar "bribe". It emphasised that India reportedly said last week it would help Mongolia use $one billion of aid offered in 2015 to overcome its current financial and economic crisis after Mongolia sought clear support from India against 'China's blockade', in reaction to the visit of the Dalai Lama to Ulaanbaator. "China won't be overly sensitive about India's cooperation with Mongolia, and won't mistake India's assistance as a counter to China," the article said. "Mongolia's economy is highly dependent on China, with more than 90 percent of its imports and exports traded directly with China. As such, China's influence on Mongolia's economy cannot be replaced by India in the short run, and efforts will be in vain if India attempts to 'bribe' Mongolia's loyalty with only $one billion," it said. The one billion dollar credit line was offered to Mongolia during Prime Minister Narendra Modi's visit in May last year which is expected to be availed by Ulaanbaatar.

Defending the new rail-road cargo route through Tibet to Nepal launched on Friday, today's article said it will boost trade with Nepal as China pushes forward with its Belt and Road (Silk Road) initiative. Last Friday, dozens of trucks carrying $2.8 million worth of products such as clothes, appliances, electronics and building materials left the Chinese border for their destination in Nepal. The new rail and road cargo service, links Guangdong, Tibet and Nepal, official media reported. "But the move doesn't mean that Chinese goods will push Indian products out of the country. In fact, when it comes to cooperation with other countries, both China and India should refrain from excessive sensitivity," the article said.  "Additionally, in May, China started a rail and road cargo service to the South Asian country as a means to shorten the time spent in sea transport," it said.  "There may be endless trouble in the future if India views efforts to facilitate the export of goods from China's enterprises as a potential threat to the sale of India-made products in Nepal," it added.

SOURCE: The Economic Times

Back to top

 

India, US strike 1st bilateral advance pricing agreement: Government

India and the US have reached a deal for the first bilateral advance pricing agreement, a move that will enable American firms to ascertain tax liabilities beforehand, Finance Minister Arun Jaitley said. The two nations have resolved over 100 cases of tax disputes involving a tax of about Rs 5,000 crore through Mutual Agreement Procedure (MAP), he said. Advance pricing provides certainty to taxpayers in respect of cross-border sales among related entities by specifying the methods of transfer pricing and determining the arm’s length price of international transactions in advance for usually a maximum of five years ahead. MAP, under the Double Taxation Avoidance Agreement (DTAA), is an alternative dispute settlement mechanism available to authorities and foreign investors. “India and the USA have reached an understanding at a recently concluded bilateral meeting between the competent authorities of the two countries to conclude the first bilateral APA between the two countries,” he said in a written reply to a question in the Lok Sabha here. The bilateral advanced pricing agreement (APA) to be entered into involves a multinational company of the US and its Indian subsidiary, he said without giving details. “The agreement shall be for a period of five years from financial year 2013-14 to 2017-18 and the two competent authorities have decided the most appropriate transfer pricing methodology to price the international transactions between the two companies and have also decided the Arm’s Length Price (ALP) of the transactions,” he said.

Bilateral APAs between India and the US are expected to reduce the transfer pricing disputes that arise in respect of international transactions between related companies located in the two countries. Also, they would lend certainty to international transactions between related companies of the two countries. This, Jaitley said, would create a conducive environment for US-based multinational companies and attract foreign investment. “Moreover, bilateral APAs would reduce the time and money spent on protracted litigation,” he said.

Finance Minister said India and the US have been resolving tax disputes under the Mutual Agreement Procedure (MAP) provision contained in the Double Taxation Avoidance Convention (DTAC) between the two countries. In the last two years, more than 100 cases of tax disputes have been resolved under the MAP provision. In a recent bilateral meeting between the two countries, another 108 cases of tax disputes have been agreed to be resolved, he said. “While the total amount of income locked up in dispute prior to the recent meeting between the two countries was approximately Rs 12,000 crore, the recent agreement to resolve more than 100 disputes would reduce this amount by approximately Rs 5,000 crore,” he added.

SOURCE: The Financial Express

Back to top

 

Trump’s tariff walls could hurt India

Donald Trump’s presidential victory should be disquieting to developing nations like India who must globally export to power their economic growth. Trump has promised to rein in free trade and globalisation that are believed to be eroding American manufacturing and factory employment. He plans to execute his promises through prohibitive tariffs and controls that could turn the US into a nettlesome export market for developing countries. As Trump’s presidency looms, fear is growing: Will he proceed with his protectionist plans?

