INTERNATIONAL
Readymade garments (RMG) exports dropped by 3.84 per cent in August. Exporters have said that they are not able to confirm orders since, after the implementation of the Goods and Services Tax (GST), duty drawback and rebate of state levies (RoSL) are yet to be decided. In August 2017, Rs 8,556.35 crore worth of RMG exports were reported as against Rs 8,897.77 crore a year ago — a drop of 3.84 per cent.
Tirupur Exporters Association President Raja M Shanmugam said that the trend would continue as exporters are not able to take new orders since, after the GST implementation, the threat of loosing drawback to the tune of five-six per cent has prevented worried exporters from confirming orders. After September, the duty drawback rate will come down and the real pinch of GST will start only from October. "This is going to be a very big threat to the growth of RMG," Shanmugam said.
Exporters have appealed to the authorities to rectify this anomaly through policy intervention in whichever way possible. If the trend continues, India's share in global RMG exports is expected to come down to 3.5 per cent this year and to three per cent next year.
India's position will drop to ninth from its current sixth position and hundreds of people would lose their jobs, said Shanmugam. There is also an apprehension that all benefits to exporters will cease from January 1 since the country has agreed and signed in the World Trade Organization that no incentive would be given after the country's per capita income reaches $1000 for three consecutive years. The country has reached that status already. On the sector's outlook, exporters said that the delay in concluding the free trade agreement with the European Union has allowed China, Vietnam, and Bangladesh to grab the opportunities.
The Confederation of Indian Textile Industry (CITI) said that the condition of not allowing the refund of accumulated input tax credit (ITC) at fabric stage (with five per cent GST at the fabric stage and its related job works) has a huge impact on processed fabrics, especially cotton fabrics, as the dyes, chemicals, and ETP chemicals are expensive and attract 18 per cent GST.
More than 80 per cent of textile manufacturing units are highly fragmented and predominantly undertake job work. The inverted duty will have a major impact on the cost of production, inflation, and export competitiveness, said CITI. "It is essential to fully refund the accumulated ITC at every stage of manufacturing, especially the processed (dyed and printed) fabrics," said CITI.
In the post-GST era, knitted fabric processing units, which have a 20 tonne per day production capacity, undertaking dyeing job works, like Tirupur, at a rate of Rs 130 per kg would pay Rs 3.89 lakh per day as input tax and Rs 1.30 lakh per day as output tax. Thus, leaving Rs 2.59 lakh per day as unclaimed ITC. This works out to Rs 9-10 crore of accumulated credit per dyeing unit (20-tonne production capacity) every year. If the ITC is not refunded, it would significantly increase the cost and would affect not only the processing segment but also the exports of garmenting and made-ups, said a leading exporter. CITI added that the garment and made-up sectors would be compelled to use imported fabric as indigenous fabric would become costlier due to inverted duty.
SOURCE: The Business Standard
Ready-made garments (RMG) exports in August dropped 3.84 per cent, as exporters were not able to confirm orders due to confusion over the duty drawback and rebate of state levies (RoSL) schemes under the goods and services tax (GST). Exporters say they are not sure whether the rebates will continue or come down in October. In August, garments worth ~8,556.35 crore were exported as against ~8,897.77 crore a year ago, a drop of 3.84 per cent. Tirupur Exporters Association President Raja M Shanmugam said the trend would continue, as the exporters were worried to confirm orders due to the prospect of loosing rebate under the duty drawback scheme to the tune of 5-6 per cent.
Currently, the duty drawback rate is 7.6 per cent free-on-board (FOB) value and RoSL is 3.5 per cent. Duty drawback is calculated by taking into account the sum of excise, input services and Customs duty. Exporters will get only 2 per cent customs duty rebate, as it does not fall under the purview of the GST. “This is going to be a very big threat to the growth of RMG,” he said.
Exporters have appealed to the authorities to rectify this anomaly through policy intervention in whatever way it is possible. If the trend continues, India’s share in global RMG is expected to come down to 3.5 per cent this year and to 3 per cent next year. India’s position as RMG exporter will drop to ninth, from the current sixth and hundreds of people would lose job if the trend continues, said Shanmugam.There is also an apprehension that all the benefits to exporters will go from January 1, as the country agreed to the World Trade Organization (WTO) that no incentive will be given after the country’s per capita income reaches $1,000 for three consecutive years. The country has reached the status already.
Exporters say due to the delay in concluding free-trade agreement (FTA) with European Union, China through countries like Vietnam, Bangladesh, etc, grabbing the opportunities. The Confederation of Indian Textile Industry (CITI) said the condition of not allowing the refund of accumulated input tax credit (ITC) at the fabric stage (with 5 per cent GST at fabric and its related job works) has a huge impact on the processed fabrics, especially cotton fabrics (as the dyes, chemicals and ETP chemicals are expensive and attract 18 per cent GST). More than 80 per cent of the textile manufacturing units are highly fragmented and undertake job work. The inverted duty will have a major impact on the cost of production, inflation and export competitiveness, said CITI. “It is essential to fully refund the accumulated ITC at every stage of manufacturing, especially the processed (dyed and printed) fabrics,” said CITI. Under the new tax regime, the knitted fabric processing unit having 20 tonnes a day production capacity undertaking dyeing job works like Tirupur at the rate of ~130 a kg would pay ~3.89 lakh a day as input tax and ~1.30 lakh a day as output tax and, thus leaving ~2.59 lakh a day as the unclaimed ITC. This works out to ~9-10 crore of accumulated credit per dyeing unit (20 tonnes production capacity) per year.
SOURCE: The Press Reader
Farmers have sown cotton in 6 lakh hectares in the State during the kharif season. This is 2 lakh hectares higher than the last season.As the cotton farmers got better price, the farmers cultivating other crops shifted to cotton. As a result, cotton sowing increased to 6 lakh hectares in the State. If the same situation continues, the Agriculture Marketing Department is expecting that farmers will get 28 lakh bales yield during the current season.
Highlights:
The Cotton Corporation of India will open 43 centres to purchase cotton from the farmers. These centres will be set up in the agriculture marketing yards. These centres will be opened in Guntur, Prakasam, Krishna, Kurnool, Anantapur, East and West Godavari districts, Srikakulam and Vizianagaram districts. The CCI officials wrote a letter to Agriculture Marketing Commissioner Samuel Anand Kumar to this effect. Following request of the CCI, the agriculture marketing department will make necessary arrangements to set up these centres. Demand for cotton is increasing both in domestic market and globally. If the demand persists, the private buyers may offer better price for cotton in the open market.
T Bhaskara Reddy, an official in the Agriculture Marketing Department said, “ The demand for cotton is increasing in the domestic and international market. If the same situation continues, the private buyers may officer better than the CCI like last year. If the private buyers offer a better price, the farmers will sell cotton to them and they will be benefited.
When the price falls in the open market, they will sell cotton in the CCI counters. The CCI will try to get MSP to the cotton farmers.” A sambasiva Rao, a cotton farmer from Tadikonda said, “ There is need to increase MSP for cotton because the cost of cultivation is increasing. During 2015-16, MSP for cotton was Rs 4,100 per quintal, in 2016-17, it was 4,160, during this season it is Rs.4,320. There is a need to increase MSP for cotton to do justice to the farmers.”
SOURCE: The Hans India
The State government has decided to give identity cards to tenant farmers to ensure Minimum Support Price (MSP) for cotton produce, Marketing and Irrigation Minister T Harish Rao said on Monday.
