The Synthetic & Rayon Textiles Export Promotion Council

MARKET WATCH 12 JAN, 2017

NATIONAL

 

INTERNATIONAL

 

Made-ups units in textiles to get add'l 10% subsidy

Units in the made-ups segment of textiles, which includes products like bedsheets, blankets and curtains, will get additional 10 per cent capital investment subsidy of up to Rs 20 crore under the Amended Technology Upgradation Fund Scheme. "Every eligible made-ups unit which has availed 15 per cent benefit under ATUFS will be paid an additional 10 per cent capital investment subsidy on their investment up to an additional maximum cap of Rs 20 crore," the Textiles Ministry said in a notification. "Thus, the total cap on subsidy for such a unit is enhanced under ATUFS from Rs 30 crore to Rs 50 crore (Rs 30 crore for 15 per cent CIS and Rs 20 crore for additional 10 per cent CIS respectively)," it said.

The additional subsidy will be disbursed after a period of three years. The disbursement will be based on a verification mechanism linked to production volume, employment and turnover. "Funds for meeting additional CIS for made-ups units will be provided for in the ATUFS budget in the respective years," said the notification. The government last month approved reforms in the apparel made-ups sector, aimed at creating large scale direct and indirect employment of up to 11 lakh persons over the next three years and boosting exports.

The reforms, part of the Rs 6,006 crore apparel package announced earlier, include providing production incentive through enhanced Technology Upgradation Fund Scheme (TUFS) subsidy of additional 10 per cent for made-ups similar to that provided to garments based on the additional production and employment after a period of 3 years. The made-ups segment of textiles include products like bedsheets, blankets, curtains, crochet laces, pillow covers, towels, zari, embroidery articles and other articles. It is the second largest employment generator after apparels in the entire textiles value chain.

SOURCE: The Business Standard

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Textile Sector MSMEs urge Centre to put sector under lowest slab of GST

Tirupur Exporters’ Association (TEA) have urged the Textile Ministry to put the sector under lowest slab of Goods and Services Tax (GST).

TEA has appealed Union Textiles Minister Smriti Irani that the entire textile sector may be placed in the lowest slab of the GST so that industry can absorb the levy without any significant impact on the business. According to TEA there is an urgent need to address this issue so as to reinstate climate of investment in micro and small industries. The Association said that successful textile clusters may be empowered with adequate industry infrastructure facilities. The benefits announced in the special package in June 2016 including rebate on state levies, EPF benefits for new employment are yet to be passed on to the exporters.

It also said that there should be no gap between government and industry. Focused and dedicated agency should be formed specifically for the knitwear sector which can serve as a catalyst for rapid growth of this industry segment. Government should consider their appeal because Textile industry has contribution of about 4% to the country’s GDP, 14% of the industrial production and 17% to export earnings.

SOURCE: The KNN India

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“Adopt eco-friendly dyeing technologies for clean and green environment”

Ms A Sharada Devi, Emeritus Scientist, College of Home Science, Agriculture University, Hyderabad, has called upon the textile industries to adopt eco-friendly dyeing technologies for clean and green environment. Addressing the two-day national conference on ‘Emerging strategies in green textiles and sustainable fashion’ organised by the Alagappa Institute of Skill Development here on Tuesday, she said as the country was confronted with pollution issues, it has become imperative for textile industries to adopt strategies for using eco-dyeing technologies. She expressed concern that the consequences of environmental pollution owing to artificial dyeing colours was on the rise. “Use of eco-friendly products such as natural dye and eco-fabrics would go a long way in addressing the pollution issues,” she said.

 

Presiding over the conference, Prof S Subbiah, Vice Chancellor, Alagappa University, said gone were the days when the European countries dominated the textile sector. A century ago, European countries monopolised the textile sector but now, most of the Asian countries have become hubs of textile industries,” he said. About 50 per cent of global textile production has come from countries such as India, China, Bangladesh, Vietnam and Indonesia, he said adding the textile industry provided direct employment to more than 45 million people in India. The conference should help the participants to adopt strategies for coming out with natural and organic clothing, which was free from herbicides and pesticides, he said.

T.R. Vijayakumar, General secretary, Tirupur exporters’ association said Tirupur has emerged as the major knitwear export hub and about seven lakh workers contributed to the success of the sector. By adopting modern technologies, the industries started using recycled water and saved enormous amount of water, he said. Prof P Sivakumar, Dean, Faculty of Education, Alagappa University and K. Mohana Sundaram, Managing Director, Priya Knit Faabs, Tirupur offered felicitations.

SOURCE: The Hindu

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Global textile investors summit in Hyderabad

The Minister for IT and Industries, K T Rama Rao, announced on Wednesday that a global investors’ summit will be organised in Hyderabad in March solely to promote the textile sector in the State. He was speaking to the media after calling on the Union Minister of State for Textiles, Smriti Irani, in New Delhi when he sought her support to make the summit a success. Irani not only assured the Minister of the Centre’s support but said she would also participate in the summit and wanted it to be scheduled on a convenient date. Rama Rao said that the key announcement pertaining to textile promotion and policy was expected at the summit. The summit will provide a global platform for interaction with investors being invited in large numbers from different countries as well as within the country.

Fashion show too

Irani came out with a proposal to organise a fashion show involving eminent designers from all over the country to showcase and promote handloom fabrics. She also shared her ideas for promotion of Deccani sheep wool and proposed certain programmes for the purpose. “I told the minister that the State would extend all support for the initiative,” Rama Rao said. He said the Union Minister, during her visit to the State, was expected to announce the Centre’s support for the Warangal Textile Park, especially the Effluent Treatment Plant proposed by the State as part of the project. He also urged the Union Minister to sanction a mega powerloom cluster at Sircilla town that had some 36,000 to 40,000 powerlooms. The Union Minister assured him of sending it for clearance from the Ministry of Finance.

Irani also commended the efforts being made by the State government to promote handlooms by making it mandatory for government staff to wear handloom clothes at least once a week. Rama Rao said he had also switched over to handlooms in solidarity with the weavers.

Later in the day, Rama Rao called on Finance Secretary Ashok Lavasa and apprised him of the need for the powerloom cluster to be established in Sircilla. He also called on Amitabh Kant, CEO of Niti Aayog, and shared the State’s experiences in the innovation sector, Ease of Doing Business and Quality of Doing Business. Kant, who visited the T-Hub a few weeks ago, wanted it to be replicated all over the country. Rama Rao also shared with Kant feedback from investors on different aspects, including the price control policy in medical devices sector during his recent visit to the USA.

SOURCE: The Telangana Today

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SIMA urges Irani to curb adulteration of cotton in Gujarat

Alleging adulteration of cotton by ginners in Gujarat, Southern India Mills' Association today sought Union Textile Minister Smriti Irani's intervention to curb the practice. "Majority of the textile mills have reported that cotton purchased from Gujarat is adulterated causing grievous problems. A section of ginners in Gujarat are mixing cotton waste (comber noil - waste extracted by spinning mills) in the virgin cotton with profit motive," the Southern India Mills' Association (SIMA) alleged.

SIMA Chairman M Senthilkumar in a statement said that the industry has been facing the problem of adulteration for the last few years and the magnitude has increased substantially from the last cotton season. He stated that the issue was brought to the notice of the Minister of Agriculture, Government of Gujarat and the Gujarat Ginners Association in December 2015. However, Senthilkumar claimed that there was no action taken by the Gujarat government. "Since the adulteration problem has still been persisting, the Association today sent a representation to the Union Textile Minister Smriti Irani requesting her intervention and prevail on the Gujarat government to take necessary steps to curb the adulteration practice followed by certain section of the ginners in Gujarat," Senthilkumar said.

The textile mills in southern states, particularly in Tamil Nadu, mainly depend on cotton from western states like Gujarat and Maharashtra for cotton. Textile mills in Tamil Nadu mainly prefer Shankar 6 variety of cotton grown in Gujarat as it is suitable to produce hosiery yarn for garment sector. Tamil Nadu consumes 100 to 120 lakh bales of cotton annually while producing only around 5 lakh bales. "As a result, textile mills have reduced the volume of purchase form Gujarat by 40 to 50 per cent are sourcing from Telangana besides importing from countries like West Africa and Australia," Senthilkumar said. Normally, textile mills used to import five to six lakh bales of cotton to meet the customers' requirements, especially the Extra Long Staple (ELS) cotton. But in the last cotton season, due to adulteration problem, 23 lakh bales of cotton were imported incurring cost towards foreign exchange of Rs 3,600 crore for the additional 17 lakh bales, SIMA said.

SOURCE: The PTI News

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Arvind plans to shift its focus on garment business

India is the world’s second-largest raw cotton producer and textile exporter, next to China. Owing to increasing labour costs, China is losing its competitive edge in textiles. This should help Indian textile companies such as Arvind. Government initiatives, such as ‘Make in India’ and enhanced Technology Upgradation Fund Scheme, will also benefit the sector. Arvind, one of the leading integrated textile players in India with exposure to both textile and apparels segments, is also one of the largest denim manufacturers in the world.

Though the textile segment continues to be Arvind’s strength, contributing Rs 465 crores to cash flows in 2015-16, the company now plans to focus on its garments business. To increase its margins, Arvind is looking to increase the share of fabric sold as garments from 6 per cent now to 20 per cent in the next few years. The expected growth in the Indian retail space, due to rising incomes, urbanisation, attitudinal shifts, etc., will be the main trigger for this expansion. 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, Arvind should be able to benefit from the growth in the retail sector.

Rejig to boost brand growth

Arvind recently sold a 10 per cent stake in its fully-owned subsidiary, Arvind Fashions, for Rs 740 crores to Multiples, a private equity firm. This strategic investment will help Arvind Fashions improve its position in the domestic apparels market. The transaction was done at overall enterprise valuation of Rs 8,000 crores for the company’s branded apparels business, significantly higher than the previous estimates of around Rs 5,000 crores. This higher valuation captures the increased growth opportunity in the garments business and will help in the counter’s re-rating. The amount, to be used for paying-off debt, will provide Arvind with the required financial muscle for future investments and acquisitions and is another reason why the counter is ready for a rerating.

Arvind is already planning two garments units in Ethiopia and this should give additional annual revenue of around Rs 1,000 crores. There is also a possibility that Arvind Fashions may go for a separate listing, another re-rating trigger. Since 50 per cent of its revenues come from the domestic market, pressure is expected to mount in both December and March quarter numbers due to the demonetisation impact.

