The Synthetic & Rayon Textiles Export Promotion Council

MARKET WATCH 28 NOV 2017

NATIONAL

INTERNATIONAL

Textile exporters unhappy with MEIS enhancement as incentives remain low

DGFT has enhanced the rates under the MEIS from 2% to 4% on RMG and made-ups from November 2017 to June 2018. Despite government's decision to promote Merchandise Exports from India Scheme (MEIS) and Remission of State Levies (RoSL) for textile sector, textile exporters said they continue to witness a shortfall of 2.7 per cent in incentives compared to pre-GST era. In a notification on Saturday late evening, Centre said post-GST rates of RoSL rose to maximum of 1.70 per cent for cotton garments, 1.25 per cent for MMF yarn, silk and woolen garments and 1.48% for apparel of blends. "Rates are upto a maximum of 2.20 per cent for cotton made-ups, 1.40 per cent for MMF yarn and silk made-ups and 1.80% for made-ups of blends. For sacks and bags made of jute, the rate is 0.60%. The RoSL rate for garments under AA-AIR combination is 0.66 per cent," the notification said. These rates shall be effective from October 1, 2017. Further, DGFT has enhanced the rates under the MEIS from 2% to 4% on RMG and made-ups from November 2017 to June 2018. For MEIS, Rs 1,143.15 crore was allocated for 2017-18 and Rs 685.89 crore in 2018-19. This is to boost exports and employment generation in the labour intensive textiles and apparel sector, government said. Exports dropped due to the acute competition from countries that enjoy duty free access in EU and other markets. Since the transitional provision of pre-GST drawback rates and RoSL benefits were extended only up to September, RMG exports reduced by 40 per cent during October 2017, lowest in the past 42 months. Ashok G Rajani, chairman, Apparel Export Promotion Council said: "Disappointed with ROSL rate as it is far below our recommendations and central taxes rebate has not been considered at all. Trade is in a dire state".M Rajashanmugham, president of Tirupur Exporters Association said the industry is witnessing a shortfall of 2.7 per cent in incentives compared to the pre-GST era. P Nataraj, chairman of the Southern India Mills' Association (SIMA), said that enhancing MEIS benefit has given some relief to the industry. "The industry was expecting at least 2-3% increase in the RoSL rates considering the various embedded / blocked taxes of Central & State levies," he added. He hoped the government would consider the remaining embedded taxes while announcing revised duty drawback rates to ensure the same level of competitiveness that the industry had when the special export garment package was in force. "The drawback and RoSL rates notified by Centre are only interim relief as these benefits have not considered various embedded taxes and also inverted duty on fabric stage," Nataraj said. Nataraj also urged Centre to announce the new rates of Duty Drawback without any further delay with effect from October 1, so that the financial stress caused to the exporters could be minimised during this critical juncture.

Source: Business Standard

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Textile exports may fall 10-15% in FY18 following paring of tax exemptions

India’s textile exports are likely to decline by 10-12 per cent for the current financial year due to the reduction in tax exemptions granted to exporters, appreciation in the Indian rupee against the dollar and shifting of import orders to competing countries. In an alarming situation, India’s readymade garments exports, which are part of textiles segment, declined by 41 per cent in October to Rs 5,398 crore ($830 million) compared to Rs 9,111 crore ($1.4 billion) in the corresponding month last year. Exports of manmade yarns, fabrics and made-ups also declined by 8.3 per cent to Rs 2,310 crore for October 2017 from Rs 2,518 crore in the same month last year. India’s overall exports of locally made retail and lifestyle products have grown at a compound annual growth rate (CAGR) of 10 per cent during FY2012-13 to FY2015-16, mainly led by bedding bath and home decor products and textiles. The government set a target for textile and garment sector exports at $45 billion for FY2017-18 as against total exports achieved worth $38.6 billion and $40 billion for FY2016-17 and FY2015-16, respectively. The decline in exports of readymade garments indicates India’s failure to grab global market share, especially when the world leader China (around 42 per cent of global market share) has ordered shut down of a number of textile units due to environment concerns. Indian textile exporters are working hard to grab the space which China tends to vacate. But, unfavourable government policies with reduction in overall duty exemptions may push Indian exporters on the back foot, say industry experts. “India’s overall textiles exports are likely to decline by at least 10-15 per cent this year due to the reduction in overall tax exemptions. While the government has increased the Merchandise Exports from India Scheme (MEIS), the Remission of State Levies (ROSL) remains far below our recommendations. Unfortunately, the government did not consider central tax rebate at all. Overall, textile exporters are witnessing a shortfall of 2.7 per cent in incentives now compared to the pre-Goods and Services Tax (GST) era. Also, appreciation in the rupee has hit exporters’ receivables,” said Ashok Rajani, chairman, Apparel Exports Promotion Council (AEPC). The Directorate General of Foreign Trade (DGFT) in a recent notification raised MEIS rate from 2 per cent to 4 per cent on readymade garments and made-ups for exports between November 2017 to June 2018 through allocation of Rs 1,143.15 crore and Rs 685.89 crore for 2017-18 and 2018-19, respectively. Also, Union Textile Ministry has recently announced the Solar Energy Scheme for small power loom units, on grid solar photovoltaic plant (without battery backup) and off-grid solar photovoltaic plant (with battery backup), where the government will provide Rs 250,000 subsidy for setting up one plant. “This will help the unit to pay back bank loans within 3 - 4 years, after which the unit shall get practically free electricity,” said Kavita Gupta, textile commissioner, Ministry of

Textiles while inaugurating buyer-seller meet here today.

Looking at various schemes and incentives offered to boost the textiles sector, the government has set a target for India’s overall apparel exports at $20 billion for FY 2017-18 against the actual exports of $16.8 billion for FY 2016-17. However, Rahul Mehta, president, Clothing Manufacturers Association of India (CMAI) believes that the export target for 2017-18 is not achievable and is likely to remain at the last year’s level. Rajani said that overseas importers are shifting orders from India to Bangladesh, Cambodia, Vietnam because of preferential treatment being given to these countries. Interestingly, cost of production in these countries is also lower because of cheap electricity.

