Coimbatore: Tirupur Exporters Association today requested Tamil Nadu Chief Minister K Palaniswami to announce new state textile policy. In a memorandum submitted to the chief minister, who was in Tirupur today, TEA President Raja M Shanmugham emphasised the need for a new policy for the growth of textile industry and exports from Tamil Nadu. The memorandum also requested the chief minister to address issues like revision of GST rate fixed for job working units from 18 per cent to five per cent, reduction of Man Made Fibre yarn GST rate from 18 to 12 per cent and construction of ESI hospitals in Northern and Southern areas of Tirupur.
Source: India Today
As many as 25 cotton ginners from Telangana and Maharashtra have partnered with about 35 textile mills here to supply cotton regularly. They are visiting textile units across the value chain in Tirupur and Coimbatore and had a discussion here on Saturday with the textile unit owners. An initiative of Indian Texpreneurs Federation, the mills had purchased about two lakh bales of cotton jointly from about 50 ginners in Telangana and Maharashtra. Prabhu Damodaran, secretary of the federation, told presspersons here on Saturday that the plan was to procure about four lakh bales jointly during the next cotton season (October 2017 to September 2018). “By purchasing cotton as a consortium, we (textile mills) get market intelligence,” he said. The consortium also creates awareness among the ginners on the quality standards and gets cotton of better quality. “We have authorised agents in these markets for six months. We have also developed a rating mechanism. When the mills get the cotton the quality is rated. There are daily updates to the mills on the rates,” he added. For the ginners, payment from the mills used to take a month or even more. There is a standardised payment system with the consortium and the ginners get the money in less than a month. There is a regular purchase of cotton too. For the mills, the transport cost comes down by Rs. 2 a kg if they purchase cotton from Telangana compared to buying from Gujarat. Maharashtra has about 400 ginning units and expects over one crore bales of cotton production next season compared to nearly 90 lakh bales this cotton year. There is 10 % -15% increase in area, the ginners said. In the case of Telangana, the area under cotton is up by about 20 %. The production this year was 48 lakh bales and it is expected to go up to 70 lakh bales next season.
Source: The Hindu
With exporters continuing to face problems in shipments of consignments under the Goods and Services Tax regime, the Central Board of Excise and Customs (CBEC) Chief has pulled up field officials and said that recent relaxations provided to exporters should be allowed. “The objective of allowing Letter of Undertaking in place of bond is to facilitate exporters. And towards this end, the said notification liberalises the conditions for exporters, extending the benefit of LUT to all kinds of exporters, whether manufacturers, merchants or service providers,” CBEC Chairperson Vanaja N Sarna wrote in a recent missive.
Relaxations
To ensure faster clearance of exports under GST, the CBEC had earlier this month relaxed guidelines and allowed exports to continue under existing bonds and letters of undertaking till July 31. It had also said that exporters can now submit bonds or LUTs in the revised format for GST, by the end of the month. Last week, it allowed similar relaxations for export-oriented units.
Noting that despite the relaxations, the CBEC is still receiving grievances from exporters on delays, she has further said: “ It must be ensured that every exporter, whether registered in Central Excise or Service Tax in pre-GST regime or not, should be facilitated to the maximum extent possible.” The CBEC has now directed three customs houses in Delhi, Chennai and Mumbai-I to examine the queries of exporters and importers, and furnish draft response within a day.
Uncertainty
Following the provisions for exports under GST has not been easy, and many exporters have also complained to the CBEC. “Despite clarifications by the government, there is still a lot of confusion at the ground level, and officials are still uncertain about how to proceed,” said an industry source. The government is also concerned that the ground-level confusion could impact the country’s exports for July.
Source: Business Line
As India gets ready for the crucial 19th round of Regional Comprehensive Economic Partnership or RCEP negotiations this week in Hyderabad (July 24-28), one wonders how aware the people in general and the stakeholders in particular are, on the likely fallout. If you go by arguments put forth by activists, the RCEP would have far-reaching impact on the economy. They say, if ratified, the RCEP provisions could impact agriculture, manufacturing, e-commerce, services and pharma. It’s not that no discussion had ever taken place. But it was largely confined to only one layer, keeping the majority out of the discourse. The opponents of RCEP compare this with the discourse that happened over other global trade pacts such as the WTO. Or, the Government has not done enough to make India discuss this. The RCEP has 16 member countries — 10 Asean countries and six with whom it has free trade agreements. It aims at creating a free, common market place for the member countries, which are home for 3.5 billion people. India, home to over one-third of the RCEP population, holds the key as it offers the second biggest market after China in the group. The People’s Resistance Forum against FTAs-RCEP feels that the manner in which the talks are being held is undemocratic and not inclusive. They are demanding that India withdraw from negotiations to safeguard its interests. It alleges that the details of the agenda and provisions are kept as a secret from the public. Talks are being held behind the doors, giving little scope for the public to understand what is happening inside. They fear severe harm to the interests of farmers, dairy industry and pharma sector as imports from developed countries could flood the domestic market. Small-holder farmers face the biggest risk as imports from developed economies could make them jobless. They fear RCEP could impact seed sovereignty of farmers. Farmers’ organisations fear that dairy imports from Australia and New Zealand could flood the Indian market, putting the domestic dairy sector in serious trouble. The States too have taken not much interest in the RCEP deliberations or its impact on the primary sector. Agriculture being the State subject, the States should have discussed the provisions in detail. Political parties too seem to have no clue on what is happening. Still more surprising is the late realisation by the activists themselves. They began rallying farmers’ associations, trade unions and intellectuals a couple of weeks ahead of the conference. They are holding parallel meetings to explain the likely fallout of the talks. Whether it is good or bad is a different issue but it is imperative that the RCEP should have been discussed in the public domain in detail, considering the scale of impact it would have. Complete absence of discourse in the public space is baffling, particularly when the crucial round of negotiations are being held in the country. Considering the apprehensions and likely implications on the country’s economy and livelihoods of crores of people, the Government should put forth the RCEP agenda for discussion. It must publicise the provisions of RCEP and what it would mean by joining a big free trade region. It will not only give them a chance to come out with suggestions, but will also help them prepare for such a regime.
