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Industries welcome revision of GST rates

The Goods and Services Tax (GST) came as a shocker to the wet grinder manufacturers here as the product was placed under 28 % tax. The Coimbatore Wet Grinders and Accessories Manufacturers’ Association made several appeals to the Union Government, seeking reduction in duty. In the recent GST council meeting, the rate has been slashed to %.According to Saasthaa M. Raja, president of the association, Coimbatore produces nearly 20 lakh grinders a year and 65 % of the market is within the State. The manufacturers here supplied grinders to the State Government for free distribution and when the scheme ended last January business dropped for these manufacturers. The market was expected to pick up only in March this year. However, the GST came in July, crippling production. Now, consumers who buy directly from the manufacturers in Coimbatore will not have to shell out much because of GST, he said. The raw materials used for production are under 18 % rate. Hence, the manufacturers will take input tax credit, he said. The Indian Chamber of Commerce and Industry, Coimbatore welcomed the reduction of GST on wet grinders, pumps, compressors, weighing machines, etc. The council has taken pragmatic decisions to solve the problems of the trade and industry, said the chamber president Vanitha Mohan. However, the council has not considered reduction of rate for cement. The Confederation of Indian Textile Industry and the Southern India Mills’ Association have said that the decision to increase the limit for composition scheme to Rs. 1.5 crore from Rs. 1 crore will bring more industries wihing the special tax payment window. Many companies were unable to file the GSTR 3B for the month of July, August, and September. The Government has exempted such companies from submitting the late fee. These are welcome measures.

Source : The Hindu

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CITI hails GST Council's decision of reducing the burden of tax compliance on manufacturing and service sector


New Delhi: Shri Sanjay K. Jain, Chairman, CITI applauds Finance Minister and GST Council for bringing in number of reforms in GST law for promoting ease of doing business especially among small businesses who have been facing a number of compliance issues in e-filing post GST regime. Chairman, CITI further stated that increasing the threshold limit on Composition Scheme from Rs.1 crore to Rs.1.5 crore is a welcome move and it will help the government bring in more units within the scope of a special tax payment window for Small and Medium Enterprises (SMEs). He further stated that the decision of uniform tax rate of 1% for both traders and manufacturers is a welcome step. He further stated that suppliers under the scheme are allowed exemption on services upto Rs.5 lakh per annum for eligibility. Shri Sanjay K Jain also welcomed the decision of GST Council by allowing big and small companies to file their GST return by March 2018 thus, minimizing the compliance burden on tax payers. According to new changes, all companies have to submit their GSTR 3B of every month by 20th of next month. However, under GSTR-1 two categories have been formed. Those companies having turnover up to Rs.1.5 crore are required to file return once in every three month. Whereas, companies having turnover above Rs.1.5 crore, they will file GSTR1 form on monthly basis. Chairman, CITI further stated that there are many companies who have not been able to file their GSTR 3B for the month of July, August and September 2017. In such cases, government has exempted such companies from submitting late fee and those who have already submitted late fee will get reimbursement. In the cases where companies had to file NIL return from October 2017 onwords, government will only charge Rs.20 per day as penalty instead of Rs.200 per day, as decided earlier. Shri Jain also felt that giving tax relief on more than 200 items - across all sectors - under various tax slabs is a commendable move and will boost not only the manufacturing sector but also give immense relief to the end users of the products. The decision will create positive vibes in the economy and help fresh flow of FDIs in manufacturing sectors, improve employment opportunities in labour intensive units, and share of textiles and other products in the world market. Shri Sanjay K. Jain, Chairman, CITI, pins hope on GST Council's Chief that he will soon address the unresolved issues of the textile industry by reducing GST rate on MMF from 18% to 12% and by refunding accumulated ITC at fabric stage. He also hoped that GST 4 CITI-NEWS LETTER Council will also reduce GST rate on 100% Cotton Dot Coated Interlining Fabric (and similar other low value added fabric) from 12% to 5% which at present attracts 12% GST rate merely because it is dot coated with 25-30 GSM of HDPE or LDPE powder, adding about Rs.6.00/meter (Incl. Profit). Without dot coated the same fabric attracts only 5% GST rate.

Source: CITI Press Release

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Indian textiles hold high export potential: Tamta 

NEW DELHI —  The minister of state for  textiles Ajay Tamta categorically  stated the textile & handicrafts  sector is economically important  from the point of low capital  investment  high ratio of value  addition  and high potential for  export and foreign exchange  earnings for the country said at  an ASSOCHAM event held in  New Delhi.  Indian textile &  Handicrafts industry constitutes  an important segment of the  Indian economy as it is one of  the largest employment  generators after agriculture. The  sector employs about 7 million  people directly and indirectly  which include a large number of  women and people belonging to  the weaker sections of the  society  said Mr Tamta  Minister  of State for Textiles while  inaugurating an ASSOCHAM  National Conference on Women  in Textiles & Handicrafts  Industry: Weaving the Threads  of Livelihood at New Delhi.  Handlooms & Handicraft  and women  both the terms have  their individual identity and the  fruitful amalgamation of both  gives them a more meaningful  identity. These industries are a  major source of income for rural  communities in general and for  rural women in particular. Though a large number of female  workforce  both urban and tribal  from all sections of the society  are involved in appropriate  returns for their efforts  said Mr.  Tamta.  The joint study released by  ASSOCHAM-Resurgent on  ‘Women in Textiles & Handicrafts  Industry’ reveals that the market  size of India’s textile market is  expected to touch $250 billion in  the next two years from the  current level of $150 billion.  The textile sector in India  accounts for 10% of the  country’s manufacturing  production  5% of India’s GDP  and 13% of India’s exports  earnings. Textile and apparel  sector is the second largest  employment provider in the  country employing nearly 51  million people directly and 68  million people indirectly in 2015-  16  adds the study.  Demonetisation and the  transition to GST have hit smaller  players hard. The number of  workers affected due to closure  of cotton and man-made fibre  textile units (the bigger units that  comprise the non-SSI segment of  the industry) during 2016-17 was  4  356 on account of the closure  of 18 units  according to official  Textile Ministry data on non-SSI  units.  During the previous two  years  the numbers were 7  938  Continued on workers affected by the closure of 27 units in 2015-16 and 5  384  workers affected from the closure of 21 units in 2014-15  taking the  cumulative figure to over 17  600 workers impacted by the closure of  67 units in the last three years.  The GST rollout has further hit SME players in textile hubs  such as Surat  Bhiwadi and Ichalkaranji. Capital goods firms are struggling as most of the downstream sectors are saddled with excess  capacity and low demand.  It is estimated that out of the total number of persons employed  in Handlooms  Handicrafts  and Sericulture  about 50% are women.  There are more women in the household industry than in the  registered small scale or cottage units. However  in the organised  sector the percentage of women workers is extremely low  with the  exception being garmenting.  Efforts are being made to restore glory of cottage based traditional sectors like handlooms  handicrafts  jute and wool through  an integrated approach covering entire value chain. To provide  encouragement to textile manufactures and farmers of raw materials  the government has been providing incentives like minimum support  price to cotton farmers  upgrading the technology for handloom  weavers and providing centres for trade facilitation.  The textiles and garments sector is one of the largest  employment generators in the country. India has around 2 million power looms manufacturing around 20 billion meters of cloth  highlighted the study.  The power looms sector accounts for around 60 percent of the  total textiles sector. The sector is largely unorganized with many  players having hardly 10–20 looms and weaving on an average around  1  000 meters of cloth per loom per month  depending on quality of  cloth and loom used to manufacture.  Many run their looms on job-work basis and many buy yarn  and manufacture cloth. These units are spread across Bhiwandi  Surat  Ichalkaranji  Erode  Bhilwara  to name a few large centres where  power looms industry is operating.  They are often victims of gender inequality as it is embedded  deep in our society and also represents our social-political structure.  Women have embarked on a new journey to discover and unravel  their talents through their dedication and hard work despite being  bound with family obstacles and social drawbacks.  There are many institutions who have pledged to support the  basic needs and empower indigenous women to expand their  opportunities. The sole intention of these organizations is to provide  the women access to necessary education  health care  employment  and a social standing.  These vulnerable and dependent women are trained mostly in the textile and weaving industry to make them independent and  economically empowered.