Source: Business Standard

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Indian textile sector's cautious optimism on govt decision

The Indian textile industry has expressed cautious optimism on the government decision to raise the incentive under the Merchandise Exports from India Scheme (MEIS) for readymade garments and made-ups and notify post-goods and services tax (GST) rates on their exports under the scheme for remission of state levies, saying it will address declining exports. The textile industry organisations include the Confederation of Indian Textile Industry (CITI), Tiruppur Exporters’ Association (TEA) and the Coimbatore-based Southern India Mills’ Association (SIMA). The commerce ministry recently enhanced the export incentives to 4 per cent from 2 per cent for the garment and made up sectors under MEIS. Similarly, under the scheme for remission of state levies (RoSL), the government has increased the refund of state levies by an average of 0.5 per cent. However, the notified drawback and RoSL rates are only interim relief as these benefits have not considered various embedded taxes and inverted duty on fabric stage, according to SIMA. Both SIMA chairman P Nataraj and TEA president Raja M Shanmugham urged the government in separate press releases to announce the new duty drawback rates without further delay with effect from October 1 to minimise the financial stress of exporters. Several garment and made-ups exporting units have already curtailed their production to the tune of 20-30 per cent rendering several lakhs jobless, Nataraj said. Nataraj is hopeful that the government would consider the remaining embedded taxes while announcing the revised duty drawback rates and ensure the same level of competitiveness that the industry had under special export garment package to enable exporters to retain existing customers and remain competitive in the global market. Noting that the exports of readymade garments had declined by 39 per cent to $829 million in October 2017, CITI chairman Sanjay K Jain said yarn and fabric, which have also witnessed a steep fall in exports, have not been given any relief. Even in garments and made-ups, the overall incentives and refund of duties on exports is still about 3 per cent less than pre-GST levels, he added. (DS)

Source: Fibre2Fashion

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Revised RoSL on readymade garments - made ups fail to cheer the sector, MSMEs say much more needs to be done

New Delhi, Nov 27 (KNN) In an attempt to address the garment sector comprising of a fair share of Micro, Small and Medium Enterprises (MSMEs) over the stress under the new taxation and fall in exports, the government recently announced revisions in the rate of MEIS as well as RoSL, this however has failed to cheer the sector. Talking to KNN, Animesh Saxena, a leading MSME exporter of garments said that there is utter dissatisfaction among the MSMEs as the new revisions still stand less as compared to what it used to be under the pre-GST era. Saxena said that according to the new announcement the RoSL touches 1.7 per cent whereas earlier it used to be around 3.7 per cent. He further said that even if the sector was to consider both the revisions and add it up, still there exist a margin of over 4-5 per cent as compared to the previous taxation, thus adding burden on the cost of production. Saxena said that with the delay in publishing the data over exports of different sector, this too hints that the government is aware of the possible slowdown. There have been several representations made both to the government and the GST Council but there have not been any positive step from the government so far. With regard to the way forward, Saxena said that the last resort for the sector could be to bank upon the duty drawback and the government must fix that to help the sector survive. Earlier the Ministry recently announced that the rates of RoSL are upto a maximum of 1.70% for cotton garments, 1.25% for MMF, Silk and Woolen garments and 1.48% for apparel of blends. It further informed that the rates are upto a maximum of 2.20% for cotton made-ups, 1.40% for MMF and silk made-ups and 1.80% for made-ups of blends. For sacks and bags made of jute, the rate is 0.60%. The RoSL rate for garments under AA-AIR combination is 0.66%. (KNN/DA)

Source: Knn India

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Crisil's urges focus on labour-intensive sector's issues as exports fall

At a time when global trade is set to accelerate, the fall in India's export is disquieting and structural changes in labour-intensive sectors such as apparels and jewellery need to be undertaken fast, rating agency Crisil said on Monday. "Global merchandise trade is expected to grow stronger at 4.2%, boosting trade intensity of growth for the first time in six years i.e. world trade growth being higher than world GDP growth. Yet, India's exports have not been able to take as much advantage of the stronger trade growth unlike many of its Asian peers like Vietnam, South Korea and Indonesia." a note released by the firm said. The International Monetary Fund (IMF) also recently pointed out that it expects global growth of trade to rise to 3.6 per cent in 2017 from 3.2 per cent in 2016. However, the Federation of Indian Exports Organizations has pointed out that almost Rs 50,000 crore worth of refunds under the Goods and Services Tax regime are still stuck with the government, leading to a massive blockage of capital. Exporters have also said that only about Rs 350 crore of refunds on account of integrated GST (IGST) have been released by the government for July, against Rs 750 crore claimed by exporters. Besides, the input tax credits, which form a chunk of GST refunds, are yet to be released. Responding to growing opposition by exporters, the government last week announced greater export support to items in the garment and the home furnishings sector under the Merchandise Exports from India (MEIS) and the Remission of State Levies. "The enhancement in MEIS rates will help in the fulfillment of orders for the Christmas festival as it will result in easing the blocked capital. It will help in the mitigation of the currency difference to some extent. However the Industry is disappointed over the announcement of the RoSL as the rate is far below than what the Industry has recommended and there has been no consideration of the central taxes rebate in the announcement. The Industry is witnessing a slowdown with jobs being lost and buyers migrating due to high cost." AshoK G Rajani, Chairman of the Apparel Export Promotion Council said. However, Crisil has pointed out that subdued export performance in recent months cannot be attributed to unfavorable currency competitiveness. In fact, a relatively stable rupee and improving global growth suggest that domestic developments might have had a greater role to play in the current export growth slowdown - in particular the disruption caused by GST regime. This is evident in the low export growth in sectors such as gems and jewellery, textiles, and leather which are incidentally also the most labour-intensive sectors, Crisil pointed out. It further said employment may be hit as a result in these sectors. But while disruptions due to GST are transitory in nature, a senior Crisil economist pointed out. The revealed comparative advantage (RCA), or the competitiveness of these labour intensive sectors, has been on a sequential decline. Case in point, the 2006-2016 decade saw RCA markedly diminish for three of these sectors, he added. The latest disruptions, earlier on account of demonetisation and now due to GST, might have pushed the competitiveness of these sectors further to the brink, Crisil has said. It added that even though disruptions related to policy changes are transitory, the structural issues plaguing these sectors need to be addressed in order to boost their competitiveness in the global market.