Source: Business Line
Former Foreign Secretary and National Security Adviser (NSA) Shivshankar Menon warned that if India continues to maintain its present stance of not giving greater market access to China then the other member countries might conclude the Regional Comprehensive Economic Partnership (RCEP) pact without it. “I think the others will go ahead will RCEP. You are so frightened of opening your market to the Chinese that you are actually dragging your feet. It is very easy to walk out of the room, it is very difficult to walk back in,” Menon told members of the Indian Association of Foreign Affairs Correspondents (IAFAC) here on Friday. The next round of RCEP talks is expected to be held on July 24 in Hyderabad while the technical-level negotiations were held on July 18. He said India’s insistence on asking for greater access in Mode 4 under services trade, which aims to open the jobs markets in the member countries for Indian professionals might let the other countries to sign the deal without India being on board. The China-led RCEP was launched in November 2012 as a counter to US' Trans-Pacific Partnership (TPP) agreement. It is being negotiated between the 10-member ASEAN economies — Singapore, Malaysia, Thailand, Vietnam, Indonesia, Philippines, Myanmar, Laos, Cambodia and Brunei and six of its free trade partners — China, Australia, Japan, South Korea, New Zealand and India. “If you look at ASEAN, you look at China and we are seeing now how 11 countries are going together to do TPP. So the Chinese are going to push for a quick RCEP and you cannot go on pulling out saying if you don’t give me Mode 4, if you don’t give me services, they will say we will go ahead without you. Problem is you do not have a coherent strategy for what you really want to do in terms of regional trade,” he said. Menon’s remarks come a day after the Chinese media warned India that the ongoing military standoff between India and China in the Doklam region, close to the India-China-Bhutan tri-junction, should not impact the RCEP negotiations. Menon, who is now also serves as chairman of the Advisory Board of the Institute of Chinese Studies, also said that the government took step in the right direction by asking China to maintain the status quo, as per the 2012 understanding between India, China and Bhutan. “India is very clear in telling the Chinese to maintain the status quo, I think that’s a very logical stand … We know each other’s stand very well on the border issue. There is nothing new to be discussed in this. All we need now is a political decision,” he added.
Source: Business Line
India is likely to clock a 7.5 per cent economic growth in the current fiscal, NITI Aayog Vice Chairman Arvind Panagariya has said, even as he acknowledged that creation of "good jobs" in the country remains a big challenge. "For the current fiscal year of 2017-18, I expect that we will be back to at least 7.5 per cent and as you get towards the last quarter of the year probably we will begin to touch eight per cent. But the average for the year would be about 7.5 per cent," Panagariya told PTI in an interview here. Panagariya, who had presented India's 'Voluntary National Review Report on Implementation of Sustainable Development Goals' at the UN High Level Political Forum on Sustainable Development 2017 last week, however, said that job creation in the country, especially at the lower, semi-skilled level, "truly is the biggest challenge, probably bigger than growing at eight per cent." He said it is unfortunate that India's better performing sectors such as automobile, auto parts, engineering goods, petroleum refinery, pharmaceuticals and IT enabled services, are not very employment-intensive. "All these (sectors) are either very capital intensive or skill labour intensive. There is a big need for good jobs at the lower, semi-skilled level. There we have got a big challenge," he said. Panagariya said he does not agree with the classification in some sections of the media that India's economic growth is a jobless growth. "I personally don't believe that is true. We cannot be growing at 7.5 per cent and then you say that jobs are not growing, investments are not growing at a satisfactory pace. All of that growth could not have come from productivity alone," he said. Panagariya, however, acknowledged that there is not enough creation of good jobs that pay good wages. "Jobs are being created. But certainly good jobs which pay good wages, those I think we have not been very successful with and that is where the big challenge lies. That really also requires some reconfiguration of the structure of manufacturing towards more labour intensive sectors like clothing," footwear and food processing, he added. He noted that China, which is the major exporter of all these products, is experiencing very high wages and is already quitting some of the space in these labour intensive sectors. "It is a good time for India to move into those sectors," he said. With the Indian government implementing the big ticket reform of the Goods and Services Tax, Panagariya said while there could be some teething troubles as the country embraces the ambitious financial reform, he does not see it significantly impacting economic growth going forward. "On some sort of an immediate negative impact (of the GST on economic growth), personally I don't think there will be a kind of negative impact that you will be able to actually measure separately," he said, adding that there will undoubtedly be teething problems initially because even if the country is small, when an entirely new system is instituted, it takes time for people to learn. "The vastness of the country makes it more complicated and you are dealing with 29 different states and different levels of income, different capacities to implement in different states," he said. "I think things should settle down in a relatively short period. I would say on the whole, we should see within a year's time positive results should be coming out and in the longer run, it should enhance efficiency," he said on GST's impact going forward. At an interactive multi-stakeholder panel hosted at the UN by India's Permanent Mission to the UN, the NITI Aayog and think-tank Research and Information System for Developing Countries last week, Panagariya had said that India's GDP could rise to about USD 8 trillion over the next 15 years if by a conservative assumption, the country registers an economic growth of 8 per cent annually.