Source : Tecoya Trend

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Future GDP growth to come from manufacturing: Suresh Prabhu

Commerce and industry minister Suresh Prabhu on Sunday said the services industry had grown at the expense of manufacturing and agriculture and his government would look at increasing the share of manufacturing to 25 per cent in an expanded GDP.  “The future of India’s GDP growth should come from manufacturing. We need to get new manufacturing ideas into India and identify 6-7 greenfield areas to focus on so that we can leapfrog globally. The ministry has started an exercise to identify these sectors,” he said. “We have to ensure a different kind of manufacturing keeping in mind future of technology, Prabhu added. He urged the Indian manufacturing sector to be part of the global supply chain and benefit from these linkages. A war room is being created to attend to issues of Fortune 500 companies and make it easier for them to do business here, he said. Interacting with members of Confederation Of Indian Industry (CII) Pune, Prabhu said unlike China, India’s growth story is private sector-driven. The government is focusing on making it easier for entrepreneurs to do business and reduce the problems they face and India had worked its way to 100 from 130 in the ‘ease of doing business’ ranking, the minister pointed out and added that the next target is to go up to 50. The government will also work on ‘ease of trading’ in India. “All elements of exports will be on one platform and this can be a game changer, Prabhu said. He also saw a role for big trading houses in expanding India’s exports and creating brand equity, like the Korean and Japanese companies had done in the past. He said there will be a mid-term review of the foreign trade policy. He plans to invite pension funds, sovereign funds and investors to India for round-table talks. FE

Source: Financial Express

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GST reset: Only 50 items stay in 28% slab, eating out to get cheaper

Consumers will be paying less for a wide range of items from shampoo to furniture from November 15 as the GST (goods and services tax) Council on Friday decided to cut the indirect tax from 28 per cent to 18 per cent on these and further down to 12 per cent on another two (wet grinders, and tanks and armoured vehicles), leaving only 50 items in the peak rate category. In all, 178 items have been taken out of the top tax bracket. Detergents, mattresses, marbles, ceramics, flooring, and toiletries will also cost less because all will come in the 18 per cent net. Besides, eating at restaurants will cost less as the Council lowered the rate on them to 5 per cent, irrespective of turnover or whether they have air-conditioners or not. However, restaurants will be denied input tax credit because they were supposedly not passing on the benefit to customers.  Only restaurants in starred hotels charging at least Rs 7,500 would pay 18 per cent, said Union Finance Minister Arun Jaitley, who chaired the Council meeting. Also, the GST on 13 items, including pasta, curry, diabetic food, and condensed milk, was lowered from 18 per cent to 12 per cent  from 18 per cent to 5 per cent on six items such as puffed rice, chikki, chutney powder, and fly ash  from 12 per cent to 5 per cent on eight items such as desiccated coconut, idli, dosa, sambar, and worn clothing  and from 5 per cent to nil on six items like guar meal and frozen fish. The GST rates on aircraft engines were reduced from 18-28 per cent to 5 per cent, aircraft tyres from 28 per cent to 5 per cent, and aircraft seats from 28 per cent to 5 per cent. The GST rate on bangles of lac was lowered to nil from 3 per cent. Prime Minister Narendra Modi said, "The recommendations made by the GST Council will further benefit our citizens and add strength to the GST. These recommendations are in the spirit of continuous feedback we are getting from various stakeholders on the GST."Under the composition scheme, which gives easier compliance to small and medium players and a flat rate without the benefit of input tax credit, the rate has been cut to 1 per cent in the case of manufacturers. Traders will continue to pay 1 per cent. For restaurants it will continue to remain 5 per cent, the same as for those (except the ones in starred hotels) that are not under this scheme. Besides, the scheme was made open for service providers up to a threshold of Rs 5 lakh. The threshold for availing of the scheme was raised to an annual turnover of Rs 1.5 crore from Rs 1 crore. Besides, the law will be changed to enable a further increase to Rs 2 crore. While Bihar Finance Minister Sushil Kumar Modi said the decision would cost the exchequer Rs 20,000 crore, Jaitley refused to quantify the revenue impact, saying compliance might also increase due to the rate reductions. West Bengal Finance Minister Amit Mitra said the Centre and the states had incurred losses of Rs 90,000 crore in the first three months of the GST.Only a few categories will remain in the 28 per cent tax slab, which would include luxury and sin goods such as big cars and cigarettes, which attract a cess over the peak rate, auto parts, yachts, construction materials such as cement and paints, etc. The move drew flak from Cement Manufacturers’ Association. The Council decided to go beyond the recommendation of the fitment committee to thin the 28 per cent slab to 62 items and decided to additionally lower rates for 12 more items. Shaving-cream, beauty products, chocolates, chewing gum, marble, and granite are among the additional 12 items whose rate has come down to 18 per cent, going beyond the fitment committee recommendation."We identified 12 more items for which the rates will be reduced to 18 per cent," said a government official. Explaining the rationale behind the move, Jaitley said the principle of equivalence was applied while fitting items in various slabs of the GST. This means that items were fitted in the slabs — 5 per cent, 12 per cent, 18 per cent, and 28 per cent — on the basis of the closest rates to the ones drawn by them in the pre-GST regime. He evaded a reply to the query as to whether the decisions were a precursor to merging the standard rates of 12 per cent and 18 per cent, saying the question pertained to the agenda of meetings in the future. Vishal Raheja of Taxmann said: "We expect that government will further slash tax rates by moving from four tax slabs to fewer rates or even a single one.” Abhishek A Rastogi, Partner, Khaitan & Co, said it appeared that after this mass rate reductions various anti-profiteering problems might come up for businesses which would not pass on the benefits to consumers.

Source: Business Standard

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Factory output slows to 3.8% in September

NEW DELHI: Industrial production grew at a slower pace of 3.8 per cent in September, mainly due to subdued performance of the manufacturing sector coupled with contraction in output of consumer durables. Factory output measured in terms of the Index of Industrial Production (IIP) rose 5 per cent in September 2016 and 4.5 per cent in August this year, data released by the Central Statistics Office (CSO) showed today.
According to the data, IIP grew at a meagre 2.5 per cent in April-September this fiscal compared to 5.8 per cent in the first half of 2016-17. In September, growth in the manufacturing sector, which accounts for 77.63 per cent of the index, slowed to 3.4 per cent, from 5.8 per cent a year earlier. During April- September, manufacturing grew at 1.9 per cent, down from 6.1 per cent in the same period last fiscal. Consumer durable goods output contracted by 4.8 per cent in September as against a growth of 10.3 per cent in the previous year. During the first half of this fiscal, the output of these goods declined by 1.5 per cent as against a growth of 6.9 per cent last year. Electricity generation growth slipped to 3.4 per cent in September compared to 5.1 per cent a year before. However, mining recorded a growth of 7.9 per cent in the month under review as against a contraction of 1.2 per cent a year ago. According to the use-based classification, growth rates in September 2017 came in at 6.6 per cent for primary goods, 7.4 per cent for capital goods, 1.9 per cent for intermediate goods and 0.5 per cent for infrastructure/construction goods compared to the previous year. The consumer non-durable segment has recorded a growth of 10 per cent. In terms of industries, 11 out of 23 industry groups in the manufacturing sector have shown positive growth in September 2017 as against the previous year.