Trade and manufacturing losses

By output value, manufacturing was one-third of GDP in the 1950s. America produced heavy durables like aircraft, autos, and industrial machinery but also a wide-range of consumer non-durables: apparel, electrical appliances, and accessories. The US has since evolved further into an intellectual and service-based economy, driven by market dynamics and the choices businesses made — the service sector is presently predominant, and manufacturing has shrunk to 12 per cent of GDP. The US still makes aircraft, turbines, and semiconductors but these are complex products that involve sophisticated (automated) manufacturing; most standard goods and those requiring labour-intensive processes have moved to low-wage countries, propelled by cost pressures in a globalising world. The US has become a net merchandise importer in the last 30 years, with manufacturing employment down to 12 million from a high of 20 million — the promise of its rejuvenation through import barriers and trade restrictions is what has catapulted Trump to the presidency.

Trade barriers and effects

Trump intends to employ punitive tariffs on cheap merchandise entering the US to encourage domestic manufacturing and bring back lost jobs. His primary tariff targets, as he has frequently indicated, are China and Mexico but one cannot rule out the effects of his action on other countries that export similar products, for example, India. In broad terms, Trump’s plan involves a 45 per cent across-the-board levy on Chinese goods and 35 per cent on Mexican. Machinery, engineered products, auto parts, electronic devices, and apparel are imports likely to be affected. In dollar terms, a good percentage of China’s current exports to the US of $482 billion — and perhaps India’s $44 billion too — could be at risk.

Interestingly, the effects of these tariffs will not be confined to the exports of these countries. They will equally impact the foreign direct investment (FDI) that flows to their manufacturing sector. As imports become less attractive to US businesses, they will increasingly prefer domestic manufacturing to off-shore ventures in low-wage countries, thereby reducing FDI. Incidentally, both exports and FDI could be further imperilled as “the nationalism” (anti-globalisation) hysteria currently gripping parts of the West becomes ubiquitous.

President’s power on trade

Can Trump unilaterally pursue the extreme protectionist policies he is touting? The US Constitution and Congressional legislation grant the President broad powers on matters of international trade. The President can abrogate trade agreements, levy tariffs on select goods, or impose at will an across-the-board levy on all goods imported from a country to protect US economic interests.

The last requires Congressional approval, and may not receive WTO blessings unless egregious trade violations are proved. But Presidents have imposed harsh levies on select goods irrespective of country origin or on specific items emanating from a country. In 2002, Bush levied a 30 per cent duty on all steel imports. In 2009, Obama hit China with a 35 per cent duty on tyres. In 2012, Congress authorised Obama higher duty on all Chinese goods citing unfair trade behaviour.

What would President Trump do? Historically, US presidents have refrained from punitive tariffs to avoid risking a trade war. Obama’s steep tyre levies resulted in Chinese retaliation on US chicken exports that eventually hurt both. There are also economic factors that act as restraints: a) High tariffs hurt US. durable goods manufacturers who must import components from several foreign locations to finish their product, and b) tariffs are in fact taxes on the consumer. Nevertheless, public opinion seems to favour trade policies that would protect American manufacturing. Polls show growing belief (especially in the Rust Belt - Michigan, Pennsylvania, Wisconsin) that low wage countries are taking advantage of U.S. free trade policies. Presently, only a third of U.S. imports are on the tariff list, the rest are on the free list. And those on the tariff list pay a nominal duty. Under President Trump, the tariff list may expand and the duty paid may rise – that will not be good news for developing countries relying on exports for economic growth.

SOURCE: The Hindu Business Line

Back to top

 

Global Crude oil price of Indian Basket was US$ 54.42 per bbl on 12.12.2016

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$ 54.42 per barrel (bbl) on 12.12.2016. This was higher than the price of US$ 51.03 per bbl on previous publishing day of 08.12.2016.

In rupee terms, the price of Indian Basket increased to Rs. 3677.60 per bbl on 12.12.2016 as compared to Rs. 3440.97 per bbl on 08.12.2016. Rupee closed at Rs. 67.58 per US$ on 12.11.2016. The table below gives details in this regard: 

Particulars

Unit

Price on December 12, 2016 (Previous trading day i.e. 08.12.2016)

Pricing Fortnight for 01.12.2016

(Nov 12, 2016 to Nov 28, 2016)

Crude Oil (Indian Basket)

($/bbl)

54.42              (51.03)

44.87

(Rs/bbl

3677.60       (3440.97)

3061.48

Exchange Rate

(Rs/$)

67.58*

68.23

 

SOURCE: PIB

Back to top

 

Tanzania domestic textiles to outnumber cheap imports

Tanzania is making efforts to protect its domestic textile market. For that, efforts are being made to introduce them in local markets instead of cheap imports. More manufacturers were moving huge sales to the regional markets of the East, Central and Southern Africa than they did to the local markets.Also, instead of dealing with second-hand clothes, traders can start buying and selling locally manufactured garment and earn maximum returns. Trade of second-hand clothes popularly known as (mitumba) trade has become the mainstay of millions of informal traders. It has in fact created employment down to the village level, although essentially not contributing to the nations' economic development. As used-clothes trade flourished, textile industries miserably declined and many of them have closed shop. Their products could not compete with second-hand imported clothes in quality or price.

