While projecting a more optimistic picture of the global economy, the International Monetary Fund (IMF) on Tuesday slashed India’s growth forecast by 0.5 percentage points to 6.7 per cent in 2017. “The growth projection for 2017 has been revised down… reflecting still lingering disruptions associated with the currency exchange initiative introduced in November 2016, as well as transition costs related to the launch of the national Goods and Services Tax (GST) in July 2017,” it said in its October 2017 World Economic Outlook. Earlier, in April, the IMF had pegged India’s GDP growth at 7.2 per cent for 2017. It has also lowered the growth projection for 2018 to 7.4 per cent from its earlier estimate in April and June of 7.7 per cent, which could once again turn India into the fastest growing economy in the world. However, the IMF was more optimistic about medium-term growth prospects for India through gains from the new indirect tax levy. “GST promises the unification of India’s vast domestic market, is among several key structural reforms under implementation that are expected to help push growth above 8 per cent in the medium term,” it said. The IMF forecast is in line with a number of recent projections that have scaled down India’s growth prospects for the fiscal due to disruptions from demonetisation and GST, despite the government’s strong defence of the moves. “The downgrade for this year for India looks like a blip. In general, the state of India’s economy is quite good,” said Maurice Obstfeld, IMF Economic Counsellor and Director of Research. GDP growth hit a three-year low of 5.7 per cent in the first quarter of the fiscal. The second volume of the Economic Survey also highlighted downside risks to its earlier growth projection of 6.75 per cent to 7.5 per cent for the fiscal. Recently, the Reserve Bank of India also lowered its growth projection to 6.7 per cent for the fiscal from its earlier estimate of 7.3 per cent.
The economy grew at 7.1 per cent in 2016-17. But, in some relief to policymakers, the IMF has pegged retail inflation at 3.8 per cent in 2017, which is well within the monetary policy committee’s target of four per cent. However, in 2018, consumer price index based inflation could rise to 4.9 per cent it said.
Robust global economy
The IMF has also estimated an upswing in the global economy and has upped its growth forecast for 2017 and 2018 to 3.6 per cent and 3.7 per cent, respectively, which is 0.1 percentage point higher in both years than in the April and July forecasts. “The picture now is very different, with accelerating growth in Europe, Japan, China, and the United States. Financial conditions remain buoyant across the world, and financial markets seem to be expecting little turbulence going forward, even as the Federal Reserve continues its monetary normalisation process and the European Central Bank inches up to its own,” it said in the Outlook while warning of challenges such as weak growth in many economies that could still upset this recovery. “Global economy is recovering at a faster pace,” said Obstfeld, while stressing that this recovery is still incomplete and could be short term. Policymakers should take action now while the time is good, he said. The IMF has scaled up its GDP growth forecast for both the US and China by 0.1 percentage point for 2017 to 2.2 per cent and 6.8 per cent respectively.
Source: Business Line
EARLIER in 2017, Minister in the Presidency for Planning, Monitoring and Evaluation Jeff Radebe highlighted the textile and clothing industry as one of the sectors where the economy could most effectively be bolstered. This is something of a miraculous turnaround, particularly in the face of investment downgrades and economic and socio-political instability. The clothing and textile industry was one of the hardest hit by globalisation and increased competition following the opening of South Africa’s borders to global markets post 1994. Facing high import duties and the skyrocketing of illegal imports and cheap textiles from China, Pakistan and elsewhere, coupled with insufficient investment, the industry went into decline. Fortunately, a number of conscious interventions were implemented that have helped to turn things around. In the Western Cape, government and industry jointly established the Cape Clothing Textile Cluster (CCTC) in 2005, a not-for-profit initiative that believed that struggling participants in the sector needed to pool resources and collaborate as a cluster to counter the effects of globalisation. Embedded in the CCTC’s approach was the concept of lean thinking – a business methodology that, simply put, aims to continuously offer more value to customers with fewer resources. It does this by foregrounding respect for people while providing organisations with a new way to think about how they organise processes and slowly eliminate the things that are not adding value. A few years later, the Department of Trade and Industry developed a nation-wide Clothing and Textile Competitiveness Programme (CTCP) whose broader objective is “to assist the industry in upgrading processes, products and people to re-position it so as to compete effectively against other low cost producing countries”. The initiative provides financial assistance to organisations as well as training in best operating practices, including lean manufacturing and thinking. Fast forward a few years and by 2013, textiles and clothing accounted for about 14% of manufacturing employment and represented South Africa's second largest source of tax revenue. The textiles, clothing and footwear industry was – according to the Industrial Development Corporation – becoming the most cost-effective way of creating jobs. In fact, that year’s Source Africa Conference brought to light that the CTCP had created some 12 000 jobs and assisted more than 400 companies. According to Ebrahim Patel, local manufacturing industry sales in clothing, textiles, footwear and leather increased from about R41.8bn in 2010 to over R50bn in 2015; an increase of 21% over five years. By contrast, they decreased by 6% in the former five years from 2005 to 2010. K-Way goes lean and reaps the rewardsOne company that exemplifies the turnaround is K-Way, a leading outdoor apparel brand. Part of the Cape Union Mart Group, K-Way’s dramatic about-turn over the past 12 years is the subject of a recent award-winning case study, The Evolution of Lean Thinking at K-Way, from the UCT Graduate School of Business adapted from a thesis by MBA student Himanshu Vidhani. In 2004, K-Way was operating at a loss and on the verge of shutting down. General manager Bobby Fairlamb was hired and given the task of turning the business around in two years – a tall order by any standards. He embraced the challenges head-on and the ensuing story makes for gripping reading. K-Way benefited from the collaboration and support provided by both the CCTC and the CTCP. The latter provided funding and training in lean thinking that enabled K-Way to buy the best machinery available and double the scale of its production, while also improving quality. Later the organisation also benefited from an injection of enthusiasm and expertise from lean thinking consultant Herlecia Stevens. Fairlamb and his team, notably Beverley Williams who became the production manager in 2009, started by using lean principles to identify and implement changes to achieve better results in the factory – notably improving production efficiency and on time delivery. After some initial success there they turned their attention to the much more difficult task of shifting organisation culture. They engaged deeply with the mostly unseen or what lean thinking calls “under the water” elements like leadership, employee behaviour and engagement. People started to become more engaged in their work and supervisors saw an increased ownership of the process. Absenteeism fell along with rework and reject rates. Fairlamb attributed all this to the morale of the people: “It’s clear to me now - if morale is up - all the KPIs are up. If morale and engagement are down, you are always on the back foot. This is why we could make the eventual strides we did.” Why is this story important? Because it offers us some insights into how to achieve success in difficult times – and not just in the clothing sector. Looking at what worked, and why, can help other organisations make more informed choices in thinking about how to approach the unique challenges in their industry or context.