Source; Business Standard

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Indian textile and garment companies looking for opportunities in Vietnam

Indian companies are looking to cement ties with Vietnamese counterparts in the textile and garment sector. A business to business meeting between Vietnamese and Indian companies took place recently in Ho Chi Minh City. Shailesh Martis—director of Cotton Textiles Export Promotion Council of India— said that Vietnam has emerged as a leading global exporter of garments and is constantly on the look-out for high-quality cotton textiles, including cotton yarn and fabrics. The Vietnamese textile and clothing industry has set an ambitious yet attainable export target of $30.5 billion for 2017. “Vietnamese importers are therefore keen on looking at alternative sources for raw materials. The Indian exporters of cotton textiles are eager to meet any gap within the Vietnamese cotton textile supply chain,” he said. According to K. Srikar Reddy, Consul General of India, there is huge trade potential in the area of textiles and garments between the two countries. The Indian textile industry has developed a complete product supply chain. The country is also one of the primary suppliers of high-quality materials and fabrics at competitive prices in the world. “As Vietnam is looking to diversify its material suppliers in the textile segment, this offers a great opportunity for mutually beneficial co-operation between Indian and Vietnamese enterprises,” he said, noting that enhancing bilateral economic engagement is a strategic objective and textile and garments has been identified as a priority sector for co-operation. The delegation of nine Indian companies has also attended the 17th Vietnam International Textile & Garment Industry Exhibition from November 22-25 at Saigon Exhibition & Convention Centre in Ho Chi Minh City. The delegation showcased cotton, high-quality woven, knitted, and denim fabrics, as well as home textiles. Beside Indian companies, the expo also features 400 exhibitors from 14 countries and regions. The strong presence of foreign exhibitors underscores the high internationalisation of this mega event as well as the attractiveness of the Vietnamese textile and garments sector. Despite US' withdraw from the Trans-Pacific Partnership (TPP), international investors have remained optimistic about Vietnam’s market potential on the back of the country’s stable economic growth.  According to the latest statistics released by the Ministry of Planning and Investment's Foreign Investment Agency, the Vietnamese textile and garments sector scored $14.58 billion in outbound shipments in the first six months of 2017, representing a significant annual increase of 11.3 per cent.

Source: VietNamNet.

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New business models of textile value chain discussed at the GSBS 2017

17th November'17, Mumbai: The largest convergence of the sporting industry in India, The Times Of India Global Sports Business Show 2017 on its 2nd day focused on ISPO academy and the textile value chain. The Chief Guest of the day, Mr. J M Balamurugan, IAS, Secretary - Sports and Youth Services, Government of Punjab addressed the state of sports in the country. Laying emphasis on the growth in this segment, he said, "Given that we are a country of 1.3 billion people, there is a huge scope for sports revolution. The solution to improve is complex, multi-dimensional, multi-pronged yet possible. The efforts need to begin at the base level; at schools. Another factor that needs emphasis is financial security for the sportsperson, we need to create gainful employment for them post retirement." Talking about the sustainability development goals 2030 and their implementation with the textile value chain, Mr. Reiner Hengstmann, Go4More, Stuttgart, Germany highlighted the 17 goals structured by the UN. Mr. Hengstmann added, "Sustainability and business must work hand in hand. It's the need of the hour that companies and brands look for sustainable solutions and for consumers to be more aware about what and how of the making of the product. We need to move from linear business model to circular model where the motto is make-take-recycle." Addressing the options and risks of digitalization for the textile industry, Mr. Anton Schuman, Ghezri Textile Organization, Zurich, Switzerland, said, "Traditional value chain is changing due to digitalization; the driver being the consumer; digitalization has enabled the industry to create realities that were unthinkable at some point. He advised the delegates to innovate, adapt digitalization, change the point of view and do it with passion and write history." Present at the show Yavuz Mogul- Verwegener & Trefflich, Leipzig, Germany, said, sustainability is the biggest challenge in sport business and the ways to tackle are communicate, educate, be transparent and digitalize. Sharing his plans for Andhra Pradesh, Dr. N Bangara Raju stated that he wants to make 60% of Andhra Pradesh's people sports active by the year 2029. Navdeep Sondhi, Gherzi Textile Organization, shared, according to a survey the global textile, apparel consumption was 90 million tons in 2016. The future of textile apparel consumption market will be India and China due to rapid growth in disposable income and younger population. In a fire chat session Harit Mehta, MD, Haren Textiles, discussed the challenges that Indian companies faces , the need for digitization and working with the supply chain. The evening saw some interesting presentations and case studies by Linz, Austria, Sanjay Kumar and ended by session by Robert Schroots, S2R, and Geneva Switzerland.

About ET Edge

Times Conferences Ltd., functional under the brand name ET Edge, is an Economic Times initiative founded to empower multiple industries and segments by sharing critical business knowledge through exhibitions, strategic conferences and summits. Encompassing the Indian business vista, ET Edge strives to bring together visionaries and key leaders on its knowledge platforms to create social and business ecology conducive to the positive changes required by the industry. The main aim of this initiative is to channel global business intelligence through expos, summits and conferences in overarching lectures, hands-on workshops, panels, roundtables, face to face meetings and case studies.