The Minister, who held a video conference with district Collectors in Siddipet, directed all the Collectors to constitute special teams for continuous monitoring of cotton marketing in each district. “District Collectors and Agriculture and Marketing officers should also be part of the committee to assess the situation from time to time and they should meet every Friday,” the Minister said.
He wanted all details of cotton farmers by the end of September so that it can be sent to procurement centres to prevent involvement of middle men. “Due to bummer harvest, huge quantities of cotton is expected to reach the markets and hence, the committees should make elaborate arrangements well in advance,” he said. Cotton Corporation of India (CCI) centers should open from October 3 and all efforts should be made to ensure their effective functioning by October 20. Minister said cotton farmers should get Rs 4,320 as MSP and no farmer should complain that they were getting less than the MSP.
Rao explained to the collectors that the Centre, accepting the State government proposal, was willing to open an additional 143 CCI centers for this Kharif season which is a positive move. He also brought to the notice of the district officials the State government’s request to the Centre to notify Ginning mills as cotton purchasing centres in view of the bumper crop, and the decision in this regard was awaited.
Quick Response Coded System ID Cards
The Minister said that to avoid irregularities during cotton purchase, QR coded ID cards will be issued to all the cotton farmers. The cards will have all information of farmers, cultivation area and yield which are provided by the Agriculture department. Rao set a deadline of October 3 for the department officials to issue QR coded ID cards to farmers. “If any farmer fails to get ID card, he can submit details to the agriculture officer concerned to get new card,” Rao said. Ministers Pocharam Srinivas Reddy, T. Nageshwar Rao, Laxma Reddy and Jogu Ramanna and Agriculture Commissioner C Paratha Sarathi also participated in the video conference.
SOURCE: The Telangana Today
A yarn-producing company took a total of Rs 700 crore as loans from a consortium of public sector banks with the intention of defrauding them and managed to siphon off Rs 95 crore from a few banks. However, the Income Tax (I-T) department's investigation wing stepped in to stop the release of the rest of the money and is now probing the case. The company has its headquarters in Mumbai and manufacturing unit in Rajasthan. It took the help of an entry operator to convert the bank loan amount into cash with the help of fictitious transactions. It convinced the banks to release Rs 95 crore of the loan amount for purchase of capital goods. The entry operator collected a cheque from the company in the name of a shell firm and returned the money in cash after deducting his commission. I-T sources said the operator had admitted to tax officials he had converted Rs 95 crore into cash through layers of transactions in the name of shell companies.
I-T officials searched the company's premises and collected several documents for examination. Officials learnt the company had increased its share value over five times --from Rs90 to Rs460 -within a year of inflating its business activities drastically on books of accounts. This increased the company's worth and it mortgaged its share with banks to get big loans for business activities, including for purchasing capital goods.
Investigators will get in touch with SEBI officials to find out how the company managed to increase its sha re price drastically. The company was not doing any substantial business to justify increase in share price. The investigators will also question bank officials on how the loans were sanctioned. An I-T official said, "Such a modus operandi has been adopted to defraud public sector banks and cause loss to the government."
The company reportedly wanted to siphon off the entire loan amount with the help of shell companies before declaring itself as an NPA (non-performing asset) by showing inability to pay back the loan amounts to the banks. In the recent past there have been several instances where firms have taken huge loans from public sector banks with the help of fabricated documents and defaulted on payment, causing huge losses to the government.
SOURCE: The Times of India
With an aim to supplement farmers' income through value-added products, the Maharashtra government is planning to set up nine textile parks in the northern cotton-growing regions of the state. "There is ample cotton growing in northern Maharashtra and there is no value addition. We are planning to set up nine textile parks there," said Subhash Rajaram Desai, industries minister of Maharashtra. He was speaking at the Progressive Maharashtra Summit organised by industry body Ficci here.
Citing the example of the textile park at Amravati, which has over 30 units operational, he added "This is helping many small and medium industries to flourish. In a similar way we can support farming and industry." He explained that value addition -- from produce to fibre to fabric to fashion -- will help farmers get a good price for cotton.
Referring to the Rs 34,000-crore loan waiver for farmers announced by the BJP-led government in Maharashtra, he said while the move is one way to support debt-ridden cultivators, it is not the only solution. "We gave loan waiver in 2008, and the necessity was felt again in 2017. This is not the final answer. The solution is to make farming more viable and sustainable." "Farming is lacking technology and food processing not implemented to desired level. The government is working on a new policy in food processing," he added.
On the ease of doing business, he said the government has taken many initiatives on this front like reducing the number of permissions required to set up industries in the state. "We have also set up a special platform called 'Maitri' that brings 18 different departments on one platform. Anybody who wants to invest in the state can make a single presentation to all department heads and expect to get clearances in this platform," Desai elaborated. Another useful thing, the minister said, would be to link the Right to Services Act with the permission procedure. "Then it would not be a favour but duty of officials. Every official would be duty bound to pursue this goal."
SOURCE: The Money Control
Women’s formalwear market in India is estimated at Rs 250 to 300 crores plus points out Ashutosh Murarka, Design Head, Arrow “And we are comfortably placed among the top two in this segment.” The size of the market is relatively low primarily due to two reasons: skewed ratio of working women to working men which is rapidly changing worldwide; and the strong competition from ethnic wear categories including saris and salwar-kameez.
Power dressing for working women
The ratio of women in the workforce has significantly increased in the corporate world, and a large number are adopting business dressing concepts. This, feels Murarka, will boost demand for women’s formals across India. “In women’s formal segment, brand loyalty and brand recognition are the key business strategies adopted by leading players.” However, Indian consumers are not brand loyal. They look for the best product at least possible price. They also have time to pick and choose. And with the arrival of international brands, decade-old domestic brands now face competition and are going through considerable change in their approach and merchandise. “These brands online presence is an outcome of globalization,” he says.
Murarka opines, “Demand for innovation and sustainability is growing. By far, small brands are becoming more popular in a price driven market whereas the metros are still captured by premium brands.” And he sees a great future for business, “With retail stores merging their physical and online stores in different ways sales are improving. Faster mobile penetration is boosting the number of Indian internet users. M-commerce is phenomenally impacting business. With so many players both branded and unbranded in the market the task for us is to pull customers to stores the most attractive way. More importantly, we must keep innovating with products, so that customers realise they are missing something in their wardrobe and only we can fill that space,” he observes.
Tier II, III cities the real growth story
He says “Metros have always given us great business as they are the major hub for all corporate setups. But growth in Tier II, III cities has increased phenomenally in the last few years. Opening of educational institutions in Tier II cities has led to a boost in buying potential there.”
This season, the brand is introducing colour blocked knits, bomber shirts, asymmetric hems, and cropped blazers. High neck dresses will be a big trend this season. “Innovation and styling are an important part of fashion, with today’s customer becoming more aware of their surroundings, they also want to contribute towards the environment and that’s why our team is continuously working towards sustainable fashion, with use of recyclable fabrics, multipurpose garments and many more ideas,” he observes.
The brand has developed a wide range of styles using bi-stretch fabrics. As always Arrow has a stronger trouser line following the introduction of their new superflex treggings, shape shift trousers. Multipurpose detachable lined jackets, reversible garments and fleece lined jackets will also be a big hit this season. The prominent colour palette will be: midnight wine, carmine pink, celadon green and garnet rose pink.
Arrow has emphasised on green fashion by using recycled polyester bamboo Lycra fabrics and designing reversible multipurpose jackets. They have used a lot of bi-stretch fabrics in their latest A/W collection which fits better and is more breathable. The dominant fabrics are: polyester and blends of viscose this season; however, suede will grow stronger this winter. By the end of this year, they are hoping to grow by 15 to 20 per cent.