SOURCE: The Fashion United

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Welspun to invest Rs 4000 crore in Gujarat

Home Textiles Company Welspun India Ltd will make fresh investments to the tune of Rs 4000 crore in Gujarat over the next 3-5 years, Welspun Group chairman BK Goenka said on Wednesday. Goenka said the company will sign three MoUs with the Gujarat government during the Vibrant Gujarat 2017 summit in Gandhinagar. "Investment of around Rs 2,000 crore will be made towards coastal economic zone, Rs 1,000 crore towards technical textile enhancement and yet another Rs 1000 cr in advanced textile," he told ET on the sidelines of the summit today. In the last decade, the company has invested Rs 10,000 crore in the state, he added.

SOURCE: The Economic Times

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Centre to set up carpet, hosiery cluster in Haryana: Irani

Union Textiles Minister Smriti Irani today announced that the Centre would soon set up a carpet cluster at Panipat and a hosiery cluster at Sirsa in Haryana. Making the announcement at the 'Pravasi Haryana Diwas' here, she told Chief Minster Manohar Lal Khattar that the central government will also support establishment of a trade facilitation centre in Panipat.

Irani said the government would also support major design initiative so that apart from weaving industries, "Haryana can have a huge influx into the industry and see the second and third generation take the legacy of Panipat forward". "If we seek to enlarge the component of industry and strengthen their base in conjunction with farmers, I am hopeful that the Centre with the support of government of Haryana, can soon open a special hosiery cluster only for Sirsa so that the state could have more employment opportunities," she said, noting that the district accounts for 40 per cent production of cotton in Haryana. She urged the 'Parvasi Haryanvis' to be a part of Swa-Prerit Adarsh Gram Yojna and contribute in the development of the state. "This will not only ensure the strengthening of industry but would also give a strength to the humanity," she said.

Speaking on the occasion, Union Minister of Steel Birender Singh said India, at present, is the third largest producer of steel followed by Japan but as per a recent data, it would surpass Japan in steel production in coming few months. While stressing the need for setting up of scrap-based steel production units, he said the central government is contemplating to bring a policy for the same. He exhorted the 'Pravasi Haryanvis' to come up with such projects as making steel from scrap is "not only cost-effective but also environment friendly". Singh said "though industrialisation is considered as the only way forward, yet the contribution of farming community in the development process" could not be forgotten.

While exhorting the 'Pravashi Haryanvis' to connect with their roots, he said there is a lot of potential in the youths of the state which can could produce best of shooters, wrestlers and athletes by supporting them. Meanwhile, CM Khattar also announced setting up of two NRI Cells to safeguard the interests of the non-resident Indians from the state. The Haryana government will shortly introduce sectoral policies including those in aerospace, defence, IT, retail, start up, innovation, textile and food processing, he said.

SOURCE: The Business Standard

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Exporters have high hopes from Budget 2017

Exporters are pinning their hopes high on the Union Budget for 2017-18 for decisive fiscal measures which would act as a stimulus to revive the economic sentiment that had seen a short-term impact of the demonetization, said chairman of the EEPC India TS Bhasin. "Budget would be critical to revive investment sentiments followed by introduction of the Goods and Services tax which will further ensure that the entire value chain in the economic activity is integrated and mapped electronically through the GST network," he said. He said while the "new normal" would lead to some adjustment problems particularly for the small and medium enterprises and especially those dependent on cash for daily operations, the government should invest heavily in digital infrastructure as cash as a percentage of GDP is expected to halve from the present 12% in the next three years or so. "Different agencies and the public sector entities like the banks and the oil marketing companies along with the Railways and port authorities should take lead in reducing the cost of digital transactions".

But in the long run, Bhasin said the entire direction towards digitalization of the economy and transparency in the government machinery and business paradigm would be beneficial. "Transparency and the value chain integration should help ensure the ease of doing business and reducing the transaction costs for the domestic industry and those who are engaged in highly competitive export sector," the EEPC India Chairman said. He said while an uptick in the US economy and in large parts of the European markets is a good news for India, "we must work for getting more and more competitive and stay on top of the situation unfolding from the impending inauguration of Donald Trump and the fall out of the Brexit". Mr Bhasin hoped that the finance minister Mr Arun Jaitley would unveil a special package for the exporters in the form of both fiscal incentives and procedural de-bottlenecks in the Budget on February 1.

SOURCE: The Economic Times

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Commerce Ministry starts review of foreign trade policy: Nirmala Sitharaman

The commerce ministry has started the review of the foreign trade policy by consulting all stakeholders to see whether any support is required for certain sectors to further boost exports. Commerce and Industry Minister Nirmala Sitharaman said the foreign trade policy (FTP) is in the process of a review. “When it (FTP) was announced in 2015, we had said we will go in for a mid-term review so that if there is any tweaking that has to be done, it will be done,” she said here at the Vibrant Gujarat summit. She said that the exercise of consulting people and taking stakeholders into confidence is on. The ministry is doing this “to see as to where and which sectors need that kind of tweaking in the policy”.

Since December 2014, exports fell for 18 months on the trot till May, due to weak global demand. Shipments witnessed growth only in June this year, thereafter again entered the negative zone in July and August. The outbound shipments are growing from September. But the global situation is still uncertain. In April 2015, the government unveiled its first five-year Foreign Trade Policy (FTP), aiming to double exports of goods and services to USD 900 billion by 2020. In the FTP (2015-20), the government replaced multiple schemes with Merchandise Exports from India Scheme and Services Exports from India Scheme.

Sitharaman also said that the ministry had requested the states to appoint export commissioners and formulate a policy. “The strategy behind that is that the states must have, in line with the FTP, but highlighting their own states’ strengths,” Sitharaman added. When asked extending extra concessions to US-based iPhone maker Apple to set up manufacturing unit in India, the minister said: “we have not taken a final call” on this. A team of the US-based iPhone maker Apple will meet a group of senior officials from ministries, including IT and finance, on January 25 to discuss its demands for setting up a manufacturing unit in the country. The company had sought exemption on the ground that it makes state-of-the-art and cutting-edge technology products for which local sourcing is not possible.

SOURCE: The Financial Express

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Vibrant Gujarat model for state investment summit

A month before the two-day Momentum Jharkhand, the state is taking lessons from Gujarat in organizing global investment summits. A team of officers from the state department for industries, mines and geology department are visiting the Vibrant Gujrat event to use it as a reference point for organizing the global investment summit.

Industrialists and entrepreneurs visiting the ongoing Vibrant Gujarat summit in Gandhinagar have advised the mineral-rich state to lay emphasis on creating infrastructure for hosting global investment summits to attract more investments in the coming years. "The infrastructure here is world class. The convention centres, pavillions and everything is top notch," a member of the state delegation told TOI over telephone on Wednesday.

Officials at the event have also been advised to "organize and execute sector specific business summits throughout the year" to create favorable atmosphere for new investments. "Industrialists and entrepreneurs are coming to the Jharkhand pavilion and advising us to organize more sector specific summits throughout the calendar," the member said.

The Jharkhand government is slated to organize an interactive session with industrialists at the sidelines of the summit on Thursday and invite them to the state's maiden global investment summit in February. Around 88 business houses from the textile, food processing and other sectors will be present at the three hour session chaired by state food, civil supplies minister Saryu Rai.

SOURCE: The Times of India

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Patel warns against steep interest rate subvention

Reserve Bank of India (RBI) Governor Urjit Patel on Wednesday cautioned that credit guarantees and interest rate subventions reduced the incentive to guard against risk when people were protected from its consequences. Patel was speaking at Gandhinagar, Gujarat, at an event to commemorate GIFT, India’s first International Financial Services Centre (IFSC). On the New Year’s eve, Prime Minister Narendra Modi raised the ceiling for credit guarantees on loans to small businesses from Rs 1 crore to Rs 2 crore and offered interest rate relief of 4 per cent on housing loans up to Rs 9 lakh and 3 per cent on loans up to Rs 12 lakh. “While some government guarantees and limited subventions can help, steep interest rate subventions and large credit guarantees impede optimal allocation of financial resources and increase moral hazard,” Patel said.

Credit guarantees “have limited utility in solving important sector issues. For small-scale enterprises, perhaps non-pecuniary and transaction costs related to clearances, inspections and the taxation bureaucracy are more important,” he said. Such guarantees should be used judiciously, Patel argued, otherwise a government guarantee ended up costing the government through higher risk premiums while borrowing money from the market.

High borrowing by the Centre and the states was limiting India’s ability to improve its credit rating and “pre-empting resources from future generations by governments cannot be a short cut to long-lasting higher growth”, Patel said. He cited International Monetary Fund data that India’s general deficit, combining state and central borrowing, was the highest among G20 nations. “We have to take cognisance of these comparisons. Specifically, this will help us to better manage risks for ourselves, and thereby mitigate financial volatility,” he added. Patel’s speech was delivered amid criticism directed at the RBI for hardships caused by demonetisation, which the government has said was based on its recommendation. The RBI, however, has clarified the government had suggested the recall of high denomination currency notes.

On regulation of international financial centres, Patel said, “While individual regulators can supervise entities initially when the size of the business is small, a unified regulator will be necessary to pay undivided attention to the IFSC.” He added work on the design of a framework for an unified financial regulator should begin soon. “Existing laws governing financial contracts in India should be reviewed and gaps addressed. Based on the review, a world-class legal framework for financial contracts in GIFT could be enabled, either by appropriately amending the existing laws governing financial contracts or enacting a fresh law,” he added.

SOURCE: The Business Standard

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Two-thirds of small businesses hit by demonetisation: Survey

A survey conducted by State Bank of India (SBI) among small businesses has revealed that more than two-thirds of them have seen a drop in business. While 30% of respondents said that business has dropped by half, another 23% said that the drop has been between 40-50%.

The main problem identified by most of the respondents was the supply of only Rs 2,000 denomination notes without intervening notes of Rs 500. This has resulted in chaos as there wasn't enough currency notes to change the Rs 2,000 denomination notes. Interestingly, the survey reveals that 63% of the respondents come out in support of demonetisation.

"Overall the decline in business is less than 50% for the majority of the businesses that were impacted. Construction sector and the informal roadside vendors seem to be the worst hit. Less impact was seen on automobile and chemist shops that already had digital modes of transaction," SBI said in its Ecowrap report. Within the textile sector, shopkeepers dealing with retail segment have been affected more than those in the wholesale segment. The gems and jewellery sector has also been hit with declining sales. Payments are moving to electronic mode gradually. The survey showed that 15% of cash-based transactions have moved to digital in weeks ensuing demonetisation.

SOURCE: The Economic Times

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Possible to meet April 1 GST rollout deadline: FM Arun Jaitley

The Goods and Services Tax (GST) regime may still be able to meet its rollout deadline of April 1 this year if the few pending contentious issues are resolved in the next few weeks, Union finance minister Arun Jaitley said at the ongoing eighth edition of the Vibrant Gujarat Global Summit here on Wednesday. In his keynote address during a seminar on ‘GST: The game changer for Indian economy’, the FM said: “Most of the issues have been resolved; a few critical issues are left which I hope will be resolved in the next few weeks. We would want it to be implemented from April if all the issues are resolved.”