Source: The Economic Times

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For exporters, GST whips up more storm in a tea cup

GST is not as “simple” as was it perceived, but “complex and complicated”, feel tea exporers.“And it’s not just about tax refunds. The relaxation given to exporters vide certain notifications will not work due to the conditions laid down for claiming exemptions. “Further, due to the peculiar nature of the trade, it is impossible to fulfil some of the conditions,” said Dipak Shah, Chairman, The South India Tea Exporters’ Association (SITEA). When asked to explain, he said: “Given the nature of the trade, the procurement of tea is through public auctions, and from multiple sellers. We subsequently mix these teas to create blends for specific export markets. “The issue starts here. Condition (V) of GST notification 41/2017 says that ‘a registered recipient shall place an order with a registered supplier for procuring goods at concessional rate and a copy of the same shall also be provided to the jurisdictional tax officer of the supplier’. As the teas are bought at auction (pan India), how can the exporter place a prior order? Our contention is when the buyer places a bid on the auction platform, it should be presumed as an order to buy. But they say that it cannot be accepted under GST. This is absurd, considering that 70 per cent of the teas are routed through auction.” “Further, how would it be possible for the buyer to provide copies to the jurisdictional tax officer of the supplier in a pan India auction, as the seller might not be from this region,” Shah asked. There is yet another condition, vide notification 41/2017, which says that the recipient should indicate the GST Identification Number of the seller plus the tax invoice number in the shipping bill or bill of export. “This is a laborious process as the teas are bought from 30-40 sellers to make a specific blend. The paperwork demanded is mind boggling. First, there is no space for such an exhaustive report in the shipping bill. But the commissioner says, ‘put it in addendum’. It does not end there. We have to disclose the identity of each supplier in the shipping bill, which is tantamount to revealing the unique composition of the blends. This is a trade secret, which each of us would like to safeguard. Commissioners agree with our viewpoint; it stands there,” lamented Shah. He said that SITEA representatives took up the issue with the GST Commissioners at Coimbatore, Chennai and Kolkata as also the Tea Board, but a solution remains elusive. More trouble confronts merchant traders with the government extending the returns filing date; traders say they are unable to get refund of the taxes paid. “Over ₹100 crore has been stuck with the government as the refund mechanism is still not in place, even after three months of GST implementation. We are now thinking of sourcing working capital requirements from private financiers as we have exhausted bank limits. The interest burden will be huge, but we will honour our commitments,” the SITEA Chairman said.

Source: Business Line

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CBDT relaxes norms for MAP & APAs

The income tax department will continue to receive applications for bilateral advance pricing agreement (APA) and mutual agreement procedures (MAP) from companies despite the absence of a particular clause — corresponding adjustment — in the double taxation avoidance agreement (DTAA) with the countries concerned, the Central Board of Direct Taxes (CBDT) said on Monday. The clarification would likely encourage more MAPs and provide consistency in the country’s direct tax regime, experts said. APAs and MAP are tools of alternative tax dispute resolution mechanism in matters involving transfer pricing. The ‘corresponding adjustment’ clause in transfer pricing matters provides that if tax demand is raised on a company by a DTAA-signatory country, the revenue authorities in India would reduce the tax liability of the parent company based in India. “Clarification of India’s position on DTAAs where Article 9(2) (corresponding adjustment) was absent is certainly a welcome news and strengthens the government’s resolve of fostering a non-adversarial tax regime. This will open the gates for many bilateral APAs and MAP cases. This sends out a positive signal and assures India Inc’s resolve to counter the pending litigation in an efficient manner,” Nitin Narang, executive director of transfer pricing at Nangia & Co, said. The CBDT was responding to several references received by it on the issue. Although OECD has clarified in its model convention on tax treaties, which is the basis of transfer pricing agreements, that the absence of ‘corresponding adjustment’ in DTAAs doesn’t stop two contracting states to apply the provision, CBDT had earlier said the absence of the clause would mean the benefit can’t be extended to companies and hence MAP applications couldn’t be accepted” it has been decided to accept transfer pricing MAP and bilateral APA applications regardless of the presence or otherwise of Paragraph 2 of Article 9 (or its relevant equivalent Article) in the DTAAs,” CBDT said.

Source: Financial Express

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Govt's subsidy schemes, tech upgradation to aid 2.5 mn ailing powerlooms

The government has introduced subsidy schemes to provide financial assistance of up to 90 per cent under the Pradhan Mantri Credit Scheme for powerloom weavers. Under this scheme, the government will provide margin money subsidy of up to 20 per cent of the project cost with a ceiling of Rs 100,000 as well as interest subvention at six per cent per annum for working capital and term loan up to Rs 10,00,000 for a maximum period of five years. The government has also introduced technology upgradation plan — Sustainable and Accelerated Adoption of efficient Textile technologies to Help small Industries (SAATHI) — for India's ailing powerloom sector. “This initiative is expected to benefit almost 2.5 million powerloom units across India, which produce 57 per cent of the total cloth in the country. The use of efficient equipment would result in energy savings and cost savings to the unit owner who would in turn repay in instalments to EESL (Energy Efficient Services Limited) over a three- to four-year period,” said Ujwal Lahoti, chairman, Cotton Textiles Export Promotion Council (Texprocil). The schemes provide for powerloom units to not only upgrade their technology, but also to install solar power equipment to cut energy costs. After repayment of bank loans in three-four years post installation of efficient technology, the cost of electricity for powerloom units will become virtually zero, say experts. “The Union Textile Ministry and state governments have announced several promotional schemes for powerloom textile industry, but there is hardly any awareness of the schemes in the industry. The maximum benefit of these schemes has been taken by the entrepreneurs of Gujarat and Tamil Nadu. The solar energy scheme for small powerloom units will help the unit to pay back bank loans within 3-4 years. After this initial repayment period however, the unit shall get practically free electricity,” said Kavita Gupta, Textile Commissioner while speaking on the occasion of the buyer-seller meet in Mumbai. Of the 2.5 million powerlooms, 50 per cent are in Maharashtra. There are 108 powerloom clusters in the country and 72 textile parks. While welcoming the increase in the Merchandise Exports from India Scheme (MEIS) from two-four per cent, Lahoti urged the government to include cotton yarn under this scheme and also increase the MEIS on cotton fabrics from two to four per cent. “While every other segment in the textile value chain, including man-made fibre spun yarn, has been provided with the MEIS benefits, cotton yarn has been excluded for some inexplicable reason, even though it was included in the Focus Market Scheme (FMS), Incremental Export Incentive Scheme under the earlier Foreign Trade Policy. At present, there are no benefits extended to the export of cotton yarn under the Foreign Trade Policy,” Lahoti said. The spinning sector with its huge investments is presently passing through difficult times and is losing market share to Vietnam and Indonesia due to increasing costs. Withdrawal of the export incentives for cotton yarn has reduced India’s competitive edge as local prices have increased by 5-6 per cent. Increase in exports of cotton yarn will benefit not only the spinning sector but also the cotton farmers and the value-added segments of fabrics and made-ups/garment, he added.