Source: Business Standard

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Council slashes rates of over 200 items, cuts tax for restaurants as part of GST overhauling

Guwahati: The Goods and Services Tax (GST) Council on Friday slashed tax on over 200 items, reduced the levy on restaurants to 5 per cent, left only 50 products under the highest 28 per cent slab, and increased the composition limit for small businesses, as it undertook a comprehensive overhaul of the new tax regime. These changes will benefit consumers and businesses alike, as products ranging from perfumes to chocolates to fans become cheaper, and help douse some of the criticism that has dogged the four-month-old tax system. The economy will get a boost from the likely consumption boost and better compliance due to simpler and less-taxing scheme. The GST Council, the apex decision-making body, approved tax cuts on 178 items to 18 per cent from 28 per cent , and on restaurants to 5 per cent but without credit for taxes paid on inputs used, making household items and eating out cheaper. "We have been reviewing the 28 per cent slab in the last three meetings. In last meetings, we had cut it on 30-40 items... It was being felt that optically some items should not be in 28 per cent and then there were some items that were manufactured earlier by the those that enjoyed excise duty exemption," finance minister Arun Jaitley told reporters after an eight-hour meeting of the GST Council. The rate cut is prospective and will be applicable from November 15 after the Centre and states issue notifications. Prime Minister Narendra Modi said the recommendations made by the GST Council will further benefit the people and add strength to the tax regime. "These recommendations are in spirit of the continuous feedback we are getting from various stakeholders on GST," the prime minister tweeted. The ruling National Democratic Alliance has been under pressure from various quarters, including traders, political parties and industry, to simplify and rationalise the GST framework. Chocolates, condensed milk, mayonnaise, curry paste, refined sugar and sugar cubes, pasta, chikki, idli-dosa batter, frozen fish, chewing gum, washing powder, shaving cream, blade, shampoo, deodorant, cosmetics, marble, granite, mattress, toothpaste, fire extinguisher, watches and nutritional drinks should become cheaper with the cut in GST rates. The rate on 13 items will be lowered from 18 per cent to 12 per cent , on 6 items from 18 to 5 per cent , 8 items from 12 to 5 per cent and 6 items from 5 per cent to zero. Only 50 items have been left in the 28 per cent bracket that include products in luxury and sin goods category and some with large revenue implications such as tobacco products, automobile, washing machine and air-conditioners. The slab had 228 items earlier. "In order to benefit small businesses and consumers, the council has decided to keep only limited items in the 28 per cent tax slab," Jaitley said. The issues of including real estate in GST and incentivising digital transactions were deferred. The council decided to go beyond the recommendations of the fitment committee that had suggested reduction in rates on fewer items, Jaitley said. Friday's rejig will have a revenue implication of about Rs 20,000 crore, a government official said. West Bengal finance minister Amit Mitra said the move will cost the Centre Rs 60,000 crore and cause a loss of Rs 30,000 crore to states. Traders supplying goods from ecommerce platforms will now not be required to register if their turnover is below Rs 20 lakh, just like their offline peers. The move will ensure a level playing field.


Eating out is set to get cheaper with the council deciding to slash GST rate for the sector to 5 per cent without any input tax credit. Restaurants, at present, face three rates depending on the category they are in. Air-conditioned restaurants face 18 per cent tax with input credit while non-air-conditioned ones pay 12 per cent . The group of ministers looking into the taxation for the sector had recommended 12 per cent tax rate with input tax credit. But some states and the Centre were not in favour of allowing input tax credit. "The council had a long discussion on the issue... Everyone agreed that restaurants that got input tax credit have not passed it on to consumers," Jaitley said. Restaurants inside hotels with room rates above Rs 7,500 per night will face 18 per cent GST with input tax credit and those below this threshold will face 5 per cent without input tax credit.


The council also approved a revamp of the composition scheme to give relief to small and medium enterprises. The threshold of the scheme will now be Rs 2 crore, up from Rs 1crore, which was raised at the previous meeting. This will be a cap provided in the law, but the immediate increase would be to Rs 1.5 crore. Tax rate for those availing the composition scheme will now be 1 per cent irrespective of whether they are traders or manufacturers.

Composition scheme for restaurants will remain with 5 per cent rate. Nontaxable goods will not be counted towards payment of tax under the scheme. The scheme offers lower compliance and less paperwork. Composition scheme has been opened up for the services sector, but it can be availed of only by those who provide services up to Rs 5 lakh. Companies with turnover up to Rs 1.5 crore have been allowed quarterly filing of returns. The simple form GSTR 3B has been extended till March 31, 2018.

 Source: Economic TImes

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Year after note ban, no jobs for educated or illiterate in Delhi textiles


For the last eight months, Babita Singh has been searching every lane and bylane of the 2-sq-km spread of the Noida Hosiery Complex, here on the grimy edge of India’s capital, for a tailor’s job. She leaves home at 7 am and walks around till 11 am when, with the first shift in place, there is no longer any hope of being called into a factory. “Look, my chappals have worn thin,” said Singh, 30, pointing to her feet. Giving up is not an option. There is nothing left for her or her family of four in Bulandshahr, their hometown in western UP that they left seven years ago in search of a better life. In March this year, the small garment unit where Singh worked for six years shut down in the wake of demonetisation, the scrapping of 86% of India’s currency, by value, on November 8, 2016. There were thousands like her, pleading for jobs at the gates of around 300 factories in the complex or sitting around in groups, hoping for a job tip from passers-by. Aimed at making the economy less cash-reliant, demonetisation came as a body blow to the readymade garments sector, 80% of which made up of informal units that operated with cash and casual labour, as reported in December 2016. IndiaSpend

About 1.5 million jobs were lost during January-April 2017 in the immediate aftermath of demonetisation, according to this analysis by the Centre for Monitoring Indian Economy, a business information company. There have been 35% to 55% job losses in manufacturing and trade since November 2016, according to data collected by the All India Manufacturers’ Organisation (AIMO) as the reported on November 8, 2017.Indian There are no clear figures on how many workers have lost their jobs due to the crisis in the unorganised apparel sector. But informal jobs, with little or no social security or benefits, constitute around 92% of all employment in India, as per government data. And the textile industry is the second largest non-farm employer in India. Singh–and thousands of other semi-literate, mostly unskilled workers employed as tailors, packers, helpers and cutters–have been hit hardest by demonetisation. They usually earn around Rs 350 for a day’s work. “I was offered a job with an eight-hour schedule this morning for Rs 6,000 a month,” said Yadesh Kumar, a migrant worker from Etawah in western UP. “I have a family of five, how will I cope?”

Many workers, like Yadesh Kumar (in yellow), had opened bank accounts to facilitate cheque payments but now find that there are no jobs to give these accounts any meaning.

Many workers opened bank accounts after demonetisation to allow employers to make cashless payments. But with no jobs for the few thousand workers–100,000, the local reckoned–wandering the hosiery complex, there is no money to put in these accounts.

Just when it seemed that cashless systems were falling into place by the middle of 2017, the complex Goods and Services Tax (GST) arrived as a second big blow. The tax system demands that companies in a supply chain are linked to one another, but it is too complex for this largely unorganised sector. “40% of workers reportedly lost their jobs, but now hopes of recovery are receding. Dhandha uth hi nahin paya (the business couldn’t get back on its feet),” said a manager at a export house in Noida. The distress visible on the streets of the factory complex was evident in the wake of demonetisation, when “Business is down by 40% in the Noida-Greater Noida region. My calculation is that about 50-70 units have shut down here in recent months,” said Lalit Thukral, executive member of the Apparel Export Promotion Council and head of the Noida Apparel Export Cluster. “Around 8,000 small garment businesses of the total of 10,000 in the country are gasping for breath now.” This is happening not just in Noida. In Tirupur, the hosiery hub in western Tamil Nadu, too businesses are down by over 40%, the reported on November 3, 2017. Surat, the textile centre in Gujarat, is in turmoil. And in Gurugram, at the eastern end of the National Capital Region from Noida, former garment units on prime real estate are being let out. Business Standard demonetisation Triple whammy: Competition from Asian rivals, and GST

Last year when demonetisation hit the apparel sector, it was already stressed by competition from other Asian nations, such as Bangladesh, Vietnam, Cambodia, Sri Lanka and Myanmar. The contribution of apparels to exports of especially Bangladesh and Vietnam rose 6.1% and 9.6% respectively in 2015, the second to China among apparel exporters, is giving Indian businesses a particularly rough time. Economist Intelligence Unit, a think tank, reported on February 3, 2016. Bangladesh, now only

apparel sector Nearly 80% of businesses in the consist of small scale units that employ casual labour.

“We are simply not productive or organised enough to deal with this competition. And then we bring in something like demonetisation and Canadian model of GST into the industry,” said a mid-scale vendor for top western brands. Speaking on condition of anonymity, he said he shut down one of his two factories with 100 machines and 150 workers last year and is now downsizing further. In the long term, he pointed out, cashless payments and GST could bring good things to the industry–formalisation of a largely unorganised sector, more transparency, less inspector raj and the corruption that goes with it. “But in the immediate future it is going to wipe out an entire generation of businesses,” he said.

