SURAT: Federation of Surat Textile Traders' Association (FOSTTA) has written to chief minister Vijay Rupani for considering setting up of a garment hub in the city to regain the glitter of man-made fabric (MMF) hub lost due to severe impact of Goods Services Tax (GST) on the sector. In a letter addressed to the chief minister, FOSTTA raised concerns about the downfall in production of man-made fabrics by at least 40 per cent and issues of job losses in textile markets, power loom weaving units and processing units due to the impact of the GST. FOSTTA said the state government must consider setting up of a garment hub under its garment policy announced on October 16, 2017. Highlighting the benefits of the garment hub, FOSTTA stated that setting up of the garment hub will allow power loom weavers and textile traders to sail through the impact of the GST. The raw fabrics manufactured by the weavers will be consumed in garment factories set up under the incentivised scheme of the state government. The raw material procured by garment manufacturers will be cheaper compared to other states and this will give an edge to the manufacturers in attracting wholesalers from across the country and abroad. The export of garments will get a boost and also the manufacturing of shirts, T-shirts, kurtis, lehngas, ladies gown, suit, salwar kameez etc will get a boost. FOSTTA secretary Champalal Bothra told TOI, "It is need of the hour that the textile industry in the city forward integrate and venture into garment manufacturing. Surat produces finest fabrics in the country and garment units in the city will have a win-win-situation. We have requested the new government in the state to consider setting up of a garment hub in the city."
Source: Times of India
India’s Bihar state has earmarked a land tract of 115 acres in Bihta on the outskirts of capital Patna to set up an apparel and textiles park, state deputy chief minister Sushil Kumar Modi recently announced. The proposed park forms part of the state policy to promote textiles, leather, information technology and food processing, he said. Modi was speaking after the inauguration of a three-day fair organized by the Bihar Readymade Garments Association. Urging readymade garment producers to invest in Bihar, he said the state has immense potential for job creation in this sector as 90 per cent workers employed in this industry in Mumbai and Bengaluru hail from the state, according to a news agency report. A number of incentives are on offer to those willing to invest in the state, he added. (DS)
Source : Fibre2fashion
Anti-profiteering provisions under GST have been one of the most hotly debated topics recently. This debate has gained momentum after the steep GST rate cut from 28% to 18% on over 175 items from mid-November. In a letter to large FMCG companies, the chairperson of the CBEC pointed out that in addition to these measures being a legal requirement, industry has a ‘social obligation’ to pass on this benefit to consumers. This seems a legitimate expectation as far as the government is concerned. However, the critics of the policy view this as an attempt to regulate the prices, which has no place in a free economy. Market forces, they say, will ensure that prices are competitive and benefits are passed on. Industry, on the other hand, believes that while the government’s intention cannot be questioned, it is practically extremely difficult to take complex pricing decisions immediately upon the rate change. Moreover, in absence of detailed guidelines on the manner in which the benefit should be passed on, businesses are not clear as to how do they establish that they have not profiteered from GST.Not surprising that this ‘trust deficit’ is now getting ministered in conflict on the ground. Recently, the director-general (safeguards) issued notices to five companies initiating an anti-profiteering investigation. These notices were triggered after reference was received from the Standing Committee which has been set up to receive the consumer complaint and carry out a prima facie enquiry. The DG’s office has indicated that they have received around 200 complaints already but have been quite careful in selecting the cases for investigation. Notices have been issued to dealers of cosmetic products and automobile, a large food-service chain and a real estate company. It, therefore, covers a wide spectrum of industry and it is likely that these are the sectors which will continue to get more attention, from the consumers as well as the government, over next few months. It is good to see that where a consumer’s complaint is against a particular supplier, the authorities have refrained to include the company actually manufacturing the product or the brand-owners, though there were some indications earlier that the government may hold these companies accountable for prices at wholesale and retail level. It is important because, for the stock already in trade, these companies may not be able to do much in case of GST rate-cut, other than ‘nudging’ the wholesalers/retailers to pass on the benefit