An official with A to Z textiles, Mr Fadhili Mbise, said at the ongoing industry exhibitions at the DITF along Kilwa Road that local manufacturers were capable of meeting local and international market demand. He said that they sell more outside than in the local market and added that if the total production was intended for the internal market, there was enough capacity to meet domestic demands. He further said that to promote local textile manufacturing industries, there should be government concerted efforts to protect them from low quality garment imports.He said the importation of second hand clothes has been increasing without taking into account the immense damages to the investments on domestic manufacturers, jobs and the economy. He said the prices of garment made locally were affordable for all classes of people and sometimes cheaper than prices of imported second-hand clothes. Taxing more second-hand clothes can be one of the measures taken to reduce importation.

SOURCE: Yarns&Fibers

Back to top

 

Nigeria: Govt Moves to Address Bottlenecks in Textile Sector

The federal government has unveiled measures aimed at tackling some of the industrial constraints in the nation's textile sector. Part of the strategies being employed aim to from the drift of companies leaving the country and stop smuggling and counterfeiting-and prioritise patronage of made-in-Nigeria products by agencies of government. The Minister of State, Industry, Trade and Investment, Hajia Aisha Abubakar, gave the hint at the weekend during a tour of textile factories in Kano as part of activities during the North-west Regional Customer Forum. The forum, which was organised by the Bank of Industry (BoI) has as its theme: 'The Role of Financial Institutions in driving the industrial development of a nation: A-Z of accessing BOI's credit facility.'

Apart from this, the development finance institution has been at the vanguard of reviving the once moribund sector, having approved loans to over 70 projects in the CTG value chain. Abubakar toured the factories in company of the President of Manufacturers Association of Nigeria (MAN), Dr. Frank Jacobs, the General Secretary of the National Union of Textile Garment and Tailoring Workers of Nigeria, Isah Aremu and the General Manager of BOI, Mr. Joseph Babatunde, among other dignitaries.

Speaking during the event, the minister said government had identified several issues including gas supply, smuggling and counterfeiting as constraints which would be addressed to revive the textile industry in the country. She said: "Some of the issues we are trying to address are the issues of smuggling and counterfeiting. Gas supply to the North. We are also trying to address the issue of patronage. On the issue of patronage, I am sure that by next year we will see more results because they also told us that special interests have come forward to them." She urged the operators to articulate their thoughts on how to move the industry forward and ensure that the critical role of the sector in the nation's economy is sustained. She said some of the things textiles manufacturers were asking for were not in line with government thinking at the moment, added that there was the need for stakeholders to find a common ground that would ensure that stakeholders are accountable and responsible in order to achieve the needed growth in the industry. Abubakar noted that the Export Expansion Grants (EEG) previously offered as incentives by government was grossly abused by stakeholders, adding that government was looking at bringing it back in an entirely different way for better and effective implementation. She said: "You know the EEG was so much abused. The EEG is going to come back but it is going to come back in a different way. And I don't know what is going to happen to what is outstanding. We are trying to look at different ways to make it easy for those who have really done what they were supposed to do. "A lot of verifications, a lot of audit is still on going for us to see what we can do because we generally believe in EEG. But the implementation of it has not been done well. There is no government that can do anything without incentives, so EEG is coming back." The minister visited five textile manufacturing plants including African Textile Manufacturing Limited, Nigerian Spinners and Dyerrs Limited, Tofa Textile Limited, Tertex Nigeria Limited, and Adhama Textile and Garment Industries Limited. It was gathered that all the plants visited were under serious operational distress with some threatening to close down due to unfriendly business environment emanating from inconsistency in government policies among other issues.