‘No jobs for men or women, illiterate or educated’

The apparel sector, as we said, provides work for men and women with low of no skills from primarily rural areas in Uttar Pradesh and Bihar, where their last occupation was either agricultural labour and small-scale farming.  Some said they had not held down jobs for a year now.

LETTER  Workers like Enashi Devi are being turned away at gates by factory managers who cite GST as the reason for the downturn.

“Woh bole rahein hain DST (sic) hai, naukri nahin milegi (they say there are no jobs because of DST–meaning GST). Look at the mobs of people searching for jobs, it makes me dizzy. Whether you are a man or a woman, educated or illiterate like me, there is no hope for any of us. Bura haal hai (things are bad),” said Enashi Devi, who had been doing the rounds of Noida the first day of every week in the hope of landing a job as a helper.

Feeder businesses struggle to cope

Equally impacted are the jobbers who run the micro businesses feeding the industry. These are complex chains of small but critical enterprises such as dyeing, embroidery, printing and zip-making, all finding it hard to comply with the GST. With earnings between Rs 30,000 and Rs 50,000 a month, they are struggling to make sense of it all.

Nayagaon, a shanty that is part village and part city, off the Hosiery Complex, houses Durga Dyers. This two-man operation runs out of a room next to a buffalo stable. Its owner, Anil Bansal, is a “local” dyer–someone who can dye small bits of fabric or yarn, the kind of assignment no big business in dyeing will take on.

Small feeder businesses like this dyeing unit running out a one room tenement in Nayagaon, off Noida Hosiery Complex, are finding it hard to deal with the complexities of GST.  He earns around Rs 50,000 in the peak season and has just acquired a GST account. But he cannot handle its complexities since he is not computer literate, so he now hires the services of an accountant. “It is tough but we are managing somehow,” he said.  Not many can afford an accountant’s fees–anywhere between Rs 5,000-Rs 10,000 on average–on such profit margins as small as Rs 15,000-20,000. They opt instead for cash payments to work around GST. “Capital is getting blocked like this because it is hard to claim returns when the entire supply chain is not GST compliant,” said Thukral. To add to the crisis, the sector is furious with the government decision to slash the duty drawback on exportable garments from 7.5% to 2% from October 1, 2017. This drawback is a relief given to businesses by way of refund of custom and excise duties on inputs used in manufacture of exported goods and it allowed the garment industry to stay competitive.  Thukral predicted the closure of another 20% units in Noida if the industry does not rally around to take orders for the next season.  “Iske baad toh bas ek hi kaam rah gaya hai–haath mein katori leke bheek mangna (there is only one alternative left after this, to beg),” said Singh, the job seeker we met at the start of this story, as she gave up her search for the day.

Source:  Business Standard

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Textile Sector Skill Council Receives Champion Skill Council Award from Shri Arun Jaitley, Honourable Finance Minister

New Delhi: Shri Arun Jaitley conferred the award, “Champion Sector Skill Council”to Textile Sector Skill Council (TSC) for its outstanding work in establishing skill-training ecosystem for Textile & Handloom industry. Shri Sanjay Kumar Jain, Chairman and Dr J V Rao, CEO of TSC received the award. The same was awarded in a function to commemorate the 3rdFoundation Day of Ministry of Skill Development and Entrepreneurship (MSDE), GoI, on 9th Nov 2017 Shri Dharmendra Pradhan, Hon’ble Minister of Petroleum & Natural Gas and MSDE, Mr. Kenji Hiramatsu, Ambassador of Japan to India, Ms. Chanda Kochhar, MD & CEO, ICICI BANK LTD., Dr. K.P. Krishnan, Secretary and Smt. Sunita Chibba, Senior Adviser, MSDE, graced the function. The award was constituted by MSDE for the best performing skill council among the 40 sector skill councils jointly established by GoI and various industries to meet the ambitious mission of empowering Indian youth with skill training and employability. TSC over the last 3years has established industry recognized training eco system for 67 job roles, which constitutes to 80% of workforce employed by the industry. It also certified more than 1,300 trainers, who are capable to provide both class room and on-job training as per national occupational standards. Till date, about 400 textile mills are affiliated to TSC and have adopted the training ecosystem developed by TSC to train about 40,000 fresh trainees. TSC also facilitated to organize RPL programs and certified about 65,000 handloom and powerloom weavers of 17 states including NE and J&K. These programs helped some of the weavers in availing Pradhan Mantri Mudra Loan to become 1st generationentrepreneurs. These programs also helped a few Manipur weavers to get connected to European buyers.

Source: TSC Press Release

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India, Canada seek to put free trade pact in fast lane

India and Canada will make efforts for expeditious conclusion of a Comprehensive Economic Partnership Agreement on goods and services at the annual ministerial dialogue starting here tomorrow, said an official statement. A high-level delegation led by the Canadian International Trade Minister Francois-Philippe Champagne is visiting India to attend the 4th Annual Ministerial Dialogue (AMD). The Indian delegation will be led by Commerce and Industry Minister Suresh Prabhu. In the current round, India and Canada will be focusing on some of the key commercial drivers to enhance bilateral partnership, the release said. "Efforts would be made to work towards the expeditious conclusion of the Comprehensive Economic Partnership Agreement (CEPA) for a progressive, balanced, and mutually beneficial agreement covering both goods and services," it stated. India-Canada merchandise trade stood at USD 6.13 billion in 2016-17, down 1.87 per cent from the previous year. The negotiations for the agreement were launched in November 2010 to boost bilateral trade and investments. According to the release, considering the high potential for bilateral trade, the trade ministers of both countries are likely to discuss issues to explore ways of expediting the early conclusion of the CEPA and the Foreign Investment Promotion and Protection Agreement. "They would also explore options for Indian interests in addressing the Temporary Foreign Workers Programme of Canada, which is affecting the movement of Indian professionals seeking short-term visas, address equivalence by the Canadian Food Inspection Agency for Indian organic product exports and exploring two-way investment opportunities," it said. Though geographically separated by a long distance, the historical ties between the two countries date back to the late 19th century when Indians began migrating in small numbers to British Columbia in Canada. Canada now has over 1.2 million Persons of Indian Origin (PIOs), comprising more than 3 percent of its population. "Though India's commercial ties with the US have seen an upswing in the last few years, trade and investment relations between India and Canada are yet to realise their full potential," the release said. Given enormous complementarities, a concerted effort to boost bilateral trade and investment from both sides would provide a fruitful outcome, it added.

Source: Money Control

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Tamil Nadu slips in attracting investments in textiles

Tamil Nadu, the major textile producing State in the country, seems to be a not so attractive destination anymore for the textile industry. According to data available, between 2011 and 2016, Tamil Nadu received just 8 % of the investments under the Technology Upgradation Fund scheme. The top States that saw investments under the scheme were Gujarat, Punjab, and Maharashtra. Till 2007, almost 60 % of the investments under the scheme used to be in Tamil Nadu. The industry started slowing down on investments since the power cut problem, said a textile industry representative here. States such as Gujarat, Telangana, and Maharashtra have come out with several incentives in the textile policies and thus attracted investments in their States. Investments in the last two or three years in Tamil Nadu is mainly towards modernisation. “Tamil Nadu continues to have 47 % of the country’s spinning capacity. We are having regular discussions with the State Government for the textile policy and even met the Chief Minister recently regarding it. We have requested the Government to support value addition, such as textile processing,” said P. Natarajan, chairman of Southern India Mills’ Association. Textile associations are also urging its members to invest in value addition, he said. Further, less than six lakh bales of cotton is produced in the State while the textile industry needs 120 lakh bales a year. This was also highlighted to the Government. The textile sector is looking for support from the Government towards upgrading looms, textile processing, technical textiles, and for common effluent treatment plants. In the last two years, smaller brands have come up in Tirupur in products such as leggings and basic wear. These are also companies with annual turnover of Rs. 50 crore to Rs. 100 crore. In the next five to 10 years, some of these might evolve as national brands, he added. The State Government recently sanctioned Rs. 25 lakh to conduct awareness programmes on technical textiles, he said.