Lessons from the K-Way story
The first lesson that the K-Way story surfaces is that at any time – but particularly at this critical juncture in South Africa’s economic history – we absolutely cannot afford waste. Amid cries of corruption and economic decline, we must focus on adding more value to our customers, consumers and enterprises by eliminating waste. The second – and this is related to the first – is that we need a fundamental shift in thinking that emphasises respectful relationships between people. This is particularly important because without engaged customers and partners, there will be no ongoing business relationships. And critically, without the participation and commitment of staff, the elimination of waste will remain a theory only. According to Professor Norman Faull, founder and director of the Lean Institute Africa, at the core of lean leadership is the necessity of adopting a different way of behaving. It is both a leadership and a management system and it involves learning new behaviours and tools; like how to learn from mistakes and how to embed the actions and processes that an organisation must implement to ensure that it is fit and ready for practice. It’s hard to put a price, or a number, on this kind of shift in behaviour. But the K-Way case comes close. When Fairlamb joined K-Way, the factory was operating at 40% productivity. This meant that for every clothing item, which should have taken 10 minutes to manufacture, employees at the factory clocked roughly 16 minutes. By 2012, K-Way was operating at 75% production efficiency. By 2015, it was charting an efficiency of 120%, as employees took eight minutes or less to make the same garment. South Africa is facing turbulent times, of that there is no doubt, but the K-Way story shows us that a slow but sure journey towards eliminating waste, creating greater respect for people and continuously engaging how to do both these things better – as well as wise collaboration within the industry and with government, it is possible to turn things around, one KPI Key Performance Indicator? at a time. If we focus on what works as much as we focus on what doesn’t, we may find a way better and more sustainable way forward. These 26 textiles & jewellery stocks may gain from the latest GST Council tweaks. Though there’s no denying the fact that the long-term benefits of GST outweigh the short-term disruptions involved in the immediate aftermath of its implementation, many sectors bore the brunt of the adjustment pangs, and for some, the going was difficult. A case in point being jewellery players and manufacturers of man-made yarns. While the former faced immense difficulties in complying with the strict Know Your Customer (KYC) norms, the latter’s financials were strained on account of an inverted duty structure (raw material was taxed at a much higher rate vis-à-vis the output) and delayed clearances/ambiguity in relation to export-related tax refunds. Taking cognizance of the matter, the Finance Ministry, in its recently concluded GST Council Meet, made some key revisions just ahead of the festive season, thereby soothing the nerves of hassled entities in both categories.
Textile sector
The GST Council revised the GST rate for job work (embroidery) in the textile sector from 18 percent to 5 percent in connection with apparel, shawl, and carpet manufacturing. This, in turn, is likely to facilitate a swift flow of processes throughout the textile value chain, enable job workers to claim input tax credit (previously, job workers were forced to pay tax on raw materials procured but couldn’t charge service tax, thus resulting in a cost hike of products manufactured by them), benefit domestic consumers, and strengthen the global competitiveness of India’s textile units. In the past, as against 18 percent tax on man-made fibre (MMF) yarn, the corresponding rate for synthetic fabric was only 5 percent. Consequently, synthetic manufacturers resorted to MMF yarn imports to save costs. To address these concerns, the GST rate on yarn manufactured from man-made fibres (MMF) has been reduced from 18 percent to 12 percent to prevent price escalations and ease working capital requirements. Nonetheless, until the option to claim input tax credit is made available at the fabric manufacturing stage, the residual problems for synthetic yarn businesses will continue to linger on. To ease the bottlenecks confronting textile exports, a series of measures were undertaken. Exporters have to pay a nominal GST rate of only 0.1 percent on the value of goods manufactured for export. Additionally, refund claims processing for exports undertaken in July and August would be initiated from the month of October 2017. The government plans to introduce e-wallets from April 2018 to improve exporters’ cash flows, too.
Source : Google.com
The Indian textile industry is hopeful of growth with revision in the GST rate announced at the 22nd "By announcing reduction of GST rates for MMF yarns and its products from 18 per cent to 12 per cent, the GST Council has met a long pending demand of the textile industry. The announcement has sorted out a big issue of inverted duty for the MMF products as it was causing serious issue of escalation of the cost of synthetic products which was further leading to cheaper imports from the competing countries like China and Indonesia," said Sanjay K Jain, Confederation of Indian Textile Industry (CITI) chairman. meeting of the GST Council. The change in GST rate will strengthen the entire textile value chain and make textile industry globally more competitive while boosting electronic payment of taxes, according to various textile industry associations. With better GST rates for cotton, MMF and blended sector, Indian Texpreneurs Federation (ITF) is also expecting a boost in volumes. "With growing domestic demand, Indian textile industry can expect improvement in utilisation levels in the short term and also more investments in weaving and processing sectors in the medium term. By this change, credit blockage will be very minimal to weaving sector, and cost difference will be absorbed throughout the value chain in a uniform manner without impacting the financials of any sector," said ITF convenor Prabhu Damodaran. The government has tried to resolve the liquidity issues faced by the exporters. "The announcement of dates for processing the refund cheques for July and August exports and also the decision for refunding a notional amount for the remaining months and later adjust the amount in the e-wallet April 1, 2018, would resolve the problem of working capital blockage and benefit the exporters," P Nataraj, chairman of The Southern India Mills Association. Measures like exempting export promotion schemes like advance authorisation scheme; EPCG from the payment of GST up to March 31, 2018 will lead to a spurt in investments, according to Ujwal Lahoti, chairman, The Cotton Textiles Export Promotion Council. "We have requested for higher rate of duty drawback rate after including the embedded taxes like transportation of raw materials and input, usage of petro products, for generation of electricity etc., which were not taken into account earlier mainly to enhance the competitiveness and also to protect SME exporters. As the exporters have to commit the future orders only based on the availability of duty drawback and other measurers, an immediate announcement of increase in duty drawback would be much helpful to restore the confidence of exporters and reinvigorate the growth trajectory," said Raja M Shanmugham, Tiruppur Exporters' Association president. (RR)
Source: fibre2Fashion
COIMBATORE: The textile industry in the region has welcomed the central government's decision to reduce Goods and Services Tax (GST) on man-made fibres filament and spun yarn from 18% to 12%.The reduced rate of tax would help the spinning and powerloom sector improve its global competitiveness and provide clothes to the poor in the country at an affordable cost. Chairman of the Southern India Mills Association (SIMA) P Nataraj thanked the GST Council for "giving a relief from the blockage in credit of exporters that affects the cash liquidity of the exporters". He hailed the announcement of processing the refund cheques for July exports by October 10 and August exports by October 18 and also the decision to refund a notional amount for the remaining months and later adjust the amount in the e-Wallet that will be implemented from April 1, 2018. Nataraj also welcomed the announcement to ease the compliance burden of medium and small taxpayers and increasing the eligibility of composition scheme from Rs 75 lakh to Rs 1 crore. He also hoped that the government would extend the transitional provision of giving the pre-GST duty drawback for another three months or till the new rates are announced. In a press statement, SIMA hoped that the GST Council would soon consider refund of the accumulated input tax credit at fabric stage especially the processed fabrics and also mandating the duty drawback committee to recommend appropriate duty drawback rates to sustain the export performance.