Source: Financial Express
The political standoff between India and Pakistan may dominate the news headlines, but India’s synthetic textiles, yarn and fibre are starting to find an increasing number of Pakistani buyers. According to Kripabar Baruah, joint director, Synthetic and Rayon Textile Export Promotion Council (SRTEPC), exports to Pakistan that had fallen in 2014-5 and 2015-6 have grown in the current financial year (2016-17). “Exports to Pakistan were down more than 5% in the last two years, but this year we have seen more than 10% growth in exports to Pakistan,” says Baruah. India is expected to export at least US$200m worth of manmade fibre (MMF) textiles to Pakistan this year. “Of this, more than 80% is in the form of fabric, 15% is yarn and only 5% is fibre,” he adds. However, while this increase is welcome, it follows sharp falls in the preceding two years – in 2013-14, Indian suppliers exported US$400m worth of artificial fabric, fibre and yarn to its north-west neighbour, he says. “Pakistan was one of the leading markets for MMF textiles for India back then,” says Baruah. “Now, we are exporting mostly to United Arab Emirates and the United States of America where our exports are to the tune of US$600m, and US$550m respectively.” Surat, a textile manufacturing hub in south Gujarat is a major exporter of MMF textiles to Pakistan. Most of the textiles exported is for women’s dress material – traditional women’s wear of salwars (baggy pyjamas narrowing at the ankles), kameez (long tunics), kurtis (short tunics) and dupatta (long scarf) and saris. Some of fabric is in demand for men’s traditional pathani suits, comprising long tunics with salwars. These exports are in the form of ready-for-dyeing material as designing and printing services in Pakistan is of superior quality, according to Rinkesh Mashruwala, executive director of Surat-based Rinkesh Textiles. Mashruwala’s company exports 100,000 metres of viscose fabric to Pakistan every month. Talking of enhancing export potential to Pakistan, he adds: “I export 50% of my production to Pakistan. We can easily increase this export by 20% if the few bottlenecks at the border are cleared.” Mashruwala explains that a lack of qualified personnel at the national border results in long waits, sometimes up to 15 days, for lorries carrying goods to Pakistan. As well as this substantial domestic market, another source of demand in Pakistan is the re-export market, serving buyers of additionally processed fabric in markets such as the European Union (EU), where Pakistan enjoys special trade access under the EU’s generalised scheme of preferences-plus (GSP+). Another exporter of women’s dress material to Pakistan from Surat, Ravindra Jain, director, Oswal Prints, believes the re-export trade could be larger if Pakistan removed restrictions on exports of printed fabrics. Furthermore, India awaits a grant from Pakistan of most-favoured nation (MFN) status for its exporters, something that New Delhi has accorded Islamabad, reducing tariffs on imports from Pakistan. Indeed, as both countries are members of the World Trade Organisation (WTO), Pakistan has a duty to give India this status – but, thus far, New Delhi has not launched a disputes case over the issue at the WTO. Baruah hopes mutual MFN status and its attendant freer trade will be forthcoming. “If in these troubled times we are doing business, one can well imagine how much better it would be for business if the relations improve with Pakistan. Trade would have more than doubled. People on both sides of the border would benefit. It would lead to better investment, benefit the consumers and the businessmen as well.”
Source: Wtin.
There will have been no punishment for being honest says Smt. Smriti Zubin Irani Smt. Smriti Zubin Irani terms GST as a “Great step towards Transparency” The Union Minister for Textiles and Information & Broadcasting Smt. Smriti Zubin Irani says that no one can harass a person who wants to come into formal economy through GST Addressing a seminar on ‘GST – a Tool for Inclusive Growth’ organised in Ahmedabad today, the Minister said past transactions are not to be checked under this system. There will be no punishment for being honest. Smt. Irani said if government agencies or officer will ask about past transactions or harasses anyone, direct action will be taken against them. The Minister asked traders and business persons to draw attention of MPs and central ministries, if any such incident occurs. She said that GST is not just ‘Good and Simple Tax’ but it also a ‘Great step towards Transparency’. “Beauty of the GST is it is a Destination tax and it gives money back through Tax credit”, she added. Textiles minister said that implementation of GST is an historic event and we are proud to be a witness of such historic event. She said that all parties came on a single platform in GST council for its successful implementation. The Minister said that no one wants to be a Tax evader, if the system is transparent and simple. She said and that this is the change that the Union Government is bringing in, under the leadership of the Prime Minister Shri Narendra Modi. “Government has taken a number of pro poor steps in its three (3) years, to make system more transparent and simpler through Jan Dhan Yojana, Mudra Yojana, Direct benefit transfer etc. and GST is also a part of this.”, she added. Smt. Irani along with other government officers gave answers of the queries raised by traders and businessmen. Minister assured them that for those who want to remain honest; there is no reason to be worried. The Minister of State for Women and Child Welfare of Government of Gujarat, Smt Nirmala Wadhwani, Members of Parliament Shri Paresh Rawal, Dr. Kirit Solanki and several other dignitaries were also present on this occasion.
