The government of Gujarat will sign a memorandum of understanding (MoU) with the Southern Gujarat Chamber of Commerce and Industry (SGCCI) for the development of a mega textile park. The agreement that will be inked during the upcoming Vibrant Gujarat Summit aims to come up with a mega textile park worth Rs 1,800 crore at Pinjrat near Olpad in Surat. The four-day Vibrant Gujarat Summit will begin from January 10. The establishment of mega textile park will bring about a change in the Surat textile sector, said SGCCI president BS Agarwal. The government will be allotting 70 lakh square metres of land for the textile park. With a total investment of around Rs 10,000 crore, the park will accommodate nearly 100 textile processing units, 40 water-jet weaving units, 225 garmenting units and other textile ancillary units, according to a leading daily. Huge textile processing units, each with an average manufacturing capacity of around 3 lakh metres of fabric per day, will be set up in the textile park. Of the total production, 50 per cent will be converted into apparel and home textiles while the remaining will be sold to other parts of the country. At present, the processing units in Surat that are situated in Pandesara, Kadodara, Palsana and Sachin industrial have only one Common Effluent Treatment Plant (CETP) per unit, said Agarwal. Surat is unable to produce apparel in huge quantity due to lack of facilities for proper disposal of effluents. This is hampering the Surat export market as garments in huge quantity of same quality are required for exports.
Source: Fibre2fashion
In a major announcement, Central Board of Excise & Customs (CBEC) has said that it has initiated the migration of its existing Central Excise/Service Tax assesses to GST. While the date for implementation of GST is still not clear, CBEC has started the process to be totally prepared for the new GST era. The initial deadline was April, 2017, but that is no longer a realistic one considering the political opposition to the move that has come up. However, Finance Minister Arun Jaitley has indicated that the standout new tax law will be implemented this year. Various reports have indicated that the most likely date for its implementation will be somewhere in the middle of the year or the monsoon season. The problem for GST arose in the wake of PM Narendra Modi led NDA government implementing the demonetisation drive in which it effectively banned the Rs 500 and Rs 1000 notes in an effort to neutralise the black money economy as well as turn the tap off on terror funding. While Opposition said it supports the government’s black money fight, it said the implementation was done in a very poor manner leading to the public being quite inconvenienced – for 50 days and over people were seen standing in long queues in front of banks and ATMS in an attempt to get access to their own money. Another move of the government that upset the Opposition was its moving the Budget 2017 date from end of February to the first of the month. With assembly elections to 5 states in the offing, including crucial states like Uttar Pradesh and Punjab, the other parties are saying the PM Modi dispensation is looking to boost the chances of the Bharatiya Janata Party (BJP) at the hustings by announcing sops in the Budget. If the existing Central Excise/Service Tax Registration Code does not have PAN, then PAN has to be obtained from Income Tax Department and the registration details have to be updated in the ACES portal www.aces.gov.in, CBEC said. The tax department has made available a 24×7 helpdesk (Toll free no: 1800-1200-232, email: cbecmitra.helpdesk@ icegate.gov.in) for the purpose of assisting existing assessees. GSTN also has a Help desk number: 0124-4688999 and GSTN email address is: help@gst.gov.in. A step-by-step Taxpayers User guide for Migration is available at www.aces.gov.in and at www.cbec.gov.in, the statement said. CBEC is also sending e-mails/recorded telephonic messages to all registered assessees requesting them to migrate to GST. Outreach programmes such as awareness workshops/training are being organised all over India at the Commissionerates and Divisional offices of CBEC.
Source: The Financial Express
The pace of implementation of Indo-Japan free trade agreement needs to be further enhanced in order to exploit the huge potential of the pact, Commerce and Industry Minister Nirmala Sitharaman said today. The issue among others was discussed during the meeting between Sitharaman and her Japanse counterpart Hiroshige Seko. She stated that the pace of implementation of India-Japan Comprehensive Economic Partnership Agreement (CEPA) has been rather steady and needed to be enhanced with faster pace to tap the huge potential of India- Japan bilateral trade, an official statement said. Japan’s Economy Trade and Industry Minister Seko said that there is a huge potential for Indo- Japanese Cooperation and mentioned that 25 Japanese companies are participating in Vibrant Gujarat Summit with great enthusiasm. The Japanese side requested that the issue of Transfer Pricing assessment and other ones as raised by Japan Chambers of Commerce and Industry in India (JCCII)from time to time need to be resolved for attracting greater Japanese investments in India, the statement said. The Japanese business delegates briefed about their business presence in India and intimated that they wanted to diversify their business in India in Sectors such as Agriculture, Power, Electronics, Railways, Logistics Sectors, manufacturing of ATMs etc and wanted to contribute to the development of India. The Japanese side expressed interest in enhancing cooperation in the area of Intellectual Property Rights (IPR) between India and Japan and intended to train Indian IPR examiners in Japan. They expressed the need for a high level meeting between India and Japan on IPR cooperation. Minister of METI, Japan also extended an invitation to 100 IPR Examiners for training in Japan, the statement said. Sitharaman requested the Japanese side to take steps to increase Indian Exports to Japan in Sesame seeds, Surimi fish and Indian generic drugs. She said that the Japanese Industrial Townships (JITs) in India would be transformational and will bring in significant Japanese investments and further strengthen India- Japan Economic Cooperation. On the logistics front, she mentioned that India plans to build Logistics University wherein the cooperation from Japan would be needed.