Source: The Hindu

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Cotton arrivals pick up, CCI intervenes to stabilise prices

With cotton arrivals picking up in all major cultivation centres, the Cotton Corporation of India (CCI) has started purchases in places where the market price has equalled the Minimum Support Price (MSP). According to CCI-director (marketing) M.M. Chokkalingam, the corporation is purchasing approximately 15,000 bales a day now. “The plan is to buy 100 lakh bales this year at both MSP prices and [through] commercial purchase,” he toldThe Hindu. Production is expected to exceed 385 lakh bales of cotton this year and prices are expected to come under stress especially for Shankar 6 (grown in Gujarat), Bunny/Brahma varieties (Andhra Pradesh, Telangana, Maharashtra, and Karnataka). “The arrivals are nearly one lakh bales a day now. The prices are already down and will drop drop further when the arrivals touch two lakh or 2.5 lakh bales a day by the end of this month,” he said.

Moisture concerns

Trade sources here added that the cotton that is coming to the market now has slightly higher moisture content, especially in Telangana and Andhra pradesh. Purchases by textile mills may be impacted if the moisture content is high. The minimum support price for Shankar 6 is Rs. 4,270 a quintal and for BB varieties, Rs. 4,320 a quintal. The market price of Shankar 6 is Rs. 10,545 a quintal and that for BB varieties, Rs. 10,798 a quintal. Last year, market prices had been higher. The MSP is not adequate and Gujarat has announced a bonus price over the MSP if CCI commenced purchasing. Maharashtra and Telangana are also expected to announce a bonus amount if there is intervention by the CCI, the sources said. Mr. Chokkalingam added that in 2014-2015, CCI had purchased 86 lakh bales. Last year, its intervention in the market was not much as prices were high.

Source: The Hindu

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Centre urged to direct CCI to purchase poor quality cotton

The Bharatiya Janata Party State unit has requested the Central Government to take steps for purchase of poor quality seed cotton from farmers through the Cotton Corporation of India (CCI). The BJP expressed concern over the heavy losses suffered by farmers due to prolonged dry spell and subsequent untimely rains in October. Cotton crop was damaged on more than 85,000 hectares in 21 districts, affecting more than 92,000 farmers. The total sown area in the State this year was 19.07 lakh hectares as against the normal sowing area of 16.76 lakh hectares, and 60% of the total sown area is rain-fed. BJP State president K. Laxman submitted a memorandum in this regard to Union Agriculture Minister Radha Mohan Singh who was in the city on Sunday. The State BJP president accompanied by senior leaders G. Kishan Reddy and others briefed the Union Minister on the plight of cotton farmers at the party’s State headquarters this evening. He told the Minister that the rain affected cotton had moisture content to the tune of 15% to 20% while the CCI procures cotton with moisture content of eight to 12% in the normal course. With the CCI not taking market intervention measures, private traders are purchasing cotton paying less than Rs. 3,000 a quintal, which is much lower than the minimum support price of Rs. 4,320 declared by the Central Government. The Minister was therefore requested to pass necessary instructions to the CCI to purchase cotton from farmers paying the MSP of Rs. 4,320 a quintal even if the moisture content is beyond the prescribed norms. The BJP State unit also requested the Centre to set up separate statutory board for Turmeric at Armoor in Nizamabad district. Setting up of the Board would go a long way in value addition, grading, preservation and marketing, besides providing farmers with access to latest technologies. In a separate memorandum to the Union Minister, he requested the Minister to categorise turmeric under commodities rather than commercial/cash crop besides abolishing futures trading of the commodity. Turmeric cultivation should be covered under Pradhan Mantri Fasal Bima Yojana and farmers should be provided with interest-free loans from nationalised banks against their produce, he said. In addition, the Centre should take steps to supply high yielding variety of turmeric seed to farmers at reasonable prices and provide 25% subsidy on exports, Dr. Laxman said. The Union Minister, he said, responded positively to the requests and assured appropriate action into the issue soon. Private traders are purchasing cotton paying less than Rs. 3,000 a quintal.

Source: The Hindu

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RIL to push polyester biz with RElan

Mukesh Ambani’s Reliance Industries (RIL) is to increase its presence in the polyester space after the launch of its new brand, RElan, through which it will get into co-branding of apparel. The largest manufacturer of polyester in the country, it has an annual capacity of 2 million tonnes (mt), almost half the country’s 4.5 mt. The firm expects 5 per cent yearly growth in this segment. China, with 45 mt manufacturing capacity out of 70 mt globally, is much ahead of India. For RElan, the new portfolio of speciality fabric, the firm has tied up with VF Corporation of America, owner of the world’s largest denim brand, Wrangler, to launch by the coming February the Inficool denim range. “We are in talks with at least five leading domestic and international apparel brands to co-brand with the RElan brand. The co-branding will give RIL a foothold in the Rs 250,000-crore Indian apparel industry, almost a 50-50 share of menswear and womenswear,” said a senior firm official. The move might help to reduce India’s fabric import, averaging 500 million sq metres, valued at $1.2 billion, in each of the past three years. The industry estimates a little more than 90 per cent of the fabric is from China, with the rest from Malaysia, Indonesia and South Korea. “The move will help India to reduce dependence on import of speciality fabrics, especially from China,” said the official. Global per capita consumption of polyester is 6 kg per person, compared to 3 kg per person in India and 11 kg in China. It is the other way round in cotton, with India’s per capita consumption at 54 kg per person versus 18 kg in China and a global average of 28 kg. India’s textile industry contributes 14 per cent of industrial production, 6 per cent of GDP and 17 per cent of export earnings. “We are expecting (yearly) growth of around 5 per cent for India in the polyester industry, much higher than the global average of 3 per cent. We are planning to tie up with 200 textile manufacturers, giving focus to Punjab, Haryana, UP and Rajasthan, which account for 20 per cent of India’s fabric production capacity and manufacturing textiles worth Rs 50,000 crore annually,” said the official.


Source: Business Standard

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Global Crude oil price of Indian Basket was US$ 62.66 per bbl on 10.11.2017

The international crude oil price of Indian Basket as computed/published today by Petroleum Planning and Analysis Cell (PPAC) under the Ministry of Petroleum and Natural Gas was US$ 62.66 per barrel (bbl) on 10.11.2017. This was higher than the price of US$ 62.40 per bbl on previous publishing day of 09.11.2017.In rupee terms, the price of Indian Basket increased to Rs 4073.51 per bbl on 10.11.2017 as compared to Rs. 4049.46 per bbl on 09.11.2017. Rupee closed weaker at Rs. 65.01 per US$ on 10.11.2017 as compared to 64.90 per US$ on 09.11.2017. The table below gives details in this regard:



Price on November 10, 2017 (Previous trading day i.e. 09.11.2017)

Crude Oil (Indian Basket)


   62.66                         (62.40)


  4073.51                   (4049.46)

Exchange Rate


   65.01                         (64.90)


 Source : PIB

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Exhibition of textile machinery spares from November 17

Southern India Mills’ Association will organise the 11th edition of textile machinery, accessories and spares exhibition here from November 17 to 20. Chairman of the association P. Nataraj told presspersons on Friday that nearly 250 participants will display machinery, spares, accessories, testing equipment, etc in 300 stalls. The participation this year is nearly 20 % more than the previous edition. The organisers expect business enquiries to the tune of Rs. 500 crore. Apart from exhibitors from different parts of the country, companies from Italy, China, Japan, and Switzerland will also take part. As a concurrent event, a farm-to-finish expo will also be organised with about 50 companies showcasing cotton, fibres, yarn, made-ups and garments. The exhibition at CODISSIA Trade Fair Complex will be open from 10 a.m. to 6 p.m. and entry is free for textile stakeholders. Nearly one lakh visitors are expected. Since the industries can purchase their requirements under one roof, this has become part of the exhibition calendar for many participants, said the organisers. Hence, the response this year had been good. Further, the industry does not expect any negative impact because of GST on investments. There is not much clarity yet on GST procedures. However, it is not expected to affect investments, said Mr. Nataraj. The exhibition will be inaugurated by Sanjay Jayavarthanavelu, Chairman and Managing Director of Lakshmi Machine Works, on November 17.