Source: PIB
AT harvest higher estimates of consumption and tight supply is to keep cotton prices firm for the next few weeks, even as farmers continue to hold close to 40 per cent of the total crop of 34 lakh bales, according to Acharya NG Ranga Agricutural University (ANGRAU) Market Intelligence Centre Kharif pre-sowing projections for 2017-18. Kapas prices have remained firm in the range of Rs.5, 900 -6000 per quintal, over the past few weeks due to lower than expected arrivals of crop and higher estimates of consumption. According to trade sources, so far about 208-210 lakh bales or about 61 per cent of the total crop has arrived. On consumption front, the Cotton Association of India has estimated for the ongoing year (October to September 2016-17) at 295 lakh bales higher than last year’s 290 lakh bales. Prices are likely to remain firm in near future as demand from yarn makers, millers, and export is likely to be higher this year. Currently cotton mills and ginners from Gujarat, Maharashtra, Andhra Pradesh, Punjab and Karnataka have been purchasing cotton. According to the trade sources cotton prices would remain firm as crop output is likely to be less in Pakistan, Bangladesh and China. Given this State of affairs, and assuming normal area in kharif 2017-18, an attempt is made to forecast the prices of cotton at harvest period. Towards this end, the modal prices of Warangal were made use of. The results of the analysis in addition to the market survey indicated that the price per quintal would be around Rs. 4600 to Rs. 5000 at harvest.
Source: The Hans India
India is not interested in re-starting discussions on a Free Trade agreement (FTA) with Israel despite Prime Minister Narendra Modi’s successful visit to that country recently as it expects to gain little from such a pact, a government official said. Scope for ties There is, however, a lot of scope for cooperation in areas such as defence off-set manufacturing, space technology, drip irrigation and agriculture, which have shot into priority following the historic meeting between the Indian Prime Minister and his Israeli counterpart Benjamin Netanyahu and preparatory work has already started.
Not much gain
“While the Israelis are keen to negotiate an FTA with India and have also communicated their interest, internal studies and industry consultations carried out by the Commerce Ministry over the years have shown that there are no discernable gains for the country,” a senior official told BusinessLine. FTAs are required when there are stiff tariffs or non-tariff barriers between two trade partners, but India does not face any problems with Israel either on the tariffs front or in the form of technical barriers, the official explained. India-Israel bilateral trade was at $5 billion in 2016-17 with India’s exports at $3 billion and imports at $2 billion. While the amount is higher than last year’s bilateral trade of $4.9 billion, it is lower than the $6-billion level of 2012-13 and 2013-14.
More tie-ups
But India is positive about the scope for greater cooperation as the two countries have different areas of strength and can gain by sharing technology and expertise. “Israel’s strength lies in areas such as security, defence and irrigation while India is strong in space technology, defence off-set manufacturing and many services. There will be an increased number of tie-ups following the visit based on the MoUs signed by both leaders,” the official said. The MEA has already started circulating the notes related to the visit to all Ministries and Departments concerned and work based on the MoUs would begin soon, the official added. Modi and Netanyahu signed seven MoUs including ones on water conservation, industrial R&D fund, agriculture and space research.
Source : Business Line
Complete value chain of garment and textile manufacturing solutions and technologies will be showcased at Gartex, India's comprehensive exhibition on garment and textile machinery, fabrics, accessories and allied industries, to be held during July 29-31, 2017 in New Delhi. In its second year, Gartex has emerged as a one-stop selling and sourcing platform. Gartex would serve as the one-stop-destination for those who wish to reach out to the innovations taking place in the country's textile, garment machinery and accessories sectors. The show this year would specially highlight the latest developments in the digital textile printing machinery, embroidery machines, and garment and apparel machinery, incorporating garmenting, digital textile printing technologies, fabrics and accessories. Digitex, which stole the show acquiring 30 per cent of the product segment in 2016, would again be a coveted platform showcasing the latest developments in digital textile printing technology encompassing machinery, inks, software and services. Visitors would get to know opportunities offered by digital printing for home furnishing and interior decorate on, apparel and fashion, corporate interiors and other related segments. Embroidery, which is used to enhance the design and look of various applications like apparel, home textiles, sarees, bags, footwear, etc., is expected to acquire the centre stage this year. As compared to print, embroidery gets greater attention because of its three-dimensional feature, offering textured and high luster effects and adding value to a product in tactile and visual parts of consumer appreciation. Most of the modern embroidery machines are computerised and specifically engineered for embroidery work. Depending upon the capabilities, diversified degrees of user input are required by the machinery to read and sew the embroidery designs. One of the show's main interests will be garment and apparel machinery, which includes pre and post process washing equipment, cloth inspection machine, cutting and laying machines, embroidery equipment, finishing machines, fusing machines, ironing and steaming equipment, knives/scissors grinding machines and quilting machines. There will be varied exhibit segments such as garment and apparel machinery, textile and textile processing machinery, digital textile processing technology, home furnishing machinery and materials, printing and dyeing, garment value-added manufacturing machines, apparel fabrics, accessories, trims and embellishments and allied products and services. Top players such as Mehala, Durst, EFI Reggiani (Arrow Digital), Britomatics, Mimaki, Jaysynth, Colorjet, Negi Sign, Aura, Peayush Machinery, Textile Technologies Roland, Wenli, Veekay Jet, Tanya Enterprises, JN Arora & Co, Cherian Machines, Sky Screen India, Tukatech, Coats India, Pashupati Overseas, Unix, Twinstar, Tajima, Dolphin and many more are expected at the show with their best products and latest technologies to define new market trends. The show will have visitors as garment exporters, garment manufacturers, fashion designers, apparel industry professionals, home textile players, textile printing companies, sports and apparel manufacturers, buying houses, soft signage companies and other stakeholders. Visitors will not only come across the latest trends but also be able to experience live demos of the innovative technological advances on the show floor. Besides, the new product launches would help them equip with their purchasing decisions. They would also get an opportunity to establish strategic partnerships with the new manufacturers and suppliers.