Source: The Financial Express
A host of foreign leaders including Presidents, Prime Ministers and Foreign Ministers of several countries will converge at Gandhi Nagar to attend the eighth edition of four-day-long Vibrant Gujarat summit beginning on Tuesday. The summit will be formally inaugurated by Prime Minister Narendra Modi. PM Modi landed in Gujarat yesterday and participated in events related to the summit. The biennial summit, a brain child of PM Modi will be held at Mahatma Mandir. It was started with the aim to attract investment in Gujarat by then state chief minister Narendra Modi. The PM on Monday inaugurated India’s first international exchange –India INX — at the International Financial Service Centre (IFSC) of GIFT City in Gandhinagar, saying it will enable Indian firms to compete on equal footing with offshore firms. As many as 12 countries and seven global organisations have joined as partner countries and organisations.Twelve countries which have partnered the Summit are Australia, Canada, Denmark, France, Japan, Netherlands, Poland, Singapore, Sweden, UAE, UK, and the USA. Seven partner organisations – Australia India Business Council, Indo-Canada Chambers of Commerce, Japan External Trade Organisation, UAE India Business Council, UK India Business Council, US India Business Council, and British Council – will also support the Summit. He will chair a Global CEO round table, which will be a closed-door event with select global and Indian CEOs on January 10. The IAF, along with the Army and the Indian Navy will also showcase their wares at their respective stalls at the global trade show as part of the summit The Summit will be held from January 10-13. In the last Vibrant Gujarat summit, 21,000 MoUs for proposed industrial investment in the state of Rs 25 lakh crore were signed with Gujarat government. Officials indicated that they are expecting the figure of investments and MoUs will be higher this time and will cross Rs 25 lakh crore mark. As many as 157 MoUs in the education sector will be signed during Vibrant Gujarat Global Summit, which include big ticket investments of Rs 1,000 crore each for setting up two private universities. The 157 investment intentions approved by the state include seven for setting up private universities, eight for start-ups and research institutes, 18 for skill development and knowledge centres and 103 educational institutes, he said here.
Source: The Financial Express
Finance minister Arun Jaitley said the Centre’s direct tax collection was up 12.01% at R5.53 lakh crore in April-December 2016 compared with the revenue in the year-ago period, while indirect tax receipts soared 25% to Rs 6.3 lakh crore. (Reuters) Finance minister Arun Jaitley said the Centre’s direct tax collection was up 12.01% at R5.53 lakh crore in April-December 2016 compared with the revenue in the year-ago period, while indirect tax receipts soared 25% to Rs 6.3 lakh crore. (Reuters) Even as anecdotes and random surveys suggest large-scale job losses and decline in revenues of firms following the demonetisation move, the government’s tax numbers largely say a different story. Tax collections of the Centre and many states haven’t lost much pace during November-December, the cash-crunch period. Companies, traders and individuals revealing their concealed incomes, the use of demonetised notes for payment of taxes and utilities and increases in the excise duties on petroleum products could be part of the reason for the sustained tax buoyancy. Finance minister Arun Jaitley said the Centre’s direct tax collection was up 12.01% at R5.53 lakh crore in April-December 2016 compared with the revenue in the year-ago period, while indirect tax receipts soared 25% to Rs 6.3 lakh crore. That means the direct tax collections have kept pace with the Budget target of 12.6% growth for FY17 in the first nine months of the financial year, while indirect tax mop-up far exceeded the modest 10.8% annual growth target. In December 2016, the month that experienced the inadequacy of replacement currency the most, indirect tax collections saw a 14.2% growth over December 2015 and 12.8% growth over November 2016, Jaitley said. Excise revenue in December 2016 was up 31.6% annually, quite at odds with the fact that manufacturing activity, gauged by the Nikkei Purchasing Managers’ Index (PMI) survey, contracted for the first time in a year in the month as demonetisation curbed new orders as well as output of companies. The headline manufacturing PMI touched 49.6 in December, compared with 52.3 in the previous month. Excise collection was up 43% at R2.79 lakh crore in April-December this fiscal, while service tax revenue rose 23.9% to R1.83 lakh crore. Customs duty receipts were up 4.1% at 1.67 lakh crore in the first nine months of this fiscal year, even though in December it saw 6.3% decline owing mainly to the post-demonetisation fall in gold imports. In December 2016, the service tax growth was recorded at 12.4%, somewhat reflecting a slowdown in the sector. The seasonally adjusted Nikkei India services business activity Index posted 46.8 in December and 46.7 in the previous month, indicating broad-based output contraction. As for the direct taxes, gross corporate tax collections in April-December was up 10.7% in April-December this fiscal over the year-ago period while personal income tax (PIT) revenue (including securities transaction tax) saw a growth of 21.7%. After adjusting for refunds, the net growth in corporate tax was just 4.4% (against the budgeted growth for FY17 of 9%), but net PIT mop-up was a robust 24.6%. And refunds haven’t slowed down either: R1.26 lakh crore was released as direct tax refunds in April-December this fiscal, up 30.5% over the year-ago period. Analysts reckon the pay commission award has contributed to the robust PIT growth. The fact that tax revenues haven’t taken a major hit augurs well for the government with an obligation to step up spending to offset the impact of demonetisation on the economy — the advance estimate of national income released by the Central Statistics Office last week factored in a 23.8% jump in government final consumption expenditure to project a GDP growth rate of 7.1% in FY17. However, a broad-based recovery of the economy will hinge on how the private investments and consumption are going to pick up in the coming months supported by the recent reductions in bank lending rates. Banks’ credit growth, at multi-year lows for quite some time, hit a 62-year trough of an annual 5.1% in the fortnight through December 23, according to SBI chief economist Soumyakanti Ghosh. This is despite the fact that banks were flush with funds following demonetisation. While many states like West Bengal and Kerala have said their VAT collections have taken a hit due to demonetisation and demanded that the Centre enhance the goods and services tax compensation, Jaitley said that after the note ban VAT revenues have “increased for most states”. He also noted that while the facility for depositing VAT in old currency was there, 99% of the central taxes were paid in digital mode.
Source: The Financial Express
Of all the things that the 1991 interim budget presented by Yashwant Sinha brought about, including liberalisation and globalisation, there was also the policy of divestment. Though the dispensation of the day had thought of divestment as more of a market-balancing strategy, it has been increasingly used by governments, that too unsuccessfully, as a tool for containing the fiscal deficit. In fact, an analysis of data since FY92, when the policy was first initiated, shows that the government has time and again missed its targets for divestment. So much so, that in the last 25 years, the government has only been able to achieve the target on four occasions. Though the situation has somewhat improved since FY12, the realisation of budgeted receipts at 49.5%, has lagged the long-term average of 52.2%. While the current government changed the name of the department from divestment to department of investment and public asset management (DIPAM)—also restarting the policy of strategic sales—the situation has not changed much. The government was able to meet just 34% of the Rs 69,500-crore target set for FY16 (this includes Rs 28,500 crore set for strategic sales); DIPAM data shows that it has only achieved 42% of the budgeted Rs 56,500 crore till November 30. With sluggish growth, slowing investment and demonetisation expected to play havoc with government’s finances, the finance minister will have to ensure that the government can trump the trend in FY18. With the government targeting strategic sales and following planned divestment, unlike in the past when governments used to scramble at the end to garner assets leading to low valuations, there may be better outcomes down the line, next year perhaps.