SOURCE: The All Africa

Back to top

 

Business as usual for Vietnam sourcing without TPP

Vietnam's clothing and textile industry has been assessing the impact of losing a huge anticipated garment export boost under the Trans-Pacific Partnership (TPP) now that US president-elect Donald Trump has promised to sign an executive order pulling out of the 12-nation trade deal. Vietnamese garment exports would have eventually earned duty-free treatment in the US under the deal, compared to a current average of 11% and a high of up to 32% for some categories. This had prompted the World Bank to issue a now-meaningless forecast that Vietnam's textile and garment exports to the US and Japan under the TPP would have played a major role in lifting Vietnam's GDP by 10% by 2030. The run-up to the TPP's completion in October 2015 had been accompanied by a massive foreign investment inflow into Vietnam's upstream textile sector to satisfy the TPP's "yarn forward" rules of origin (ROO). During 2015, the Vietnam textile and garment sector had received a record US$2bn in foreign direct investment (FDI), according to the Vietnam Textile and Apparel Association (VITAS). Whereas these mostly Japanese, Chinese, South Korean and Taiwanese investors now seem to have placed their bets on the wrong horse, the Vietnamese garment sector itself does not necessarily count itself as being among the losers in the TPP story. "Wages will increase at a slower rate now that the TPP is dead, which is good for us, as the pre-TPP hype had been pushing them up greatly at our expense," Chris Walker, marketing manager at Thai Son SP Garment Factory in Ho Chi Minh City, told just-style. "Anyone who buys from Vietnam will still have to factor in the duty rate, so it will be business as usual," he adds. Last month US president-elect Donald Trump said he will take steps to withdraw from the proposed Trans-Pacific Partnership (TPP) free trade deal on his first day in the White House in January.

But Vietnamese Prime Minister Nguyen Xuan Phuc emphasised that with or without the TPP deal Vietnam remains committed to further opening up its economy to the world. Vietnam has already signed 12 free-trade agreements, and Phuc's comments echoed those by Vietnam's trade minister Vu Huy Hoang, who said the textiles, seafood and footwear sectors would still remain competitive without the TPP.

Experts with a close eye on the Vietnamese textile and garment sectors concur. According to Tomoo Kikuchi, senior research fellow at the National University of Singapore's Centre on Asia and Globalisation, the considerable amount of investment by foreign multinationals in the upstream supply chain triggered by the TPP's yarn-forward rule is also an effort to upgrade the value chain in Vietnam. Kikuchi expects this trend to continue. "The rules of origin gave the industry an incentive and thus momentum to invest in upstream textiles, which is a natural thing to do when labour cost rises. "Sure, no TPP is disappointing, but whether that will slow down the trend I am not sure," he adds. Achim Haug, Hong Kong-based chief representative of Germany Trade & Invest, a government agency assisting FDI in Vietnam, points out that Vietnam's structural advantages for the export-oriented manufacturing sector remain high, "so that investors will keep coming with or without TPP." Among these advantages are Vietnam's wage levels being one-third lower than in neighbouring China, a relatively good infrastructure, political stability, and a young and motivated workforce.

"Particular opportunities also arise from the free-trade agreement between Vietnam and the European Union, which has been signed and is now awaiting ratification in the EU," Haug says. "We hope for quick clarity on this, so that the agreement can come into effect in 2018 as planned." Whereas the US has been the top market for Vietnam's textile and garment products with US$10bn in 2015, shipments to Europe in the same period were significantly lower at nearly US$3bn. But unlike the TPP with its strict yarn-forward rule, the Vietnam-EU FTA comes with a generous "fabric-forward" ROO. This means Vietnamese garment makers will be able to perpetuate their reliance on cheaper Chinese yarn, thereby safeguarding their profit margins. The EU agreed to remove all import tariffs on Vietnam's textile and garment products within seven years. "Disappointed but not devastated" Even before Trump's most recent anti-TPP tirade, congressional leaders from both parties had clarified that they will not bring the trade deal forward. "We are disappointed but not devastated because our members knew that zero tariffs would not have been in effect as soon as next year, meaning no one had done pricing or had placed orders based on TPP," Hughes explains. "But ironically, even as Vietnam has no TPP, it got all the foreign investment and the EU deal. By contrast, the TPP's death is a clear loss for US fashion brands, not least in their competition for global space with their EU competitors," she adds.

Nevertheless, Hughes believes there are some reasons to be cautiously optimistic. According to her, the Trump administration will over time see these economic realities, with the Trump family's business interest in apparel in general, and the fact that daughter Ivanka Trump has her own apparel and footwear line in particular, likely to emerge as helpful factors. And with currently 97% of all apparel sold in the US being imported, she sees no way that the bulk of production could be brought back to America, especially not if his core political pledge is to cut down the number of immigrant visas. "Trump talked about crafting bilateral FTAs, so why not one with Vietnam?" Hughes says.