Source: Fibre2Fashion
|
Item |
Price |
Unit |
Fluctuation |
Date |
|
PSF |
1234.55 |
USD/Ton |
0% |
7/21/2017 |
|
VSF |
2343.42 |
USD/Ton |
0% |
7/21/2017 |
|
ASF |
2188.18 |
USD/Ton |
0% |
7/21/2017 |
|
Polyester POY |
1249.33 |
USD/Ton |
0.30% |
7/21/2017 |
|
Nylon FDY |
2971.79 |
USD/Ton |
1.01% |
7/21/2017 |
|
40D Spandex |
5026.90 |
USD/Ton |
0% |
7/21/2017 |
|
Polyester DTY |
2365.60 |
USD/Ton |
0% |
7/21/2017 |
|
Nylon POY |
1589.39 |
USD/Ton |
0% |
7/21/2017 |
|
Acrylic Top 3D |
3104.85 |
USD/Ton |
0.96% |
7/21/2017 |
|
Polyester FDY |
5677.44 |
USD/Ton |
0% |
7/21/2017 |
|
Nylon DTY |
1456.32 |
USD/Ton |
0% |
7/21/2017 |
|
Viscose Long Filament |
2750.01 |
USD/Ton |
1.64% |
7/21/2017 |
|
30S Spun Rayon Yarn |
2971.79 |
USD/Ton |
0% |
7/21/2017 |
|
32S Polyester Yarn |
1833.34 |
USD/Ton |
0% |
7/21/2017 |
|
45S T/C Yarn |
2735.23 |
USD/Ton |
0% |
7/21/2017 |
|
40S Rayon Yarn |
1951.62 |
USD/Ton |
0.76% |
7/21/2017 |
|
T/R Yarn 65/35 32S |
2291.68 |
USD/Ton |
0% |
7/21/2017 |
|
45S Polyester Yarn |
3119.64 |
USD/Ton |
0% |
7/21/2017 |
|
T/C Yarn 65/35 32S |
2321.25 |
USD/Ton |
0% |
7/21/2017 |
|
10S Denim Fabric |
1.37 |
USD/Meter |
0% |
7/21/2017 |
|
32S Twill Fabric |
0.85 |
USD/Meter |
0% |
7/21/2017 |
|
40S Combed Poplin |
1.19 |
USD/Meter |
-0.12% |
7/21/2017 |
|
30S Rayon Fabric |
0.67 |
USD/Meter |
0% |
7/21/2017 |
|
45S T/C Fabric |
0.69 |
USD/Meter |
0% |
7/21/2017 |
Source: Global Textiles
Note: The above prices are Chinese Price (1 CNY = 0.14785 USD dtd. 21/7/2017). The prices given above are as quoted from Global Textiles.com. SRTEPC is not responsible for the correctness of the same.
Garment exports to India declined in fiscal 2016-17 thanks to 12.5 percent countervailing duty by the neighbour, which negates the benefit of duty-free access, and the emergence of its own apparel manufacturing industry. Last fiscal year, garment shipments to India, a market of more than $40 billion, fetched $129.81 million, down 4.85 percent year-on-year. The development is in contrast to expectations: exports were supposed to increase manifold for geographical proximity, Bangladesh's competitive advantage in this field and India's burgeoning middle-class.
“We have a very good market in India, but we cannot utilise the potential due to price competitiveness,” said Mohammad Hasan, executive director of Babylon Group, a leading garment group. Babylon Group sent garment products worth $1.67 million in 2015 and $1.6 million in 2016. The number this year will be lower, he said. “Export of garment from Bangladesh is not increasing as the Indian manufacturers are also producing the same clothes at cheaper rates.” Plus, the Indian importers are not interested in bringing in garment items from Bangladesh for the 12.5 percent countervailing duty (CVD), an import tax imposed on certain goods in order to prevent dumping or counter export subsidies. “It is my observation that if we can utilise the giant Indian and Chinese markets, our garment exports will boom,” Hasan added. Apart from CVD, the Indian government has been subsidising its garment makers, said Faruque Hassan, vice-president of Bangladesh Garment Manufacturers and Exporters Association. So determined the Indian government is in seeing its garment sector thrive on the global stage that it changed an old law. Previously, the Indian government did not allow the big industrial groups to invest in the garment manufacturing industry, which it changed a few years ago. The big industrial groups no longer need to restrict their investment to the backward industries like textile, chemicals, printing, dyeing, weaving, spinning and finishing; they can also set up garment manufacturing factories, Hassan said. As a result, the Indian garment sector has been growing in stature every year and its market share worldwide is also increasing. “However, we should not look to India as our competitor as we also import a lot of raw materials like cotton, chemical products, fabrics and yarn from them for our garment sector,” Hassan added. Bangladesh imports goods worth more than $6 billion from India in a year through the formal channels, about $2 billion of which is cotton. More than 50 percent of Bangladesh's cotton requirement in a year is met by imports from India. Abdul Matlub Ahmad, the immediate past president of the Federation of Bangladesh Chambers of Commerce and Industry and a former president of the India-Bangladesh Chamber of Commerce and Industry, urged the Export Promotion Bureau to open a separate cell for the Indian market. The cell will research the reasons for the floundering exports to India. “By this time, Bangladesh's export to India should have crossed the $1 billion mark. But, still we cannot cross this mark despite having the potential.” Ahmad said both Bangladesh and India are strong in the production of the same kinds of goods like garment. “So the demand for Bangladeshi goods in India is low. We should find out goods in which India is not strong. We should produce those and export to India.” He cited the Pran-RFL Group as a case in point. The Bangladeshi company has found a huge market in India for its agro-based and processed food items. “Actually, neither the public nor the private sector is serious about the Indian market,” he added. Not only garments, but the overall export to India also declined in fiscal 2016-17 to $672.40 million, according to data from the EPB.