Source: The Financial Express
The latest release of CSO data on advanced estimates of GVA/GDP for FY17 has put estimated real GDP growth for the year at 7.1%, 0.5% lower than the previous year. As these estimates are based on the data prior to the commencement of the demonetisation exercise, it is likely that the full year GDP growth rate may be marginally lower in view of slowdown in cash based sectors. In first half of the current fiscal, the country has grown by 7.2% and hence to achieve a 7% growth in the full year, the country must grow at 6.8% in the second half. This is a probable scenario if the performance of the economy in fourth quarter takes place on a growth momentum mode. It is heartening to note that agriculture sector is projected to achieve 4.1% growth rate in FY17 as against a meager 1.2% in last year. Good agriculture production has a significant contribution to income and employment generation, lower pressure on migration and improving the quality of life in the rural areas which would ultimately enhance rural consumption. For the industrial sector, a look at some of the relevant sectors would reveal the intensity of the driving forces. The projected growth at (-) 1.8% in mining and quarrying sector against a growth of 7.4% in the previous year is worrisome. The major two components in mining, namely coal and iron ore are dependent on the demand from the end using sectors, steel and power. The fresh activities in the auctioned mines have just started and the pace of the activities would be driven by demand from the end using sectors. The demand for coal from the power sector (especially from the industry sector) has slowed down resulting in staggering of the FSAs with CIL. In manufacturing, around 72% estimates are based on the performance of private corporate sector (listed companies) and around 23% is accounted for by the performance of the quasi corporate and unorganized sector as obtained from IIP index on manufacturing. As manufacturing IIP has grown by (-) 1.0% during April-October’16, the extrapolated projection level for this sector is subdued and may have pulled down the total GVA growth in manufacturing at 7.4% against 9.3% achieved in last year. It may also be mentioned here that compared to last year’s negative growth, the WPI in manufacturing has grown by 2% in April-November’16 period and this has positively contributed to GVA growth in manufacturing. Construction sector has been projected to experience one of its lowest growths in the recent past at 2.9%, a clear 1% drop from the previous year. The latest sops announced for personal loan rates and subsidised loans for affordable housing sector are definite steps to rejuvenate the real estate sector in fourth quarter and may pull up the depressing growth rate a bit upwards. The highest growth rate has been predicted for financial, insurance, professional services at 12.8% which is nearly double the rate achieved in the last year. The industrial growth in the country comprising of mining, manufacturing, electricity, gas and water supply and construction segments is crucially dependent on investment reflected in gross fixed capital formation as a percentage of GDP. At constant prices (2011-12 prices) the GFCF as percentage of GDP has progressively come down from 32.3% in FY15 to 31.2% in FY16 and has been projected to reach 29.1% in the current fiscal. We had earlier discussed that a minimum 5% growth in GFCF/GDP ratio from the current level of 29% is needed primarily targeting the infrastructure sector. The composition of GFCF needs to be oriented towards energy, railways, roads, irrigation, ports, urban development, airports, storage and warehouses, real estate segments in order to make a positive impact on the growth of critical sectors like steel. The consumption of steel in the country in the first 9 months of the current year has experienced a growth of 3.3%, while the production of crude steel has grown by 8.5%. In order to stimulate more demand to absorb the likely expansion of fresh capacity, the investment scenario has to perk up significantly in the coming months.
Source: The Financial Express
Finance minister Arun Jaitley has made light of the demonetisation impact on GDP—HSBC has just lowered its FY17 estimate to 6.3% as compared to FY16’s 7.6% growth—by highlighting the fact that April to December tax collections at both the central and state government levels have been quite robust. A report in The Times of India (ToI) suggests VAT collections grew 26% in Maharashtra in November and 17% in December—only 3 of 17 states for whom the data is available, ToI reported, showed a decline in VAT collections; even West Bengal, which saw an 8% fall in December reported a 10.8% rise in November. An official release shows April-December direct taxes for the Centre rose 12% and indirect taxes 25%—while direct taxes are in line with the FY17 budget targets, indirect taxes grew at more than double the budgeted 10.8%. That is great news in an economy where a rise in government spending is critical for making up for the continued slowing in investment growth—also, there are going to be significant shortfalls in divestment and telecom revenues, so a high tax mop-up is critical. In the long run, Jaitley is right, there is a correlation between GDP growth and tax growth—between FY09 and FY17, GDP grew 2.72 times and central taxes 2.69 times. Even this, though, may not hold if there is an increase in formalisation of the economy or a greater drive to capture untapped sections. Which is why, in the 2000s, as more and more segments of the economy were being made to pay service tax, the buoyancy was as high as 8.7 times—but, over time, this fell to 2.37 in the 2010s. In the case of corporate taxes, buoyancy has plummeted from 2.96 to 0.69; but for excise, it has jumped from 0.25 to 1.37. In the short-run, the relationships fluctuate a lot more. Between FY01 and FY02, GDP growth rose from 7.6% to 8.2% while personal income tax growth plunged from 23.8% to 0.8%; between FY08 and FY09, GDP growth slowed from 16.1% to 12.9% while personal tax growth plunged from 36.7% to 3.3%—neither of these are results you would expect in the normal course. In the case of service taxes, when GDP growth fell from 12.2 in 1999-00 to 7.6% in FY01, growth in service tax collections almost trebled, from 8.7% to 22.8%; but while GDP growth rose from 12.9% to 15.1% between FY09 and FY10, service tax growth fell from 18.8% to minus 4.1%. This unpredictable pattern is also evident in the April-December data put out by Jaitley, even though the overall number shows a buoyant trend. So, while personal income tax grew 10.7% versus the FY17 budget’s estimated 9%, excise duties rose 43% versus the projected 12.2% and service taxes grew 23.9% versus the projected 10%—surely a 43% hike in excise revenues, levied on the top-line of firms, is not in keeping with corporate tax growth of a mere 10.7% even if you account for the impact of price changes? While demonetisation clearly cannot be judged by what happens to taxes in the short-run, its success has to be gauged over the medium term, and in terms of how many more taxpayers are brought into the net and how fast tax-to-GDP level rises. Between 1990-91 and FY17, India’s tax-GDP ratio has risen only from 9.8 to 10.7, after falling to 8.4 in 1999-00—for an economy where the share of the black economy has fallen dramatically, that’s a poor show and highlights the need for serious thought on how tax rates/structures are to be revamped.