Source: The Hindu

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ASEAN signs free trade, investment pacts with Hong Kong

MANILA: ASEAN ministers inked free trade and investment pacts with Hong Kong on Sunday (Nov 12) on the sidelines of the 31st ASEAN summit. The trade agreement - a much-anticipated culmination of nearly three years’ worth of negotiations - is aimed at eliminating or reducing tariffs, liberalising trade and services, and establishing rules to promote confidence in trade. The investment agreement will cover the protection, promotion and facilitation of investment. The agreements are expected to come into effect by January 2019 and "strengthen economic relations between ASEAN as an integrated market and Hong Kong as one of the world’s leading trade and investment powerhouses", and stimulate economic development in the region, ASEAN ministers said in a joint statement. The deals are expected to benefit Hong Kong -  a separate jurisdiction from China - after the city was not included in a free trade agreement (FTA) between ASEAN and China in 2010. Hong Kong’s commerce and development secretary Edward Yau said on Sunday at the signing ceremony: “In the face of protectionist sentiments in other parts of the world, these two agreements are in fact a loud and clear vote from all of us here for freer and more open trade." ASEAN ministers noted the growing economic relations between ASEAN and Hong Kong: Hong Kong was ASEAN’s sixth largest trading partner in 2016, while ASEAN as a bloc was Hong Kong’s second largest trading partner. Based on ASEAN statistics, merchandise trade between Singapore and Hong Kong in 2016 was valued at US$93.3 billion (S$127 billion), a 1.3 per cent increase from US$92.1 billion in 2015. Total foreign direct investment flows from Hong Kong to ASEAN amounted to US$9.9 billion, up from US$4.1 billion in 2015.


Meanwhile, at the Preparatory Regional Comprehensive Economic Partnership (RCEP) Ministerial Meeting, which was held on the sidelines of the summit, Philippine Trade and Industry Secretary Ramon Lopez reported progress has been made. RCEP is an FTA under negotiation among the 10 ASEAN countries and partners which the organisation has existing agreements with. These countries are China, South Korea, Japan, Australia, New Zealand and India. Speaking at the Marriot Hotel, Mr Lopez said: “We note the milestones and breakthroughs reached, especially those that yielded substantial outcomes like the conclusion of chapters on the economical and technical cooperation in small and medium enterprises." RCEP is of “tremendous importance” to ASEAN economies, he said, adding that intense effort has to be put into providing a concrete and tangible roadmap that leaders will endorse, therefore laying the foundation for a binding agreement. At the previous summit in April, Singapore Prime Minister Lee Hsien Loong said that with ASEAN already having separate FTAs with each of these existing partners, Singapore is of the opinion that there needs to be something more in the RCEP for the package to be “substantial, meaningful” and one that has balance, and benefits for all participants.


Source: Financial Expres

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Pakistan : Cotton imports: Govt turns to non-tariff barriers after higher duties fail

ISLAMABAD: The government’s policy to appease legislators of the ruling party by discouraging agriculture-related imports has come to haunt textile exporters who are now facing new curbs on their raw material imports due to introduction of non-tariff barriers. The textile sector had recently won some concessions from the government but it is again knocking the door of cabinet members. The importers face a new challenge in the shape of restrictions on import of cotton – their basic raw material that – is in shortage in Pakistan. For the last many years, the country is meeting cotton needs by importing the commodity from India and Brazil, as local production is not sufficient to meet total requirements. For the current fiscal year 2017-18, the federal government has estimated cotton production at 13.6 million bales against a total requirement of around 14.3 million bales.

Women pickers toil unprotected in cotton fields

But cotton cultivation remained at only 6.8 million acres, which is 88% of the target and would result in farmers missing the production target by at least one million bales. Despite the deficiency, the Ministry of Commerce issued a notification that placed new restrictions on cotton imports along with 580 other items. This time, the government has chosen a time-tested technique to discourage millers from importing cotton, after imposition of duties and taxes could not stop the cotton imports. In the name of containing the growing import bill, the government has heavily targeted agriculture-related imports by introducing non-tariff barriers (NTBs). The import of cotton linters will be subject to valid import permit, valid phytosanitary certificate and plant protection release order of Department of Plant Protection of the Ministry of National Food, Security and Research. As per the new restrictions, the Plant Production Department will issue import permits that will allow only one shipment and will not cover partial shipments under one permit, according to a complaint that Diamond International Corporation Limited registered with All Pakistan Textile Mills Association (Aptma).

Before introduction of the NTB, the millers were allowed to import the commodity in more than one shipment against one permit, depending upon the availability of cargo and better prices. The millers want the government to continue with the old arrangement of issuing import permits for cotton imports covering partial shipments to avoid unnecessary delays that will also increase costs. Cotton is not the only commodity that the PML-N government has targeted. It has also imposed similar NTBs on imports of onions and tomatoes. Both commodities are in shortage in the local markets and their prices have skyrocketed, affecting almost every household. Textile ministry opposes duty on cotton import. This has been done to appease a group of Members of National Assembly of the PML-N that the government cannot afford to annoy due to the precarious political situation, said an official in the Ministry of Food and Agriculture. But politicking carries huge implications for every household besides the possibility of hurting textile exports that are already struggling due to a high cost of doing business. Exports have slightly picked in recent months on the back of concessions announced by the government. But these benefits may erode due to high cost of doing business. Because of pressure from a group of legislators, the government also seems to be backtracking from its promise of lifting 9% taxes on duties that it had reintroduced earlier this year in the name of encouraging the farmers to grow cotton. A delegation of the Aptma on Saturday met with Food and Agriculture Minister Sikandar Bosan and requested him to lift the duties with effect from January 2018. The minister showed his inability to meet the demand despite making a promise, said an office bearer of Aptma. The government charges 4% customs duty and 5% sales tax on imports of cotton. Despite levying of these duties and taxes, the imported cotton is roughly 16% cheaper than the locally produced cotton which is a big source of attraction for the textile millers.

In addition to introducing certification requirements, the federal government also imposed restrictions on import of Indian and Brazilian cotton in May this year. The cost of energy may also go up for the industries after National Electric Power Regulatory Authority’s decision to increase electricity tariffs by roughly Rs1.50 per unit. Prime Minister Shahid Khaqan Abbasi is expected to approve the increase next week. Compared with roughly Rs11 per unit cost in Pakistan, energy is available at Rs7 per unit in Vietnam and India – the two main competitors of Pakistan. Same is the situation in case of RLNG that costs Punjab-based industries $11 per mmbtu.


Source: The Express Tribune

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Turkmenistan to build cotton mill in north-eastern province

The country’s Ministry of Textile Industry assessed the proposals of bidders. Hilli Yup Economic Entity deals with the design, construction and equipping of a new cotton mill. After the cotton mill is commissioned, 6,000 tons of cotton yarn will be produced annually. Turkmen President Gurbanguly Berdimuhamedov stressed that the textile industry is one of the priority directions of the processing sector of the Turkmen economy. "Big investments, made in textile industry, stimulate the growth of production of high-quality cotton products, having a huge demand among foreign consumers," the president said. Focusing on the importance of building new industrial facilities for the economic development of districts, where new jobs will be created, the president pointed to the need to strengthen control over the work in this direction. More than one million tons of cotton is grown annually in Turkmenistan, which is the raw material base for the development of the textile industry. Up to 70 percent of the raw materials are processed in the country. At present, Turkmenistan produces up to 118,000 tons of cotton yarn, 178 million square meters of fabrics, 11,000 tons of knitted fabric, 7,200 tons of terrycloth.

Source: Azer News

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Expensive garments manufactured in Eastern Europe's cheap labor factories

Many garment workers in Eastern Europe, such as those seen here in a Serbian textile factory, complain of suffering under exploitative and abusive labor practicesTwo garment factory workers recount stories about the dark side of the textile industry. "I told the supervisor I couldn't breathe near this machine. It is already 30°C in the factory, and if we work at near the machine it would be much hotter," says worker from a textile factory in Serbia. In response, the supervisor turned the machine's exhaust pipe to direct the fumes in the faces of the seamstress and her co-workers, and said, "That's your problem, and if you can't deal with it, there are enough people waiting to take your place! The door's over there!" Another worker reveals: "Management asked us to raise money to buy a blood pressure monitor because they themselves will 'treat' us and will not call a doctor if we faint. The two women have asked to remain unnamed - like everyone else who had the courage to describe working conditions in the Serbian textile industry for a study conducted by Clean Clothes Campaign (CCC), an international organization dedicated to improving working conditions in the garment industry. Many Serbian workers are scared of losing their jobs as they are considered to be the lucky ones for getting a job in the private sector in a country where the overall unemployment rate is 16 percent and 30 percent for young people. In Serbia, the well-paid jobs are in state institutions and hiring is based on connections and political affiliation.