SOURCE: Just Style

Back to top

 

 

List of Vietnamese prestigious exporters announced

The Ministry of Industry and Trade has officially announced a list of 310 Vietnamese prestigious exporters for 2015, aimed at supporting local firms in promoting exports and expanding markets. The ministry last week promulgated Decision No 4769/QĐ-BCT to approve the list of local prestigious exporters for 2015. The vote was held in co-ordination with the provincial departments of industry and trade, other ministries, sectors, associations and relevant agencies after publishing the list of exporters on the ministry’s website for selection. The list of exporters was chosen based on the proposals of relevant agencies, along with the ministry’s criteria of maximum export turnover, prestige with foreign partners and duties to the tax and customs sector.

Notably, the ministry has given priority in choosing sectors in which the country has encouraged exports as well as those facing difficulties in finding export markets. The ministry’s Import-Export Department said the vote aimed to recognise exporters’ positive contributions to the country’s export growth while giving them support in seeking markets. It also aimed to encourage Vietnamese exporters to further improve their image towards international integration with the world economy. The voted exporters would be permitted to advertise their products for free on the ministry’s website moit.gov.vn and its newspapers and magazines. They would be given priority in participating in national trade promotion programmes and receive free training courses on e-commerce. The ministry would also directly introduce the list to foreign partners. The exporters were chosen from 22 sectors, including seafood, rice, rubber and coffee, as well as garment and textile. Some of the names on the list are Intimex Group, Việt Phú Thịnh Rubber Joint Stock Company, Tân Phong and Nhà Bè Corporation, as wel as Việt Tiến Garment and Textile Company, and B.Braun Việt Nam.

SOURCE: The Vietnam News

Back to top

 

2016 Newsmakers: It’s Taps for the TPP Free-Trade Agreement

It took years to negotiate and one presidential election to terminate. The Trans-Pacific Partnership, a free-trade accord between the United States and 11 other Pacific Rim countries, was poised to be approved this year by the U.S. Congress. But election-year politics put an official end to that as both presidential candidates Hillary Clinton and Donald Trump made it known they would not back the trade pact. Now that Trump is headed for the White House, he has made it clear he will abandon the agreement, which took some seven years to negotiate in its current form. He feels it threatens U.S. manufacturers and businesses. Retailers and clothing importers were eager to see a deal passed because it would have lowered tariffs on thousands of items coming in from member countries such as Vietnam, which is a major clothing manufacturer. It would have also installed uniform intellectual-property stipulations and enforced uniform labor and environmental laws among the member countries.

The Trans-Pacific Partnership was the largest free-trade pact ever negotiated by the United States and would have lowered tariffs on everything from cars to farm products. It represented 40 percent of the world’s gross domestic product but blatantly shunned China as a member. Besides the United States, the other signatory countries were Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. Now that the trade pact is dead in the water, some of the signatory countries are thinking about joining trade agreements put forth by China.

Beijing sees this as an opportunity to advance its proposed Free Trade Area of the Asia-Pacific (FTAAP) and the Regional Comprehensive Economic Partnership (RCEP), which includes an even larger group than the TPP club. The 10 members in the Association of Southeast Asian Nations would be joined by China, Japan, South Korea, India, Australia and New Zealand to form the RCEP Group.

SOURCE: The Apparel News

Back to top

 

 

Apparel Companies Still Have an Abysmal Record on Forced Labor

The NGOs Humanity United and Business and Human Rights Resource Centre recently issued a report that is pessimistic about the global apparel industry’s efforts to eradicate forced labor from their supply chains. Issued by KnowTheChain, the survey offers a grim assessment about companies’ actions to protect workers during the recruitment process. The NGOs also say these companies have little or no process in place allowing them to listen to their employees’ concerns. The average score on the assessment is 46 out of 100. But less important than the raw numbers is how 20 of the world’s largest apparel companies mostly scored low across the 22 indicators measured by the NGOs’ researchers.

Across the board, one theme resulted in a relatively high score: monitoring. But the fact that auditing and disclosure efforts netted decent marks shows that the garment industry’s reliance on inspections and social audits is not nearly enough to stop the human rights abuses that mar this industry’s reputation. The problem, as long reported in India, is that forced labor most often occurs amongst the subcontractors and smaller suppliers that are tucked in the furthest reaches of apparel companies’ supply chains. For those looking for some signs of responsibility within the textile and garment sectors, Adidas‘score provides some hope. The German athletic apparel company outpaced Gap in this assessment by a few steps. Researchers noted Adidas’ transparency and the copious amounts of data it has released over the years. Compared to other apparel companies, Adidas has far stricter requirements when it comes to the recruitment and treatment of workers hired through employment agencies and job brokers. The company also launched efforts to raise awareness about modern-day slavery, and has been more successful than many of its peers at identifying risks of human rights violations. Adidas even went as far as assessing potential abuses from where materials such as rubber, cotton and leather are sourced.