Source: The Daily Star
Cambodia’s garment exports grew slower than expected by about 4 percent in the first half of the year compared with 9 percent in the same period last year while foreign investment in the sector fell by 30 percent, according to a report released by the National Bank of Cambodia on Saturday. The NBC report said the slow growth was because of falling garment exports to the US, rising competition from Vietnam and Myanmar, and high production costs due to the increasing minimum wage. The US and the EU are the top two destinations for Cambodia’s garment exports and the NBC report pointed out that in the first half of the year total US-EU garment exports represented 67 percent of the kingdom’s total exports, down from 75 percent in the same period last year. The report also added that investment in the garment sector fell due to investors realising that Cambodia, in the next three years, would no longer enjoy preferential tax treatment from the EU as it moves up the ranks from a lower income country to a lower middle income nation. “Cambodia will face tough competition in the global market in the short, medium and long term due to Vietnam, Cambodia’s main competitor in garment sector, getting preferential tax treatment in 2018 on its exports to the EU under the Free Trade Agreement,” said Chea Serey, NBC’s director-general. “The increasing of minimum wages will also put pressure on Cambodia’s competitiveness,” she added. The Asian Development Bank on Thursday, in its Asian Development Outlook 2017 report, cautioned that since Cambodia is a highly dollarised economy, it must be careful to align minimum wage adjustments with productivity increases to keep wage costs in check and stay competitive as a manufacturer for export markets. In April, the World Bank in its Cambodia Economic Update report stated that rising labour costs, driven in part by the increasing cost of living, US dollar appreciation, and competition from other regional low-wage countries, in particular Myanmar, continue to exert downward pressure on prices of exported garment products. “However, a further decline of foreign direct investment inflows into the sector does not bode well for future garment sector expansion, as the industry is currently moving towards higher value-added products and will need to become more capital intensive if it is to confront increasing labor costs by improving productivity,” added the bank. Meanwhile, NBC governor Chea Chanto told a conference on Saturday that Cambodia’s GDP is estimated to grow 7 percent in 2017, thanks to the growth of the garment, construction, real estate and tourism sectors. “The garment sector continues to be a major contributor to the GDP, despite its slower growth rate, while the construction and tourism sectors continue to grow,” said Mr Chanto. Along with optimism, he said, Cambodia’s economy also faces a number of risks that could affect both internal and external growth. “The rise in the US dollar will reduce the competitiveness of Cambodia’s exports and may affect the tourism industry,” said Mr Chanto. “The uncertainty about the effect of British withdrawal from the EU on Cambodian exports to the UK is also a cause for concern,” he added. Within the country, said Mr Chanto, increasing wages may make the cost of production higher –which could have an effect on the manufacturing sector.
Source: Khmer Times
COLOMBO -- Despite a recent move by the European Union to restore Sri Lanka to its highly favorable Generalized System of Preferences Plus program, the country will find it hard to catch up with Bangladesh, which has powered ahead in textile and apparel production in the last few years. Production and labor costs remain high compared to competitors, and analysts are skeptical that the government will be able to meet its goal of doubling exports by 2020. The EU, which is Sri Lanka's biggest export destination, absorbing some 36% of total shipments, reinstated the country into the GSP Plus program in mid-May, removing import tariffs on more than 6,000 products, including clothing. Sri Lanka was dropped from GSP Plus in 2010 for human rights violations, but remained in the less-favorable GSP program, under which its exports were taxed at 9.6%. That had had an impact. Total apparel exports fell from $4.7 billion in 2014 to $4.6 billion in 2015 and 2016, according to the Joint Apparel Association Forum, an industry body. Exports to the EU in 2014 stood at $2.1 billion, but dropped to $1.9 billion in 2015 and 2016. The slump has continued in 2017, with apparel exports falling another 5.8% in the first five months, compared with the same period in 2016. But JAAF adviser K. J. Weerasinghe is fairly optimistic: "We are confident we can now receive at least an additional $400 million worth of orders from the EU initially, which will increase further, now that we have regained GSP Plus," he said. Weerasinghe, and some retailers, said it would not be possible to meet the government's target of doubling exports by 2020, although 2022 was a possibility. Analysts say that Sri Lanka needs to do more to catch up with countries such as Bangladesh, which is now the world's second-largest clothing exporter after China. Bangladesh accounts for 6.4% of global clothing exports, compared with Sri Lanka's 1.2%. Machine operators at work in a state-of-the-art garment factory in Sri Lanka. Part of the reason for this is that Sri Lanka has fallen behind in terms of value chain creation. Bangladesh, for example, has set up spinning mills and knitting mills, which allow manufacturers to cut production costs and improve efficiency. This also puts Bangladesh