The GST rollout scheduled for April 1 this year is stuck because of differences between the Centre and states over control and administration of the tax and also compensation to be paid to states that face revenue shortfall because of the GST rollout. The finance minister is hopeful of resolving the ticklish issue of dual control of taxpayers at the forthcoming meeting of the GST Council on January 16. “GST implemented will transform India into one entity. GST will truly move around the country. The GST will also help make India one common marketplace. It will lead to better and hassle-free goods and services. It will free many bottlenecks. Once GST is rolled out, the Indian economy will be cleaner and stronger. Our economy will be much better, bigger and cleaner and India will be a highly successful economy,” he said. GST, or a national sales tax, will replace a jumble of levies to create one of the world’s biggest single market.

Commenting on the slew of recent moves made by the Modi government, including the biggest and most contentious one of demonetisation of old Rs 1,000 and Rs 500 notes, the FM said: “There is a need to take bold decisions to reform the economy. The level of discretion needs to eliminated.” Claiming that the Indian economy has opened up in the past two-and-a-half years and that the country was “back on the global radar”, Jaitley said: “A new India had emerged and which is evident from the fact that while the world is moving slowly today and you hear the voices of protectionism in the developed world, the debate over protectionism is hardly heard in India. And that is an indication of how aspirational, open and progress-oriented Indian public opinion is increasingly becoming.”

In a spirited defence of the demonetisation move, the FM said digitisation that got a leg up post demonetisation, together with GST, will lead to expansion of formal economy and boost growth. Gujarat chief minister Vijay Rupani, deputy CM Nitin Patel, Welspun Group chairman BK Goenka, Gujarat government officials, including chief secretary JN Singh, additional chief secretary (finance) Anil Mukim and secretary (finance) Mona Khandhar also participated in the discussion.

SOURCE: The Financial Express

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Don’t see a big difference if GST is implemented in April or September: Naushad Forbes

Stating that demonetisation has stabilised in urban areas, CII President Naushad Forbes on Wednesday said that the government needs to remonetise rural areas with more Rs 500 notes. In an interview with ET Now he said, “Economy returning to normalcy post demonetisation. New currency of Rs 500 denomination should reach more to rural areas.” Talking about GST he told the business channel that government must finalise GST roll out dates at the earliest. “I don’t see a big difference if GST is implemented in April or September.”

Meanwhile, States and Centre have been unable to reach any consensus on the issue of dual control in administrative control of Goods and Service tax, Finance Ministry said after a GST Council held a meeting last week. Dual control has been one of the key issues preventing Central Government from meeting the April 1st deadline. The next meeting of the council will be held on January 16.

In council’s last meeting, Union Finance Minister Arun Jaitley had said that GST’s primary drafts for Central Goods and Service Tax (CGST) and State Goods and Service Tax (SGST) have been approved. However, no consensus was reached on the issues of dual control and cross empowerment issues still remain to be resolved. There is an issue with Integrated GST (IGST) Bill and dual control regarding division of jurisdiction and administrative powers over tax assesses between the Centre and the states.

Notably, three Bills relating to GST, namely, the CGST Bill, the IGST Bill and the Bill for compensating states for revenue losses following the implementation of GST have missed the initial deadline of passage in the Winter Session of Parliament.

SOURCE: The Financial Express

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'It's the beginning of the end for India's economy'

Warning of more suffering and adversity in the months to come because of the government's demonetisation move, former Prime Minister Manmohan Singh said India's economy was looking at “the beginning of the end”. He said all rating agencies had revised India's growth figures, projected at 7.6 per cent just a few months ago, down to 7 per cent and some had had even said it could be as low as 6.3 per cent, adding: “Modi ji keeps saying he's out to transform the economy. His claims are hollow.”

Spelling out the effects of the precipitous fall in national income, Singh said: “Employment will fall , growth in agriculture, industry and services will fall. Production, especially in the informal sector of India's economy, which accounts for 45 per cent of India's national income, will fall.”  Singh was speaking at the Congress's Jan Vedna convention in the capital on the effects of demonetisation.

Interestingly, speaking at the same convention, former finance minister P Chidambaram sought to tweak Singh's earlier assessment of two per cent hit to growth (made during a speech in the winter session of the Rajya Sabha). Chidambaram said the demonetisation could shave off “one per cent or more” of gross domestic product (GDP) growth, but added that even that was substantial: “One per cent reduction means a loss of Rs 1,50,000 crore to the economy.” Neither Singh nor any member of the Congress made even an oblique reference to Prime Minister Modi's charge that those who were criticising the currency move were effectively protecting the corrupt.

The Congress's attack on the government had three arguments: That it would have no effect on reducing corruption; that it was a decision that undermined the Cabinet and spelt political capture of the central bank, weakening the institution; and that it struck at the right of people to exercise their will about the way they chose to spend the money they had earned.

Throwing a challenge to Prime Minister Narendra Modi over his aggressive campaign for a cashless economy, Chidambaram asked if the PM could promise that no capitation fee would be paid by parents for their children's admission into medical and engineering colleges, a process that will begin in a few months. “I am throwing another challenge to the PM. In the months of May and June, engineering, medical colleges will open and capitation fee will be taken. Can the Prime Minister assure that the parents need not worry? That no capitation fee will be asked or taken. Can he give that promise?”

The Prime Minister is talking of cashless society, which has never happened anywhere. “He has no right to decide that. He should look into global phenomenon also. In the US, cash flow is around 42 per cent, in France it is 56 per cent. It's people's choice to use cash or card,” Chidambaram said at the event. “In this country, farmers, salary-class workers need cash to meet their daily needs. Three objective was told by the PM on 8 November: Counterfeit currency, black money and corruption. I challenge the PM to put all those promises to test.” He asked the government to compensate the families of those daily wage earners who had lost their lives because of demonetisation.

Pointing to the fact that Cabinet ministers were virtually kept prisoner when the decision was taken, no records were kept and the central bank was ordered to take the decision, Chidambaram said: “Demonetisation was the decision of one person. I am the Führer. I am the leader. I must decide.”  Congress Vice-President Rahul Gandhi said: “Demonetisation is just an excuse. PM Modi knows that he won't be able to hide under the garb of yoga and Make in India. When he got worried, he broke the backbone of the Indian economy (through demonetisation). Almost every economist of repute has criticised demonetisation.”

SOURCE: The Business Standard

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Pre-Budget meets begin; analysts bet on rural-focused stocks as elections, GST loom

With the commencement of pre-Budget meetings, the market focus is getting shifted to the likely sops Finance Minister Arun Jaitley may announce in the forthcoming Budget to rejuvenate the economy, in a wake of recent demonetisation and looming state elections ahead. Analysts noted that rural economy has been somewhat resilient despite the cash ban and believe that Budget for financial year 2018 would include sops for rural-focused sectors that may help negate the negative implications of demonetisation and the implementation of GST later this year.

BofA-ML in a note said the recent by-elections -- in West Bengal, Tamil Nadu, Madhya Pradesh, Assam, Tripura, Pudducherry and Arunachal Pradesh -- did not really throw up a clear picture with most political parties, whether for or against demonetisation, winning in their states. The foreign brokerage expects a step-up in public rural spend as India begins the run up to the 2019 general elections with these state polls.

The implementation on GST is likely to hit informal sector, which holds significant job opportunities for rural India. The year is also crucial given elections in many states including Uttar Pradesh. Rural-sector stocks should be on the radar, analysts said. “Where will the government spend its money? I think it will be on infrastructure because that is the employment generator in the rural sector. So we think that sectoral allocation gradually on cyclical stocks is what we will build up during the course of the year,” said Sunil Subramaniam, CEO of Sundaram Mutual Fund. “I do not think the government is thinking about D-Street when it thinks about Budget. What the government is going to think about three state elections. So, it needs to create a positive impact into the rural India,” Subramaniam added.

Ridham Desai, Managing Director at Morgan Stanley said 2017 is going to be a strong year for farm income. “So keep a watch on companies that rely on farm incomes for their business. This could be the best farm year in past several years. It has had really not been affected by demonetisation because the credit cycles in rural India are far more robust than in urban India. So the way we sense out here people retracting demand it is a very urban phenomenon. I do not think that is happening in the same way in rural India. You can see that difference in performance in the autos -- tractor sales in December because I think underlying farm demand is quite strong,” Desai said.

Arvind Sanger, Geosphere Capital noted that Prime Minister Narendra Modi’s recent speech was populist in nature, which made sure that the poor and the rural farmers who were disadvantaged by demonetisation get some goodies to offset that. “So that raises the questions whether this is going to be a populist Budget. Is it going to be a Budget geared towards making sure that the upcoming state elections, BJP does well or is it going to be a Budget which is going to have any ground-breaking tax and other measures which have long term positive growth implication?,” Sanger said.

SOURCE: The Economic Times

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Rupee jumps 20 paise to 68.12 against dollar in early trade

The rupee was trading 20 paise higher at 68.12 against dollar in the early trade on Thursday on account of selling of Amercian currency by bank and exporters. Meanwhile, domestic equity markets opened with marginal gains following mixed global cues. The 30-share Sensex opened 31.25 points, or 0.12 per cent, up at 27,171.66, while the 50-share Nifty index opened 10.40 points, or 0.12 per cent, up at 8,391.05.

Rupee kicked off 17 paise up at 68.15 against dollar on Thursday against previous close of 68.32 per dollar. According to Nirmal Bang Commodities, the local currency is likely to trade with a sideways to up movement on Thursday. The currency is expected to trade in the range of 68.10-68.40 on Thursday. Meanwhile, the RBI on Wednesday fixed the reference rate for the dollar at 68.2276 and euro at 72.3213.

Foreign institutional investors (FIIs) stood net sellers in equity markets on Wednesday as they offloaded shares worth Rs 105.61 crore with gross purchases and gross sales of Rs 3,597.89 and Rs 3,703.50, respectively, according to the data available with depositor NSDL. On the further movement of rupee, Abnish Kumar Sudhanshu, Director and Research Head, Amrapali Aadya Trading & Investment said, “Global equity market funds based in America is investing back in US to ride on the prospective growth story which is a strengthening the US dollar. Additionally higher US fund yield also triggering out flows from emerging markets bonds making emerging market currency even weaker. We expect rupee to decline further once US economic revival gain pace in coming months”.