Source: Business Standard

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Indian FM supports ease of GST procedure in Surat meeting

Indian finance minister Arun Jaitley is satisfied with the wholehearted support extended by Surat’s industry community, particularly textile traders, to the goods and services tax (GST) initiative. After meeting textile traders there on November 26, he said some genuine industry grievances are mostly procedural in nature and will be resolved with time. Jaitley supported their demand for ease of procedure in the GST regime while briefing the media after the meeting. The industry representatives appreciated Jaitley’s prompt and positive response to their inputs in the past.

Source: Fibre2fashon

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Rupee scales new 2-month high of 64.50, soars 20 paise vs dollar

Showing resistance against early volatility, the rupee today surged by a hefty 20 paise to end at a fresh two-month high of 64.50 against the beleaguered dollar even as S&P kept India's credit rating unchanged. The rupee marked its best closing since September 20. It had tumbled to a low of 64.83 in early trade. In early trade, the rupee resumed almost flat with negative bias at 64.71 from last weekend level of 64.70 in knee-jerk reaction to the S&P rating outcome. But, later drifted sharply to hit a fresh intra-day low of 64.83 on immense dollar pressure before a spirited recovery in mid afternoon deals. After climbing a fresh high of 64.49 towards the tail-end trade, the local unit finally settled t 64.50, revealing a smart gain of 20 paise, or 0.31 per cent. The rupee has appreciated 31 paise last week. The RBI, meanwhile, fixed the reference rate for the dollar at 64.6948 and for the euro at 77.1421. Global rating agency Standard & Poor's on Friday kept its sovereign rating for India unchanged at 'BBB-minus' with 'stable' outlook saying vulnerabilities stemming from low per capita income and high government debt balance strong GDP growth. India's rating reflects its strong GDP growth, sound external profile and improving monetary credibility on reform implementations, S&P said in a statement. The rating stance taken by S&P Global Ratings comes days after Moody's Investors Service raised India's sovereign rating for the first time in over 13 years on growth prospects boosted by continued economic and institutional reforms. Positive vibes created by the global rating agencies on India predominantly injected a new enthusiasm for forex market sentiment, a trader commented. Moreover, improving macro fundamentals and growing expectations of more reforms that will boost long-term economic growth and attract healthy foreign inflows are helping rupee to maintain a strong upbeat trend, he added. Crude prices slipped from two-year highs on prospects for increased output. Brent crude, the international benchmark is trading down 0.52 per cent at USD 63.14 a barrel in early Asian trade. Foreign investors infused over USD 2.6 billion in the country's capital markets this month so far, propelled by government's announcement of recapitalising PSU banks and India faring well in the World Bank's 'ease of doing business index'. Meanwhile, heavy short covering at lower levels along with healthy buying in key financial and banking counters helped the domestic bourses to overcome a spell of early sharp volatility to end with moderate gains despite fragile Asian market sentiment. Extending their uninterrupted winning run for the eighth straight session, the BSE Sensex rose over 45 points to close at 33,724.44, while Nifty added 10 points at 10,399.55. In cross-currency trades, the rupee recouped against the pound sterling to settle at 86.09 from 86.13 per pound and also regained some lost ground against the Japanese yen to conclude at 58.00 per 100 yens from 58.03 last weekend. However, it continued to rule weak against the euro and finish at 77.01 as compared to 76.73 earlier. On the global front, the US dollar reversed the Asian recovery and fell back in the negative territory, hovering at around six-week lows against other major currencies in quiet trade largely impacted by subdued US macro data. Sentiment on the greenback remained vulnerable after last Wednesday's minutes of the Federal Reserve's November meeting amid concerns over inflation outlook. The dollar index, which measures the greenback's value against a basket of six major currencies, was down at 92.59 in early trade. Elsewhere, the common currency euro surged ahead to fresh two-month high against the US dollar earlier on Monday amid speculation that Germany’s main opposition SPD party is mulling another coalition government with Chancellor Merkel’s CSU/CDU bloc. Pound sterling, however, traded little changed after hitting a new 7-week high last Friday amid very positive Brexit talks. In forward market today, premium for dollar declined due to sustained receiving from exporters. The benchmark six-month premium payable in April fell to 114-116 paise from 117-119 paise and the far forward October 2018 contract also softened to 255-257 paise from 256-258 paise previously.

Source: Financial Express

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New body soon to push exports, says Suresh Prabhu

MUMBAI: The government is in the process of setting up a new organisation to promote exports in different geographies of the world, developing global linkages Suresh Prabhu, the minister of commerce and industry, said on Monday. “For the first time, the government is working on creating a new organisation to promote India’s exports globally.We will have offices at least in 10 different geographies, with market research back-up and promotional activity. With a completely different approach, we will work with the private sector on this, so that we can penetrate global markets effectively,” said Prabhu, addressing a CII event. It is not possible for a small businessman to sit in India and do business globally. We want to create support system ... by creating brand equity for India globally. Linkage with global market is necessary for promoting Indian products and we will do that,” he added.

Source: The Economic Times

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Textile division will turn profitable by Q4FY18 or Q1FY19, says Technocraft

We see no particular advantage in demerger, Sharad Saraf, CMD of Technocraft Industries (India) said. Technocraft Industries (India) is in focus after they approved 28 lakh share buyback. In an interview to CNBC-TV18, Sharad Saraf, CMD of the company spoke about the latest happenings in the company and discussed the FY18 outlook. We have re-engineered textile division with Rs 100 crore capex, said Saraf. He further said that textile division will turn profitable by Q4 of FY18 or Q1 of FY19. According to him, textile business will turn EBIT positive from FY19. Saraf expect Rs 500 crore topline from textile business going ahead.