SOURCE: The Fashion United
The sixth edition of the 4-day international textile and apparel fair Vastra will be organised in Jaipur from September 21 to 24 at Jaipur Exhibition and Convention Centre (JECC) in Sitapura. It will be inaugurated by Union Textiles & Information and Broadcasting Minister Smriti Zubin Irani and Rajasthan Chief Minister Vasundhara Raje on 21 September, 2017. Rajasthan Industries Minister, Rajpal Singh Shekhawat will be the guest of honour.
The exposition is an all-encompassing trade fair and conference on textiles and apparel, which will present a fusion of the finest and the latest in textile products ? from fibre to fashion, services and technology, Managing Director of Rajasthan State Industrial Development and Investment Corporation Ltd (RIICO), Mugdha Sinha said today in a release. She further said over 250 exhibitors from 13 states will showcase their products. Around 300 overseas buyers from more than 50 countries and 200 representatives from around 100 Indian buying houses/agents are slated to attend the event.
Karnataka is participating as partner state, and Odisha, Madhya Pradesh, Uttrakhand and West Bengal are participating as supporting states in the event, she added. The first three days of the event will be devoted exclusively to B2B and the last day will be open for B2C, involving retail sales. The fair will be open for general public on 24th September.
SOURCE: The India Today
The state government has decided to start work on mega infrastructure projects worth Rs 1 lakh crore this year. “We are working to fast-track the projects to get rid of the mismatch between rapid urbanisation and rising infrastructure demands,” said Chief Minister Devendra Fadnavis on Monday. “We have earned appreciation from Niti Aayog for undertaking big-ticket projects worth Rs 5.96 lakh crore across sectors,” he added. The chief minister was addressing the conclave, Progressive Maharashtra: Leap Frogging to $ trillion economy in year 2025. The conclave was organised by FICCI in Mumbai. While announcing that work order for the 21.8-km Mumbai Trans Harbour Link will be issued in the next 15-20 days, Fadnavis said, “This will be the biggest sea link between Sewri and Nhava Sheva. It will connect the island city of Mumbai to Navi Mumbai.”
SOURCE: The Indian Express
Exporters plan to seek outright exemption on payment of goods and services tax, citing a crunch in working capital due to the uncertainty in the time taken to get refunds for unutilised input tax credit. Exporters, heads of export promotion councils and senior officials from the commerce ministry plan to submit a petition seeking the exemption when they meet the revenue secretary on Tuesday. “There is an apprehension that exports will decline, going ahead,” said an official aware of the meeting. Exporters are likely to raise the issues of working capital and refunds which will be ploughed back into their business and the loss of interest. “Merchant exporters and those in the small and medium enterprises are up in arms,” the official said. Micro, small and medium enterprises now have to pay GST when buying from merchant exporters. The government has a two refund mechanisms for exporters.
They can furnish a bond instead of paying integrated GST and claim refund of the unutilised input tax credit. This entitles them to get a 90% refund within seven days of acknowledgement of the application and the rest in 60 days. Alternatively, they can pay IGST and then claim the refund, which they get within 60 days. Another official said certain traditional sectors like textiles and gems and jewellery are suffering and need special attention. A scheme offering higher duty drawbacks will end on September 30 and many exporters don’t have the finances to pay for exports.
SOURCE: The Economic Times
In wake of the recent petitions being filed in high courts challenging various aspects of the Goods and Services Tax (GST), the Central Board of Excise and Customs (CBEC) on Monday directed its officials to appeal all high court orders, where the levy of GST has been questioned or stayed, through Special Leave Petitions in the Supreme Court. The CBEC has also asked its officers to “efficaciously defend” all matters in interest of government.
The CBEC in an instruction issued to all principal chief commissioners and chief commissioners of Customs and GST said that principally, all orders/judgments, whether interim or final, are appealable. “Where the levy of GST has been questioned or stayed, irrespective of the fact that matter is still pending before the High Court, the same needs to be challenged by way of filing of a SLP (Special Leave Petition) before the Supreme Court,” it said. It has asked officials to expeditiously send self-contained proposals after thoroughly examining the “impugned High Court” orders to CBEC Commissioner (Legal).
The CBEC in its instruction said that the Supreme Court allows SLP only when there is a substantial question of law of general or public importance or there is manifest injustice resulting from the impugned order or judgment. The instruction also said, “After the implementation of GST with effect from July 1, 2017 a number of writ petitions/PILs have been filed in various High Courts challenging or seeking clarification on various aspects of GST law and rate of tax on some products. Recently, a High Court in few cases relating to GST, has granted interim relief by directing that no coercive steps would be taken to recover tax or credit, pending the outcome of the petition filed. As GST is at its inception stage, it is important to defend the issues effectively to defend the interest of government.” The instruction, which has been issued with the approval of CBEC Chairman, further said that all Principal Chief Commissioners/ Chief Commissioners and Principal Director Generals/ Director Generals have been told to take all measures necessary to efficaciously defend all matters and in particular, GST-related petitions in High Courts under their respective jurisdictions.
SOURCE: The Indian Express
With the deadline for filing Goods and Services Tax (GST) returns for August coming to an end in less than 72 hours, only 6.9 lakh taxpayers have filed their GSTR-3B- a short summary return, at the end of Monday, said sources familiar with the development. The government expects tax returns from about 64 lakh tax payers for the month of August. According to the data accessed by The Indian Express, about 4.99 lakh tax payers had filed 3B returns for August till September 17. The deadline for filing GSTR-3B will end on September 20.
GSTR-3B is a single page summary return form that is to be filled by all normal registered tax payers on self assessment basis. In the GSTR-3B, assessees need to furnish summary of information about sale and purchase, available input tax credit (ITC), tax payable and tax paid. The 3B tax return does not have to be filed by Input Service Distributor (ISD), a Non-Resident Person, Tax Collector at Source (TCS), Tax Deductor at Source (TDS) & Composition Dealers.
On Saturday, Sushil Kumar Modi, Deputy Chief Minister of Bihar, who is heading the newly-formed Group of Ministers to look into the glitches of the GST Network said that while 46 lakh taxpayers had filed their 3B returns for the month of July, for August, only 3.05 lakh GSTR-3B returns had been filed till Saturday. The total number of registrants under GST is 85 lakh, which includes about 23.18 lakh new taxpayers and 62.25 lakh taxpayers who have migrated from the earlier VAT, excise and service tax regime. About 11 lakh dealers have registered under the composition scheme, Modi had said.
“Already decided that first cycle of GSTR 1,2,3 will be given a long rope…time for GSTR 1 is October 10, GSTR 2 will be October 31 and GSTR 3 will be November 10…In the meantime we have extended the time for GSTR-3B for six months. So, for 6 months people have to file their self-assessed summary return by 20th of the next month and there is not going to be any extension of time as far as 3B is concerned,” Revenue Secretary Hasmukh Adhia had said.
According to experts, the GSTN portal will get tested once again with the taxpayer rushing to file their August returns in the next last two days. In August, due to huge rush of July GSTR-3B return filing on the penultimate date, the GSTN software witnessed glitches and the last date of filing was extended.
“If 90 per cent of the assessees are going to attempt filing returns in the last two days of the deadline then it is definitely going to test the system. To that extent it will test the GSTN portal. Having said so , we can’t really blame the tax payers because most of them very busy in getting GSTR-1 done. I think it’s only in the last three or four days they have started working on GSTR- 3B,” said Uday Pimprikar , Tax Partner at EY India. An email sent to Adhia seeking comment on the 3B filings by taxpayers for August, did not elicit any response.