Source: The Times of India
Mandaviya’s visit comes days after the GST council revised the tax slabs. Moreover, the textile traders of Surat have decided to celebrate a “black Diwali”, resolving not to light up the 160 markets in the city, as their demands before the GST council have not been looked into. Union Minister of State for Road Transport and Highways Mansukh Mandaviya on Tuesday assured the Surat textile industry of “sorting out” their issues concerning the Goods and Services Tax (GST) soon, following a call for “black Diwali” by them. Mandaviya chaired a meeting with delegates from different sectors of textile industry like, weaving, manufacturing and trading on Tuesday, during which he assured them that their issued would be looked into. Mandaviya’s visit comes days after the GST council revised the tax slabs. Moreover, the textile traders of Surat have decided to celebrate a “black Diwali”, resolving not to light up the 160 markets in the city, as their demands before the GST council have not been looked into. After the meeting Mandaviya said, “We have not made Diwali black for the textile traders. Their issues are being looked into by the GST council and will be sorted out soon.” “The GST council has made several changes into the tax slabs. For instance, 18 per cent GST on yarn has been reduced to 12 per cent. The 18 per cent GST on all works related to fabrics has been reduced to 5 per cent and so on,” Mandaviya said. About diamond sector, he added, “We are also looking into 3 per cent inter-state GST for merchants having factories in Surat and trading office in Mumbai. We are hopeful that their issues will also be sorted out.”
Source: The Indian Express
The 22nd GST Council meet addressed concerns of jewellery companies by easing KYC norms. There was some relief for synthetic yarn makers, too, as issues in connection with delayed clearances/ambiguity in export-related tax refunds and an inverted tax structure were considered. Though there’s no denying the fact that the long-term benefits of GST outweigh the short-term disruptions involved in the immediate aftermath of its implementation, many sectors bore the brunt of the adjustment pangs, and for some, the going was difficult. A case in point being jewellery players and manufacturers of man-made yarns. While the former faced immense difficulties in complying with the strict Know Your Customer (KYC) norms, the latter’s financials were strained on account of an inverted duty structure (raw material was taxed at a much higher rate vis-à-vis the output) and delayed clearances/ambiguity in relation to export-related tax refunds. Taking cognizance of the matter, the Finance Ministry, in its recently concluded GST Council Meet, made some key revisions just ahead of the festive season, thereby soothing the nerves of hassled entities in both categories.
Textile sector
The GST Council revised the GST rate for job work (embroidery) in the textile sector from 18 percent to 5 percent in connection with apparel, shawl, and carpet manufacturing. This, in turn, is likely to facilitate a swift flow of processes throughout the textile value chain, enable job workers to claim input tax credit (previously, job workers were forced to pay tax on raw materials procured but couldn’t charge service tax, thus resulting in a cost hike of products manufactured by them), benefit domestic consumers, and strengthen the global competitiveness of India’s textile units. In the past, as against 18 percent tax on man-made fibre (MMF) yarn, the corresponding rate for synthetic fabric was only 5 percent. Consequently, synthetic manufacturers resorted to MMF yarn imports to save costs. To address these concerns, the GST rate on yarn manufactured from man-made fibres (MMF) has been reduced from 18 percent to 12 percent to prevent price escalations and ease working capital requirements. Nonetheless, until the option to claim input tax credit is made available at the fabric manufacturing stage, the residual problems for synthetic yarn businesses will continue to linger on. To ease the bottlenecks confronting textile exports, a series of measures were undertaken. Exporters have to pay a nominal GST rate of only 0.1 percent on the value of goods manufactured for export. Additionally, refund claims processing for exports undertaken in July and August would be initiated from the month of October 2017. The government plans to introduce e-wallets from April 2018 to improve exporters’ cash flows, too.
Jewellery sector
India’s gems and jewellery companies, that have been reeling under major headwinds over the past year (in the form of demonetisation and GST-induced complexities), were in desperate need of some relief immediately before the festivities kick off. The GST Council Meet, by virtue of a few important decisions, gave the sector a shot in the arm. The GST Council eased KYC (Know Your Customer) compliance limit from Rs 50,000 to Rs 2 lakh on jewellery purchases. The government exempted small jewellers (with a turnover up to Rs 2 crore) from provisions of the Prevention of Money Laundering Act (PMLA, 2002) as well, wherein they would not be required to submit KYC information of customers transacting in excess of Rs 50,000. Though the revised provisions will boost overall demand, the move, incrementally, will help the unorganised players more than their large organised counterparts.