Curiously, fast fashion brands such as H&M, Primark and Inditex (which operates Zara) make up the top tier within the NGOs’ rankings. H&M, for example, received favorable reviews for its traceability standards and for leading as one of the more responsive companies to workers’ grievances within its supply chain. But the company could perform better when it comes to how it purchases materials from its suppliers, and could also do more to halt dodgy recruiting practices within its suppliers’ factories. Luxury brands, however, are the laggards in KnowTheChain’s report. Companies including Ralph Lauren, Hugo Boss, Prada and Kering (which is the parent company of Alexander McQueen and Gucci) were criticized on a variety of factors, from risk disclosures related to forced labor in garment manufacturing, to recruitment policies used at their suppliers’ factories. The report cast a particularly harsh light on Prada — describing its leading practice as “none,” while alleging the design house has done virtually nothing on matters ranging from traceability to monitoring. Prada has long pledged that it has “respect” for human rights, but in these NGOs’ view, it’s done little other than post those words publicly on its website.

Rounding out the list were two Chinese apparel giants, knitwear manufacturer Shenzhou International and Belle International, maker of women’s shoes. Those companies have also accomplished little save for posting a few words on their websites, the NGOs found. So what can companies do, other than find new ways in which to audit their factories and launch processes to ensure they are not buying from unethical suppliers and subcontractors?

Eliminating oppressive recruitment fees would be a start, insist the NGOs’ researchers. One problem companies confront in their supply chains is that many job brokers charge their recruits hefty fees, which leaves the door open to more exploitation – and can even leave workers subjected to debt bondage. Apparel companies could also do more to share grievance procedures with their workers, as only 4 of the 20 companies surveyed had such a policy. Over 20 years after human rights abuses in garment sweatshops rocked the apparel industry, improvement in the sector’s respect for human rights still has a long road ahead. “The fast-growing garment sector can create important opportunities for its 60 million workers worldwide – many of whom are women,” said Annabel Short, deputy director of the Business and Human Rights Resource Centre. “Yet far too many remain exploited, including in situations of forced labor.”

SOURCE: The Triple Pundit

Back to top

 

Ethiopia: Efficient Textile, Garment Industries to Boost Export

The textile and garment industry is one of the rising sectors in Ethiopia. It is one of the developmental sectors that are given a due attention by the government in the second Growth and Transformation Plan II (GTP II). Aspiring to increase the export from the sector by one billion USD by the end of GTP II, the government is demonstrating commitment in investing in the sector. The sector is also expected to create more than 300,000 jobs during the plan period. In addition to the suitable policy concerning the sector, the nation is placed in the disadvantageous position with easy access to international value chain and it has abundant and competitive workforce, according to Ethiopian Investment Commission (EIC).

 

On the other hand, different incentives have been provided for foreign investors and local small scale and medium textile and garment associations in order to encourage the sector. According to Siyoum Wujira, Garment and Textile Directorate Director at the Ethiopian Textile and Garment Agency, small and medium industries have been given support in terms of structure, training, work shops, loan, machinery lease, finance, advice services, market linkages and the like.

Girma Tafere, a Senior Officer in technology transformation and training directorate at Textile Industry Development Institute, said that the Institute provides chemical and environmental laboratory facilities, spinning, garment technology, weaving, knitting and trainings. According to him, the number of middle and higher industries of the sector has currently reached 161. The progress of the sector is promising, the export status accelerated from 7 million in 1990 to 111 million USD in 1998. Moreover, the national export has been growing from 0.9 to 3.8 per cent. However, some inconveniences remain to be challenging to the progress of the sector.

Aiming at improving support methods for small and medium textile and garment industries, a four-day capacity building training took place in Wolkitte town from November 29 to December of this year. The training was organized by joint coordination of Small and Medium Manufacturing Industries Agency and stakeholders. According to a training document prepared by the Ministry of Industry, the major challenges are lack of input with fair price, quality and quantity, lack of skilled man power, and less improved technologies. On the other hand, investors' (engaged in small and medium textile and garment) lack of awareness on the sector was mentioned as another issue to deal with and which made such a training mandatory. Daniel Gobena a trainee and catalyst in the textile industry from Gundish Meda site of Addis Ababa told journalists that he expects the training would bring tangible solutions for the problems that the industry is facing. He added that shades have been provided for associations to use them as work shops for five years.