SOURCE: The Economic Times

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Demonetisation: WB cuts Indian GDP growth for fiscal to 7%

In its first projection on India post-demonetisation, the World Bank has lowered the country's GDP growth estimate for this fiscal to 7 per cent, from its earlier estimate of 7.6 per cent made in June last year. "Growth in India is estimated to reach 7 per cent in financial year (FY)2017 ... reflecting a modest downgrade to India's expansion," the multilateral lender said in its Global Economic Prospects report released here on Tuesday. "Unexpected demonetisation -- the phasing out of large denomination currency notes -- weighed on growth in the third quarter of FY 2017," it said. "Weak industrial production and manufacturing and services purchasing managers' indexes further suggest a setback to activity in the fourth quarter of FY 2017," the report added.

Last week, India's official statistician in New Delhi also lowered the country's gross domestic product growth estimates for 2016-17 to 7.1 per cent, compared with the 7.6 per cent growth in 2015-16. While announcing its monetary policy review last month, the Reserve Bank of India acknowledged the demonetisation factor and lowered their gross value added (GVA) growth estimates for the current fiscal to 7.1 per cent from the 7.6 per cent forecast earlier.

On November 8, Prime Minister Narendra Modi announced the demonetisation of Rs 1,000 and Rs 500 notes, saying the move was aimed at eliminating black money, counterfeit currency and terror financing. As cash accounts for more than 80 per cent of the number of transactions in India, demonetisation "could continue to disrupt business and household economic activities, weighing on growth", the Bank said. According to the report, even with a 7 per cent growth rate for 2016-17, India will still be the fastest growing major economy in the world, bypassing China, which is projected to grow at 6.5 per cent in 2016. China's planning body the National Development and Reform Commission on Tuesday estimated the economy to have grown about 6.7 per cent in 2016. The world's second largest economy registered the same growth rate in the first, second and third quarters last year, it said.

The World Bank also noted that demonetisation may, in the medium term, aid liquidity expansion in the banking system, which may help in lowering lending rates and boosting economic activity. However, the challenges encountered in implementing demonetisation may pose risks to the pace of other economic reforms such as the Goods and Services Tax (GST) and labour and land reforms, it added.

Following eight meetings of the GST Council in New Delhi and the vocal opposition of some states to demonetisation, it is all but certain that the Centre will be unable to keep to its targeted deadline of rolling out GST by April 1, 2017. The World Bank expects global growth in 2017 to rebound to 2.7 per cent from a post-financial crisis low of 2.3 per cent last year. "After years of disappointing global growth, we are encouraged to see stronger economic prospects on the horizon," World Bank President Jim Yong Kim said in a statement. Meanwhile, American rating agency Fitch on Tuesday downgraded India's growth outlook to 6.9 per cent for 2016-17, from the earlier 7.4 per cent, citing the "short-term disruptions" caused by demonetisation.

SOURCE:The Economic Times

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Demonetisation effects in India to disappear in medium term: World Bank

The World Bank today said that the "adverse effects" of demonetisation in India will disappear in the medium term, saying any reform has short-term costs. "Any reform has short-term costs but ultimately reforms will bring long-term gains. In the case of India, we expect whatever the adverse effects of these changing of notes to basically disappear in the medium term," Ayhan Kose, Director of Development Prospects Group at the World Bank told reporters during a conference call.

In its latest report, the World Bank revised its estimates of India's growth rate in 2016-17 fiscal year from previous projection of 7.6 per cent to seven per cent. But, Kose said the World Bank is expecting growth picking up over the period FY18 and FY19, supported by private consumption, infrastructure spending, and a rebound in investment growth. "So, India has already undertaken a wide range of reforms. These reforms we are expecting loosened domestic supply bottlenecks and increased productivity and, in the coming years, moderate inflation and civil service pay raise should continue to support real incomes and consumption," he said in response to a question.

The World Bank expects private investment to accelerate as firms and banks undertake the necessary measures and the effects of important structural reforms start being felt. "India is a cash-intensive economy. We know that. The cash accounts for over 80 per cent of the transactions, almost two-thirds of the value of all transactions. There have been questions over whether the Reserve Bank of India has printed sufficient new currency to replace the old ones, with disruptions, of course, affecting rural areas and urban poor," Kose said in response to another question. "But having said all of this, we expect the growth to increase in 2017, after this brief period associated with the change in notes. And the effects of this change in notes are expected to weigh in, in the medium term, with growth, as I mentioned, picking up momentum in FY18-FY19, supported by private consumption, infrastructure spending, and a rebound in private investment," he said.

Kose said the Indian Government has made a decision and implemented this decision swiftly with the objective that this could help reduce informal--the size of the informal economy. "Whenever these types of policy changes are implemented, they have effects during the transition. The part of the reason the government implemented the scheme was to curb corruption, tax evasion, and counterfeiting. If that were expected, that by broadening the tax base, revenues will eventually go up, besides reducing the size of the informal economy," Kose said.

SOURCE: The Economic Times

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GST to be simple, less burdensome for industry: Hasmukh Adhia

Goods and Services Tax will usher in a very simple and less burdensome taxation regime as it will be a single rate indirect tax which can be paid by debit/credit cards, cheque and NEFT, Revenue Secretary Hasmukh Adhia said. He said, GST will make it easier for traders and industry to access Input Tax Credit and also ease compliance burden as the entire country will become a single market. "GST is a very very simple thing to follow, it is going to be very easy for all of you. There will not be any border restriction when you move goods from one state to another. And many of the small small taxes will go away. It will be one unified tax," Adhia said at the Vibrant Gujarat global Summit here.

The government had planned to roll out GST, which will subsume excise and service tax and other local levies, from April 1,2017. However, vexed issues like jurisdiction over assesses, remain to be resolved by the GST Council chaired by Union Finance Minister Arun Jaitley. "We are working overtime to make it a reality as early as possible. Our target date is April 1, 2017, and we will see to it that we try our best to bring it to people," Adhia said, adding that taxes can be paid by way of NEFT, RTGS, cheque, and debit/credit cards.

Explaining the procedure of tax payment under the new tax regime, he said GST is a single tax and Integrated GST on cross border movement of goods and services is only an "interim" tax for which input tax credit can be claimed. "GST will indeed become a very simple and less burdensome tax for most of the people of the country. Be it manufacturers or traders. Simple tax, single compliance procedure, it will become very very simple for the people to pay taxes," Adhia said. The GST Council has already reached an agreement on a 4-tier tax structure -- 5,12,18 and 28 per cent. Besides, a cess on demerit, luxury and some more goods would be levied.

SOURCE: The Economic Times

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Fintech startups make a beeline for partnering tech firms on GSTN

Financial-technology companies building applications to allow businesses more choice on filing returns under the new tax regime are rushing to strike partnerships with the firms selected to provide the backend interface. The Goods and Services Tax reform is expected to be implemented in the coming financial year and all such tie-ups have to be stitched and in place by then. The government has shortlisted 34 companies including Deloitte Touche Tohmatsu India and Reliance Corporate IT Park to provide the core backend infrastructure for the Goods and Services Tax Network, the non-profit entity building the technology backbone for GST. Firms such as ClearTax and RazorPay are free to build enterprise-facing applications on top of this infrastructure to facilitate easy filing of tax returns. These can be mobile applications, returns filing systems and invoice upload functionalities for businesses, which will be required to file GST returns every month. While ClearTax, LegalRaasta and Quicko are developing returns filing systems, companies such as RazorPay are focused on the payments part of the process. “We are in discussion with two GSPs and will make a final call based on who goes live first,” said Harshil Mathur, chief executive of Tiger Global Management-backed RazorPay.

GSPs, or GST Suvidha Providers, are the companies selected to build backend infrastructure. The firms building the enterprise-facing interfaces are application service providers, or ASPs. Digital tax filing platform Quicko is building a mobile application and a web interface, which will be enabled by National Securities Depository Ltd, for companies to file GST returns online. “Currently, we are helping traders have a seamless transition from (value-added tax) and excise duty to GST registration,” founder Vishvajit Sonagara said, adding that about 4 million traders have so far registered for GST through different platforms, including Quicko.

LegalRaasta has developed a mobile app for companies to send invoices directly. “We are also providing add-on services so (small and medium enterprises) can send the image of an invoice or their details through an Excel sheet, which will be uploaded by us,” said Himanshu Jain, founder of LegalRaasta. Revenue models, however, are yet to be decided for both the backend infrastructure and application providers. “That is one of the reasons why we are open to tying up with multiple startups and companies in the space,” said Ankit Agarwal, director of Alankit Ltd, a certified GST Suvidha Provider. “Startups have the potential to bring on large volume of business, especially in specialised sectors like pharma and healthcare,” he said.

A GSTN official said the entity will not regulate the fees that GSPs can charge for their service or the number of applications providers they can work with. “However, if we receive feedback on unfair practices or complaints about a GSP, we have maintained a leverage in our agreements to end their licences,” the official said. “The accountability of security of GST filings also lie with the GSPs, which will need to conduct audits regularly and ensure the cybersecurity strength of ASPs they work with.”

SOURCE: The Economic Times

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‘Protectionist’ India resorts to other tools to bypass WTO bilateral rules

With little flexibility under the World Trade Organisation (WTO) and bilateral trade agreements to raise tariffs, India is increasingly resorting to other tools — anti-dumping duties, safeguard levies and minimum import prices (MIPs) — to provide the requisite protection to domestic industries from inexpensive imports and meet contingencies like a sudden influx in imports. Data reviewed by FE show that incidence of anti-dumping actions more than doubled in the four years to 2016 — as many as 75 products came under anti-dumping levies in 2016 against 37 in 2013.

Trade experts say this is not a development to be decried as these measures are legitimate and mostly WTO-compliant. While India’s MIPs on steel products have recently come under attack from countries like Japan for being protectionist and against WTO rules, New Delhi is seeking to address Tokyo’s concerns by citing the fact that the number of items under MIPs has already been cut down to just 19 from 176 earlier. However, anti-dumping duties are much easier to defend multilaterally.

Even while a designated agency is probing an allegation of dumping and is yet to verify if such exports undertaken below cost have caused material injury to the domestic industries concerned, the WTO allows imposition of provisional duties. In many instances, the provisional duties are not converted to definitive duties (which indicate that investigations have proved dumping harmful to the local players) but the purpose of checking cheap imports are served with the provisional imposts. Of the 75 anti-dumping measures taken by India in 2016, 48 were provisional duties while 27 such pre-existing levies were graduated to definitive ones. The items that have been subjected to anti-dumping duties in recent years include steel products, inorganic and organic chemicals, machinery, engineering goods, textiles, etc.

On the steep rise in the number of anti-dumping measures, TS Vishwanath, principal advisor, APJ SLG Law Offices, Delhi, noted that it does not necessarily imply that India has adopted a protectionist trade policy. He said reports of steel imports priced at less than the cost of production of exporters making their way into the Indian market testifies this fact. “AD (anti-dumping) is a WTO-compatible trade defence measure available to member nations against imported goods sold at a price less than the cost of their production.” India, a WTO member country, has the legitimate right to protect its domestic industry from unfairly priced imports, he added.