Source: Moneycontrol.com
Handloom is not merely an economic activity. It’s an art that its practitioners dedicate their lives to learn. India is a land of rich textiles. Each state of India has its own hand-woven, hand-embroidered, traditional handloom textiles and sarees that have won the admiration of millions across the globe. In post-Independent India, successive governments have taken special measures to protect and promote India’s rich handloom textile industry through legislative and institutional mechanisms, tax incentives and other financial measures; by setting up cooperatives and linkages for marketing the products, by reserving products within handloom categories to eliminate competition with mass-produced textiles and through various other methods. However, in the past one year, the double jolt of demonetisation and a hastily-implemented and complicated Goods and Services Tax that did not give a tax exemption to handloom, at least in the first round, has dealt a severe blow to the handloom industry. According to the data from the ministry of textiles, there are 43.31 lakh weavers in India, out of which 77 per cent are women. Out of these 43.31 lakhs, as many as 36.33 lakh are in rural areas. Large sections of the weaver community belong to the minorities, and other socially and economically marginalised sections of society. Many of them live below the poverty line. By a rough estimate, 61 per cent of weavers work independently, 34 per cent work under master weavers, and only five per cent work through cooperatives and clusters. The handloom industry is totally decentralised, and is spread across India. It operates within the informal sector, and creates around 14 per cent of total textile production in India. The Indian textile industry is one of the world’s oldest. There is evidence of cotton production in the Indus Valley Civilisation. Indian cotton and silk were prized items for export in ancient India to other ancient civilisations. Super-fine cotton fabric called muslin, known in ancient Rome as ventus textilis (the woven wind), was a highly-coveted item. It’s said that it was so fine that Roman emperor Augustus banned its use as a dress material by the women of his court through an imperial decree stating it’s bad for the morals of his people. Ibn Batuta, the 14th century traveller, noted that among the presents sent by Delhi’s Sultan Muhammad bin Tughlaq to the Yuan emperor in China were 100 pieces each of five varieties of cloth, each category named differently. When the East India Company ventured into India, one of its main items of export was Indian textiles. This changed only after the Industrial Revolution in England. Along with new technologies, England adopted a protectionist policy towards its own nascent textile industry by banning the import and sale of finished pure cotton products from India. In India, the colonial administration not only discouraged the indigenous textile industry, but flooded the Indian market with cheap mill-produced Lancashire textiles. At one stroke, a millennia-old tradition was reversed. From being the world’s largest textile exporter, India began to import British textiles. During the freedom movement, Mahatma Gandhi began the practice of spinning and weaving homegrown textiles — khadi. The symbolism of khadi in India’s Independence movement is immense. Khadi symbolised India’s pride, entrepreneurship, a move towards self-sufficiency, and a spirit of resistance to the mighty colonial power. Khadi remains one of the most potent symbols of India’s independence from “political slavery, economic bondage and cultural stagnation”. It’s an intrinsically embedded imagery of the freedom struggle with Mahatma Gandhi. It’s shameful to see the Mahatma’s image replaced by the current Prime Minister’s photograph in khadi calendars, with a minister of the ruling party from a state saying that Mr Modi is a bigger brand than Mahatma Gandhi. For the first time in Independent India, khadi has been taxed under GST. Though the khadi yarn, Gandhi cap and the national flag remain exempt, other items made of khadi, including apparels, are being taxed. The handloom textile industry operates within a framework of cash and credit flow. The weavers are given credit by middlemen and/or traders for the purchase of raw materials like yarn, threads or zari. With demonetisation, the cash disappeared and credit stopped. Demonetisation hit all small and medium-scale industries in the informal sector, but the handloom sector suffered an even bigger blow. It already had to compete with large-scale mass production of textiles. With the withdrawal of cash from the market, not just production suffered due to lack of availability of credit and cash in hand to purchase raw materials, but also demand dipped due to the reduced purchasing power, leading to a vicious circle of low-demand, low-production and stagnation in the market. The government’s refusal to grant a tax exemption to handlooms while introducing GST has led to even more miseries for weavers. Thanks to the lack of technical knowhow and the absence of an efficient machinery to help implement GST, the utter confusion in the informal sector, including the handloom sector, continues. The weavers are not given credit as they can’t raise invoices due to the lack of digital as well as financial literacy. The tax on sarees and apparels above Rs 1,000 has made competition far tougher for the handloom sector. According to a media report, in Varanasi, the Prime Minister’s constituency, which is one of the earliest textile centres in India, traditional weavers have been rendered jobless and are being forced to look for other jobs. Over 70 weavers are said to have committed suicide in Varanasi due to the vicious cycle of debt and poverty. Handloom is not merely an economic activity. It’s an art that its practitioners dedicate their lives to learn. The master weavers produce masterpieces that not only exemplify an individual’s superb skills but contain centuries-old traditions in a single piece of cloth. In many weaving communities, skills are imparted by home training and continue through generations. It’s the State’s responsibility to create a conducive environment for such craft to survive and thrive. Mr Modi’s government talks about skilling India, but seems to be doing its best to destroy one of the most ancient and precious talent-pool of skills the country has.
Source: Asian Age
India’s gross domestic product (GDP) growth rate slowed to 5.7% in the April-June period of 2017-18 from 6.1% in the preceding quarter. This is the lowest in past three years. The main reasons for such slow growth are the lingering impact of demonetisation, de-stocking ahead of the Goods and Services Tax (GST) roll-out leading to slow manufacturing, and shrinking exports. Growth rates of manufacturing and exports were minus 3.12% and minus 9.62% respectively during the April-June period of 2017-18 over the preceding quarter. While recent trends in Indian merchandise exports have been more or less similar as those in case of world’s exports but the cause of worry is India’s very small share in world trade. India’s share in world total merchandise exports and imports were 1.65% and 2.21% respectively in 2016. These figures present a big challenge towards enhancing our exports and firming up India’s position in many of its current trade negotiations such as the India-EU free trade agreement, the Regional Comprehensive Economic Partnership for Asia and the Pacific. Though there are sector specific challenges to boost India’s exports, there are economy-wide challenges too. Trade facilitation needs: Despite various initiatives, India stands well below than its peers in terms of trade facilitation. According to World Bank’s Doing Business Report (WBDBR), India’s “trading across border” rank has considerably declined from 126 in 2014 to 143 in 2016. Trade cost and time are significantly higher in India as compared to neighbouring competitors. In 2016, export and import time (including both documentary and compliance) in India were 144.5 hrs and 344.6 hrs, respectively, while cost to export and import (US$ per 20 containers) were 505 and 708.8, respectively. Depreciating the rupee: Appreciating rupee has reduced the price competitiveness of Indian exports. Rupee has appreciated by 5.32% against the US dollar from January-July 2017 on a monthly average basis. While this helped in reducing our import bill, it has adversely affected the Indian exports. We need to depreciate (not devaluate) the rupee to enable our exporters to trade and create jobs. The RBI has to step into the market to either reduce the interest rate or buy up dollars. Low utilisation of trade agreements: Despite having a number of trade agreements, Indian exporters have not been able to reap their true benefits. This is mainly due to challenges emanating from higher sanitary and phyto-sanitary measures and technical barriers, and complications in fulfilling rules of origin conditionalities. India’s average usage rate of trade agreements is 27%, the highest being 40% in case of India-Singapore comprehensive economic cooperation agreement and lowest being 14% in case of India-MERCOSUR preferential trade agreements. This shows that our traders are still using most-favoured nation (MFN) tariffs while doing trade with free-trade agreement (FTA) partners, as against preferential tariff rates. Difficulties arising out of GST: GST was pronounced and sold as the largest tax reform in independent India and indeed might help the Indian economy grow in the coming years. However, it has posed a number of problems for our traders. Some of them are blockage of funds due to non-refund of input credits, non-inclusion of petroleum products and electricity under GST making their purchase costlier, procedural difficulties in its compliance, especially for MSMEs. Majority of the export promotion councils are demanding tax exemptions on exports. Miscellaneous challenges: There are several other challenges such as declining global demand, high credit cost due to high interest rate, high logistic cost due to higher petroleum prices, tariff advantage to competitors such as Bangladesh due their LDC (least developed country) status, inappropriate labour laws having weak links between productivity and wages, lack of competitiveness due to non-compliance with quality standards.