In five years, someone has to work and improve his/her business and then leave the shade for a new coming job seeker. "There are so many who have transformed their business and moved from state owned shades to their own shops and there are some as well who failed because of less awareness about the use of the shades," he noted. On the other hand, slow process on credit access and some maladministration of the shades are few challenges for small and medium scale associations or people organized in textile and garment sector, according to him. Textile and garment fields still serve as bench marks for the growth of other industries. In Ethiopia, there is also a huge and untapped potential for cotton production which is the major input for the industry. Therefore, strengthening access and incentives for small and medium textile and garment industries, and most of all improving the competency of the labour force in the sector should be given due attention. The sector also need committed and modern management system in a way that can raise the small industries baselines to the higher ones.

SOURCE: The All Africa

Back to top

 

Success of Bangladesh's "Green Factories" in RMG sector

Bangladesh should rejoice at the news that seven industrial units of the country have ranked among the top 10 on a list of the world's 25 most environment-friendly factories. Until recently, Bangladesh's readymade garment (RMG) sector had been highly criticised by numerous quarters of the international community before coming under government scrutiny. However, the Leadership in Energy and Environmental Design (LEED) certificate awarded by the U.S. Green Building Council, a Washington-based NGO, is a testimony to Bangladesh's success in ensuring maximum environmental safety of its workplaces.

 According to the list - Remi Holdings, the RMG factory in the Adamjee Export Processing Zone (EPZ) of Narayanganj District became the number one environment-friendly factory in the world. Narayanganj's Plummy Fashions became the runners-up. In addition, the country's other industrial units that made it to the list include Vintage Denim (owned by ABA Group), SQ Celsius 2, Genesis Washing, SQ ColBlanc and SQ Birichina. Owners, mangers, employees and workers along with all active stakeholders of these factories deserve applause for their extraordinary achievements. Undoubtedly, their collective effort has lead to a sterling success in protecting the workplace environment, setting an example for others to follow.

Nevertheless, the idea of a "green factory" (with maximum eco-friendly facilities for workers) should cover factories not only in the country's RMG sector but also in other sectors. There are numerous complaints regarding the environmental safety of Bangladesh's other industrial sectors. Meanwhile, owner of one of the top 10 environment-friendly factories commented that the buyers would not pay extra despite the high cost of making a factory environment-friendly. These foreign buyers who are so concerned about the workplace environment are not likely to contribute their shares to an actual commitment in ensuring environmental safety of the factories. Reneging on their commitment is worse than playing a double-standard role.

However, others should learn a great deal from the recent achievements of Bangladeshi factories. Time has come to rectify the distorted image of the country's RMG sector left by Tazreen Fashions and Rana Plaza factory incidents. The process of upgrading standards of workplace environment in every other sector of the country should start now. After all, those people behind the success of these RMG factories have demonstrated that building and sustaining a green factory are not beyond people's power here. According to Bangladesh Garment Manufacturers and Exporters Association (BGMEA), amid a tight scrutiny from the government, most of the Bangladeshi RMG factories now provide for a tolerable workplace environment with adequate humanitarian facilities for workers and staff. Evidently, the US government has lost its justification before declining to grant any GSP facility to the Bangladeshi RMG companies.

Washington never hesitated to express its once-justified concern about the workplace environment in Bangladesh. But it has not asked reluctant buyers there to pay a fair price. This is simply unacceptable. Dhaka should further raise the issue in a dialogue with the US government. The growth of the country's economy rests on the country's RMG sector, one way or the other.

SOURCE: The Financial Express Bangladesh

Back to top

 

McMaple launches new rayon fabric for garments

McMaple Textile Company, a leading rayon and viscsose fabrics company, has launched a new rayon fabric that is perfect for garments. Available in black and red colours, the new product is plain woven with density 68*68, yarn count 30*30, width 63”, and weight 127g. The company has also launched a new printed dress material woven rayon fabric. The new printed dress material has classic chic pattern that make the colour of hair and skin look more elegant and stylish. Deisgners' favourite from New York to Paris, this fabric has yarn count 45*45, density 100*80, width 142 cm and weight 110-115g.