Noted trade expert Biswajit Dhar also feels it is quite natural that when the global economy is not doing well, countries resort to dumping their goods in foreign markets. However, he added that though ant-dumping measures are consistent with WTO norms, there are often questions about the method in which the injury margins and dumping duties are computed.

Sources said 18 organic chemical items were slapped with definitive AD duty in 2016. Also, four items related to nuclear reactors, boilers, machinery and mechanical appliances and four items related optical, photographic, cinematographic, measuring, precision, checking, medical or surgical instruments and parts and accessories thereof attracted definitive AD duty in the year. Curiously, Malaysian exports to India attracted highest number definitive AD duties, on four products. Besides, definitive AD duties on three products each from China, European Union, Taiwan and the US were imposed in 2016.

A total of 14 cases of AD inquiries (read provisional duties) were initiated against China in 2016, including five iron and steel products. These apart, five fresh cases of AD inquiry were initiated each against the EU and South Korea last year. Four AD inquiry against imports from Thailand were also started in 2016. Interestingly, not a single case of AD inquiry was initiated against the US in 2016.

Overall, 12 cases of AD inquiry were initiated against iron and steel products and a similar number of AD inquiries were initiated against both organic and inorganic chemical products. So half of the fresh AD inquiries in 2016 were against chemicals and steel imports into India.

India’s peak customs duty (the highest of the normal rates) on non-agriculture products had come down steeply from a prohibitive 150% in 1991-92 to 40% in 1997-98 and further, to 20% in 2004-05 and 10% in 2007-08. Broadly, the basic customs duty corresponds to the tariff on imports as other duties on imports like countervailing duty are in lieu of taxes that domestic goods suffer. There is little scope for India to raise the peak customs duty without running to a problem with the WTO. On the other hand, it still has some room for raising duties on farm items to meet objectives like pepping up domestic prices as in many cases there are still gaps between the committed floor tariffs (bound tariffs) and applied tariffs.

SOURCE: The Financial Express

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Saudi cuts February oil exports to some buyers in India, Malaysia to meet OPEC deal

Saudi Arabia has cut February term crude supplies to refiners in India and Southeast Asia, seeking to comply with an OPEC deal, but it has held most of its exports to the rest of Asia steady for a second month, industry sources said on Wednesday. State oil giant Saudi Aramco reduced February term supplies of mainly heavy crude to Reliance Industries and Hindustan Mittal Energy Ltd (HMEL), as well as to Malaysia's Petronas, four sources familiar with the matter said.

Aramco has also cut oil supplies to another southeast Asian buyer for a second month in February, one of the sources said. That means some major oil companies in Europe and the United States could see reductions of up to 18 percent in their term volumes for February, the source said. "Saudi Arabia and Kuwait are focusing their cuts on US and European customers as they target excess inventories and protect market share in Asia," Energy Aspects analyst Virendra Chauhan said. Saudi Aramco and the other companies could not be reached for comment. Details on the amounts of the supply reductions could not be confirmed.

Saudi's February supply reductions to a handful of Asian refiners mark the start of cuts to a region left untouched in January at the onset of the OPEC output deal. The producer maintained strong exports to Asia in January to protect its market share there and because it gets higher netbacks on sales to the East than it does for other regions.

The Organization of the Petroleum Exporting Countries (OPEC) agreed to cut production by 1.2 million barrels per day (bpd) in the first half of 2017 to reduce a global supply glut and support prices. World's top exporter Saudi Arabia cut oil output in January by at least 486,000 bpd to 10.058 million bpd. Still, Saudi Aramco kept February supplies to most North Asian refiners at full volumes for a second month, trade sources said, indicating it will have to continue cutting exports to Europe and the United States to meet its OPEC commitment. "I think the Saudis won't touch volumes to Japan, South Korea and Taiwan. Southeast Asian demand is small when compared to North Asia," a Singapore-based crude analyst with a European oil company said.

SOURCE: The Economic Times

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Global Crude oil price of Indian Basket was US$ 52.56 per bbl on 11.01.2017 

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$ 52.56 per barrel (bbl) on 11.01.2017. This was lower than the price of US$ 53.22 per bbl on previous publishing day of 10.01.2017.

In rupee terms, the price of Indian Basket decreased to Rs. 3586.13 per bbl on 11.01.2017 as compared to Rs. 3622.66 per bbl on 10.01.2017. Rupee closed weaker at Rs. 68.23 per US$ on 11.01.2017 as compared to Rs. 68.06 per US$ on 10.01.2017. The table below gives details in this regard: 

Particulars

Unit

Price on January 11, 2017 (Previous trading day i.e. 10.01.2017)

Pricing Fortnight for 01.01.2017

(Dec 14, 2016 to Dec 28, 2016)

Crude Oil (Indian Basket)

($/bbl)

52.56              (53.22)

53.05

(Rs/bbl

3586.13       (3622.66)

3599.97

Exchange Rate

(Rs/$)

68.23              (68.06)

67.86

SOURCE: PIB 

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Ethiopia opens up to Italian textile machinery

An Italian textile machinery delegation will be attending the upcoming multi-industry Addis Chamber International Trade Fair (ACITF), which will be held in Addis Ababa from 23 February to 1 March 2017. Ethiopia is an emerging production hub for the global textile and garments industry. Cheap labour costs, free trade agreements with major Western markets and a constantly growing economy have made this Sub-Saharan African country a choice destination for the manufacturing of garments by major industry retailers.

Given the necessary upgrade in technology required, the demand for textile machinery is growing consequently, sustained by incentive schemes enacted by the government authorities to attract foreign capital, ACIMIT, the Association of Italian Textile Machinery Manufacturers, reports. The 21st edition of the ACITF trade fair will feature a delegation of Italian textile machinery manufacturers at the Italian pavilion organised by the ICE-Agency. Among ACIMIT associated members are: Carù, Corino, Fadis, Ferraro, Itema, Marzoli, Mei, Reggiani, Roj, Salvadè, Savio, Sicam and Simet.

Ethiopian market

ACIMIT President Raffaella Carabelli is extremely confident in the Ethiopian market. “Our exports have grown significantly over the past five years, although their overall value remains quite modest (EUR 4.4 million in 2015),” she said. Over the first nine months of 2016, Italy ranked third, right behind China and Turkey, in terms of sales of textile machinery to the Ethiopian market.  “The quality of our machine technology is superior to that of our competitors currently operating in this market. Our focus is on getting potential buyers to get to know and appreciate the quality of our technology, through opportunities such as the ACITF, as well as through the institutional missions organized in recent years, thanks to the support of the Ministry of Economic Development and ICE-Agency,” explained Ms Carabelli.

ACIMIT is a private non-profit body and its main purpose is to  promote the Italian textile machinery sector and in supporting its activity, mainly abroad. In order to do that, ACIMIT provides information on the activity of the producers and organises a wide range of promotional activities, often in collaboration with ICE (Italian Trade Commission). ACIMIT represents an industrial sector comprising around 300 manufacturers, employing close to 12,000 people and producing machinery for an overall value of about EUR 2.6 billion, with exports amounting to 86% of total sales. To further strengthen Italy’s presence in Ethiopia, in 2015 ACIMIT signed a memorandum with the Ethiopian Textile Industry Development Institute for the creation of a technology centre providing expert training on textile machinery, thereby contributing to the professional training of future textile operators in Ethiopia.

SOURCE: The Innovation in Textiles

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Heimtextil 2017 hosts 2963 companies from 67 countries

Heimtextil 2017, the world’s leading trade fair for home and contract textiles currently underway in Frankfurt, Germany, is playing host to over 2,963 companies from about 67 countries across the world. Numerous events are accompanying the ongoing industry meet-up and providing valuable stimulation in terms of design, trends and new textile products. “With its high density of global market leaders and the huge variety of its product portfolio, Heimtextil is unique and highly attractive for the international industry. For the seventh time in a row, the trade fair has grown, both in terms of the exhibitor numbers and surface area, underlining its globally leading position,” said Detlef Braun, member of the executive board of Messe Frankfurt. The product group ‘upholstery’, which offers décor and upholstery fabrics as well as upholstery and imitation leather, has experienced considerable growth over the past three years. New suppliers for this segment from countries like Italy, Spain, Poland and Turkey are attending the event, making it an ever more important point of contact for contract furnishers and architects. Everything related to the product segment ‘bed’ from machines via the fibre to the end product of a mattress, bed cover or pillows are being exhibited at Heimtextil. Accessories such as lamps or bathroom items that complete the portfolio and offer an opportunity for dealers to expand their product ranges are also present at the event.

Under the roof of ‘Design live’, a platform for textile design, 230 international studios are presenting their new designs. Design live has gradually become one of the core elements of Heimtextil over the years and is a hotspot for creativity and design from all over the world. The product group ‘digital print technology’ with its machine suppliers for digital print processes continues to be a focus. A variety of international market leaders including Epson, Hewlett Packard, Mimaki and MS Printing are on board. In partnership with the German Institute for Textile and Fibre Research, a ‘Digital Textile Micro Factory’ has been installed for the first time. Visitors are experiencing a complete digital production chain live, from the design, digital printing and finishing to automatic cutting and confection. More than 30 new companies are exhibiting their fresh product and design ideas as part of the start-up programme ‘New & Next’ spread out over the product groups Design live, floor, bed, bath and table. Exhibitors from Europe, Japan, Iran and Korea among other countries are participating in this programme. The ‘Theme Park’ is a trend and inspiration area where visitors are finding new design products. The overarching theme is ‘Explorations’. An accompanying programme of talks and guided tours give far-reaching insights into new design projects. For the 2017/18 season, a team of six international design studios have isolated the most important themes from various general trends.

SOURCE: Fibre2fashion

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FPCCI appreciates efforts of TDAP for Exporters: Pakistan

Zubair F. Tufail, President of the Federation of Pakistan Chambers of Commerce and Industry highly appreciated and acknowledged the services of S. M. Muneer, Chief Executive Trade Development Authority of Pakistan (TDAP) for playing an instrumental role in the package announced by Prime Minister for exporters. He indicated that this package will provide relief to the exporters and boost the exports of Pakistan which are continuously showing a declining trend for the last three years.

The President FPCCI hoped that the package would help achieve the objectives of an export-led growth and will revive the industries of Pakistan, particularly the textile industries, which have been highly affected due to an international recession, regional competitiveness and the high cost of doing business. He added that under the package, sales tax and customs duty on the import of textile machinery, cotton and man-made fibres are abolished.