A proposed basket of measures
In order to enhance our exports, we should have country-centric rather than area-centric strategy. This is because different countries in the same area may have varying import standards and procedures. Therefore, India needs to develop a comprehensive dataset of its trade transactions to prepare future policies. In short, keeping these challenges in mind and in the wake of industry expectations from mid-term review of foreign trade policy, it is a challenging time for the commerce and industry minister of India to introduce a basket of measures for the growth of our exports. Some immediate actions may include the following: Firstly, a comprehensive review of various export promotion schemes is required as not only GST has increased input cost for various manufacturing products but also it is a reality time for India’s commitments to the World Trade Organisation (WTO). Along with simplification of rules of origin provisions in our FTAs, the focus should be on research and development and raising standards of Indian products. Secondly, medium and small enterprises should be at the centre of the foreign trade policy as they contribute a majority to our exports – in this regard, they should be incentivised in a WTO-compliant manner to grab the manufacturing space being vacated by China and other east and southeast asian countries. E-commerce is the key for future business – the foreign trade policy (FTP) should have a separate chapter on it, dealing with both on a business-to-business perspective, and business-to-consumer basis. Thirdly, agricultural products are important constituent of Indian exports but there has been a steady decline in their exports during 2014-15 to 2016-17 – there should be a separate policy on enhancing agricultural trade. For reducing the time and cost of doing trade at the port level, all export-import transactions should be brought under the ‘Single Window Interface for Facilitating Trade.’
Source: The Wire
The State government’s advance preparations in asking the Cotton Corporation of India to purchase cotton at minimum support price of Rs. 4,350 per quintal came a cropper in Adilabad agriculture market yard as trading opened on Monday. Apparently, it did not reckon with the CCI's purchase regulations with regard to moisture content in the produce and farmers had to settle for Rs. 4,000 per quintal with private traders giving the go-by to the regulations on the opening day. “It is clearly the failure of the government in spreading awareness on bringing dried cotton with moisture content within the regulated 8 to 12% and also in realising that theCCI would stick to its moisture regulations come what may,” pointed out farmer More Prabhakar from Tamsi mandal. As the customary auction was held in the morning in the presence of Forest Minister, the Cotton Corporation of India quoted the minimum support price. Private traders quoted Rs. 4,600 per quintal but insisted on implementing the moisture regulation which would have them reject the produce with moisture content of more than 12%.
Source: The Hindu
Nagpur: The incessant downpour in Nagpur District for past three days has adversely affected the Soyabean and cotton crops in and around the region. The unseasonal rain which lashed the city has had poor impact on ready for harvesting Soyabean crops as well as cotton. The Soyabean crops are almost ready to be harvested but the rain has wrecked it. As if the deaths in Yavatmal did not cause enough loss to the farmers, the rain brough its own share of miseries for them. Although, no data is available, it is being anticipated that the loss might be more than that of preceding years. Farmer leader, Ram Nevle informed that Soyabean fruits as well as cotton flowers have died. “The sudden rainfall will decrease the production. Farmers are not even provided any compensation by the government for loss lower than 50 percent. We have had a loss of around 15 percent”, he said. Talking further on the loss, Agriculture Superintendent, M.B. Shende has informed that all the farmers have been directed to give details of the crop damage. However, the complete data has not been collected till now.
Source: Nagpur Today
Farmers protested against the fall in cotton prices at the grain market here today. Cotton is reportedly being procured for Rs 4,500 per quintal against Rs 5,500-6,000 per quintal during this time last year. Gurtej Singh, a farmer of Lehra bega village, said, “The price has fallen below Rs 4,000 per quintal. This is not enough to meet the cost incurred on production. Disposal of rice straw has also added to our woes.” Thana Singh, a farmer of Naruana village, rued, “We are not selling our crop. Instead we are throwing away our produce. No one is lifting our crop.” Farmers said they would not be able to recover the input cost at such a low rate. Darshan Singh said increasing labour cost and crop failure has added to their troubles. Dyan Singh, a farmer of Jai Singh Wala village, said, “We avoided paddy as the water table has been receding. Given the poor market response and government apathy, we have decided to sow paddy next year.” On the other commission agents deny any role in falling cotton prices. Rajesh Bansal, a commission agent, said, “We are not responsible for the fall in prices. It depends on the rate list prepared by the government.”