McMaple rayon and viscose fabrics are highly absorbent with superior drapability and dye ability, stated Wen Wei, technical manager for McMaple. “It is ideal for the hot and dry weather environment apparel, from dresses, tops to shirts, and this rayon fabric is completely opaque.” McMaple is also helping the fashion industry to take first-mover advantages with its digital printed rayon fabrics. McMaple has launched the new digital printing technology which enables garment manufactures launch a new product in a short time through creative idea, prototype to bulk production.

Compared to dye printing, digital printing has a higher productivity, the printing quality is more steady and robust, and can also produce small quantity products in a quick time for prototype and bulk production. McMaple utilises the digital printing technology to print more customised patterns and colours. Headquartered in Hong Kong, China, McMaple has facilities in Zhejiang, and sustainable suppliers in Shandong. McMaple also has office in Shanghai, and warehouse in Shaoxing, Zhejiang.

SOURCE: Fibre2fashion

Back to top

 

Techtextil and Texprocess in the age of space travel

Under the heading Living in Space and in cooperation with the European Space Agency (ESA) and the German Aerospace Centre, Techtextil, a show for technical textiles and nonwovens, and Texprocess, a leading trade fair for processing textile and flexible materials, will illustrate the broad spectrum of applications for technical textiles, with examples from the aerospace sector. “Space fascinates people all over the world. All our space missions are backed by many years of research and innovation in which new materials and processing technologies played a decisive role,” commented Frank Salzgeber, Head of ESA Technology Transfer Programme Office (TTPO), on the collaboration with Techtextil and Texprocess. Both shows will take place from 9-12 May 2017 in Frankfurt, Germany.

Techtextil and Texprocess will showcase products and processes covering almost all aspects of human life, from clothing, via building and mobility, to safety, medicine and agricultural technology. “It will take several years before we can hold fairs on Mars. Until then, we will show at Techtextil and Texprocess products and processes covering almost all aspects of human life, from clothing, via building and mobility, to safety, medicine and agricultural technology – in other words, all those fields that are necessary for travel and survival in space,” commented Olaf Schmidt, Vice President Textiles and Textile Technologies, Messe Frankfurt.

Expert lectures

In addition to a space-oriented area, insights into the start-up scene and expert lectures are planned. Based on the areas of application for technical textiles, Techtextil will present high-tech textiles and textile processing technologies from and for the space sector revolving around four main themes. Mobility brings together examples of applications relating to locomotion in space, such as lightweight structures for space capsules and parachute fabrics. Clothing covers the subject of functional garment textiles such as space-inspired high-tech fashion. Civilization stands for textile products for survival, e.g., geotextiles for growing foodstuffs and textiles for medical applications, as well as for energy production or filtration. Architecture presents applications for dwellings and the infrastructure.

Materials for aerospace industry

According to the German Aerospace Industries Association, the German aerospace industry generates annual revenues of EUR 34.7 billion and is set to expand further. With a growth rate of 12% a year, aerospace is one of the world’s driving forces for growth in the field of carbon-fibre reinforced plastics. Techtextil will present high-tech textiles and textile processing technologies from and for the space sector. Used in components of space capsules and fuel tanks, this heat and deformation resistant material cuts weight and, therefore, transport costs. Fibre-reinforced composites are also used in the folding antennae of communication, which can be as much as 30 metres in diameter when opened, and earth observation satellites. Last but not least, a space suit consists of numerous layers of high-tech textiles that protect the astronaut from heat and radiation at the same time as regulating the body temperature.

Dr Rolf-Dieter Fischer, Director, DLR Technology Marketing, said: “Thanks to their extreme durability and temperature resistance, many of the materials developed for space travel are finding their way into everyday products, and vice versa. This is particularly true of fibre-based materials with materials developed for space suits that regulate heat and moisture now being used in sports shoes, garments and home textiles.”

SOURCE: The Innovation in Textiles

Back to top

 

FTA names Hoggle as representative for US & Canada

Brussels based Foreign Trade Association (FTA), has appointed a new country representative in the United States to services its members, located in both, Canada and the US. Kelli Hoggle will offer support and guidance in two FTA programmes, the Business Social Compliance Initiative (BSCI) and the Business Environmental Performance Initiative (BEPI). Kelli Hoggle, will also assist FTA members sourcing from the region and actively engage with producers on the ground to support their sustainability efforts. FTA represents over 1,900 retailers, importers, brands and national associations to promote and defend international trade and supports their business by providing information and practical solutions towards sustainability in the global supply chain. The association provides the Business Social Compliance Initiative (BSCI) to support participants to improve working conditions in factories and farms worldwide. It also provides the Business Environmental Performance Initiative (BEPI) to facilitate improved environmental performance in global supply chains.

SOURCE: Fibre2fashion

Back to top