Source: The Financial Express
MCL News and Media has launched a new briefing, which provides in-depth, practical advice on the critical issue of due diligence in textile sourcing. The report, written by international textile consultant and Ecotextile News correspondent, Simon Ferrigno, explains the due diligence concept and discusses how it is much more than just compliance to third-party textile standards and basic risk management. For any retailer or brand that is not only concerned about mitigating risk, but is also looking to improve its impact on the environment and the lives of workers in its supply chain – this special briefing is a ‘must-read’ report for your business. Spread over four parts, ‘Due Diligence in Textile Sourcing’ asks whether current due diligence initiatives are a sophisticated way for retailers and brands to cover their backs, or whether it is a valuable tool for companies and investors upstream to ensure they comply with certain legal and moral imperatives of sustainable development. The report also looks at how due diligence moves beyond the limitations of textile standards, which in the instance of cotton, can often ignore key questions outside their crop and immediate farm boundaries. With the OECD recently presenting draft textiles guidelines for consultation, this briefing also uses the example of an ‘organic’ cotton farm project in the Lower Omo Valley, Ethiopia as a yard-stick for what might pass a due diligence test, which goes well beyond ordinary third-party certification. “Due diligence is often seen as an essential tool and process for companies to identify, assess, mitigate, prevent and account for how they address the actual and potential adverse impacts of their business activities,” says Simon Ferrigno. “However, this process not only concerns adverse impacts caused or contributed to by companies, but it also considers those potential and actual adverse impacts that are directly linked to their operations, products or services through a business relationship. “This is an important distinction because due diligence goes beyond direct relationships and in the case of the textile industry goes well beyond the Tier 1 level suppliers to retailers and brands. As such, the obligation is however on this final user to leverage others in the supply chain to action, to create improved transparency and understanding.” A wider list of recommendations can be found at the end of this four-part briefing, which gives a thorough introduction about why due diligence is a must for apparel buying teams. It then drills down further to examine how a comprehensive due diligence programme by retailers and brands can impact on the environment, economy and society, and finally how it can dove-tail into policy and governance.
Source: EcoTextiles
GAR Corporation has proposed to set up two IT/ITeS zones in Telangana, while Vaxenic India wants to set up biotechnology and bio pharmaceuticals SEZ in the state. (Reuters) SEZ Farmers Protection Welfare Associations, an NGO, claimed that between 2010 and 2015, several state governments had notified a total of 4842.38 hectare of land as SEZ land, and out of that the companies have utilised only 362.25 hectare for SEZ. The Supreme Court on Monday sought response from the Centre and seven states on a PIL seeking compensation and return of the unused land, which was acquired for setting up Special Economic Zones (SEZs), to farmers. It has also sought a CBI probe into all the alleged instances of “misuse” of SEZ land for other use including real estate. SEZ Farmers Protection Welfare Associations, an NGO, claimed that between 2010 and 2015, several state governments had notified a total of 4842.38 hectare of land as SEZ land, and out of that the companies have utilised only 362.25 hectare for SEZ. The bench led by chief justice JS Khehar asked the ministry of commerce and industry and the seven states –Telangana, Andhra Pradesh, Maharashtra, Tamil Nadu, Karnataka, Punjab and West Bengal — to file their reply in four weeks to the plea raised by the NGO. While stating that the land was acquired for setting up SEZs by the states, it said that most of the land is lying unused and even some corporates have either taken heavy loans from banks or have diverted the land to other uses like real estate. Quoting a government committee on land reforms, it said that more than 2.1 million hactare of agricultural land has been transferred for non-agricultural purposes during 1990-2003, the NGO said. Senior counsel Colin Gonsalves, on behalf of the NGO, said the companies have very often borrowed from banks by mortgaging these lands and have raised more than R6,000 crore. Even a CAG report in 2014 found that of the 50 SEZs that were approved for the state, only 15 are operational, six have been denotified and as many as 29 are still to start commercial activities, he said. The senior counsel further told the bench that the government has admitted in the Rajya Sabha that as high as 40% of the total land acquired for SEZ across 20 states of the country remains unutilised up to March 13, 2015. “In a written reply to a Rajya Sabha question, Nirmala Sitharaman, minister of state for commerce and industry (Independent Charge) had provided figures on the unutilised land in various states. She said that in four states — Nagaland, Manipur, Goa and Jharkhand — 100% of the SEZ land acquired remains unutilised, while in seven out of 20 states 50% of the total land acquired under SEZ remains unutilised. Some of the states with high ratio of unutilised SEZ lands include Chhattisgarh (78.24%), Haryana (70.69%), Rajasthan (82.31%), Uttar Pradesh (63.24%),, Tamil Nadu (53.08%), Punjab (67.04%), Chandigarh (59.60%),” the petition said. The PIL further said that more than 77% of notified SEZ land is concentrated in four states – Andhra Pradesh, Gujarat, Maharashtra and Tamil Nadu. These states have acquired 35,415 hectare of land out of 45,782 hectare of total land acquired by the 20 states. Besides, the SEZ developers allowed purchasing agriculture lands with the support of local government officials/police in various states, it said.