Workers treated as slaves

Textile industry workers in particular are forced to accept inhuman working conditions and the tyranny of arrogant superiors in an industry predominantly owned by foreign stakeholders who manufacture clothing for the Western European market. An atmosphere of fear prevails: There are constant threats of dismissal and workers are denied part of their statutory minimum vacation, if they are even allowed to take it at all.

"Female workers report that they are treated like machines or like slaves, not like human beings. They are yelled at  sexual harassment is part of everyday life," says Bettina Musiolek, the CCC coordinator for Eastern and Southeastern Europe. This all happens in jobs that pay less than a country's minimum living wage and expect many hours of unpaid overtime. The legal minimum wage in Serbia is 278 euros per month, but a family of four needs at least 652 euros a month to make ends meet. The women who work in the textile industry earn an average of 202 euros a month and 227 euros a month in the leather and shoe industries. The sector employs around 100,000 people in Serbia, which is the equivalent of about eight percent of the country's workforce.

From rags to riches

The idea of farming seems today more abstract than ever before. Jost Franko's latest photo essay brings this distant world back to our reality, in which the ridiculous price of garments is paid by workers living in dire conditions. Pictured here is a relative of Issa Gira (67) from Burkina Faso, who's been growing cotton for 30 years, but still earns less than a dollar a day.

A low-wage paradise in the heart of Europe

Garment industry conditions in the new emerging economy, Serbia, are no different than in other low-cost manufacturing countries. "For global fashion brands, countries in Eastern and Southeastern Europe are low-wage havens," conclude the authors of the study. Well-known retailers, like H&M, Benetton and Esprit, or even luxury brands like Louis Vuitton, Prada and Versace manufacture their expensive products in low-cost factories. The European sweatshops are known for their cheap but experienced and qualified workers. As a rule, the companies pay the workers – the majority of whom are women – the statutory minimum wage, which ranges from 89 euros a month in Ukraine to 374 euros a month in Slovakia. In order to secure a family's livelihood and enable it to meet its basic needs, wages would have to be four to five times higher. Even upscale brands like Dolce&Gabbana are interested in building production lines in Eastern Europe

Consumers are being misled

Many brands have "Made in Europe" or "Made in EU" written on their labels, thereby suggesting that the garments have been produced under fair conditions, while "in reality, many of the region's 1.7 million garment workers live in poverty," reveals the CCC study. "Sometimes we just don't have anything to eat," said a woman in a textile factory in Ukraine, while a worker in Hungary said, "Our wages are just enough to pay for heating and utilities."These conditions are only possible in a pro-employer environment. "It is essentially a union-free zone. No one represents the workers' interests effectively," says Musiolek. Governments also provide foreign companies with direct and indirect subsidies. In Serbia, for example, businesses are given high subsidies, plots of land below market price or even for free, tax breaks and free infrastructure in many cases. In addition, governments "set very low minimum wages," Musiolek points out. Serbian President Aleksandr Vucic and Yumtobel CEO Ulrich Schumacher break ground on the company's new factory in the southern Serbian town of Nis

Conditions reminiscent of early capitalism

Stefan Aleksic, one of the authors of the study, told DW that an economic race is underway in Southeastern Europe. "Many poor countries surround Serbia and everyone is fighting for the same investments. A climate of competition has emerged: Who will offer foreign investors better conditions for cheap manufacturing?" explains Aleksic. The result is devastating. "The state funds the retention of a backward economy." Despite everything, the Clean Clothes Campaign does not call for a boycott of the companies involved. "The workers keep telling us, 'We need these jobs.' They have to be paid properly and working conditions must be adjusted to meet EU standards," says Bettina Musiolek. But there is still a long way to go. "First of all, the unions need more support. These conditions, reminiscent of early capitalism, and the weakness of labor market actors are shocking."


Source: Deutsche Welle

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Cambridge scientists incorporate circuits into fabric

Scientists from the UK, Italy and China have been able to incorporate washable, stretchable and breathable electronic circuits into fabric, opening up new possibilities for smart textiles and wearable electronics. The circuits were made with cheap, safe and environmentally friendly inks, and printed using conventional inkjet printing techniques.
The researchers, from the University of Cambridge, working with colleagues in Italy and China, have demonstrated how graphene -- a two-dimensional form of carbon -- can be directly printed onto fabric to produce integrated electronic circuits which are comfortable to wear and can survive up to 20 cycles in a typical washing machine.
The new textile electronic devices are based on low-cost, sustainable and scalable inkjet printing of inks based on graphene and other two-dimensional materials, and are produced by standard processing techniques. The results are published in the journal Nature Communications.  Based on earlier work on the formulation of graphene inks for printed electronics, the team designed low-boiling point inks, which were directly printed onto polyester fabric. Additionally, they found that modifying the roughness of the fabric improved the performance of the printed devices. The versatility of this process allowed the researchers to design not only single transistors but all-printed integrated electronic circuits combining active and passive components. Most wearable electronic devices that are currently available rely on rigid electronic components mounted on plastic, rubber or textiles. These offer limited compatibility with the skin in many circumstances, are damaged when washed and are uncomfortable to wear because they are not breathable. "Other inks for printed electronics normally require toxic solvents and are not suitable to be worn, whereas our inks are both cheap, safe and environmentally-friendly, and can be combined to create electronic circuits by simply printing different two-dimensional materials on the fabric," said Dr. Felice Torrisi of the Cambridge Graphene Centre, the paper's senior author. "Digital textile printing has been around for decades to print simple colorants on textiles, but our result demonstrates for the first time that such technology can also be used to print the entire electronic integrated circuits on textiles," said co-author Professor Roman Sordan of Politecnico di Milano. "Although we demonstrated very simple integrated circuits, our process is scalable and there are no fundamental obstacles to the technological development of wearable electronic devices both in terms of their complexity and performance." "The printed components are flexible, washable and require low power, essential requirements for applications in wearable electronics," said PhD student Tian Carey, the paper's first author.  The work opens up a number of commercial opportunities for two-dimensional material inks, ranging from personal health and well-being technology, to wearable energy harvesting and storage, military garments, wearable computing and fashion. "Turning textile fibres into functional electronic components can open to an entirely new set of applications from healthcare and wellbeing to the Internet of Things," said Torrisi. "Thanks to nanotechnology, in the future our clothes could incorporate these textile-based electronics, such as displays or sensors and become interactive."
The use of graphene and other related 2D material (GRM) inks to create electronic components and devices integrated into fabrics and innovative textiles is at the centre of new technical advances in the smart textiles industry. The teams at the Cambridge Graphene Centre and Politecnico di Milano are also involved in the Graphene Flagship, an EC-funded, pan-European project dedicated to bringing graphene and GRM technologies to commercial applications. The research was supported by grants from the Graphene Flagship, the European Research Council's Synergy Grant, The Engineering and Physical Science Research Council, The Newton Trust, the International Research Fellowship of the National Natural Science Foundation of China and the Ministry of Science and Technology of China. The technology is being commercialised by Cambridge Enterprise, the University's commercialisation arm. (SV)

Source : Fibre2Fashion

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TMAS set to expand in Vietnam textiles industry