to the consumers. A quick glance at these notices (available on DG’s website) gives an insight as to where the authorities are getting to. However, it also raises many other questions, with no real answers. To start with, it is not clear as to the procedure adopted by the Standing Committee in conducting the preliminary enquiry and was any opportunity provided to the companies to explain their stand. For instance, in case of the notice issued to the real estate company, a presumption seems to have been made that the input credit available would exceed 12% GST payable. This may not be right in case of existing projects, where substantial construction has happened before GST. In such cases, the amount of additional input credit would essentially pertain to construction material purchased after July 1, 2017, whereas GST of 12% would apply also with respect to instalments due after GST but pertaining to prior period. Further, the information sought seems to be quite detailed within the limited time provided, some of which has to be certified by an accountant. The example of the notice issued to retail company is also interesting. While the complaint is for a specific product, the information has been sought at an entity level and with respect to all their products. It would, therefore, be interesting to see whether the enquiry extends to all other products. The other ambiguity is as to whether the benefit has to be necessarily passed on for all items (SKUs) and from the very date when the rate got reduced. For instance, the enquiry against the food-service chain is for a particular product, viz. café latte, wherein the customer found that prices remained unchanged as on November 15, when the GST rate was reduced from 18% to 5%. What if the company decided to pass on the benefit attributed to this produce by say reducing the prices of cappuccino or some other beverage instead? What if the quantity of the product got increased for the same price? What if the prices were reduced after a week? It may be noted that for restaurants, quantification of the precise impact is slightly complex due to denial of input credits, along with rate reduction.While it is too early to comment on the direction in which these proceedings will go, it is clear that unless these issues are well thought out and addressed quickly, this could snowball into an avoidable stand-off between industry, businesses and consumers. The only solution is to adopt the middle path. Focus on the spirit and intent of the law rather than getting caught in the mirage of technicalities. While the industry should ensure that the entire GST benefit is passed on to the consumers within a reasonable timeframe, the authorities need to appreciate the business nuances and allow companies reasonable flexibility in terms of the mechanics of passing on the benefit. There should also be deterrence for filing frivolous complaints.
Source : Financial Express
With foreign portfolio investors (FPIs) continuing to buy Indian bonds and stocks, the rupee could strengthen further, hitting levels of 63 to the greenback, say market watchers.
With foreign portfolio investors (FPIs) continuing to buy Indian bonds and stocks, the rupee could strengthen further, hitting levels of 63 to the greenback, say market watchers. On Friday, the local currency touched a near-three-year high to close at 63.37 against the dollar. While the immediate reason for the rupee’s strength is the weakening of the greenback, over the past year foreign inflows of more than $30 billion into the equity and debt markets saw the rupee steadily strengthen against the dollar, notching up gains of over 7%. Close to $25 billion came in by way of FDI equity flows between April and September 2017. Currency expert AV Rajwade believes the rupee may very well breach the 63 level, depending upon the Reserve Bank of India’s (RBI) stance. “The central bank might allow the rupee to strengthen, as it will help rein in inflation,” Rajwade explained. However, exporters are a nervous lot. As Jamal Mecklai, CEO, Mecklai Financial Services, points out there was some positive exports data in November. “But, on an absolute basis, we are still way below what we used to see in 2011. In that context, there is still much to be done,” Mecklai pointed out. Rajwade observed the central bank’s currency stance hasn’t been right. “Our exports are suffering and manufacturing has remained stagnant for some time. Even if you look at the REER (real effective exchange rate), it indicates that the currency is very over-valued at the current juncture,” he noted. Currency and money expert Ananth Narayan pointed out that the RBI may intervene if the rupee continues to appreciate too much, but the options might be limited. “Firstly, with an independent monetary policy, compromise on the currency or capital flows can become inevitable. Secondly, the Trump administration in the US is already watching countries for possible currency manipulation. Given our trade surplus with the US, it may be a factor that cannot be ignored forever,” Narayan explained. Mid-sized