in a good position to sell large volumes of cheaper apparel such as knitwear, woven shirts, sweaters and sweatshirts. Amit Gugnani, an analyst at Technopak Advisors, a management consulting company, said Sri Lanka must adopt a similar approach to developing value chain capabilities. "In complete integration, it becomes relatively easier to look at cost engineering across the value chain," he told the Nikkei Asian Review. Gugnani also suggested that the government should set up textile industrial clusters in the country's north and east by providing investment incentives, as part of the value chain creation. Another aspect of making production cheaper is to concentrate on remote and backward regions. Wages in Sri Lanka are typically higher than in Bangladesh and Vietnam, making the country better suited to producing high-end garments such as swimwear, trousers and underwear, including lingerie for top brands such as Victoria's Secret. According to the World Bank's "Stitches to Riches" report, released in April 2016, the minimum monthly wage in Sri Lanka is $120, compared with $70 in Bangladesh. Sri Lankan labor laws also limit factory workers to 57.5 hours per week, with fixed weekly holidays. This compares with Bangladesh's working limit of 60 hours and Vietnam's 64 hours. Sector has fallen well behind rivals such as Bangladesh Controlling costs Gugnani said Sri Lanka should amend these labor laws. "It's important for Sri Lanka to look at providing lower minimum wages in backward and remote regions ... where the cost of living is comparatively lower," he said. "The industrial clusters in these regions can focus on basic products with minimal value addition and large volumes." To cut production costs further JAAF has requested exemptions from Sri Lanka's 2% nation-building tax and a 7.5% port and airport development tax on the importation of machinery for the sector. "We don't have a problem with the government taxing our profits, but we have sought an exemption on some taxes for importation of machinery," Weerasinghe said. Industry participants are also urging the Sri Lankan government to look at reducing duties, offering input tax rebates on raw materials sourced locally, and providing subsidies to factories that improve efficiency, to promote competitiveness with Bangladesh and Vietnam. Anushka Wijesinha, chief economist of the Ceylon Chamber of Commerce (which uses an older name for Sri Lanka) said the country must also focus on becoming an easier place to do business. He added: "For a more sustainable and sustained increase we need to focus on competitiveness factors and factors that hold our exporters back -- like standards, bureaucratic and procedural delays." Wijesinha said the government must help exporters to test products to meet international standards. Also, he urged the government to remove archaic laws such as the need for some exporters to obtain permits for each shipment. Sri Lanka is ranked 110th among 190 economies in terms of the ease of doing business in 2016, slipping one place, according to the latest World Bank annual ratings. Gladys Lopez-Acevedo, an economist at the World Bank, has another solution. She said that Sri Lanka should explore the idea of exporting more to other countries, including China. "Sri Lanka must look at consolidating its position, and not only focus on higher-end and value-added garments," she said. To this end, Weerasinghe said the industry was looking at manufacturing shoe uppers, having received interest from a large company in Europe. "We have the potential to diversify and go beyond from our current strengths," he said. Hasitha Premaratne, chief financial officer of Brandix Lanka, the largest apparel exporter in Sri Lanka, with a customer portfolio that includes Victoria's Secret, Gap, Lands' End, Lane Bryant and Marks and Spencer, agreed that Sri Lanka must diversify. "The country can broaden its horizon into areas such as synthetic products," Premaratne said. "We have a strong presence in innerwear products. However, we could look at the development of our infrastructure in synthetic fabrics as this is a growing global trend." Aroon Hirdaramani, a director of Hirdaramani Group, a manufacturer for brands including Tommy Hilfiger, Levi Strauss and Nike, said his company started talking a week after the EU announcement to existing customers keen to increase sourcing and new customers looking to place orders. Hirdaramani and Premaratne were both optimistic that Sri Lanka's tighter labor laws and ethical standards could attract more European buyers. However, Wijesinha said gains from the GSP Plus decision would not start to appear until 2018: "We will become competitive against others, and factories that were slowing down will see a boost in earnings and job creation, but this will not happen overnight. Order books for 2017 are mostly completed already, so we will only begin to see the gains from 2018, 2019 onward."
Source: Nikkei Asian Review
LAHORE: Major stakeholders of Pakistan’s textile sector have demanded that the government should conduct an industrial census, especially in all textile chains, which will reveal the actual number of production units, labour employed and machinery installed. The census will help in understanding the real strength of the textile industry, depending on which real challenges faced by the troubled sector can be examined. “The ministry is laying the entire blame on businesses for using outdated technology and on reduced international demand due to global recession,” Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA) Chairman Ijaz Khokhar said while talking to
The Express Tribune.