Sources said the issue pertaining to the unexpectedly high transitional input tax credit claims of Rs 65,000 crore by businesses has not been resolved because of the non-availability of data from GSTN. CBEC has written to chief commissioners directing them to verify every input tax credit claim of over Rs 1 crore. The verification by the tax department may include matching credit claimed with closing balance in returns filed under earlier laws and checking eligibility of credit under the GST regime. The report is expected on September 20.
SOURCE: The Indian Express
Finance Minister Arun Jaitley today said compulsion of going digital post note ban has become a habit and e-payments will gather pace on account of government initiatives and technology advancement. He further said high denomination currency circulation has come down in terms of volume after demonetisation of Rs 500 and Rs 1,000 notes that came into effect from November 9 last year. “Obviously in the month of November, December and January, a lot of people went in for digitisation in terms of mode of payment more out of compulsion rather than finding it a more convenient method to transact, but that compulsion created a habit for many,” he noted. “We reached a peak figure (after the demonetisation), then it marginally slipped and is now bound to pick up again,” he said after the launch of mobile app Tez — a Hindi word which means fast — for digital payments developed by Google for India. Various government initiatives to encourage digital transactions are going to make a major advance in that direction, he added. Referring to the benefits of demonetisation, the finance minister said the high denomination currency in circulation has come down.
“As we stand today, the high denomination currency has squeezed… the squeeze process is going to happen in the natural course of the economy. Second important test is as a consequence of this how much we are able to expand the number of assessees and the tax base, both direct and indirect,” he said. According to the RBI, there were as many 588.2 crore of Rs 500 notes, both old and new in circulation, as of March 31, 2017. As of March 31, 2016, there were 1,570.7 crore Rs 500 notes in circulation. As many as 328.5 crore pieces of new Rs 2,000 notes were in circulation as on March 31, 2017, the RBI annual report said. Built on the government-supported Unified Payments Interface (UPI), Tez allows users, free of charge, to make small or big payments straight from their bank accounts, Google said.
The app was built for India, working on the majority of the country’s smartphones, and is available in English and seven Indian languages (Hindi, Bengali, Gujarati, Kannada, Marathi, Tamil and Telugu). Tez works in partnership with four Banks — Axis Bank, HDFC Bank, ICICI Bank, and State Bank of India (SBI) — to facilitate the processing of payments across over 50 UPI- enabled banks. “Now, the time has come with application as simple as this that what started as compulsion becomes a matter of convenience and eventually a matter of spending habit as far as Indian people are concerned,” the finance minister noted.
SOURCE: The Financial Express
Several Indian companies, including some large entities, may start receiving notices from Monday on transitional tax credits in the run-up to the introduction of the single producer levy, two people with direct knowledge of the developments told ET. The notices from the indirect-tax department follow last week’s direction from the Central Board of Excise and Customs (CBEC) that asked chief commissioners to verify all transitional credit claims beyond Rs 1 crore. About 160 companies, which collectively have claimed about Rs 65,000 crore in transitional tax credits, would be issued notices in the coming weeks. “By Friday, chief commissioners had received the names of companies in their jurisdictions and asked for a basic report on the subject. Notices would be issued to companies and explanations would be sought for the amounts claimed in transitional credits,” said a person in the know.
In some cases, the indirect-tax department is also asking companies – particularly some Hyderabad-based infrastructure establishments — to produce the VAT returns of the past one year. The government is seeking these details to cross-check the transitional credit in GST. Transitional credits are basically tax credits accumulated before July 1 on pre-GST stock. According to the GST law, the credit can be set off against GST liability. Taxmen suspect that some companies are misusing the provision and have filed fake returns. “The suspicion is that many companies have claimed credit when they do not have proper invoices to support them. Ideally, when this happens, companies could only claim 60% of transitional credit, but some companies seem to have taken 100% credits,” said a tax officer. Industry trackers say that this step by the government has spooked several companies. “Large companies, with huge inventories, longer cycle time, and substantial monthly tax payments may rightfully have claimed significantly high transition credit,” said MS Mani, partner, Deloitte India. “Hence, all large claims should be evaluated after considering the size of the operations and attendant circumstances. There is an urgent need to define some processes based on which the transition credits are scrutinized, so that credits are not denied on frivolous grounds and unnecessary litigation is avoided.” Individual companies under the lens could not be ascertained, but the tax officer quoted above said: “Most of these companies being scrutinised are major vendors of some of the biggest Indian companies. In most cases, the companies still have time to rectify their mistakes,” he said.
Some industry trackers say that Rs 65,000 crore as transitional credit in the total GST revenue of Rs 95,000 crore for July appears disproportionate. “The amount of opening credit does look to be on the higher side, particularly because many companies have not yet filed the TRAN 1. In some cases, companies may have made genuine errors in credits. Many of these companies may revise in the coming weeks,” said Pratik Jain, Partner, National Leader - Indirect Tax - PwC India. Experts said those scrutinising credits now time may be doing so prematurely as several companies are yet to file GST due to the extended deadline. “The deadline for filing Trans 1form is extended to October 3 and so the department will get final data only then,” said Sachin Menon, national head of indirect tax at KPMG.
SOURCE: The Economic Times
The committee led by Revenue Secretary Hasmukh Adhia to look into difficulties faced by exporters under the Goods and Services Tax will hold its first meeting on Tuesday. “The committee will review the various issues and work out any immediate measures that may be required,” said an official source. It will also submit full report to the GST Council when it meets in October. In the interim, the committee could also have more meetings to address any other challenges.
With exporters facing numerous challenges relating to submission of bond and refund of Integrated GST that had also stalled consignments, the committee was set up by the Finance Ministry last week based on a decision of the GST Council. “It will look at the issues of export sector and to recommend to the GST Council suitable strategy for helping the export sector in the post-GST scenario,” an official statement had said at the time. The members of the committee include of Vanaja Sarna, Chairperson, Central Board of Excise and Customs (CBEC); PK Das, Member (Customs), CBEC; Alok Chaturvedi, Director General, DGFT; Additional Secretary, GST Council; Director-General, DG Export Promotion from the Central Government. Commissioners of Commercial Taxes from the States of Gujarat, Maharashtra, Karnataka, Uttar Pradesh and West Bengal are also its members.
SOURCE: The Hindu Business Line
The rupee on Monday erased all the gains and closed over fresh one month low as traders turned cautious ahead of the Federal Reserve meeting that begins on Tuesday. The rupee closed at 64.14 a dollar—a level last seen on 18 August, down 0.09% from its Friday’s close of 64.08. The home currency opened at 64.07 a dollar and touched a high and a low of 64 and 64.15 respectively.
Currently, market pricing of a Fed hike by year-end stands just below 50% and traders expect Chair Janet Yellen to keep her options open for December. Main focus will be on the policy makers’ view on 2018 rate-hike plans as balance-sheet reduction is already priced in, Bloomberg reported. Bond yields hit a fresh 15-week high. The 10-year bond yield closed at 6.610%—a level last seen on 6 June, compared to its previous close of 6.597%. Bond yields and prices move in opposite directions. The benchmark Sensex index rose 0.47% or 151.15 points to closed at 32,423.76. So far this year, it has risen over 22%. So far this year, the rupee has gained 6%, while foreign institutional investors (FIIs) have bought $6.61 billion and $20.33 billion in equity and debt, respectively.
Asian currencies were trading lower. China offshore spot was down 0.37%, Japanese yen 0.35%, China renminbi 0.27%, Taiwan dollar 0.14%, Indoensian rupiah 0.11%. However, South Korean won was up 0.45% and Philippines peso 0.28% The dollar index, which measures the US currency’s strength against major currencies, was trading at 91.828, down 0.05% from its previous close of 91.872.