Source: The Financial Express
The textile town of Solapur — known for its unique blankets, towels and handloom fabrics — is all set to emerge as country's hub for manufacturing uniforms for various institutions, informed Shri Solapur Readymade Kapad Utpadak Sangh officials on Thursday. Office-bearers of the organisation were in Pune to promote India's first International Uniform & Garments Exhibition that began in Solapur from January 5 and will conclude on January 7. "With adequate support from the state and central governments, Solapur can become a supplier of uniforms to the nation as the city and region has ample labour supply. With some elementary skill training they can become ready for the uniform manufacturing industry," the officials said in a press conference. Nilesh Shah, vice president of the organization, said Solapur has close to 70 small units that manufacture uniforms and currently do a business of about Rs 600 crore — catering mainly to the school uniforms segment. "With support from central and state agencies Solapur can claim a much larger pie of the Rs 18,000 crore uniforms manufacturing business in India," he said. The vice President (Sales & Marketing) of Mafatlal Industries Ltd MB Raghunath said Solapur is well connected by road and rail with the rest of the country and will be an ideal centre for wholesalers and retailers of uniforms to access. "The uniform industry is growing at 25-30% annually and the government can itself be a major buyer of uniforms for its departments like home department or health department," he said. Among various demands of the organisation are appropriate land to develop a uniform manufacturing park and skills training institute focused on skill training," Shah said. Machinery manufacturers, suppliers of other services to uniforms industry, textiles companies and wholesalers and retailers of uniforms from countries such as Iran, Iraq, Sudan, Kenya and Czech Republic are participating in the three-day exhibition. Baliram Balu Chavan, deputy textile secretary, said the state government has sanctioned a sum of Rs 18 lakh for the exhibition and allotted space for the show. "The government will be open to consider aspirations of the uniform manufacturers in Solapur if they come with a detailed proposal," he said.
Source: Times of India
Manufacturers from the textile town of Solapur are hoping for achche din after state textile minister Subhash Deshmukh on Thursday gave his nod for setting up the proposed garment park at Narsing Girji (NG) Mill that is spread across 27 acre. Deshmukh was in Solapur on Thursday for the inauguration of a three-day International Uniform and Garments Exhibition. Amit Kumar Jain, joint secretary, Shree Solapur Readymade Kapad Utpadak Sangh, said, "After thorough discussion and analysis we have come to a conclusion that it will take around Rs 300 crore for setting up the textile park. The NG Mill can easily host around 50 manufacturing units, which will help in booming the current business of uniform manufacture in Solapur from Rs 600 crore to Rs 3,000 crore. Jain said the proposed park's ground-breaking ceremony is likely to take place on January 26 and the preparations for the same will begin soon. He added that at present Solapur has close to 70 small units that manufacture uniforms and currently do a business of about Rs 600 crore.
Source: Times of India
With the shortage of labour, spinning mills in Tamil Nadu are unable to run their units on a daily basis. The number of shifts has come down to two or one per day. With inadequate workforce, they are unable to carry out production to the capacity, resulting in piling up of yarn stocks and plunge in yarn sales. Since the start of demonetization drive, as most of the mills rely on migrant labourers , who have returned to their home towns and will come back only when there is sufficient cash flow in the market. Also as per yarn merchants, the migrant labourers are unable to open bank account as they do not have identity proofs. According to secretary of Coimbatore Yarn Merchants and Brokers Association C T Nehru Ramanathan, due to the fall in production, the loss incurred is anything between 15% and 25% as compared to the business two years ago. Also yarn exports have come down. He urged the officials from the central government to visit the region to take stock of the industry's problems. Centre's support is needed to revive the industry. With fall in yarn supply, weaving units have also shrunk their output. The president of Federation of Tamil Nadu Yarn Merchants Association, T Ramasubramaniam said that most weaving units have temporarily closed. They only function two or three times a week or for important orders. On any given time, most big spinning mills have stock of 15 days to 30 days. Now, it has piled up to three or four months.
Source: Yarns and fibres
Khadi and Village Industries Commission (KVIC) will set up high-end outlets called Khadi Lounge in Lucknow, Delhi and Jaipur to promote the fabric for masses. The lounge will offer premium varieties of stylish and elegant silk and new designs of readymade apparel made of khadi. The association will also renovate its 178 outlets using Rs 80 crore grant. Khadi lounges in Delhi, Lucknow and Jaipur will stock premium collection of khadi silk and new readymade khadi apparel that will satisfy khadi lovers’ quest, said Vinai Kumar Saxena, chairman of KVIC. The first lounge has been opened in Mumbai and it will offer designer garments made of khadi for men and women. High fashion garments designed by fashion designer Ritu Beri will also be showcased at the lounge. The chain of khadi lounges is being set up to showcase the best of handcrafted products and fabrics, according to media reports. Buying one piece of khadi cloth will generate employment for one artisan, said Haribhai Choudhary, minister of state for MSME, while inaugurating the lounge in Mumbai. He added that 94 per cent of employment is generated by MSMEs, while public sector generates merely 4 per cent. This sector also contributes about 65 per cent to the GDP growth. MSMEs are also taking up the ZED (zero defects, zero effect) movement and over 10 lakh units should be established. Close to 50 parameters have been decided to meet ZED certification, said Choudhary. KVIC is aligned with Prime Minister Narendra Modi’s vision for khadi and is committed towards the Make in India initiative, said Saxena. The association has taken the steps to help implement PM’s mission of making khadi a fashionable garment, said Usha Suresh, CEO of KVIC. (KD)
Source: Fibre2fashion
Arvind, one of India’s leading integrated textile players and also one of the largest denim manufacturers in the world with exposure to both textile and apparels segments. The company plans to focus on its garment business to increase its margin. Arvind is looking to increase the share of fabric sold as garments from 6% now to 20% in the next few years. Further with the expected growth in the Indian retail space, due to rising incomes, urbanisation, attitudinal shifts, etc., will be the main trigger for expansion. Arvind should be able to benefit from the growth in the retail sector. Since its garments segment holds several well-known foreign-licensed brands such as Arrow, Tommy Hilfiger, US Polo, Flying Machine, Calvin Klein, Nautica and Izod. Moreover, with China losing its competitive edge in textiles due to increasing labour costs and this should help Indian textile companies such as Arvind. India is the world’s second-largest raw cotton producer and textile exporter, next only to China. The government initiatives, such as Make in India and enhanced Technology Upgradation Fund Scheme, will also benefit the sector. Arvind with the required financial muscle for future investments and acquisitions is another reason why the retail counter is ready for a rerating. Arvind is already planning two garments units in Ethiopia and this should add an additional annual revenue of around Rs 1,000 crore.