Source: The tribune
GBTL. formerly known as Grasim Bhiwani Textile Limited, subsidiary of Grasim Industries Limited, has signed superstar Amitabh Bachchan as its brand ambassador. Grasim's association with the iconic star is driven by the desire to expand its business pan-India as well as in global markets, and progress towards its strategic goal to become the market leader. "We are privileged to have Amitabh Bachchan as our brand ambassador. His vibrant persona, legacy and pan India appeal makes him, the perfect fit for brand GBTL – Grasim. It is the most recognised suiting brand in India and by roping in Bachchan, the company has demonstrated its intent to take the brand to a supreme level, addressing the market needs and preferences of consumers across the length and breadth of India," said S Krishnamoorthy, managing director of GBTL. GBTL has a strong presence in manufacturing of polyester viscose and polyester wool fabric which caters to the domestic as well as in the international market across geographies under the brand name GBTL - Grasim. The brand is known for young, fashionable and innovative brand targeted at the fashion forward consumer. Grasim’s offerings are the outcome of an innovation driven-culture, diligent research and development and a dedication to live up to consumer expectations. Grasim has all-India presence through an elaborate and well-established pan-India distribution network. "I am happy that Ogilvy & Mather is reunited with GBTL - Grasim. I am also overjoyed that the company has got Amitabh Bachchan on board as their brand ambassador. The fact that this news is announced on Mr. Bachchan’s 75th birthday is an icing on the cake," said Piyush Pandey, executive chairman & creative director, South Asia Ogilvy & Mather. (RR)
Source: Fibre2Fashion
|
Item |
Price |
Unit |
Fluctuation |
Date |
|
PSF |
1347 |
USD/Ton |
-0.39% |
10/10/2017 |
|
VSF |
2437 |
USD/Ton |
0% |
10/10/2017 |
|
ASF |
2656 |
USD/Ton |
0% |
10/10/2017 |
|
Polyester POY |
1260 |
USD/Ton |
-0.60% |
10/10/2017 |
|
Nylon FDY |
3381 |
USD/Ton |
0.45% |
10/10/2017 |
|
40D Spandex |
5886 |
USD/Ton |
0% |
10/10/2017 |
|
Polyester DTY |
5705 |
USD/Ton |
0% |
10/10/2017 |
|
Nylon POY |
1524 |
USD/Ton |
-0.49% |
10/10/2017 |
|
Acrylic Top 3D |
3049 |
USD/Ton |
0% |
10/10/2017 |
|
Polyester FDY |
2792 |
USD/Ton |
0% |
10/10/2017 |
|
Nylon DTY |
1615 |
USD/Ton |
-1.38% |
10/10/2017 |
|
Viscose Long Filament |
3456 |
USD/Ton |
0% |
10/10/2017 |
|
30S Spun Rayon Yarn |
3033 |
USD/Ton |
0% |
10/10/2017 |
|
32S Polyester Yarn |
2022 |
USD/Ton |
-0.45% |
10/10/2017 |
|
45S T/C Yarn |
2883 |
USD/Ton |
0% |
10/10/2017 |
|
40S Rayon Yarn |
3200 |
USD/Ton |
0% |
10/10/2017 |
|
T/R Yarn 65/35 32S |
2430 |
USD/Ton |
0% |
10/10/2017 |
|
45S Polyester Yarn |
2173 |
USD/Ton |
0% |
10/10/2017 |
|
T/C Yarn 65/35 32S |
2445 |
USD/Ton |
0% |
10/10/2017 |
|
10S Denim Fabric |
1.419 |
USD/Meter |
0% |
10/10/2017 |
|
32S Twill Fabric |
0.878 |
USD/Meter |
0% |
10/10/2017 |
|
40S Combed Poplin |
1.221 |
USD/Meter |
0% |
10/10/2017 |
|
30S Rayon Fabric |
0.679 |
USD/Meter |
0% |
10/10/2017 |
|
45S T/C Fabric |
0.718 |
USD/Meter |
0% |
10/10/2017 |
Source: Global Textiles
Note: The above prices are Chinese Price (1 CNY = 0.15092 USD dtd. 10/10/2017). The prices given above are as quoted from Global Textiles.com. SRTEPC is not responsible for the correctness of the same.
The garment exporters' profitability has hit a rock-bottom thanks to the continued downward price pressure by the international retailers amid rising production costs. “In fact we are just keeping our businesses afloat,” said a garment manufacturer who exports apparel items worth nearly $500 million a year. The price of garment items has been falling 5-8 percent every year whereas the cost of production is increasing 15-18 percent, he said. For instance, in 2015, a pair of denim trousers fetched him $8; the same pair is now bringing him $7.75. The production cost and the buying price of a pair of denim trousers are almost the same, the exporter added. Although the export of garment items grew 10 percent in volume in fiscal 2016-17, the value remained almost the same as in the previous year, according to commerce ministry data. In fiscal 2016-17, the growth of garment exports, which account for 82 percent of the total national exports, was also the lowest in the past 15 years. Garment exports increased 0.20 percent year-on-year to $28.14 billion in last fiscal year, 7.34 percent below the target of $30.37 billion for the year. The sector witnessed on average 16 percent year-on-year growth since 1990 up to fiscal 2015-16, according to the Policy Research Institute of Bangladesh. Industry insiders identified some major reasons that are affecting the price levels of apparel items in Bangladesh. Primarily, the demand for apparel items is declining in the Western world as customers progressively become more environment-minded. They are making more conscientious buying decisions: purchasing less and focusing on quality. In 2015, the demand for apparel items worldwide declined 8 percent to $445 billion, according to data from the World Trade Organisation. Too many products for too few consumers are the greatest challenge facing the fashion industry, according to the Massachusetts Institute of Technology's Centre for Collective Intelligence and Materials System Laboratory. The global garment industry manufactures more than 150 billion pieces of garments each year, but there are roughly 7.5 billion people on Earth, it said. The garment industry is producing 50 garments for each of the roughly three billion people who have the means to consume them. Moreover, the profitability from the sales of basic garment items that Bangladesh specialises in is also low. Since more than 70 percent of the exported garment items from Bangladesh are basic items, the manufacturers also receive low price offers from retailers. Mostafiz Uddin, managing director of Denim Expert, a Chittagong-based denim exporter, echoed the same as the MIT study. “Too many countries are producing too many apparel items for customers.” The existing companies in the countries like India, Vietnam and China are increasing their capacity every year to grab more market share, Mostafiz said. “We are in a fierce competition now. There are too many manufacturers in Bangladesh.” As a result, the small and medium scale factories have the threat of closure looming over them, Mostafiz said. Garment exporters are surviving thanks to value-added items, lower bank interest rate, and higher efficiency in the use of water, power and workforce, said Siddiqur Rahman, president of Bangladesh Garment Manufacturers and Exporters Association. “The bigger factories are automating their whole production to reduce costs and cope with the falling prices,” Rahman said. The government's stimulus package for exporting to new markets has also been of great assistance, he said.