SOURCE: The LiveMint
The GDP growth number for the latest quarter (2017Q2) was bad, very bad. It came in at a year-on-year growth of 5.7 per cent. Just to provide a perspective — the low growth reported was the eighth worse quarter since 2011, and the 14th worst quarter since the start of the high growth period in 2003/04. You want more evidence on the lowness of this growth number? The average GDP growth for the two years prior to the election of Narendra Modi election in May 2014 was 6.4 per cent; even if for the rest of this fiscal year GDP growth averages an unlikely 6.5 per cent each quarter, the fiscal year numbers will not match the UPA average for their bad years. Yes, that is how bad GDP growth is today.
It is imperative that the political and economic policymakers in the Modi government get down to identifying the cause of this downturn. National elections are just 18 months away, and does the BJP actually believe that a growth rate below the UPA’s worst years will not dent its popularity?
Prior to the 2017Q2 number, the favourite refrain of the Modi detractors or Congress supporters (same set of individuals) was that the high GDP growth rate in 2014/15 and 2015/16 (7.5 and 8 per cent, respectively) was caused by political manipulation of the figures by the Central Statistical Organisation (CSO). The critics were too politically correct to say so openly but they clearly implied that the CSO was fudging the growth figures at the behest of the BJP government. Now that the GDP numbers conform to their political priors, there is not a squeak from all these statistical doubters; these critics-without-base should either come out with their latest updates on GDP growth in India or at least apologise to the CSO for doubting their integrity and expertise.
The media and economic experts have noted the phenomenon of low growth and have offered two explanations. The most common, near universal explanation, is the equivalent of the butler did it. In other words, the closest, most proximate (and coincidentally most popular with the anti-Modi crowd) cause of the growth slowdown is demonetisation.
Besides convenience, this explanation has some theory to back it up: If for a cash-dependent economy, you remove its lifeline (over 86 per cent of cash was demonetised on November 8, 2016) then obviously you will get a crash in output. As the “experts” point out with glee, a 2 per cent decline in GDP growth was exactly what was predicted by them to be the consequence of demonetisation. Growth has shown a big decline, and the world economy is booming, so India is in low growth mode because of demonetisation.
The second most popular explanation centres around the appreciation of the RBI’s nominal 36-country real effective exchange rate (REER). Some noted economists are behind this logic, hence, this hypothesis deserves serious examination. For the moment, let it be noted that for the first eight months of this year, exports (in US dollar terms) are up 12.1 per cent, while the REER has appreciated by 4.8 per cent. For the last six years, and excluding the bad trade year of 2015 (export and import growth were — 15 per cent and — 12 per cent, respectively), both export growth and REER appreciation in 2017 are the highest observed. Between 2012 and 2016, export growth had averaged 0.3 per cent, and REER an average depreciation of 1.6 per cent.
For the moment, the export explanation for the growth slowdown is perhaps even less meaningful than demonetisation.
So what does explain the downturn? Bad weather or bad karma? Maybe the latter. One fact noted by some objective experts is that the growth slowdown preceded de-monetisation. After hitting a peak of 9.1 per cent in 2016Q1, quarterly GDP growth registered 7.9 and 7.5 per cent in the subsequent quarters, that is, at the time of demonetisation, GDP growth was already down to 7.5 per cent, a full 1.6 per cent below the peak reached just two quarters earlier.
If one has to explain the growth slowdown without recourse to conspiracy theories about data manipulation (we can’t really do that now because growth is lower, much lower, than what the so-called data manipulators would like) one has to begin to answer the following two questions: What determines growth, and which of these determinants was flashing a red signal before demonetisation.
In most countries (strike that and replace with all countries except a unique country called India) the above question has the same answer — look at interest rates, stupid. No matter what country you go to, central bank and government officials have the same answer and the same policy: If you want to increase demand (up the GDP growth rate), decrease interest rates; if you want to decrease demand, increase interest rates. Why Indian macro-experts almost never offer this policy is a question I can’t answer — a psychiatrist might do much better.
That interest rates do matter in India, and matter a lot, can be shown as follows. We look at only those sectors most susceptible or sensitive to interest rate policy. Agriculture can be ruled out, as it is most influenced by the weather; public utilities, public administration and defence should be excluded from the analysis, as these sectors are more susceptible to the whims and decisions of bureaucrats rather than the babus residing in Mumbai.
Which leaves us with manufacturing, mining, services (excluding public administration) and construction. Both mining and manufacturing (M&M) are problematic for any analysis because these two sectors have been plagued with high corruption, and even higher bad balance sheets (NPAs or non-performing assets). It is likely that resolution of the NPA problem will significantly improve investments and growth, but the resolution will need a different instrument than lowering interest rates.
If one takes only the interest rate sensitive sectors (services – public administration + construction) then one can estimate interest sensitivity of output growth. This sector can also be thought of as the demonetisation sector. Agriculture and government expenditures bias GDP growth upwards, balance sheet considerations bias GDP growth downwards. These sectors are ignored in our calculations.
Average growth in the demonetisation sector in 2015-16 was 9 per cent — hence, 7 per cent is the expected growth for this sector in 2017/18. We have only two observations since demonetisation — 2017Q1 and 2017Q2; sector growth rate in these two quarters was 6.5 and 7.9 per cent respectively, or an average of 7.2 per cent.
We don’t want to push the analysis too far in the direction that only interest rates matter — there is the weather, animal spirits, momentum, confidence, and a host of other vaguely important factors. However, no matter what explanation you come up with, you will have to circle back to interest rates — the evidence is that strong. But go ahead, disregard the evidence. You are in good company with the experts at the RBI (and MPC). They must know better, otherwise why else will they keep real interest rates at world-beating levels?
SOURCE: The Financial Express
India is poised to emerge as an economic superpower, driven in part by its young population, while China and the Asian Tigers age rapidly, according to Deloitte LLP. The number of people aged 65 and over in Asia will climb from 365 million today to more than half a billion in 2027, accounting for 60 percent of that age group globally by 2030, Deloitte said in a report Monday. In contrast, India will drive the third great wave of Asia's growth - following Japan and China -- with a potential workforce set to climb from 885 million to 1.08 billion people in the next 20 years and hold above that for half a century. "India will account for more than half of the increase in Asia's workforce in the coming decade, but this isn't just a story of more workers: these new workers will be much better trained and educated than the existing Indian workforce,'' said Anis Chakravarty, economist at Deloitte India. "There will be rising economic potential coming alongside that, thanks to an increased share of women in the workforce, as well as an increased ability and interest in working for longer. The consequences for businesses are huge.''
While the looming 'Indian summer' will last decades, it isn't the only Asian economy set to surge. Indonesia and the Philippines also have relatively young populations, suggesting they'll experience similar growth, says Deloitte. But the rise of India isn't set in stone: if the right frameworks are not in place to sustain and promote growth, the burgeoning population could be faced with unemployment and become ripe for social unrest.
Deloitte names the countries that face the biggest challenges from the impact of ageing on growth as China, Hong Kong, Taiwan, Korea, Singapore, Thailand and New Zealand. For Australia, the report says the impact will likely outstrip that of Japan, which has already been through decades of the challenges of getting older. But there are some advantages Down Under.