Textile Machinery Association of Sweden (TMAS) is all set to explore opportunities in the Vietnam textiles industry. The member companies of TMAS who are well-established leaders in various areas of the textile manufacturing process, are all set for expansion in Vietnam. The companies have a unique combination of production expertise, and superior services. Tran Phuoc Thanh, business development representative for TMAS in Vietnam, has also gathered insights into the industry and undergone training in Sweden, from the Swedish textile machinery makers and their customers. "TMAS is positioned for long-term in Vietnam. The country is emerging as the new global production centre of textile products. We want to be part of this exciting growth and expansion. We believe we have a lot to offer in terms of our knowledge, expertise and innovative technology," said Mikael Äremann, president, TMAS. The textile industry is growing dramatically and Vietnam has been identified as a hub for the Asian textile industry in the next decade. The main reason for this is the increasing cost levels in China, causing many textile and garment brands to relocate in Vietnam. In fact, TMAS companies in Sweden have already started realising a notable increase in demand for their products and services "TMAS companies are the perfect match for the Vietnamese textile industry. We are a relatively small, tight-knit group of companies, each specialising in a different key area along the manufacturing process. Our size allows us to be flexible. We work closely with our customers, we listen and adapt quickly to their changing needs as and when they respond to market demands," emphasized Therese Premler-Andersson, secretary general, TMAS. It has been estimated production in the Vietnamese textile and clothing industry will increase by an average of 12-14 per cent between 2016-2020. Export is also expected to reach $50 billion by 2020, rising from $28 billion in 2016, a company press release said. “TMAS is reflective of Sweden’s reputation for reliability, quality and world leading technology. R&D is important and TMAS companies have a solid track record for ensuring their customers achieve long-term profitability and growth. Building smart, sustainable solutions is in our DNA, and we will definitely meet the drive for innovation in Vietnam,” added Andersson. "I look forward to enabling TMAS to be a key driver of success for Vietnam, and through Vietnam to the region, and the world," Thanh concluded. The member companies will be showcasing their innovative products and services at the textile machinery exhibition that is scheduled to be held in Ho Chi Minh City, beginning from November 22. (RR)

Source : Fibre2Fashion

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Colombia's European machinery show ends successfully

The first European roadshow of 14 textile machinery manufacturers, that took place on October 18, 2017 in Bogota, Colombia, and the following day in Medellin, ended on a successful note. The textile machinery companies showcased their latest technologies and various seminar sessions, that helped textile mills to upgrade to state-of-the-art operations. With more than 100 Colombian textile producers attending, it exceeded the expectations of the organisers, the Belgian (SYMATEX), French (UCMTF), Spanish (AMTEX), and Swedish (TMAS) textile machinery associations.
The organisers were particularly thankful to ALCOTEX (the Colombian Association of Textile Techniques and Professionals and of Dressmaking) and ANDI (the Colombian association of entrepreneurs) which helped organise and promote the events.
The event format included a 15 minutes presentation by each machinery manufacturer. In parallel, a mini fair was held where they showed animated videos of their machinery running at client’s sites and showcased textile samples produced on their equipment. They were available to develop business cases and personalised technological solutions. The four associations are very satisfied with this result and will continue to explore the format and collaborate among the European Textile Machinery Associations to showcase the latest technology to different markets. The machinery manufacturers who presented their knowhow and latest technologies include Bonas, Canmartex, Dollfus & Muller, Escarre, Gomplast, Icomatex, Industrial Sagarra, Iro, Laroche, N. Schlumberger, Petit Spare Parts, Picanol, Tacome, and Van De Wiele. Elias Junker, Laroche area sales manager said, “Our strategy is to be our customers’ partners and not only machine suppliers, that’s why we need to meet them at the highest possible level, face to face. This enables us to understand their needs and offer them the best possible technologies and machines with which they will be able to design new products, open new markets in a very productive, reliable, cost effective and sustainable way. This roadshow has been very effective. We met long-time customers and made new contacts. We will certainly meet again with the executives we have met, in international shows or on their own premises.”

Source : Fibre2Fashion

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Pakistan : Problems of textile sector to be resolved: State Minister

State Minister for Commerce and Textile Haji Muhammad Akram Ansari said on Sunday that his ministry had compiled a summary regarding the problems facing by the textile sector which would be submitted before the national assembly to pave way for immediate relief and sustained growth of this important segment of national economy.
Addressing members of All Pakistan Textile Processing Mills Association (APTPMA) here, he said that he was fully conversant with the issues of textile sector and was trying from day first to resolve the same.However, many of these issues are linked with other ministries and in order to settle down these, he will arrange meetings of the representatives of textile sector with the high officials of these ministries.
He said that he had already brought the issues of delay in refund-claims and abuse of discretionary powers by tax officials into the notice of Special Assistant to Prime Minister on Revenue Haroon Akhtar who had assured that the issues would be addressed on top priority basis. Regarding local level issues, he said that he would have a meeting with Chief Commissioner Inland Revenue tomorrow. He has requested MNAs Mian Abdul Mannan and Chaudhry Nisar to join him which would also be attended by the representatives of textile sector.Similarly, another meeting with deputy commissioner Faisalabad would also be arranged to resolve the issues relating to environment, social security and Punjab Revenue Authority, etc.
Responding to a question about Gas Infrastructure Development Cess (GIDC), the minister requested the Chairman APTPMA to nominate 2-3 representatives so that he could arrange their meeting with the concerned authorities to settle down these issues amicably. “No doubt government is focusing on enhancing exports but the issues of local industry would also be taken care-off”, he said.
In his welcome address, Chairman APTPMA Khalid Habib Sheikh underlined the problems confronted by the textile processing sector and said that high cost of doing business, GIDC, sales tax on import of coal, turn over tax, withholding tax and refund issues had shattered the profitability of this sector.
He said that smuggling of cloth was yet another threat to this value-added and laborer intensive industry. He demanded a separate electricity tariff for the textile sector.
He also demanded to withdraw the notification for banning import of cotton and yarn. Later, APTPMA shield was presented to State Minister Haji Muhammad Akram Ansari.—APP

Source: Pakistan News

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China is becoming new engine of world economy:German entrepreneur

China is now the new engine of global economic growth, and the sound economic growth in China is conducive to the world at large, a German entrepreneur told Xinhua in a recent interview. Frank-Jurgen Richter, founder and chairman of Horasis, an international consultant firm, said on the sidelines of a two-day forum held in Sheffield, a city in South Yorkshire, earlier this week that "I think China is now, we can easily see, becoming the new engine of growth" in the world economy. "I think the Chinese economy is doing very well," he said, voicing his full confidence in the future of China's economic development following the successful conclusion of the 19th National Congress of the Communist Party of China (CPC) in October. Richter noted that the blueprint laid out at the just-concluded CPC national congress "is now very much about focusing on innovation, on the entrepreneurship, and the green economy," and "more focused on quality growth." "Chinese companies now are taking the world lead, they are innovative, they are the vanguards, they are not longer just copying the technology about 10 to 15 years ago, which was very natural at that time," he said. But now they are at the front of the (world's advanced) technology. Just think about companies like Huawei," he said. Technologies Co Ltd, a Chinese multinational networking and telecommunications equipment and services company headquartered in Shenzhen in southern China, is the world's third biggest smartphone maker which continued to expand its presence in the high-end segment. "It is the new China, and it is the reason that I am so bullish on China's economy," Richter said. "In the past, the world economy was still dominated by the US, and partly by Europe, maybe by Japan, but all those old markets are rather weak," he said. "And even though Europe is recovering, the US is recovering; the real leader is now with China." "So China is doing well, and the whole world is doing well. And that's the reason I think we should all support the Chinese economy," he said, adding that "we should join hands" to boost the healthy economic progress in China and other parts of the world. "Today's companies have to cooperate across industries, across national boundaries," he said. "Chinese companies are very open, are very global, and we see the rise of Chinese brands -- the global brand of Chinese origin." Richter cited what he described as "very famous household brands" produced by Lenovo, Xiaomi, Hisense, Didi and Alibaba, saying: "It is like a new trend, Chinese brands are getting very famous." On the back of technological prowess and good value, an increasing number of Chinese companies, including Huawei, Lenovo, Gree, Xiaomi and drone maker DJI-Innovation, have gained foothold in the international market, paving the way for a wave of global Chinese brands. "I think the Chinese government is very pro-business," Richter said. "It is not a protectionist." "I think it is also inviting foreign companies to come to China," he said. The forum, known as the 2017 Horasis China Meeting, was organized by Richter's organization. Introduced by Horasis in 2005, the meeting has become one of the foremost global business gatherings on China. Present at the forum were about 300 businessmen, scholars and government officials from such countries as China, Britain, the United States, France, Germany, Belgium, the Netherlands, Russia, Saudi Arabia, India, Mozambique and Haiti. Richter, born in 1967, is a German entrepreneur and currently the chairman of Horasis. He has served in that role since he founded the organization in 2005.

Source: China Daily.

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