Source: The Daily Star
U.S. apparel imports fell in August for the third consecutive month, moving in the opposite direction of overall goods and services imports. However the shift in sourcing from China to Vietnam continued despite the failure of Trans-Pacific Partnership.Total apparel imports dropped by 1.4% in the month to $9.3 billion on a CIF basis,, according to data released late last week by the U.S. Census Bureau, while total U.S. goods and services imports increased by 3.8%, to $203.5 billion. On a 12-month smoothed basis, apparel imports fell by 2.2%, capping five months of increases, an indication that apparel imports have bottomed out and stabilized. A healthy job market, low inflation and strong dollar have failed to compensate for persistent apparel deflation in an oversupplied retail market and declining consumer interest in apparel compared to other expenditure categories. Apparel exports rose by 2.6% to $506 million. Total U.S. goods and services exports increased by 5.1%. On a year-to-date basis, apparel imports have fallen compared to last year, according to OTEXA, the International Trade Administration’s Office of Textiles and Apparel. Total apparel imports declined by 1.9% on an MFA basis in the January to August period, to just over $53 billion from $54 billion in the same period in 2016. Among the top 10 U.S. apparel trading partners, only Vietnam, India, Nicaragua and Mexico have grown their apparel shipments to the U.S. On a square meter equivalent (SME) basis, imports have edged up by 0.9% this year, continuing the overall tendency toward cheaper goods, despite upward pressure on labor and raw material costs. The average cost per unit of an imported garment fell by 2.8% in the first eight months of the year. The average cost per SME increased by 11.4% from Mexico, and rose 3.7% for El Salvador, but dropped for all other key trading partners, with the cost per SME from China suffering the biggest drop, down by 6.4%.Vietnam’s apparel shipments to the U.S. continued to grow, increasing by 5.6% to $7.7 billion in the period, gaining over a percentage of U.S. apparel import market share so far this year, to 14.4%.Mexico’s apparel exports to the U.S. increased by 5.3% to $2.3 billion, driven by near-sourcing efforts on the part of many U.S. brands. Mexico’s share of U.S. apparel imports increased by 0.3 percentage points. China has lost the most share of U.S. apparel imports in the period, down one percentage point to 32.8%.Bangladesh also lost share, with apparel shipments to the U.S. down by 5.9% year-to-date, to 5.6% of total U.S. apparel imports.
Source: Sourcing Journal online
The Vietnam Textile & Apparel Association, or VITAS, has come out against a proposed government plan to increase the country’s minimum wage, claiming the industry is still struggling to keep up with a series of hikes imposed in the last decade, according to Vietnamese media reports. The National Wage Council in August proposed a 6.5% raise in the regional minimum wage for 2018 and submitted the proposal to the government for approval. The proposed monthly wage hike of $8 to $10 a month is said to be the lowest raise ever offered. VITAS said minimum wage in domestic enterprises increased 21.8% between 2007 and 2017, leading many to reduce workers’ annual bonuses and turn to more automation. Constantly increasing the minimum wage reduces competitiveness and shifts the labor structure, preventing enterprises from expanding production and taking away job opportunities, VITAS vice chairman Truong Van Cam told media in Vietnam. He said no increase should be imposed. Amid this concern and even with the U.S. pulling out of the Trans-Pacific Partnership, Vietnam’s apparel shipments to the U.S. continued to grow, increasing 5.6% to $7.7 billion for the first eight months of the year, gaining over a percentage to hold 14.4% of U.S. apparel import market share., according to the International Trade Administration’s Office of Textiles and Apparel. Vietnam determines minimum wages by four regions. Each region is evaluated according to its socio-economic development and present industries. Region I spans the urban areas of Hanoi and Ho Chi Minh City, Region II covers the rural areas of Hanoi and Ho Chi Minh City, in addition to the urban vicinities of Cần Thơ City, Đà Nẵng City and Hải Phòng City. Region III applies to the provincial cities of Bắc Ninh Province, Bắc Giang Province, Hải Dương Province and Vĩnh Phúc Province, while Region IV covers remaining vicinities. If the 2018 regional minimum wage goes into effect, Region I monthly minimum wage will increase to $175 from $165, Region II to $155 from $146, Region III to $136 from $127 and Region IV to $121 from $136. According to National Wage Council chairman Doãn Mậu Diệp, the council provided two options for members to vote on—an increase of 7 percent or an increase of 6.5%. More than half of the members voted for the second option at the meeting. Although the council agreed to move forward with the 6.5% increase, some members were concerned about Vietnam’s labor progress and business expansion initiatives. Many members said they felt unsatisfied with the increase, since it would not allow Vietnam to provide a minimum wage compatible to the minimum standard of living by 2020. What’s more, some said the increase does not favor company development or the welfare of workers. Vietnam Chamber of Commerce and Industry vice chairman Hoàng Quang Phòng said despite more than 73,000 companies opening facilities in Vietnam this year, 50,000 other businesses have also closed their doors.
Source: Journal Online
Baku, Azerbaijan: As of October 10, Azerbaijan harvested 71,680 tons of cotton, which is 2.7 times more than in the same period last year, the country’s State Statistics Committee said in a message. For comparison: 27,050 tons of cotton were harvested in Azerbaijan for the same period last year. During the reporting period, the biggest volume of cotton was harvested in the Saatli district. Some 12,950 tons of cotton were harvested from the sown area of 17,220 hectares. In total, 136,410 hectares were sown in cotton this year, which is 2.7 times more than the area sown last year.