He rejected the government’s assertion of outdated technology, arguing that most production units were equipped with semi-automated machinery to ensure operational efficiency. “We are competing in global markets and international players never visit any factory and place orders with the units working with outdated technology as they have strict quality control measures in place,” Khokhar said. “What about Bangladesh, China, Vietnam and other such countries whose exports are rising; are they not being hit by this recession,” he asked while dismissing government’s claim of global recession hitting Pakistan’s exports. “The industry needs a census so the government and stakeholders could discover its actual strength based on which future strategies should be made,” Khokhar added. Textile exports recorded a high of $13.8 billion in 2013-14, but they dropped to $12.14 billion in 2015-16. In the first 11 months of 2016-17, the exports stood at $11.23 billion. Instead of outdated machinery and depressed foreign demand, industry representatives consider uneven industrial and tax policies, smuggling and high cost of doing business as the main causes of weakening exports. Former All Pakistan Textile Mills Association Punjab chairman Shahzad Ali Khan believes old technology was a reason behind the current state of affairs in the textile sector due to which the industry was dying slowly. “Indian businesses have successfully automated their industries due to which they are more energy efficient. India is now manufacturing textile machinery whereas we in Pakistan are not even producing its spare parts,” Khan said. He added many groups in Pakistan had successfully upgraded their facilities, but for medium-sized enterprises the situation was precarious since their liquidity had dried up over the years and no bank was willing to give them fresh loans to update technology. Former All Pakistan Textile Processing Mills Association chairman Maqsood Ahmad said the textile industry in general was facing huge challenges, but a comprehensive research (through census) could help eliminate misconceptions about the industry. “Industrial census is important to reveal structural deficiencies based on which the government and the stakeholders can overhaul the policies,” he added.
Source: The Express Tribune
About 2,000 youth are set to get jobs in the apparel industry following the signing of a deal to be spearheaded by the US Agency for International Development (USAID) East Africa Trade and Investment Hub (the Hub). The programme signed with Generation Program Kenya Limited — a local subsidiary of the McKinsey Social Initiative — will equip young people with skills needed in the apparel industry. The pilot programme, to be implemented in collaboration with the Ministry of Industrialisation, will see seven training centres set up and equipped across the country. The pilot plan, that will also involve the Kenya Association of Manufacturers, will include screening of 4000 youth for training and job placement in the apparel industry. The programme is aimed at addressing the skills gap that currently hinders growth in the apparel sector in Kenya. The pilot project also seeks to create “a sustainable and replicable model for apparel sector skills development throughout East Africa.” The partnership ensures US brands and retailers’ goods are manufactured using the best business practices, creating a win-win situation for all players. The East Africa is establishing itself as a key-sourcing destination for buyers of global apparel, footwear and travel goods.
Source: Business Daily
KABWE is poised to have a second textile firm which is envisaged to create over 2,000 jobs for the local people once completed. The establishment of the textile firm is a brainchild of the Industrial Development Corporation (IDC) and is earmarked for construction in the Kabwe Multi-facility Economy Zone (MFEZ). The new textile will be the second to be established in Kabwe after Mulungushi Textiles, which has ceased operations to pave way for upgrading and rehabilitation works. Kabwe town clerk Ronald Daka said the new textile company will create over 2,000 jobs and Marubeni, a Japanese textile company, will be a partner in the construction of the firm. “The Government of the republic of Zambia through IDC has proposed to develop a textile industry and has requested for 26 hectares of land in the MFEZ and we have given 24 hectares,” Mr Daka said. Mr Daka said in an interview yesterday that the textile firm will seek to surpass the operations of Kafue Textiles and Zambia China Mulungushi Textiles.
He said Kabwe Municipal Council is happy about the construction of the textile because it will contribute to the growth of the local economy. “For us this is a game-changer for Kabwe. Mulungushi (Textiles) is tied to a Chinese company but for this new textile, Marubeni are basically supporting this initiative,” Mr Daka said. He said investors in different areas are making inquiries about investment opportunities in Kabwe. He said this is an indication that they have confidence that their investments will be secure in the area. “People who want to invest should enjoy the benefits of investing in this Kabwe Multi- facility Economy Zone,” Mr Daka said.
Source: Zambia Daily Mail
Ethiopia, which produces about one lakh tonnes of cotton a year, is looking at investments from the Indian textile and clothing industry at its industrial parks and also to cultivate more cotton. A delegation, including Bogale Feleke Temesgen, Ethiopian State Minister of Industry, and Sileshi Lemma Bekele, Director General of Ethiopian Textile Industry Development Institute, held meeting with members of Southern India Mills’ Association here on Friday. They had a similar meeting in Dindigul too. According to Mr. Temesgen, Ethiopia has just about 176 textile units and produces one lakh tonnes of cotton a year. “With three million hectares of land, the potential is immense to increase cotton production,” he said. Just 20 % of the three million ha is under cotton now and there is potential to increase it to 80 %. “We are here today to convince investors to come to Ethiopia,” he said. Indian textile industry can grow cotton on the uncultivated land, set up units to produce yarn and other value added products. Some of the main countries evincing interest to invest in Ethiopian textile sector are China, India, Turkey, South Korea, Japan, Germany, Italy and the U.K. According to the World Investment Report 2016, Ethiopia stands next to Vietnam in attracting foreign direct investment in textiles. It offers power at competitive price and land on 60 to 80 years lease. “We are aiming to generate 30 billion $ forex from textiles in the next 10 years. We have worked out what we need to do to achieve this. We need to attract investments,” added Mr. Bekele. Close to 500 companies have taken licence to invest in different industries in Ethiopia, mostly in textiles. It plans to have over 150 companies in textiles by 2020. Ethiopia is developing 13 industrial parks and four of them are operational. Indian companies such as Arvind have invested in some of these. In most of these parks, the focus is on the textile and apparel sector. With a growing population, Ethiopia needs to create jobs and hence the focus on textiles, said Mr. Temesgen.
Source: The Hindu