Moreover, the new duty drawback rates was decided for textile garments (7%); textile made-ups (6%); processed fabric (5%); yarn and grey fabric (4%); while sports goods, leather and footwear will be taxed at 7%, he added. He expected that the incentives and support to exporters would definitely address the challenges being faced by exporters on a sustained basis and have met the long aspirations of the industry.

Zubair Tufail also appreciated S. M. Muneer for his efforts making TDAP a corporate and corruption-free entity and it is expected that the exports of Pakistan will increase manifold in 2017 and 2018. He added that it is the right time that the Prime Minister has announced the special package for exporters which will be beneficial in achieving the optimum benefits of GSP Plus from the EU, increase in exports and a reduction in the unemployment rate. He further added that the export package coupled with CPEC and reduction of power shortage will put Pakistan on the road of progress and prosperity.

He also hailed the efforts of the Chief Executive TDAP for using his good offices in supporting and helping the business community of Pakistan in getting the long outstanding refunds to exporters, declaring a zero rate status to five export sectors and curtailing load shedding electricity and gas for industries etc. He indicated that now it is the responsibility of businessmen to utilize and get the maximum benefits from the incentives for enhancing their exports.

SOURCE: The Daily Times

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US textile & apparel imports down 6.32% in Jan-Nov '16

The import of textiles and apparel by United States declined 6.32 per cent in the first eleven months of 2016 to $97.225 billion, compared to imports valued at $103.782 billion in the corresponding period of 2015. Imports from China alone were valued at $35.903 billion, accounting for 36.92 per cent share of all textile and garment imports made by the US in January-November 2016. Vietnam, India, Bangladesh and Indonesia were the next four top suppliers of textiles and garments to the US, with goods valued at $10.498 billion, $6.711 billion, $5.113 billion and $4.578 billion, respectively, during the eleven-month period, according to the Major Shippers Report, released by the US department of commerce.  Segment-wise, the US apparel imports during January-November 2016 were valued at $74.965 billion, whereas non-apparel imports accounted for $22.260 billion, the data showed.

Among the top ten apparel suppliers to the US, only Vietnam was able to increase its exports by 2.16 per cent year-on-year. On the other hand, imports from Cambodia declined by 12.92 per cent, whereas China and Mexico saw their exports drop by 8.38 per cent and 5.38 per cent respectively, over the corresponding period of 2015. In the non-apparel category, among the top ten suppliers, only Turkey registered a positive growth of 6.15 per cent year-on-year. While imports from Vietnam, China, Italy and Taiwan dropped by 27.45 per cent, 16.39 per cent, 11.70 per cent and 10.84 per cent to $489.875 million, $9.875 billion, $477.761 million and $433.881 million, respectively.

Of the total US textile and apparel imports of $97.225 billion during January-November 2016, cotton products were worth $43.022 billion, while man-made fibre products accounted for $48.391 billion, followed by $4.164 billion of wool products and $1.647 billion of products from silk and vegetable fibres. In 2015, the US textile and apparel imports increased by 4.15 per cent year-on-year to $111.928 billion, with apparel alone accounting for $85.164 billion.

SOURCE: Fibre2fashion

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Sales of Textile Floorings Market to be Worth US$ 109.7 Bn in 2016, says FMI

Global sales of textile floorings is estimated to reach US$ 109.7 Bn by 2016 end, witnessing a y-o-y growth of 4.8% over 2015. Carpets segment is expected to continue to account for major share in the textile floorings in 2016, to account for 90.7 %, up from 90.5 % in 2015.

Demand for tufting technology, which offers lower manufacturing cost, as well as easy installation and ease of use by consumers, is expected to continue to increase over the forecast period (2016–2026). Among material types, synthetic textiles segment is expected to remain dominant, accounting for US$ 93 Bn by 2016 end. On the basis of application, residential segment accounted for the largest share in terms of revenues in 2015 and it is estimated to remain the same in 2016. Residential segment is estimated to account for US$ 69.2 Bn in 2016, an increase of 5.1% over 2015.

Asia Pacific Excluding Japan (APEJ), is the largest market for textile floorings. The market in the region is estimated to be valued at US$ 35.8 Bn by 2016 end. Increasing construction activities and infrastructure development in countries such as China, India, ASEAN countries and MEA, which are few of the most lucrative markets globally, is expected to provide an impetus to the demand for textile floorings. In addition, to being the largest market in terms of revenue and volume consumption, APEJ will continue to remain the fastest growing market globally.

Growing construction industry in the U.S. and Asia Pacific region is estimated to drive the demand for textile floorings in 2016. Revival of residential construction sector in the U.S. and improving infrastructure facilities in developing regions are expected to boost demand for textile floorings. While the EU economy remains shrouded in uncertainty; steady growth of the construction sector in Western Europe is expected to continue creating growth opportunities for textile floorings manufacturers.

Mohawk Industries Inc., Shaw Industries Group Inc., Tarkett S.A, Beaulieu International  Group N.V, and Interface, Inc. are the major players in the global textile floorings market, accounting for 12.0% market revenue share in 2015. Leading players in the market are focusing on increasing acquisitions of regional manufacturers in order to enhance their operations with minimum capital expenditure, thereby strengthening their value chain.

Long-term Outlook: The long-term outlook on the global textile floorings market remains positive, with the market value expected to increase at a CAGR of 5.7% during the forecast period.

SOURCE: The Sat Press Release

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VINATEX expects double digit growth in 2017

One of the biggest manufacturer and exporter of garments, Vietnam National Textile and Garment Group (VINATEX) expects that its sales will rise 12 per cent, production value 14 per cent, while exports will grow 11 per cent, all over the prior year in 2017. VINATEX also added that it has enough orders in hand to keep them busy in the first quarter of 2017. Vietnamese media quoted VINATEX general director Le Tien Truong as also informing that the industry will face various challenges in the current year, which includes that trade deals like the EU-Vietnam FTA and the Trans-Pacific Partnership, will not come into effect in 2017.

According to Truong, competition will turn more fierce as competitor countries helped by advantages in exchange rates as well as tax rates will continue to bag orders, while economic instability in the EU too will become a matter of concern for the Vietnamese sector. In 2016, VINATEX saw its revenue growing 5 per cent over 2015 to $2.5 billion, with pre-tax profits also rising at the same pace to reach VND 41 trillion. These results came in the year when, overall Vietnamese garment exports climbed 5.7 per cent year over year to $28.3 billion.

SOURCE: Fibre2fashion

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As TPP hopes fade, Vietnamese companies chart new paths for expansion

The atmosphere inside the offices of Vietnam's Garment 10 became strangely charged when the news came in that Donald Trump had been elected president of the U.S. Than Duc Viet, deputy general director of the state-run textile company, broke into a rousing speech. "If the TPP falls through, we can always look to Europe or South Korea," he told managers. "After all, we haven't been making all these improvements just for the TPP!" Duc was referring to the Trans-Pacific Partnership, the comprehensive, 12-nation trade pact that would have given Vietnamese exports easy access to a vast market. Unfortunately for Hanoi, Trump has vowed to scrap the deal on his first day in office. But while this is a setback for Vietnam's industrial policy, resourceful companies already have their own plans for going global well underway.

ALWAYS IMPROVING Garment 10, or Garco 10 for short, is a symbol of Vietnamese industry. Revolutionary leader Ho Chi Minh toured its factory on the outskirts of Hanoi in 1959. During the Vietnam War, workers manned anti-aircraft guns on the roof when they were not busy sewing. The company is taking the likely failure of the TPP in stride, confident that the improvements Duc referred to will serve it well. The garment maker's main factory, now staffed with 400 workers, is the very embodiment of continuous improvement. In 2010, the company chose eight highly skilled workers and tasked them with reporting on new ways to boost productivity. he company has also invested in physical capital. Affixing buttons and ironing, tasks previously done by hand, were automated in 2014, more than doubling productivity. A year later, an automated distribution system was put in place on a dress-shirt line to deliver to each worker exactly the number of garments that he or she can effectively handle. Both are state-of-the-art technologies in Vietnam. Veteran worker To Thi Hien said that in the more than 10 years she has been with Garco 10, productivity has risen consistently, leading to higher output and greater quality even as the number of employees stays the same.

As an alternative to TPP nations, Garco 10 is setting its sights first on South Korea. A free trade pact between that country and Vietnam took effect in December 2015. Next is the European Union, which is slated to have a functioning free trade agreement with Vietnam by 2018.

Vietnam has trade agreements with more than 10 economies, including Australia, Chile and the ASEAN Economic Community, which links the country to fellow members of the Association of Southeast Asian Nations. Unlike the TPP, these deals do not include rules of origin for products and materials, so exporters can compete on quality alone, Duc said. This means vast opportunity for Vietnam's textile industry, which combines low wages and high quality, he added.

LOOKING OUTWARD Since the Doi Moi reforms of the 1980s aimed at turning Vietnam into a fledgling market economy, the country has sought to attract foreign investment by deepening bilateral ties with certain countries.

Perhaps its biggest success in this regard was with South Korea's Samsung Electronics, which built a massive factory in Vietnam's northern province of Bac Ninh and another in Thai Nguyen. The two plants made a combined 30% of the 420 million mobile phones Samsung produced worldwide in 2015. Samsung has invested upwards of $7.5 billion and employs some 110,000 people in the country.

Lacking key exports, Vietnam suffered a trade deficit every year since it joined the World Trade Organization in 2007 until Samsung helped it achieve its first trade surplus in 2012. The company accounted for nearly 20% of the value of Vietnam's total exports in 2015. Of the $68.3 billion in foreign direct investment inflows from 2013 to 2015, South Korean corporations provided 28%, or $19.1 billion. And most of that appears to have come from Samsung. But the Galaxy Note 7 debacle exposed the risks of depending too heavily on one company. Samsung ended production of the flagship smartphone after a number of the devices caught fire. This could put an even bigger dent in Vietnamese exports in 2017, according to an official at the Ministry of Industry and Trade.

Vietnam, with its small domestic market and underdeveloped native industry, has more reason than ever to seek the benefits of freer trade. The country has envisioned itself becoming the Southeast Asian hub for such labor-intensive manufacturing as electronics assembly and garment making, securing steady growth for years to come. The TPP would have been a big step forward for that strategy, but even without that boost, Vietnamese companies are finding opportunities for foreign expansion, including in other ASEAN countries. The country's largest dairy producer, Vietnam Dairy Products, or Vinamilk, in May began operations at a processing facility in Phnom Penh, Cambodia -- its first major plant in a country where nearly all diary products are imported. In addition to Cambodia, Vinamilk likely envisions branching out into Thailand, Myanmar and other markets linked by overland routes. The launch of the ASEAN Economic Community at the end of 2015 paved the way for such a move, abolishing import tariffs within the bloc on raw milk and materials. In 2016, Vinamilk scaled up sales of powdered milk for infants in the Middle East.