Source: News Agency
Visiting Russian minister of industry and trade Denis Manturov recently proposed Uzbek foreign trade Minister Eler Ganiev creating a ‘green corridor’ for the supply of textile products from Uzbekistan. Both nations aim to expand cooperation in textiles as Uzbekistan is the world’s sixth-largest cotton-growing country producing 1.1 million tonnes annually. The ‘green corridor’ concept was launched by the European Union in 2007 wherein goods do not have to undergo customs inspection while crossing borders. In 2017, the supply of textiles from Uzbekistan to Russia increased by 22 per cent. Ganiev feels the potential is vast as the proposal covers production cooperation, the use of Uzbek yarn for production at Russian enterprises, the supply of finished textile products, knitted fabrics and cotton fabrics. “We expect that by the next year, the volume of trade in textile products could reach about $700 million," he was quoted as saying by Uzbek media reports. By 2017 end, the republic intends to reach the $5-billion trade turnover level with Russia. Moreover, this year Russia has come out on top among Uzbekistan’s foreign trade partners. (DS)
Source: Fibre2Fashion
ICE cotton futures settled flat on Tuesday after rising to near a one-week high on concerns about Texas weather, with the market awaiting a monthly crop supply and demand report from the U.S. government on Thursday. Cotton contracts for December were unchanged from the previous session at 68.95 cents per lb. It earlier touched 69.88 cents a lb, the highest since Oct. 4. "The market was little concerned about the Texas crop facing cold weather, but then it could not sustain the gains," said Peter Egli, director of risk management at British merchant Plexus Cotton. Egli said participation in the market was slow because traders are waiting for a U.S. Department of Agriculture report "to see if the crop is as big as everybody is anticipating or whether the quality is going to be as good as they are hoping." The September World Agricultural Supply and Demand Estimates (WASDE) report projected 21.76 million bales of U.S. cotton output for the 2017-2018 crop year, higher than the 20.55 million bales of production estimated in August. Meanwhile, the USDA's weekly crop progress report on Tuesday showed 25 percent of cotton crop was harvested in the United States by the week ended Oct. 8, up from 17 percent in the previous week. It rated 60 percent of the U.S. cotton crop in good to excellent condition, up from 57 percent a week ago. Total futures market volume rose by 4,981 to 19,882 lots. Data showed total open interest fell 197 to 229,746 contracts in the previous session. Certificated cotton stocks deliverable as of Oct. 9 totaled 5,445 480-lb bales, unchanged from 5,445 in the previous session. The dollar index was down 0.44 percent. The Thomson Reuters CoreCommodity CRB Index , which tracks 19 commodities, was up 1.24 percent. (Reporting by Eileen Soreng in Bengaluru; editing by Grant McCool)
Source: The Times of India
COTTON plantings in Southern NSW are tipped to double this season, amid high water allocations, excellent planting conditions and good prices. And for the first time cotton planted in the Riverina will outstrip rice plantings. This year it is predicted 89,320ha of cotton will be planted in the Lachlan, Murray and Murrumbidgee irrigation valleys, up 53 per cent on the 58,210ha planted last year. That’s according to figures from Monsanto, seen by The Weekly Times, based on farmer planting intentions. The biggest jump in plantings was in the Murrumbidgee Valley, up 56 per cent or 24,000ha on last year to 66,800 ha. While in the Murray Valley, traditionally a strong rice-growing region, Monsanto predicts plantings are up 36 per cent to 4020ha, while in the Lachlan system cotton acreage is tipped to rise 49 per cent to 18,500ha. A reasonably large rice crop is predicted to be planted in the NSW Riverina. Last month the Australian Bureau of Agricultural and Resource Economics and Sciences forecast 84,000ha of rice would be planted this year and, if realised, it will be the third largest crop in the past decade and up on the 80,000ha planted last season. Monsanto southern NSW regional business manager Luke Sampson said the region was on track for the second year in a row of record cotton production. He said good water allocations in the irrigation regions was a major reason for the lift in cotton plantings, along with better potential profitability for growers compared with other crops such as rice and corn. “The upside potential is significantly better in cotton than corn or rice. If (farmers) have a good growing season in the southern region the upside yield potential is much better,” he said. Cotton Australia southern valleys regional manager Honi Anderson said last season’s crop was affected by wet conditions that prevented plantings, but conditions this year had been ideal. “There’s existing growers who are planting a lot more than last year, and new growers who are opting for cotton for the first time,” she said. Rice Growers Association president Jeremy Morton said they would still “like higher water allocations” but he believed there would be good rice plantings because a lot of water had been carried over from last year.
Source: The Weekly Times
For years, the textile sector has been the country’s backbone as it provides employment and export revenues. The sector absorbs 40% of the total industrial workforce and contributes 62% towards exports. However, the sector is losing its competitiveness at the international level due to a number of challenges at global and domestic levels. According to the Economic Survey of Pakistan, exports of the clothing sector, towels, knitwear, carpets and rugs showed a negative growth rate during 2016-17. The exports from subsectors, including cotton yarn and cloth, hosiery, knitwear, bed wear, towel, ready-made garments and synthetic fabrics, are less than their potential. And the total potential for direct exports forgone per annum is $3,602 million. This is a huge loss not only for the textile sector but also for Pakistan as underutilisation means millions of workers who can get the job remain unemployed because there is a decrease of 30-35% of production capacities of the industry. Resultantly, factories are shutting down and causing production and revenue losses. The export growth of textile and clothing in other countries has been higher in the last few years. During 2011-16, India’s exports increased 31% from $27.7 billion to $36.4 billion, while Bangladesh’s and Vietnam’s exports showed a 63% and 107% growth, respectively. On the contrary, Pakistan’s exports showed a negative growth rate of 10% from $3.8 billion to $12.5 billion. Despite being the fourth-largest producer of cotton, Pakistan is not even in the list of the top 10 exporters. Energy cost is a serious concern for the textile sector as spinning, weaving and processing industries heavily rely upon energy consumption. Industrial gas tariff of Pakistan is 100% higher and electricity tariff is almost 50% higher as compared to other regional competitors. With energy as a major cost of production, the sector is losing its competitiveness by consuming expensive energy. Sales tax refunds are also not being paid by the government which is causing a financial crisis for exporters. Exchange rate overvaluation is another concern owing to which the exports are expensive in the global market. High level of indirect taxes are also increasing the financial burden for the businesses and making it difficult for them to keep their product price compatible at the international level. Technological improvement is another aspect where Pakistan lags behind. Not enough investment has been made in technology because of which the productive capacity of the sector remains stagnant. In 2006, Pakistan made $1 billion investment per annum whereas in 2016-17 this investment reduced to $0.56 billion. Investors are also unwilling to invest due to the high cost of doing business as there are abundance of taxes and regulatory procedures which have to be followed by them. On the other hand, countries like China, India and Bangladesh are providing extensive investment incentives to enhance investment and production activities. But for Pakistan, the decline in investment further results in unemployment and production losses. However, the government has recently announced export package for the industry which will help in its modernisation and development. The package contains new duty drawback rates on products, including processed fabric, textile and garments, yarn and grey fabric and made-up textile articles. It is required that the government implements the Prime Minister’s Export led Growth package which will generate millions of jobs and increase the exports. Exporters also require duty-free import of cotton so that they can have competitive raw materials. Other measures are also needed. Although textile exports heavily rely upon few products, including cotton, apparel and clothing, contributions from other textile products are currently quite dismal and needs to be enhanced to develop the export base. The government must also pay the pending sales tax refunds to the industry to ease its financial burden. Exchange rate should also be adjusted according to market conditions to avoid any uncertainty in policy measure.
Source: The Express Tribune