"Rare among rich nations, Australia has a track record of welcoming migrants to our shores," said Ian Thatcher, deputy managing partner at Deloitte Asia Pacific. "That leaves us less at risk of an ageing-related slowdown in the decades ahead.'' Japan's experience shows there are opportunities from ageing, too. Demand has risen in sectors such as nursing, consumer goods for the elderly, age-appropriate housing and social infrastructure, as well as asset management and insurance. But Asia will need to adjust to cope with a forecast 1 billion people aged 65 and over by 2050. This will require:
Raising retirement ages: Encouraging this could help growth in nations at the forefront of ageing impacts. More women in the workforce: A direct lever that ageing nations can pull to boost their growth potential. Taking in migrants: Accepting young, high-skilled migrants can help ward off ageing impacts on growth. Boosting productivity: Education and re-training to bolster growth opportunities offered by new technologies.
SOURCE: The NDTV
Days after New Delhi and Tokyo made common cause on Chinese actions in South China Sea and the One Belt One Road project, foreign ministers of India, the US and Japan Monday discussed both issues and emphasised the need to ensure freedom of navigation and respect for territorial integrity, a Ministry of External Affairs (MEA) statement said. External Affairs minister Sushma Swaraj, US Secretary of State Rex W Tillerson and Japanese Foreign Minister Taro Kono met in New York on the sidelines of the United Nations General Assembly under the rubric of India-US-Japan trilateral foreign ministerial meeting.
The MEA statement said the ministers “emphasised the need for ensuring freedom of navigation, respect for international law and peaceful resolution of disputes”. These are exactly the same phrases used in India’s joint statements with the US in June and with Japan last week — as they obliquely refer to China’s actions in South China Sea. However, last week, the India-Japan joint statement dropped any explicit mention of South China Sea, a departure from the previous joint statement in 2016.
The statement also said that “on connectivity initiatives, the importance of basing them on universally recognised international norms, prudent financing and respect for sovereignty and territorial integrity was underlined”. This is a reference to India’s reservations on One Belt One Road project, since the China-Pakistan Economic Corridor passes through Pakistan-occupied Kashmir. The statement uses the same terms as in India’s official statement while boycotting Chinese President Xi Jinping’s Belt and Road initiative meeting in Beijing in May. These terms were also used in the joint statement during Japanese PM Shinzo Abe’s visit to Ahmedabad and Gandhinagar last week.
On North Korea, the MEA statement said “Swaraj deplored DPRK’s recent actions and stated that its proliferation linkages must be explored and those involved be held accountable”, obliquely referring to Pakistan and China. India has, in the past, pointed to links between Pakistan and Chinese nuclear programmes and the North Korean programme.
The three ministers directed their senior officials to explore practical steps to enhance cooperation, the statement said, implying that the foreign secretaries and the joint secretaries will have conversations on the issues concerned. Swaraj is in New York to represent India at the annual session of the UN General Assembly, which she will address on September 23.
During her week-long stay, Swaraj is expected to hold more than a dozen bilateral and trilateral meetings with leaders attending the session. Swaraj will also participate in a high-level meeting on UN reforms, hosted and chaired by US President Donald Trump. India is among the 120 countries which have supported the reform efforts of the UN Secretary General.
In a preview of Swaraj’s engagements, India’s Permanent Representative at the UN, Syed Akbaruddin had said that issues of climate change, terrorism, people centric migration and peacekeeping are key focus areas for India this year. Akbaruddin, in an interaction with Indian reporters, had ruled out a bilateral meeting between Swaraj and her Pakistan counterpart Khawaja Asif. However, the two leaders are likely to encounter each other at several multilateral meetings, including that of SAARC and the Shanghai Cooperation Organisation.
SOURCE: The Indian Express
Twenty-first century will mark the great Indo-American business partnership as relationship between the two nations are extremely warm and cordial and would further consolidate, Chief Minister Devendra Fadnavis said on Monday. “The 20th century was known for Sino-American business partnership. The 21st century will be known for Indo-American business partnership,” Fadnavis said.
On the topic — Taking US-India Economic Relations to the Next Level — a discussion organised by the Indo-American Chamber of Commerce, Fadnavis said: “While America is world’s oldest democracy, India is world’s largest democracy. The economic reforms undertaken by the Centre and state provide immense potential to take business partnership to level next globally. Let us work together closely and unleash the potential of two great democratic countries.”
He added: “The relationship between India and US has never been so good like now under the leadership of prime minister Narendra Modi. Today, India has earned great respect from across the world.” While stating that India has great demographic advantage over all other developed nations with an average age of below 25 years, Fadnavis said: “The vast pool of human resources and talent is our strength and makes it a great land for opportunities for overseas investors.”
SOURCE: The Indian Express
|
Item |
Price |
Unit |
Fluctuation |
Date |
|
PSF |
1323.72 |
USD/Ton |
1% |
9/18/2017 |
|
VSF |
2456.7 |
USD/Ton |
0% |
9/18/2017 |
|
ASF |
2502.48 |
USD/Ton |
0% |
9/18/2017 |
|
Polyester POY |
1332.11 |
USD/Ton |
0% |
9/18/2017 |
|
Nylon FDY |
3234.91 |
USD/Ton |
2% |
9/18/2017 |
|
40D Spandex |
5645.83 |
USD/Ton |
1% |
9/18/2017 |
|
Polyester DTY |
3311.2 |
USD/Ton |
1% |
9/18/2017 |
|
Nylon POY |
5767.9 |
USD/Ton |
0% |
9/18/2017 |
|
Acrylic Top 3D |
1556.42 |
USD/Ton |
0% |
9/18/2017 |
|
Polyester FDY |
2899.21 |
USD/Ton |
1% |
9/18/2017 |
|
Nylon DTY |
2655.07 |
USD/Ton |
0% |
9/18/2017 |
|
Viscose Long Filament |
1686.12 |
USD/Ton |
0% |
9/18/2017 |
|
30S Spun Rayon Yarn |
3067.06 |
USD/Ton |
0% |
9/18/2017 |
|
32S Polyester Yarn |
2029.45 |
USD/Ton |
1% |
9/18/2017 |
|
45S T/C Yarn |
2868.69 |
USD/Ton |
0% |
9/18/2017 |
|
40S Rayon Yarn |
2121 |
USD/Ton |
1% |
9/18/2017 |
|
T/R Yarn 65/35 32S |
2410.92 |
USD/Ton |
0% |
9/18/2017 |
|
45S Polyester Yarn |
3234.91 |
USD/Ton |
0% |
9/18/2017 |
|
T/C Yarn 65/35 32S |
2410.92 |
USD/Ton |
1% |
9/18/2017 |
|
10S Denim Fabric |
1.42672 |
USD/Meter |
0% |
9/18/2017 |
|
32S Twill Fabric |
0.42267 |
USD/Meter |
0% |
9/18/2017 |
|
40S Combed Poplin |
1.22682 |
USD/Meter |
0% |
9/18/2017 |
|
30S Rayon Fabric |
0.68666 |
USD/Meter |
0% |
9/18/2017 |
|
45S T/C Fabric |
0.72328 |
USD/Meter |
0% |
9/18/2017 |
Source: Global Textiles
Note: The above prices are Chinese Price (1 CNY = 0.15259 USD dtd. 9/18/2017). The prices given above are as quoted from Global Textiles.com. SRTEPC is not responsible for the correctness of the same.
Pakistan Readymade Garments Manufacturers & Exporters Association (PRGMEA) on Monday signed memorandum of understanding (MoU) with Ecommerce Gateway Pakist5an, a leading trade fair organiser, to attract foreign investment worth $375 million into textile sector. “A number of Chinese firms have shown interest in relocating their textile, garment and accessories production units to Punjab with an investment of at least $25 million per unit,” said Ijaz Khokhar, central chairman PRGMEA said addressing the concluding ceremony of Textile Asia Trade Exhibition.