Source: Yarns and fibres
Bombay Dyeing, the textile flagship of the Wadia Group, to restructure its retail business and to make it profitable by the next fiscal year has roped in PricewaterhouseCoopers, Microsoft, KPMG and EY. They are completely overhauling the business with help from the consultants to turn the loss making retail business to cash positive. PwC and KPMG are working to define the standard operating procedures to turn the business as a pure retailer with a focus on attracting young consumers and talent, Microsoft and EY are going to put in place a new technology architecture right across manufacturing to the sales point, said Nagesh Rajanna, Bombay Dyeing's chief executive for retail operations. In 2015-16, Bombay Dyeing reported a net loss of Rs. 85 crore on sales of Rs. 1,845 crore. The retail division posted sales of Rs. 306 crore, while the larger contribution came from the polyester staple fibre business. Rajanna said that the retail business is targeting sales of Rs. 1,000 crore by 2020 so that the company's contribution to the Wadia Group revenue increases to 30% from 17% now. Bombay Dyeing's ecommerce website will aim to provide a virtual experience of its products to the consumer to help drive sales. They also have joint business plans with leading marketplaces like Amazon, Flipkart, Snapdeal, Myntra and Paytm. Ecommerce sales will contribute 10% of their revenue. It has roped in young talent with FMCG and telecom background, including from organisations like WalMart and Airtel, to drive the change. The company plans to also double the sales and marketing force of 1,000 people in four years. As part of the restructuring, Bombay Dyeing has completely moved away from manufacturing and entrusted the job to 60-odd third-party manufacturers in the North and West. It is collaborating with international designers in the US, Hong Kong and France to roll out jointly-branded products and premium offerings in bath and bed linen with digital prints. The offline retail expansion will be franchise-led for exclusive outlets and sale through distributors for reaching out to multi-brand stores. It will not add company-owned stores that currently total 30, but plans to more than double the franchisee-run outlets to 500 from 200 in the next four years. Bombay Dyeing will also invest Rs. 100 crore on refreshing the brand and increase its appeal among the millennial consumers. Recently they have unveiled a new logo.
Source: Yarns and fibres
The Seam, a commodities trading and agribusiness software provider has partnered with IBM to form a blockchain consortium for the global cotton industry. The company intends to lead an industry-wide collaboration initiative to create a supply chain and trading ecosystem built on IBM blockchain technology, specifically using the hyperledger fabric. “This new technology will be transformational for the cotton industry... There are numerous organisations, processes, systems and transactions involved from field to fabric. Situated at the intersection of agriculture, finance and technology, The Seam, with the help of IBM, is uniquely positioned to introduce blockchain technology to cotton-affiliated businesses worldwide,” said Mark Pryor, chairman and CEO of The Seam. Blockchain technology encourages broad involvement with the benefits of a network effect, whereby a service becomes more valuable with the more participation it has. A blockchain is a secure, distributed and immutable digital ledger, enabling companies to work together on a foundation of trust, increased speed and reduced interference. IBM will play a key role in driving global adoption, with its digital footprint in all cotton producing and consuming regions. “Blockchain offers enormous potential to drive innovation throughout the cotton industry... A consortium approach using IBM blockchain and the hyperledger fabric can help create greater efficiency and serve as the foundation of a robust system for massive collaboration,” said Arvind Krishna, senior vice president, IBM Research.
Source: Fibre2fashion
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$ 54.64 per barrel (bbl) on 09.01.2017. This was lower than the price of US$ 55.06 per bbl on previous publishing day of 06.01.2017. In rupee terms, the price of Indian Basket decreased to Rs. 3725.39 per bbl on 09.01.2017 as compared to Rs. 3741.64 per bbl on 06.01.2017. Rupee closed weaker at Rs. 68.19 per US$ on 09.01.2017 as compared to Rs. 67.95 per US$ on 06.01.2017. The table below gives details in this regard:
|
Particulars |
Unit |
Price on January 09, 2017 (Previous trading day i.e. 06.01.2017) |
Pricing Fortnight for 01.01.2017 (Dec 14, 2016 to Dec 28, 2016) |
|
Crude Oil (Indian Basket) |
($/bbl) |
54.64 (55.06) |
53.05 |
|
(Rs/bbl |
3725.39 (3741.64) |
3599.97 |
|
|
Exchange Rate |
(Rs/$) |
68.19 (67.95) |
67.86 |
Source: Ministry of Textiles
A freight train carrying garments, fabric, bags, suitcases and other household items from China to London has been launched. The train was flagged off from Yiwu West Railway station in China’s eastern Zhejiang province on the first day of 2017. The train will pass through seven countries and cover more than 12,000 kilometres before reaching London. The train is expected to reach London in third week of this month after passing through Kazakhstan, Russia, Belarus, Poland, Germany, Belgium and France. London is the 15th city in Europe that has been added to China-Europe freight train services. This will improve China-Britain trade ties, and strengthen connectivity with western Europe. It will also better serving China’s Belt and Road Initiative, an infrastructure and trade network connecting Asia with Europe and Africa along ancient trade routes, the China Railway Construction Corporation said. In January 2016, China had sent its first cargo train to Iran, which travelled a distance of 10,399 kilometres in about 18 days.