Source : Money Control

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Cotton prices jump 7% on fear of fall in output

PUNE: Cotton prices have jumped 6-7% in a week, as the trade is speculating a big fall in output due to pink bollworm attacks in some states, even though there is little clarity yet on the extent of the damage. “Prices have increased by ?250-300 per quintal last week. From our earlier estimate of 400 lakh bales, the trade expects production to fall to 340 lakh bales,” said Pradip Jain, president of the Jalgaon Ginning and Pressing Association. Concerns about crop quality have also impacted prices. “Of late, instances of rejections of cotton bales by buyers have increased,” said Jain. Various government and trade bodies have undertaken surveys to reassess the crop. A Maharashtra government official, who did not want to be named, said the fall in yields could be 15-20%. Textile commissioner Kavita Gupta said: “Maharashtra has been somewhat more impacted by bollworm. Telangana has also got impacted, while Gujarat has been minimally impacted. Some states like Gujarat have declared bonus above MSP, which will help the farmers.” The Cotton Association of India had pegged India’s 2017-18 cotton production at 375 lakh bales (each 170 kg). Cotton bolls are plucked multiple times and about 70% of the crop has already been harvested. Losses due to pink bollworm were higher during the first pickings. However, now the research agencies have noticed an improvement in quality. Blaise D’souza, head of crop production at the Central Institute of Cotton Research in Nagpur, said: “Timely action taken by farmers by spraying pesticides has improved the condition and the next pickings may be of good quality.”

Source: Economic Times

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Global Crude oil price of Indian Basket was US$ 62.14 per bbl on 24.11.2017

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$ 62.14 per barrel (bbl) on 24.11.2017. This was higher than the price of US$ 61.57 per bbl on previous publishing day of 23.11.2017. In rupee terms, the price of Indian Basket increased to Rs 4022.57 per bbl on 24.11.2017 as compared to Rs. 3989.55 per bbl on 23.11.2017. Rupee closed stronger at Rs. 64.73 Per US$ on 24.11.2017 as compared to 64.79 per US$ on 23.11.2017. The table below gives details in this regard:

Particulars

Unit

Price on November 24, 2017 (Previous trading day i.e. 23.11.2017)

Crude Oil (Indian Basket)

($/bbl)

   62.14                       (61.57)

(Rs/bbl)

  4022.57                   (3989.55)

Exchange Rate

(Rs/$)

   64.73                        (64.79)

 

 Source: PIB

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NIIFT to provide free Industrial Sewing Machine course for underprivileged

The Northern India Institute of Fashion Technology (NIIFT) has set up a skill development and training facility for the underprivileged students which will be used in a free course of the Industrial Sewing Machine Operator. Under the association of NIIFT and Groz-Beckert Asia, NIIFT has provided space for the training facility while Groz-Beckert Asia has offered machinery, equipment, furniture and other related installations including IT peripherals. Additionally, Groz-Beckert Asia will provide necessary financial support for the smooth functioning of the training facility. After completing training, the pass-outs will become employable in the apparel and textile industry. The facility will also help them in finding suitable jobs. The content of the training course has been designed looking at the current and future needs of the industry. The course will be offered to the economically weaker sections for 3 months. The facility was inaugurated by Dr Anton Reinfelder, Managing Director, Groz-Beckert Asia Pvt Ltd and Inderjit Singh, Registrar, (NIIFT) in the Ludhiana campus of NIIFT.

Source: YarnsandFibers

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Cold spell warming sales for apparel companies

While sales in November 2016 were muted on account of demonetisation, most brands say this year November sales are high even after discounting the impact of the note ban. Apparel brands are witnessing 40-60% growth in winter wear salesdue to early onset of winter in north India this year compared to the previous two years that were a virtual washout. Brands are lining their stores up with heavier jackets and sweaters instead of sweat shirts and thin jackets like the last two years. “The sales in November is better than October which was the Diwali month. While the national capital region is growing highest at the rate of 60%, other areas such as Rajasthan, Punjab, Haryana, Himachal Pradesh are also experiencing spike in sales,” said Kavindra Mishra, MD, Pepe India. The brand has included heavy jackets and other items in its collection this year. “If you see the trend so far we should have a good winter this year,” said the chief executive of a global fashion and lifestyle group. He said it sold about 15,000 jackets a week in north India this November compared to about 14,000 a week last year. Some companies are expecting a higher contribution of winter sales to the overall sales. “The contribution of winter wear to total sales could go up this year,” said Alok Dubey, ceo, Lifestyle Brands Division, Arvind Lifestyle Brands, without putting any number. Delhi and north India normally account for 30-40% of fashion and lifestyle retailers’ revenue during the winter months. However, winters for the past two years have been among the warmest, during December to March, in north India which impacted sales of winter clothing by almost 30% forcing retailers to tweak their winter products mix. While sales in November 2016 were muted on account of demonetisation, most brands say this year November sales are high even after discounting the impact of the note ban. On Saturday, Zara outlets to Levi’s stores in the NCR were reporting good numbers for winter items. A Gant outlet in Mall of India in Noida said it has been selling on an average three thick jackets a day since the onset of the cooler weather in north India thanks to snowing in the Himalayas. “All my malls have reported that sales for winter wear have picked vis-a-vis October. It has picked up in November. There is an early winter this time and I anticipate it to pick up even more so,” said Pushpa Bector, head of premium mall division at DLF, that owns malls including Promenade DLF Place and Mall of India among others in the NCR. “Last week there was a spike in sales.” She said this year there has been increase of 20% in winter sales compared to same time last year. Another chief executive of a global brand said this year sweatshirts with large logos of the brands are in vogue. “After three years we are seeing a comeback of sweatshirts with logos,” he said asking not to be quoted. “Winter items sales is massive very high double-digit growth this year,” he said declining to share actual numbers. While the timely onset of winters seems to have given brands the hope to generate a better sell out as compared to the previous seasons where in there was almost a virtual wash out, some fear the trend to start early discounting to spoil the show. “.. considering the lukewarm response in retail industry during the festival season- the higher discounting prevalent in the market may neutralize the possible gain on this front,” said Sundeep Chugh, CEO & MD, Benetton India.