Vinamilk CEO Mai Kieu Lien said the company has conquered its home market thanks to world-class product quality, adding that there is no reason to think that success cannot be repeated around the world. The company's dairy farm in Nghe An Province became the first in Vietnam to receive certification under the internationally recognized Global Good Agricultural Practices program in 2014.

BRANCHING OUT FPT Chairman Truong Gia Binh leads the country's largest technology company. During a break at a Dec. 8 economic seminar in Hanoi, he could be seen plugging FPT and Vietnam's tech industry as a whole to multinational executives, including Wouter Van Wersch, CEO of GE ASEAN. FPT opened a sprawling 5.9-hectare information technology services complex in Danang in late April. By 2020, the company aims to employ 10,000 engineers and pull in IT orders from around the world, with a focus on the emerging field of connected devices known as the internet of things. Even agriculture is taking a global approach. In 2015, Starbucks began selling Arabica coffee grown in Da Lat, Lam Dong Province, at select U.S. locations, and it could offer the beans in over 50 countries in the future. A senior coffee specialist at the U.S. company reported being "delighted" by the quality of the coffee.

Last July, manufacturer and trading company Cao Thanh Phat became the first company to sell Vietnamese-grown dragon fruit in Thailand. Vietnam shipped 4,608 tons of fruit to the U.S., Japan, South Korea, New Zealand and Australia in the six months through June, up 81% from a year earlier. Dragon fruit made up 70% of that amount, placing it alongside rice, pepper and catfish as one of Vietnam's key farm and fishery exports. Still, only a few Vietnamese companies are ready to compete on the global stage. For all the Doi Moi sloganeering, the country has dragged its feet on numerous economic reforms. No longer able to count on the TPP, Vietnam's leaders must chart a new path for growth.

SOURCE: The Asian Nikkei

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Pak industry concerned over China's plan to set up business units under CPEC...

Heads of various business chambers in Pakistan have expressed concern over reports that China is planning to set up or establish industrial units and warehouses under the ongoing over 50 billion dollar China Pakistan Economic Corridor (CPEC). Media reports and sources have quoted representatives of the chambers of commerce and industry of Gujarat, Gujranwala and Sialkot, as saying that Pakistan runs the risk of turning into a purely consumer­driven market if clearance is given for such planning.

Urging the Nawaz Sharif­led government to take the business community in these three industrial cities into confidence about the nature of China's planned industrial units in the country, the presidents of these business chambers — Abrar Saeed Sheikh (Gujarat), Majid Raza Bhutta (Sialkot) and Saeed Ahmed Taj (Gujranwala) — said not doing so would further weaken Pakistan's manufacturing sector. It was decided that all three presidents would call on Prime Minister Nawaz Sharif to share their concerns over the proposed establishment of Chinese industrial units along the CPEC route.

Mr. Bhutta, in particular, was quoted by the media, as saying that the concerns of local manufacturers with regard to the impact of proposed CPEC projects should be addressed forthwith, as this had the potential to hit export performances from these cities. The chambers' presidents also sought easing of China's visa policy for local businessmen. In a related development, the Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA) has warned that the country's textile sector faces the eminent possibility of decline, given the advantages being offered to Chinese companies under the CPEC.

PRGMEA senior vice president Javad Choudhry was quoted, as saying that he is concerned about hearing reports of Chinese firms relocating their textile units to various free industrial zones in Pakistan and also being given energy/power at concessional rates. He said that the government should ask Chinese investors to establish joint ventures with local stakeholders in an equity ratio of 49 percent to 51 percent.

SOURCE: The India Live Today

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Ministry predicts 2017 export growth: Vietnam

Last year, Viet Nam’s total export turnover was US$175.9 billion, an increase of 8.6 per cent over the previous year. Therefore, the ministry has set an export turnover target of $188 billion for 2017, or 6.9 per cent higher than last year. The ministry said telephones and spare part exports were expected to reach $39 billion, representing a 13 per cent year-on-year rise, and the products with highest export turnover in 2017. The garment and textile products would follow with export turnover of $25 billion or 6 per cent higher than that of last year. Electronics, computers and spare parts are forecast to achieve export turnover of $22 billion, increasing 19 per cent from last year. The exports of shoes, seafood and fruits would also contribute high export turnovers of $14 billion, $7.5 billion, and $3 billion respectively.

Minister Tran Tuan Anh believes that in 2017, import-export turnover would continue to increase thanks to the signing of a number of free trade agreements (FTAs) and FDI inflows shifting from other countries to Viet Nam. Participation in the ASEAN Economic Community would also bring opportunities to the country by expanding its export markets as well as increasing competitiveness.

Statistics from the ministry showed that last year Viet Nam exported 25 products, with turnover of more than $1 billion each. In 2016, the country reported a trade surplus of $2.68 billion, accounting for 1.52 per cent of its total import-export turnover. Viet Nam’s export turnover to its traditional markets including Asia, Europe and the US saw positive growth last year. The export turnover to the US saw the highest growth rate of 13.2 per cent, followed by Europe with 11.3 per cent and Asia with 6.9 per cent.

SOURCE: The Vietnam Net

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China trade conundrum

Britain’s Pickwickian Foreign Secretary Boris Johnson is a master of bullish forecasts and chortling optimism. And he had plenty of reason to be upbeat about Britain’s supposedly sunny future this week. Returning from Washington (and Trump Tower in New York), he could celebrate that U.S. officials were looking for a “fast” trade agreement with the U.K.

Despite the superficial bonhomie, there is already a potential bone of contention between the trade visions of the two parties: China. The U.K. has long been the leading champion of a liberal approach toward trade with the Middle Kingdom. Even after the Brexit vote, Britain has led the charge against EU efforts to impose far stiffer duties against Chinese dumping. Prime Minister Theresa May has vowed to continue this liberal tradition and wants to make Britain a “global champion of free trade.” This hardly chimes with the mood music in Washington, where the priority is to hit the Chinese hard and bring back jobs lost around the world in low-cost manufacturing.

President-elect Donald Trump’s picks for commerce secretary and U.S. trade representative — Wilbur Ross and Robert Lighthizer — seem to confirm he is on a collision course with Beijing. Ross has been branded “Mr. Protectionism,” with a track record in investing in embattled steel and textile manufacturers that were only able to defend their market thanks to border taxes. Both he and Lighthizer support Trump’s demand to label China a currency manipulator and impose special import duties on Chinese products. They will team up with the head of Trump’s newly created National Trade Council, Peter Navarro — author of the book “Death by China.” As the junior partner in any upcoming trade talks with Washington, the U.K. will quickly find itself under pressure to join a Trumpian alliance against China.

There are plenty of reasons for Americans to be suspicious about a trade deal with the U.K. if London is seen as having a soft touch on China. Will goods exported from the U.K. have been produced with ultra-cheap Chinese raw materials? Could the U.K. effectively become just a backdoor for Chinese access to the U.S., if London cozies up to China? This will be a tough call for Britain. The “Golden Age” of Anglo-China relations initiated by former Prime Minister David Cameron and his Chancellor George Osborne already seems like ancient history. May’s initial reluctance to approve the Hinkley Point C nuclear plant, a landmark project involving Chinese investment, soured bilateral relations. During a visit to Hangzhou in September, May felt the Chinese frustration, receiving a hectoring demand from President Xi Jinping for Britain to do more to build “mutual trust.” Nevertheless in November, May also proclaimed her own “golden era of relations between the U.K. and China,” including expanded trade and investment ties. That may not play well in Washington.

SOURCE: The Politico

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BRICS indispensable force with rising clout: Chinese media

BRICS nations contributed more than half of the global growth and their rising clout has made them indispensable to global "financial stability", official media here said today as China assumed Presidency of the five-member bloc that includes India. The ninth summit of the leaders of BRICS is scheduled to be held in Xiamen, a coastal city in East China's Fujian province, in September under China's Presidency.

Highlighting China's perspective of the five member bloc, an article in the state-run China Daily today said "in the past decade, the BRICS, (Brazil, Russia, India, China and South Africa) bloc has contributed more than half the global growth". "With 42.6 per cent of the world's total population and roughly one-third of the world's land area, it has a combined GDP that accounts for about one-fifth of the world's total," it said. "At the same time, the group, with its rising international clout, has become an indispensable force behind global economic governance reforms and international financial stability," it said. However, the gloomy global economic picture and fall in commodity prices have brought a lingering slowdown to haunt the BRICS' economies, overshadowing their effectiveness as drivers of the global economy, it said. But the five economies have showed resilience thanks to their multi-faceted mechanism of cooperation and huge potential.

Despite the challenges, BRICS members have abundant natural and human resources, vast markets, huge growth potential and bright prospects in trade and investment, it said. "Closer inter-BRICS cooperation and better coordination in multilateral platforms is the key to cope with the challenges and complexities of the global economic and political landscape," it said.

Apart from carrying out structural reforms to make their growth more balanced and sustainable, the five economies also need to coordinate their development strategies through such vehicles as the New Development Bank, the Asian Infrastructure Investment Bank and the Belt and Road Initiative (the Silk Road Economic Belt and 21st Century Maritime Silk Road), it said. In the international arena, BRICS countries are expected to provide more solutions to gnawing global issues including terrorism and climate change through closer coordination. "As a bloc that represents the interests of the developing world, BRICS is also counted on to drive the wheels of South- South Cooperation, improve global governance and establish a fair, just and inclusive international order," it said. "Cooperation in economic and political fields has over the years emerged as the two 'wheels' of BRICS. The rise of the five emerging economies has brought profound changes to the world political and economic landscape. "Under such circumstances, the group is bound to play a bigger role in international affairs as there is still much to be desired both in the international system and global governance," it said.

"Overall, there are enough reasons to believe BRICS will embrace an even brighter decade, which will also be a boon to the rest of the world," it said, adding that China will help anchor the international organisation in a better position to tackle global challenges and uncertainties.

SOURCE: The Economic Times

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Oil rises as Saudi tells Asian customers of output cuts

Oil prices rose for the first time in three days on Wednesday, following news of Saudi supply cuts to Asia, but persistent doubt over output reductions and signs of rising shipments from other producers kept gains in check. Brent crude futures were up 41 cents at $54.05 a barrel by 1133 GMT, while US West Texas Intermediate crude futures were up 39 cents at $51.21 a barrel. Brent has surrendered nearly 40 per cent of the gains made between late November and early January. Analysts, however, said the slide was unlikely to become more aggressive, given the likelihood of Saudi Arabia and its Gulf neighbours at least sticking to their pledge to cut output. "Few envision that Brent crude at sub-$50 a barrel is a viable price (in the first half of 2017) amid Opec production cuts tightening up the market," SEB commodities strategist Bjarne Schieldrop said. Whether "last night's low of $53.58/barrel turns out to be the low point remains to be seen. However, we do think that buying in the territory between the current price of $53.88/b and down to $50/b is probably as good as it gets for buyers in H1."