Source: Fibre2fashion
Pakistan, the world’s fourth largest cotton producing country but interminable power and gas cuts have stopped exporters from producing their orders on time. Many have watched helplessly as their clients have instead turned to Vietnam or Bangladesh. A third of the production capacity of the textile sector has disappeared, thousands of factories have closed, and most of the others are running below full capacity, said Rehan Bharara, a former loom owner who now runs a public infrastructure project for the textile industry. Only those manufacturers which invested heavily in their own energy production survived. These include plants run by the Sadaqat company, which provides house linen to major Western retailers such as Debenhams, Tesco and Target. Energy supply to huge printing, cutting and sewing departments is rotated according to need. They have three sources of electricity: the main and cheapest one is generation through gas, if they don’t have gas, they have go for Wapda (the public utility), if Wapda closes, they go to diesel generators, said chairman Mukhtar Ahmed. They have no choice. If they stop producing, they will lose their customers. Smaller plants, notably the hundreds of thousands of cotton loom workshops, lack backup generators and are dependent on the public network. Their loom workers only get paid if there is power and looms are running. If there is no power, there are no wages, said Mohammad Rizwan, a weaver. The government has promised to end power cuts by 2018, and textile industry would be prioritized. As the country slowly emerges from a long-term power crisis, its once booming textile sector is moving quickly to find its feet, but high energy costs and a decade lost to competitors mean recovery is far from assured. Total exports, meanwhile, 60 percent of which are made up by textiles, declined by 13 percent in the first nine months of this year compared to last, a sign that the industry’s recovery is yet to begin. In the past few weeks, the biggest manufacturers in Faislabad have been supplied without interruption 24 hours of electricity a day, said Wahid Raamay, chairman of the Council of Loom Owners in Faisalabad. Despite these important advancements, textiles are not yet out of danger. As the country’s electricity supply has improved, natural gas imports bills have gone up with the increased cost passed down to consumers. The cost of electricity is estimated to have doubled over eight years, from six rupees per kilowatt/hour to 11 which is still much lower when compared to electricity produced by a diesel generator the cost is 26 rupees per kilowatt hours. Muhammad Salim Bhatti, general manager of the city’s power distribution company admiited that at this time they are struggling to give competitive power. Over time, they will become cheaper as new power plants will be more efficient and will be in a position to compete.
Source: Yarns and fibres
In the absence of adequate business-friendly environment, the upcoming package of Rs 75 billion for six export oriented sectors would not ensure full scale recovery of the export oriented industry, said analysts. According to the news reports, Prime Minister Nawaz Sharif is likely to announce an incentive package for five or six export-oriented sectors to the tune of Rs 65 -75 billion of which textile sector would be the top beneficiary. "The package could go some way in making the textile sector competitive internationally but core issues like uncompetitive exchange rate, higher electricity/gas prices, poor power supply, out dated technology, undiversified product base and low cotton quality will continue to hamper a full scale recovery of the sector", said Zeeshan Azhar, an analyst at Foundation Securities. The said incentives would add to the incentives long in place since the effect of Textile Policy FY14-19 and the FY17 budget. Currently, rebate on local tax varies between 1-4 percent of Free on board (FOB) value on 10 percent incremental exports over last year. This rebate could go up to 3-8 percent of FOB value. The new tax rebate could be on 10 percent incremental exports or be extended to full FOB value. The impact on companies' bottom line would be muted in the former case but sizable in the latter, added Azhar. The government believes the package is necessary to encourage exporters who are struggling due to lower demand from major export markets, stable US Dollar-Pakistani Rupee parity, and incentive package announced by competitors like India, Bangladesh and Vietnam. He added that the downward trajectory in textile exports has shown some respite over the last 2 months but our prognosis of the sector remains weak. The scope and impact of the upcoming textile package is still to be seen. The initial blueprint as indicated by news flows reveals that the government would refund 3/4/6/8 percent taxes on yarn & grey fabric/processed fabric/home textile & knitwear/garments respectively, provide freight subsidy to exporters, remove regulatory duty and customs duty on key export oriented industrial inputs including raw materials, remove import duty and sales tax on industrial machinery, and simplify duty rebate, bond and export refinance schemes to facilitate Small Medium Enterprises (SME) exporters. "These measures are aimed at reducing the exporters cost of doing business, making them more competitive in the international marketplace and technological revival of the industry".
Source: Daily Times
Unifi Inc. continues to expand its global footprint of REPREVE® recycled fiber by entering into Vietnam with support from Century Synthetic Fiber Corp., now a licensed manufacturer of Repreve. Century Corp. will manufacture, sell and distribute Repreve filament yarn within Vietnam, and Unifi Textiles (Suzhou) Co. Ltd. (UTSC) — Unifi’s subsidiary in China — will manage sales and distribution of Repreve filament yarn exported from Vietnam. This collaboration will open distribution channels for Repreve in a key apparel-producing region, helping to fulfill increasing demand and shorten lead times to the Company’s customer base.Headquartered in Ho Chi Minh City, Vietnam, Century Synthetic Fiber Corp. is one of the largest polyester yarn manufacturers in Vietnam. Century Corp. was established more than 15 years ago and continues to invest in its operations and expand capacity today. “Vietnam has been a region of focus for brands and retailers over the past few years,” said Tom Caudle, president of Unifi. “The growth in the region cannot be ignored, with exports of approximately $27 billion of apparel and textiles in 2015, and expectations to grow to $30 billion in 2016. Within the past 18 months, we’ve grown distribution of REPREVE to include Turkey, Taiwan, Sri Lanka and now, Vietnam.” Jay Hertwig, vice president of global brand sales, marketing and product development for Unifi, added, “This is a strategic position in growing the global supply chain for Repreve and will allow us to expand into other Premium Value Added (PVA) products in the near future. A presence in Vietnam will enable Unifi to meet sourcing requests and increasing demand from our customers wherever they choose to do business.”
Source: Textile World
A Chilean artist is creating outlandish, eye-catching garments specifically to ensure that they won’t be ignored. Ingrato is the alter ego of Sebastián Plaza Kutzbach, a creative producer at The University of Chile, who uses traditional textile processes to make garments that are designed to attract attention. Kutzbach tells The Creators Project why he invented the alter ego and what he’s trying to do with it: “The project was born because of the need to show the artisan's work that exists in my country and its devalued state because of the textile industry. Everything that I display as 'Ingrato' is handmade.” Chile has a rich history of textile art. The Mapuche, for example, are an indigenous Chilean culture that are known for traditional garments, which were once so highly valued that one of their ponchos could be traded for multiple horses. Kutzbach is concerned that Chilean garments now have to compete with a globalized textile industry that’s decreasing their worth in comparison to cheaper, factory-made garments. Kutzbach’s intention is to highlight the artistry behind Chilean textiles, especially their handmade qualities, and to illustrate their creative possibilities. “The concept seeks to intervene the human body in different ways,” says Kutzbach. And considering that Ingrato translates to “ungrateful,” it seems that one intervention that Kutzback is determined to achieve is an increase in appreciation for the skilled labor involved with textile production. Kutzbach says he is always striving to showcase the work that goes into the production of the garments for the Ingrato project in new and different ways. “My process of creation is experimental depending on the garment I want to create and I have in mind, always the processes are changing.” Luckily, Kutzbach documents his evolving processes and interventions extensively on social media. These interventions often include groups of people knitting and crocheting in public as well as participating in events by wearing their handmade creations. These images clearly illustrate how successful Kutzback is at attracting attention with his work. A video from the Modamorphosis series, created by audiovisual producers LENGUA, documents the process that Kutzbach goes through to make his garments. Starting with the sketching out of a design, the video moves through steps like dyeing the fiber that will be used to make the garment. The brilliantly colored fibers that result are then woven, knitted, and crocheted by hand. In contrast to these traditional processes, the resulting garments appear distinctly otherworldly, an effect which is accentuated by the remote landscape in which the video takes place. The models in the video end up looking almost like aliens in a sci-fi movie, a poignant comment on our relationship to indigenous textile production processes.