Source: ET Retails

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Global Textile Raw Material Price 2017-11-27

Item

Price

Unit

Fluctuation

Date

PSF

1376.41

USD/Ton

-0.55%

11/27/2017

VSF

2220.51

USD/Ton

0%

11/27/2017

ASF

2676.78

USD/Ton

0%

11/27/2017

Polyester POY

1361.21

USD/Ton

0%

11/27/2017

Nylon FDY

3452.44

USD/Ton

0%

11/27/2017

40D Spandex

6007.56

USD/Ton

0%

11/27/2017

Polyester DTY

1612.15

USD/Ton

0%

11/27/2017

Nylon POY

3239.52

USD/Ton

0%

11/27/2017

Acrylic Top 3D

2813.67

USD/Ton

0%

11/27/2017

Polyester FDY

1711.01

USD/Ton

0%

11/27/2017

Nylon DTY

3650.16

USD/Ton

0%

11/27/2017

Viscose Long Filament

5749.00

USD/Ton

0%

11/27/2017

30S Spun Rayon Yarn

2904.92

USD/Ton

-0.52%

11/27/2017

32S Polyester Yarn

2088.20

USD/Ton

-0.15%

11/27/2017

45S T/C Yarn

2904.92

USD/Ton

0%

11/27/2017

40S Rayon Yarn

3057.01

USD/Ton

-0.50%

11/27/2017

T/R Yarn 65/35 32S

2509.49

USD/Ton

0%

11/27/2017

45S Polyester Yarn

2220.51

USD/Ton

-0.68%

11/27/2017

T/C Yarn 65/35 32S

2463.86

USD/Ton

0%

11/27/2017

10S Denim Fabric

1.42

USD/Meter

-0.11%

11/27/2017

32S Twill Fabric

0.88

USD/Meter

-0.17%

11/27/2017

40S Combed Poplin

1.22

USD/Meter

0%

11/27/2017

30S Rayon Fabric

0.67

USD/Meter

0%

11/27/2017

45S T/C Fabric

0.73

USD/Meter

0%

11/27/2017

Source: Global Textiles

Note: The above prices are Chinese Price (1 CNY = 0.15209 USD dtd 27/11/2017). The prices given above are as quoted from Global Textiles.com.  SRTEPC is not responsible for the correctness of the same.

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 Tex Styles launches new brand campaign for GTP

Tex Styles Ghana Limited, the producer of GTP and other woodin fabrics, has launched a new brand campaign for GTP with a purpose of reinforcing the brand promise of GTP, which is expressed as ‘Timeless Grace’. The purpose is also to strengthen its position as a leading textile manufacturer in Ghana. GTP is Africa’s leading textile and printing brand. “For well over 50 years, GTP has been consistent in its promise of offering consumers premium quality fabrics, timeless designs, and strong heritage that make them look and feel beautiful, proud, confident and to stay in tune with the culture. We can confidently say that GTP has become the second skin of Ghanaians,” commented Rev Badu, marketing director of GTP, at an event held in the company’s premises. Considering the point of view of consumers, the reinforcement of unique value proposition is being done in order to stay true to the GTP brand, added Badu. “The company will embark on the new campaign by utilising cultural attributes and courtesies associated with Ghanaians to demonstrate to the rest of the world the sociable and hospitable nature of Ghanaians and by so doing inspire others to do the same,” he further said. “We know Ghanaians are quite gracious by virtue of the cultural upbringing. Through this campaign, we want to encourage Ghanaians to teach more, share more, innovate more, celebrate more and love more. All these virtues inspire positive change and growth.” GTP brand is a joint venture of Tex Styles Ghana Limited and Premium African Textiles Company Limited. These companies are responsible for the creation of designs, printing, distribution and marketing of the GTP brand.

Source: Fibre2fashion

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Chinese textile firms turn to biomass fibre production

Hismer Bio-Tech Co. Ltd. in China's Shandong province is making biomass fibre from shrimp and crab shells, a pioneering effort to produce synthetic fibres from products not derived from crude oil. Qingdao-based BMSG, a bio seaweed substance processing firm, has been turning seaweed into biomass fibre that can be safely used for surgical dressings. Hismer turns shrimp and crab shells from food waste to chitosan fibre, indistinguishable from other synthetic fibres. The fabric is used for making socks, underwear, bedding, medical products like masks and sanitary pads, and special cloth used in aerospace planes, according to company chairman Hu Guangmin. BMSG’s fibres are processed further into surgical dressing. Hismer annually collects 10,000 tonnes of the shell waste from seafood processing companies in China's ports of Qingdao, Yantai, Dalian and Ningbo to produce 6,000 tonnes of biomass fibre. The company has turned the world's largest marine renewable producer, according Chinese news agency report. After facing trouble in the past due to rising cost at home and stagnant export market, five years back the company focussed on developing this technology. Hu said Hismer has set up production cooperation with 70 companies, including Toyota, Freudenberg and Medovent, for developing fabric products for medical use. It also makes product development in partnership with Taiwan-based tech firm BenQ and Hong Kong-based lingerie producer Embry Form.The company has developed materials that are mildew-proof and resistant to fire, static electricity and odor used in China's ‘Shenzhou’ manned spacecraft and ‘Tiangong’ space lab. Though at an initial stage, biomass textile materials are the future of textiles, Jiang Shicheng, a member of Chinese Academy of Engineering, said.

Source: Fibre2fashion

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China to cut import duty on 187 items, including apparel

China will cut import tariffs on 187 items, including food, pharmaceuticals, garments and recreational products, from December 1 to lower costs and stimulate domestic consumer spending. After the cut, tariffs on the products, which include cashmere clothing, will average 7.7 per cent, down from the current 17.3 per cent, according to the finance ministry. High taxes on imports have raised prices of foreign brands in China pushing consumers to spend more overseas. As people’s consumption demands rise, the tax cuts will benefit the choices available to consumers inside China and help upgrade the domestic supply system, Chinese media reports said quoting a ministry statement.

Source: Fibre2fashion.