Khokhar said the foreign companies were also committed to transfer their technologies, besides buying back Pakistani products after value-addition here (Pakistan), leading to enhanced local export and lowering Pakistan trade deficit with China. “We will form joint ventures with local companies from Gujranwala, Lahore, Sialkot, and Faisalabad. We will also train the local engineers in manufacturing spare parts of sewing and textile machines and then buy them back them for export to China,” the PRGMEA chairman quote the Chinese companies as saying. He said the Pakistan Readymade Garments Manufacturers & Exporters Association and Ecommerce Gateway signed the agreement to continue to jointly conduct this mega textile event in future on annual basis. “Around 52,000 trade visitors registered their presence in the textile fair in three days,” Khokhar said.
Jawwad Chaudhry, vice chairman PRGMEA, said the machinery and equipment displayed at the exhibition were of immense utility to manufacturers producing value added products for increasing volume of exports. “I hope that local businessmen would benefit from this technology by adding value to their products,” Chaudhry said. He observed the local textile sector's whole chain was also invited to attend this country's largest textile show. “The exhibiting countries included Austria, China, Czech Republic, France, Germany, India, Italy, Korea, Taiwan, Turkey, UK, USA etc,” he added. Dr Khurshid Nizam, the CEO of Ecommerce Gateway Pakistan, said that this textile machinery fair in Pakistan would increase productivity, resulting into better competitiveness.“The exhibition is aimed at bringing Punjab’s potential of textile and garment machinery, accessories, raw material supplies, chemicals and allied services under one roof, as around 80 percent of textile industry is located in this province,” Nizam added.
SOURCE: The News
Textile exports from Latin American nation of Peru rose 12 per cent to $115 million in July 2017, compared to the same month last year, according to the data from the Central Reserve Bank (BCR). The rise in exports was driven by increase in imports by countries like China (280 per cent), Brazil (67 per cent), Ecuador (54 per cent) and the US (21 per cent). While there was a 10 per cent increase in exports volume, price increase was 2 per cent, a Peruvian news agency report said quoting BCR statistics. In terms of region, 41 per cent of al Peruvian textile exports were shipped to Asia, 27 per cent to South American trade bloc Mercosur, and 21.3 per cent to North America.
Peru produces one of the world's finest cotton varieties, Peruvian Pima. The country also produces 80 per cent of the world’s fine alpaca fibres. The textile and apparel industry in Peru directly employs more than 250,000 persons, and caters to several global clothing brands such as Lacoste, Max Mara, Polo Ralph Lauren, Hugo Boss, Ragman, Armani, and others. Peru is currently the top t-shirt supplier to Brazil and is also the second largest knitted clothing supplier, after Mexico, among Pacific Alliance countries (which include Chile and Columbia).
SOURCE: The Global Textiles
The death of retail is a hot topic on the minds of business and economic thought leaders. What does this mean for our local apparel Retail scene and business environment?
Superstars of Retail, Mr Price Group, accounted a drop in headline earnings for the first time in 16 years. In the year to April 1 2017, Mr Price reported a fall of 10.4% in earnings per share. Before our eyes we saw the 159 year old Stuttafords dissolve despite its efforts. It’s a tough time for the Retail sector.
Unless you have been living under a rock, it should be of no mystery to you, the way shopping is being done by the urban population in Botswana is changing. For illustrations sake, several weeks ago, I witnessed a very interesting phenomena, I saw shopping happen, but outside the store. What I witnessed was a delivery being made to a client who had purchased a garment of clothing from a “facebook vendor”. More recently a friend of mine found her dream wedding dress on well-known Ali Express, there will be no need for consumers like her to search through a plethora of retailers.
Retail has been taking place outside the conventional store for some time, however with digital platforms like Facebook, simple Online shopping and Instagram, shopping for apparel has been transformed forever. It arouses great enthusiasm to see young individuals take advantage of this to better their lives, it is a welcomed disruption. On the other hand, does this signify a bleak future for apparel Retail stores as we know them? Yes and no.
Yes because, what we are seeing is a death of a traditional channel. The “facebook store”, for lack of a better term, in its nature is more convenient, from the browsing and comparing, to paying and ultimately receiving your desires goods, its fluid and less strenuous, time wise and on the pocket (although further analysis is necessary to prove the latter). These entities offer free delivery either in Gaborone or in the country, an upper hand in terms of value adding processes, even some of the most popular Botswana owned retailer slack in this aspect. A consumer browsing through a facebook store during work hours needn’t plan for a trip to a physical brick and mortar store for something he or she likes. If say consumer lives in Serowe / Palapye, the vendor being in Gaborone is not a cause for concern.
Payments are done through varying mobile platforms. The seamlessness of the shopping experience goes a long way in building greater loyalty to these enterprises. With the rise of increased connectivity and consequently a rising number of facebook users in Botswana these shopping experiences are going to be a noticeable challenge to conventional apparel Retailers in our economy.
The death of retail will not occur that hastily in Botswana, qualifying the ‘no’ side of things. Africa has a good 2082 shopping centers, and in Botswana there seems to be a one popping up often. We can explain this by highlighting a few factors, one of which is the “eating out” experience, which is an irreplaceable and sustains “mall culture”. Needless to say as long as there is a mall we will see an apparel retailer, but not in the volumes we have always known.
A study* in 2015 indexed Botswana as number two in retail potential, I believe there is room to question this where apparel retail is concerned. If advanced economies are anything to go by, even peering into neighboring South Africa, apparel shopping at these locations, shopping for clothes at brick and mortar stores is not here to stay. Several stores are not only downsizing but some have totally exited the South African market.
The Relationship Between The Two Channels
In the digital age, consumers use online stores as a reference point and more often than not know what they are looking for when they visit a store, curbing down unplanned purchases, in this case the channel remains the same. Yet an interesting counter notion is that physical stores serve as points of reference and comparison, but actual trade occurs with various online vendors, local or international, at a later stage.
Either way, consumer behavior has been altered, and in Botswana it is the social media stores which we can use to an extent when explaining these dynamics. What then for Botswana owned apparel retailers, how do they avoid having a white sheet of paper spread out on what would have been their store front? The death of retail is slow one, but that is no reason for comfort. It’s slow but also inevitable.
To survive, retailers in Botswana should make adequate advances towards R&D for appropriate Channel Strategies, suitable to our changing market. R &D firm Seriti Insights is undertaking the generation of these strategies, the outcomes of which should be interesting. Once again these disruptions are welcome in my view, disruption to things as we know them allows for great opportunities for development and growth of new ideas. Young people behind social media stores do deserve consideration and support. It will not be instant but the apparel retail environment needs surveillance, as does the overall death of Retail.
SOURCE: The Weekend Post
Indoinesia textile and garment industry is one of its oldest. The government aims to increase the value of exported textiles and garments to US$75 billion by the year 2030, implying that this industry would contribute around 5% to global exports. 88Spares.com chief executive officer and co-founder Hartmut Molzahn (pic) was therefore inspired to launch a business to business (B2B) multi-vendor marketplace to assist the sector. “Textile companies in Indonesia are very old school. They do not talk about online shops. Digital technology can help them to increase their value chain, enabling everyone to save and make more money,” he tells Digital News Asia (DNA). To Molzahn, Indonesia is strategically placed and the country accounts for nearly 2% of global textiles and related products.
88Spares.com facilitates B2B transactions between buyers and sellers in the textile and garment manufacturing industry and specifically deals in industrial machine spare parts and consumables. “Vendors can cut their costs and efforts on sales and marketing easily by selling textile machine spare parts for weaving and spinning machines as well as various textile machinery spare parts through our web-based platform,” he adds. After it was soft launched at the international garment exhibition, Indo Intertex 2017 in April, Molzahn says that Spares88.com will be officially launched in Q1 2018. “Now we are still bootstrapping the market. We are focusing on attracting more vendors in the textile and garment industry in Indonesia,” he says.