Source: The creator projects
Turkish-Qatar textile factory named Sur Textile Factory, a joint venture between Sudanese and Qatari ministries of defence and Turkish businessmen opens in Khartoum, Sudan. Sudanese President Omar al-Bashir, HE the Minister of State for Defence Affairs Dr Khalid bin Mohamed al-Attiyah, and Turkey’s Defence Minister Fikri Isik, inaugurated the new phase of Sur military and civilian clothing factory. The factory aims to provide high quality military, logistic and civilian products to the Middle East and Africa following global standards. During the inauguration ceremony, President Bashir said that the factory represents a successful model of administration and investment and new technology, including enhancement of capacities and transfer of expertise. In addition, the factory provides new initiatives to better the environment, social responsibility and maintain the welfare of the labourers. The president reaffirmed his determination to continue supporting the Sur factory to enable it to achieve its goals to serve the international society, by opening up global markets to service army alliances. Meanwhile, the Sudanese minister of industry said that the factory is considered a great leap in industrial development in the country. New production lines are scheduled to open next May. Besides covering the needs of the Sudanese army the SUR will export its production to Qatar, Turkey, Kenya and Somalia. A number of ministers and senior officials in the field of textile industry in Sudan, along with military and diplomatic officials from Qatar, Sudan and Turkey attended the ceremony. Founded in 2003 by the Sudanese Ministry of Defence and Turkish investors, SUR International Investment Company Ltd., was initially designed to fabricate the uniforms of the Sudanese army. In June 2013, the Qatari Armed forces joined the project and provided the needed funds to transform the factory into an integrated military textile company able to produce all textile products of the military and police forces in Africa besides Middle East countries.
Source: Yarns and fibres
Sanjay Kathuria, the World Bank lead economist for South Asia, has said the right thing. He said Bangladesh needs to think beyond the apparel sector as a part of its efforts for attaining the next phase of growth and poverty reduction. Though Bangladesh's export performance in the apparel sector is impressive, WB economist Sanjay Kathuria wrote in the Bank's South Asia Region blog that the next phase of growth and poverty reduction is harder since the more obvious sources of growth have largely been exploited. Bangladesh is now the world's second largest apparel exporter, next only to China. It employs about 4.0 million workers, 75 per cent of whom are female. About 80 per cent export earnings come from the ready-made garments, which means the country's over-reliance on this sector. There is no denying that the country is failing to diversify its export market. It has miserably failed to penetrate into two fastest growing regions in the world - South Asia and East Asia. Only around 2.0 and 9.0 per cent of its exports are going to these regions. Years of prolonged efforts by the government to diversify both its products and market bases have failed to yield any visible outcome. So many years have passed since the country's liberation, its export earnings are still dependent largely on limited items and export destinations. The government had taken up Export Diversification Project in 1999 with financial support of the WB in order to integrate Bangladesh in the global economy through promotion and diversification of exportable. Regrettably, the project failed to perform satisfactorily and was abandoned. The earlier steps taken by the government -- either strategic or operational -- were not sufficient to diversify products and markets. Now it is time for the government to provide policy support to the non-RMG products. Those who are small suppliers need networking, match making, information sharing to popularise their products to the world. Some potential products have been identified to promote abroad to widen the export basket. Such products are printing and packaging, furniture, electronics, shipbuilding, plastic and light engineering. Shipbuilding can be a good alternative to any industry, including garments, because it has a link with backward linkage industry that can create extra market if nurtured properly. There is a large market for local auto parts as well.
Source: The Financial Express
The retail industry is already taking a major hit this year, with several retailers announcing massive closures and layoffs within the first few week of the year. The closures are leaving behind a glut of empty space that is exacerbating problems for developers and investors in the retail real estate game. Take a look at some of the biggest closures of 2017. In a message posted on its website, The Limited announced it had closed all of its stores nationwide as of Sunday. That’s 250 locations and roughly 4,000 jobs lost. The women’s apparel chain will continue to operate online, bowing to the growing preference to e-commerce shopping. Increasing struggles in the women’s apparel and mall business led to the closings, and the retailer’s parent Sun Capital told Fortune. In a losing fight for sales, the retailer announced plans last week to unload an additional 108 Sears and 42 Kmart stores by early 2017, in addition to selling its Craftsman tool brand for $900M. Between the two brands, that’s roughly 2,000 shuttered stores within the past decade. The sale is also an effort to get Sears Holdings out of the red — the company reported a $748M deficit in December and needs to raise a whopping $1.5B in 2017 to continue operations. CEO Eddie Lampert was recently approved to loan the company $500M. Following a disappointing holiday season, Macy’s announced it will close 65 stores this year, laying off some 10,000 employees. This is part of a plan Macy’s announced in August to cut 15% of its portfolio, or roughly 100 locations, by 2017 as a result of plummeting sales and a sizable drop in foot traffic. The retailer is being assisted by CBRE in offloading its stores. Finish Line, another mall-based retailer, announced last week it will close 150 locations over the course of four years. That’s nearly 25% of the athleisure chain’s 617-store portfolio. This move is yet another sign that the regional mall is struggling to maintain traffic that translates into sales for tenants.
Source: Forbes