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German Technology Successfully Met US and Mexican Textiles and Nonwovens

Frankfurt, Charlotte, Mexico City, 27 November 2017 – The VDMA Textile Machinery Association has accomplished successful events for the textile industries in the US and Mexico. More than 80 decision-makers of the US textile, nonwoven and carpet industry as well as 25 leading textile machinery and accessories manufacturers participated in the VDMA textile machinery conference on November 6 in Charlotte (NC). The following two-day event on 8-9 November in Mexico City attracted nearly 450 customers and 30 textile machinery and accessories manufacturers, making it one of the most successful events of the VDMA Textile Machinery Association ever. “In the light of the high number of participants and the intensity of the discussions regarding concrete investment intentions, the VDMA events have been a big success for our company”, explains Hermann Selker, Head of Marketing, Trützschler. The conference in Mexico City was addressed by José Cohen Sitton, president of the National Chamber of the Textile Industry CANAINTEX: “German textile machinery and engineering are one of the best in the world", he stated. Sitton added that the Mexican textile industry has to invest in order to be on top of technology no matter what the outcome of the ongoing NAFTA negotiations will be. Whereas these two events focused on customers, the training session at the Instituto Politécnico Nacional (Escuela Superior de Ingeniería Textil) in Mexico City on November 10 aimed at future engineers. About 500 textile engineering students followed the technical presentations from 18 textile machinery and components manufacturers. The company delegates also visited the machinery department of the faculty. The VDMA's contribution to improve the education of future customers was very much appreciated. Commenting on the training session, Arturo Arauzo, Director of the Escuela Superior de Ingeniería Textil, said: “The visit and the technology presentations of the well-known German machinery companies were very well received by our students and by the staff. We see this visit as the beginning of a partnership between our institute and the German textile machinery industry.” In the US and Mexico, the VDMA member companies presented their latest production technologies from spinning to dyeing and finishing. Major topics addressed were digitalization of the textile and textile machinery industry (Industrie 4.0 / industrial internet), higher efficiency and profitability, energy, water and material savings, new applications with growth potential, such as composites and nonwovens, higher quality with measurement, control and testing devices, technical training centres. Information on the two events, speakers and content is available on the websites: www.germantech-ustextile.de and www.germantech-mextextile.de. In 2018, the VDMA Textile Machinery Association will be supporting sales and marketing of the member companies through trade fairs (German pavilions), own technical conferences & B2B as well as official trade missions in the following countries: Indonesia, India, USA, Belarus, Brazil, Uzbekistan, Iran, China, Egypt.

Source: Press Release

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Pakistan : FBR assures textile sector 100pc examination of second hand clothing import

At the recent meeting held among Special Assistant to Prime Minister on Revenue, Haroon Akhtar Khan, FBR and textile sector at Lahore. FBR team tried to resolve all issues raised by the industry on the spot. FBR to curb mis-declaration and all rolled-back sales tax refund payment orders (RPOs) in April 2017 have been re-issued to accommodate maximum refund claimants. FBR assured textile sector 100 percent examination of second-hand clothing imports. Authorities also agreed to grant customs duty exemption on the import of heavy generators through issuance of an SRO in coming days. FBR team also assured the industry to examine the issue of refund on packing material used in export goods. Industry highly appreciated role of FBR team particularly Haroon Akhtar for addressing all issues of the textile sector and re-issuance of all rolled-back sales tax refund payment orders (RPOs) of April 2017. During meeting, FBR Member Customs Zahid Khokar assured that coal etc would be given consideration favourably for duty free import for exporters in spite of not being constituent part of exportable goods. Expert said that in an unprecedented move in spite of weekly holiday the Special Assistant to Prime Minister on Revenue, Haroon Akhtar Khan along with top hierarchy of FBR and field formations held a daylong meeting with APTMA office holders and key exporters at APTMA House Lahore on implementation issues of tax incentives to the exporters to address their liquidity crunch to boost exports. Tax authorities verified from the participants whether Refund Payment Orders (RPO) of all those cases have been issued which were rolled back in April 2017. Regarding complaints of un-explained deductions from RPOs, tax authorities have decided to examine the issue in the light of observations made by some units. Sources said that Haroon Akhtar observed that refunds are right of the exporters and issuance of RPOs is not a favour to them and FBR is considering the clearance of backlog of refund in one go as a part of textile package, sources said. Earlier APTMA office bearers and present members highlighted their issues and Haroon Akhtar Khan and his team patiently heard and addressed each issue to facilitate the industry. Chairman APTMA claimed with facts and figures that Pakistan's export can be doubled by 2020 provided identical support is given to textile export sector. He explained that energy cost is more than 30% of the conversion cost in spinning, weaving and processing industries whereas industrial gas tariff is 100% higher than the regional competitors whereas electricity tariff is 50% higher. He observed that due to high cost of production coupled with non-implementation of tax incentives both viability and liquidity has taken its tool and closure is such an alarming that membership of APTMA has declined from 445 to 345 units. According to Group leader Goher Ijaz, prohibition of refund on packing material is becoming a confiscatory measure as in export of garments the packing material use and substantial cost is a necessary ingredient of export business. The under miss-declaration of second hand clothing; garments are being imported to the detrimental of local garment industry. During meeting, Chairman APTMA, Amir Fayyaz pointed out that textile & clothing exports of Pakistan which were at 13.8 $ billion in 2010-11 has declined by 10% to 12.5 $ billion in 2016-17, mainly due to high energy cost and non-implementation in letter and spirit to tax incentives to the exporters. During same period, textile exports of Sri Lanka has increased by 20%, India by 31%, Bangladesh by 63% and Vietnam by 107% solely due to supportive policies of the respective governments.

Source: YarnsandFibers

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NTMA and Govt of Nigeria stuck in cotton export debate

 

A debate has stirred up between the Government of Nigeria and the Nigerian Textile Manufacturing Association (NTMA) on the export of cotton from the country. MTMA’s acting director general Hamman Kwajaffa said at a public hearing organized by a parliamentary committee on industry that it wants a ban on the export of cotton from the country as it is needed for local manufacturing. Lamenting Nigeria’s over-reliance on imported fabrics, Ruff ‘n’ Tumble founder Adenike Ogunlesi said it is unfortunate that the country is yet to reap the benefits from the US African Growth Opportunities Act (AGOA) due to the reverses suffered by the textile and garment sector over the years. Secretary general of the National Union of Textile and Garment Workers of Nigeria Issa Aremu said urged the government to grant full autonomy to the proposed council. (DS) The discussion was to set up a cotton, textile and garment (CTG) development council. Kwajaffa welcomed the move to establish the CTG development council, saying it would create a conducive environment for the economy.

Source: YarnsandFibers

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