Saudi Arabia, the world's top oil exporter, has told some of its Asian customers that it will reduce their crude supplies slightly in February. But there is still plenty of oil to fill the gaps left by the Organization of the Petroleum Exporting Countries. North American drilling is on the rise, while European and Chinese traders are shipping a record 22 million barrels of crude from the North Sea and Azerbaijan to Asia this month. There is still doubt among many market watchers over whether the planned cuts will be enough to rebalance a market that has been oversupplied for the past two years. "Traders continued to fret about rising US supply and compliance by Opec to agreed-upon production cuts," ANZ bank said.

The US Energy Information Administration (EIA) said on Tuesday that crude production in the United States this year would rise by 110,000 barrels per day to 9 million bpd. Another concern is high US crude stockpiles, with the EIA scheduled to release its latest figures on Wednesday. Opec's second-biggest producer Iraq plans to raise crude exports from its southern port of Basra to an all-time high of 3.641 million bpd in February, keeping shipments high even as Opec production cuts take effect this month.

SOURCE: The Economic Times

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World Bank projects global growth at 2.7% in 2017

In an encouraging sign, the World Bank today projected a global growth of 2.7 per cent in 2017, even as it observed that stagnant global trade, subdued investment and heightened policy uncertainty marked another difficult year for the world economy. "After years of disappointing global growth, we are encouraged to see stronger economic prospects on the horizon," World Bank President Jim Yong Kim said as the financial body in its latest report said that global economic growth is forecast to accelerate moderately to 2.7 per cent in 2017 after a post-crisis low of 2.3 per cent in 2016. "Now is the time to take advantage of this momentum and increase investments in infrastructure and people. This is vital to accelerating the sustainable and inclusive economic growth required to end extreme poverty," Jim said.

In the latest edition of the Global Economic Prospects, the World Bank said growth in advanced economies is expected to edge up to 1.8 per cent in 2017. Fiscal stimulus in major economies -- particularly in the US -- could generate faster domestic and global growth than projected, although rising trade protection could have adverse effects, it said. Growth in emerging market and developing economies as a whole should pick up to 4.2 per cent this year from 3.4 per cent in the year just ended amid modestly rising commodity prices, the bank said. However, the outlook is clouded by uncertainty about policy direction in major economies, the report said, adding that a protracted period of uncertainty could prolong the slow growth in investment that is holding back low, middle, and high income countries.

Analysing the worrisome recent weakening of investment growth in emerging market and developing economies, it said that investment growth fell to 3.4 per cent in 2015 from 10 per cent on average in 2010, and likely declined another half percentage point last year. "We can help governments offer the private sector more opportunities to invest with confidence that the new capital it produces can plug into the infrastructure of global connectivity," said World Bank Chief Economist Paul Romer. "Without new streets, the private sector has no incentive to invest in the physical capital of new buildings. Without new work space connected to new living space, the billions of people who want to join the modern economy will lose the chance to invest in the human capital that comes from learning on the job," he said.

SOURCE: The Economic Times

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Advanced economies growth to edge up 1.8%: World Bank

Growth in advanced economies is expected to edge up to 1.8 per cent in 2017, while growth in emerging market and developing economies as a whole should pick up to 4.2 per cent from 3.4 per cent in the year just ended amid modestly rising commodity prices, says a recent report. Global economic growth could accelerate moderately to 2.7 per cent in 2017. The global economy will grow after a post-crisis low last year as obstacles to activity recede among emerging market and developing economy commodity exporters, while domestic demand remains solid among emerging and developing commodity importers, according to the World Bank’s January 2017 Global Economic Prospects report. “After years of disappointing global growth, we are encouraged to see stronger economic prospects on the horizon. Now is the time to take advantage of this momentum and increase investments in infrastructure and people. This is vital to accelerating the sustainable and inclusive economic growth required to end extreme poverty,” said Jim Yong Kim, Group President, World Bank. The outlook, however, is clouded by uncertainty about policy direction in major economies. A protracted period of uncertainty could prolong the slow growth in investment that is holding back low, middle, and high income countries.

The report analyses the recent weakening of investment growth in emerging market and developing economies, which account for one-third of global GDP and about three-quarters of the world’s population and the world’s poor. Investment growth fell to 3.4 per cent in 2015 from 10 per cent on average in 2010, and likely declined another half percentage point last year. “We can help governments offer the private sector more opportunities to invest with confidence that the new capital it produces can plug into the infrastructure of global connectivity. Without new streets, the private sector has no incentive to invest in the physical capital of new buildings. Without new work space connected to new living space, the billions of people who want to join the modern economy will lose the chance to invest in the human capital that comes from learning on the job,” said Paul Romer, chief economist, World Bank.

China is projected to continue an orderly growth slowdown to a 6.5 per cent rate. However, overall prospects for emerging market and developing economies are dampened by tepid international trade, subdued investment, and weak productivity growth. Among advanced economies, growth in the US is expected to pick up to 2.2 per cent, as manufacturing and investment growth gain traction after a weak 2016, notes the report. “Because of the outsize role the US plays in the world economy, changes in policy direction may have global ripple effects. More expansionary US fiscal policies could lead to stronger growth in the US and abroad over the near-term, but changes to trade or other policies could offset those gains. Elevated policy uncertainty in major economies could also have adverse impacts on global growth,” said Ayhan Kose, World Bank development economics prospects director.

Regional growth in South Asia is expected to pick up modestly to 7.1 per cent in 2017 with continued support from strong growth in India. Excluding India, growth is expected to edge up to 5.5 per cent in 2017, lifted by robust private and public consumption, infrastructure investment, and a rebound in private investment. Europe and Central Asia’s growth is projected to pick up to 2.4 per cent in 2017, driven by a recovery in commodity-exporting economies and recovery in Turkey. The forecast depends on a recovery in commodity prices and an easing of political uncertainty. Russia is expected to grow at a 1.5 per cent pace in the year, as the adjustment to low oil prices is completed. Latin American and Caribbean region is projected to return to positive growth in 2017 and expand by 1.2 per cent. Brazil is projected to expand at a 0.5 per cent pace on easing domestic constraints. Weakening investment in Mexico, on policy uncertainty in the US, is anticipated to result in a modest deceleration of growth this year, to 1.8 per cent.

Growth in the East Asia and Pacific region is projected to ease to 6.2 per cent in 2017 as slowing growth in China is moderated by a pickup in the rest of the region. Output in China is anticipated to slow to 6.5 per cent in the year. Middle East and North Africa are forecast to recover modestly to a 3.1 per cent pace this year, with oil importers registering the strongest gains. Sub-Saharan African growth is expected to pick up to 2.9 per cent in 2017 as the region continues to adjust to lower commodity prices.

SOURCE: Fibre2fashion

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Teijin Frontier to partake in Domotex 2017 trade fair

Teijin Frontier Co.Ltd, the Teijin Group’s fibre-product converting firm, has announced that it is set to partake in Domotex 2017, a leading trade fair specialised in floor coverings, to be held at the Hanover Fairground in Hannover, Germany, from January 14 to 17, 2017, in stand C61, hall 004. This will mark Teijin Frontier’s first appearance at the event. Teijin Frontier’s stand will showcase a variety of innovative floor coverings, such as carpet tiles and broadlooms decorated with patterns of bamboo; moss, rock gardens and kimono, combining the high quality and visual beauty symbolic of Japanese products with the concept of “Made in Japan”.

The stand will also present carpets featuring clear patterns, shading and raised profiles created with special machinery that adjusts the height of pile yarn, and beautiful colour gradation achieved with advanced dyeing processes. The carpets on display will include items not only for commercial facilities but also for homes with non-slip backings. Teijin Frontier aims to develop new customers and expand awareness of its floor-covering line-up by participating in Domotex 2017, which is expected to attract over 1,400 exhibitors and some 45,000 visitors from 100 countries.

SOURCE: Fibre2fashion

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Gildan Activewear acquires American Apparel via auction

Canadian apparel retailer Gildan Activewear has acquired American Apparel through a court supervised auction. Gildan entered into an asset purchase agreement with American Apparel that served as the initial bid in a bankruptcy court supervised auction on November 14, and the same day, American Apparel filed for Chapter 11 bankruptcy protection. Gildan’s final cash bid of around $88 million includes the acquisition of the worldwide intellectual property rights related to the American Apparel brand and certain manufacturing facilities. The Canadian garment retailer will also separately purchase American Apparel inventory, to ensure a seamless supply of goods as it integrates the brand within its Printwear business. “We are excited to be moving forward with this acquisition, as the American Apparel brand will be a strong complementary addition to our growing brand portfolio,” CEO of Gildan Glenn Chamandy said. “We see strong potential to grow American Apparel sales by leveraging our extensive printwear distribution networks to drive further market share penetration.”

SOURCE: Fibre2fashion

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Records numbers for Ethical Fashion Show and Greenshowroom

Organisers of next week’s fully booked Ethical Fashion Show and Greenshowroom trade fairs say the 178 labels on display during both shows will be a new exhibitor record, as well as a 15 per cent increase on last year’s winter edition. The shows, which take place from 17 – 19 January at the Postbahnhof in Berlin, will include two new fashion shows – ‘Ethical Fashion on Stage’ and ‘Salonshow’ – as well as a number of presentations and panel discussions on sustainability in the fashion industry.

At the ‘Salonshow’ on Wednesday 18 January, collections will be on show from a range of eco fashion labels, including Austriandesign.at, Biaggi, Blue Valley, Inti Ferreira, Johanna Riplinger, Lanius, Lanius X Kunert, Royal Blush, Somyso, Studio Elsien Gringhuis, Studio Jux and Xess+Baba. Later that day, the 'Ethical Fashion on Stage' show will present looks by B Frog, C. Pauli, Chapati, Colombo3, Elementum, Greenbomb, Jaspe, Komodo, Naturaline, Organication, Shirts for Life, Tranquillo and Ukua Lov Baby. “All the options that the Postbahnhof offers have been exhausted. We look forward to another positive reception from the exhibiting labels and a fantastic range”, says Olaf Schmidt, vice president of textiles and textile technologies at Messe Frankfurt. The event organisers are also calling all professional and amateur photographers, journalists and bloggers to take part in a photo competition. Entries will be taken of people, general photos of the trade fair or the fashion shows, and can be posted on social media using the hashtags #myfairpic, #greenshowroom and #EFSB.

SOURCE: The Innovation in Textiles

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