Molzahn also says that his company will serve a niche market and enhance the chances small and medium enterprises (SME) and family businesses of entering the sector. The startup will generate revenue from every successful transaction and will take a percentage depending on the value of a transaction. 88Spares.com chief marketing officer and co-founder Rosari Soendjoto says that they aim to make positive contributions to the local textile and garments industry. She also hopes to become a catalyst of change in the domestic economy. “Even we are still doing business by bootstrapping, to develop our business, we are also planning on fundraising,” she said. 88Spares.com also has a presence in China by enabling China-based manufactures to become vendors on the platform.
Digitalisation in the textile industry
The Hong Kong Research Institute of Textiles and Apparel (HKRITA) chief executive officer Edwin Keh said at the International Textile Manufactures Federation Annual conference 2017 (ITMF 2017) in Bali recently that the textile industry is still left behind in utilising technology. In order to transform, key players in the industry have to participate in this new economic era. “We have three options -- to become victim, bystanders, or participants in this digital era. I hope everyone can be a participant,” he explains.
At the same event, Alvanon president Edward Gribbin said that that millennials are coming into the market and they think differently. Alvanon is a US apparel product development consultant. “We are in the age of digital disruption. Rather than going to shop at an offline store, consumers choose to shop online. In the fashion industry nowadays, consumers are in control,” he said. He added that Amazon in 2016 saw the most demand for its apparel category and for players in this sector had to “transform or die”. Molzahn offered three main components for a company to move into the digital realm.
First, a company need the right human resources. Having someone from the C-level to take on digitalisation process will help change mindsets across the company. The next thing is to have the right organisation. Molzahn says the role of an IT department has to change and be integrated into the company’s key strategy. The company then has to cultivate an entrepreneurial mindset in all employees. Innovation might take some time and it can be helped by setting up infrastructure for corporate entrepreneurship to develop business innovation. “In the future, software will become a driver in the industry and I believe that every industrial company will become a software-driven company,” he says.
SOURCE: The Digital News Asia
A surge of clothing companies including Nike and Levi Strauss have all committed to set emission reduction targets through the Science Based Targets initiative, pushing the number of companies pledged to the scheme beyond 300.
Announced as part of Climate Week, which commences in New York today (18 September), six apparel companies have agreed to align their emission targets with the goals of the Paris Agreement to limit global warming to well below 2C. Nike, Levi Strauss, Gap, Guess, Eileen Fisher and VF Corporation have all signed up to the Science Based Targets initiative this week.
In 2017, more than 90 companies have joined the initiative, which now has more than 300 members. Other new companies that have committed to the initiative recently include Cummins, Olam, Telefónica and Veolia. UN Global Compact’s chief of programmes Lila Karbassi said: “As more and more companies see the advantages of setting science-based targets, the transition towards a low-carbon economy is becoming a reality. “Businesses now working towards ambitious targets are seeing benefits like increased innovation, cost savings, improved investor confidence and reduced regulatory uncertainty. This is becoming the new ‘normal’ in the business world, proving that a low-carbon economy is not only vital for consumers and the planet, but also for future-proofing growth.” The new apparel firms signed up to the initiative will have to take steps to embed the ethos of science-based targets amongst suppliers. More than 90% of apparel brand emissions are located in the value chain.
The story behind the science
To date, companies that have joined the Science Based Targets initiative represent around $6.5trn in market value and are responsible for 750 million metric tonnes of CO2 emissions annually. The companies span 35 countries, and the US now has 50 firms committed to the initiative – more than any other nation.
The involvement of US businesses in the initiative builds on research by The Climate Group, which found that the action of US states, cities and businesses could "significantly mitigate" the impact of the US decision to withdraw from the Paris Agreement. US companies that have committed to science-based targets are accountable for 166 million metric tonnes of CO2 emissions annually.
The Science Based Targets initiative, which works as a partnership between CDP, WRI, WWF and the UN Global Compact, reviews business emission targets, and only ones that meet strict criteria are approved. So far 72 science-based targets have been approved through the initiative, including 41 this year. Recent approvals include M&S, Tesco, Mars, HP and Kering.
Research from Business in the Community (BITC) found that the adoption of science-based-targets and the engaging with the supply chain are two of the biggest challenges facing sustainability professionals in the next decade.
SOURCE: The Edie
Nusa Dua, Bali recently welcomed 250 participants of International Textile Manufacture Federation (ITMF) from 29 different countries. “They were in Bali from September 14 -16, not a single participant issued a complaint, everybody was happy because they got to explore Tanah Lot, Ubud and Uluwatu after the meeting,” explained Indonesia textile association executive secretary boards of directors, E.G Ismy. The group visited Tanah Lot on their first day in Bali. Tanah Lot was once visited by the vice president of India Muhammad Hamid Ansyar, Turkish and Korean celebrities and contestants of Miss World 2012 and 2013. “Tanah Lot is very cool, the place’s arrangement emphasizes on the religious value mixed with the beautiful nature,” said ITMF president, Jaswinder Bedi. Tanah Lot is one of the leading tourist destinations in Bali after Kuta Beach, as it has a breathtaking panoramic view especially during sunset.
Following the visit to Tanah Lot, the group then went Ubud where they saw rice terraces, local handicrafts, art galleries and visited the Sacred Monkey Forest Ubud. “The Sacred Monkey Forest is really special, former Manchester United player Luis Nani once visited this place, so did Hollywood celebrities Paris Hilton and Julia Roberts. This is a wonderful experience for the ITMF delegates,” said tourism ministry's Archipelago Tourism Marketing Development deputy, Esthy Reko Astuti. The last stop was Uluwatu where they witnessed the performance of Kecak traditional dance at Pura Uluwatu during sunset.
SOURCE: The Jakarta Post
China and Nepal have agreed to start technical works to build a cross-border railway link via Tibet to boost connectivity, according to Nepalese Foreign Ministry. This was decided during the recent visit of Nepalese Deputy Prime Minister and Foreign Minister Krishna Bahadur Mahara to Beijing. "Both sides have agreed to move forward technical works relating to construction of Nepal-China cross-border railway line," the Foreign Ministry said in a statement last week.
During the high-level talks in Beijing, Mr Mahara had requested China to forward the work relating to preparation of a Detailed Project Report for the construction of inter-country railway line giving it high priority, it said. However, China's state-run People's Daily has claimed that during Mr Mahara's visit to China early this month a deal has been struck to establish the rail link. It said the rail link includes two lines: one connecting three of Nepal's most important cities and two between China and Nepal.
The daily, however, did not identify the Nepalese cities. The Sino-Nepali railway, which passes through the Chinese border town of Zhangmu and connects with routes in Nepal, will be the first railway by which China enters South Asia, said Zhao Gancheng, director of the Centre for Asia-Pacific Studies at the Shanghai Institute for International Studies. "Although the railway connection between China and Nepal is intended to boost regional development and not for military purposes, the move will still probably irritate India," he was quoted as saying by the daily - the ruling communist party's official mouthpiece.
China last year agreed to consider building a railway into Nepal and to start a feasibility study for a free trade agreement with landlocked Nepal, which has been trying to lessen its dependence on its other big neighbour India. Nepal also signed up to President Xi Jinping's Belt and Road initiative which is opposed by India as it passes through Pakistan-occupied Kashmir.
SOURCE: The NDTV