and small businesses in the apparels and leather sectors are bearing the brunt of the stronger rupee with large organised players in sectors like IT services and pharmaceuticals somewhat better prepared. MV Narasimhan, SVP & global head, business finance, Dr Reddy’s Laboratories, observed that while in the near term, hedging policies across companies would largely cover the appreciation they would need to keep a careful watch on the movement in the currency. Jayant Tagore, CMD, Synthokem Labs, said most companies have bought forward contracts till next December. “Should the appreciation continue pharma companies may increase prices by about 10% in the export markets,” Tagore said. For now IT companies are confident of maintaining their margins using the levers such as utilisation and automation. “There has also been some improvement in the pricing environment,” a senior IT executive noted, adding this was especially true for fixed-price projects. Moreover, with greater automation, costs are being reined in. The thumb rule in the IT sector is that operating margins contract by 30-40 basis points for every one percent appreciation of the rupee. Exporters of textiles, said S Sakthivel, former president of Tirupur Exporters’ Association (TEA) and chairman of Poppys Knitwear, would lose some bargaining power. “For every rupee of appreciation, exporters stand to lose `35 crore a month on total monthly exports of about Rs 2,300 crore. “At an all-India level, the loss would be an estimated Rs 150 crore a month,” Sakthivel said. The US Treasury department in October had said that over the first half of 2017, there was a notable increase in the scale and persistence of India’s net foreign exchange purchases, which have risen to around $42 billion (1.8% of GDP) over the four quarters through June 2017. “India has a significant bilateral goods trade surplus with the US, totaling $23 billion over the four quarters through June 2017. Treasury will be closely monitoring India’s foreign exchange and macroeconomic policies,” the report indicated.
Source : Financial Express
TThe country's agriculture sector is expected to grow higher than projected 2.1 per cent growth by the CSO for the current fiscal, following better rabi crop prospects, the agriculture ministry said on Sunday. Last week, Central Statistics Office (CSO) had pegged farm and allied sector growth at 2.1 per cent for 2017-18, much lower than 4.9 per cent achieved in the 2016-17. The farm sector growth comprises GVA (gross value added) of crops at 60 per cent, livestock 20 per cent and forestry 8.5 per cent and fishing and aquaculture at 5.5 per cent. The agriculture sector can, therefore, be expected to register a much higher GVA for the year 2017-18, when final estimate figures are released, it added. agriculture, farm
Justifying the reasons for possible higher growth, the ministry said it is of the opinion that the lower coverage of area by August 2017 on account of delayed onset of monsoons has caused a poor reflection compared to the actual positive field situation by December 2017.However, good rainfall thereafter helped increase in area coverage in accordance with the with kharif targets."Despite delay in onset of monsoons and relatively poorer rainfall vis-a-vis the previous year, the area coverage under kharif finally rose to 106.55 million hectares against the five year average of 105.86 million hectares," it said. It is, hence logical, that the computation based on area coverage under crops as in August 2017 had a negative impact on the CSO's advance estimate for the overall agriculture sector.The GVA estimate is bound to get corrected upwards, if increased area coverage by December 2017 and concomitant production estimate in case of foodgrains, oilseeds and commercial crops, in particular, are taken into account, it said. These three account for higher percentage of share than horticulture in the GVA computation and horticulture is showing a higher productivity estimate, it added. The ministry further said the livestock and fishery sector was very positive till August 2017 and by December the dominant crop sector has "bounced back"."If this amended and actual field situation are taken into account in computation of the GVA for agriculture sector as a whole, its growth rate can be estimated to be much higher than the advance estimate of 2.1 per cent," ministry said. Stating that the rabi prospects are good, the ministry said rabi crops have been covered in an area of 58.6 million hectares which is a "very good progress". Considering that the rabi sowing continues up to first week of February, the total area under crops and resultant production will be very good, it added. The ministry also observed that CSO estimates of farm sector growth this fiscal comes on the back of a very robust GVA of 4.9 per cent in the previous year."Considering that crop segment constitutes a dominant component of the GVA computation, its performance is very critical. However, with in elasticity of land where there exists little scope for increase in the average coverage, productivity enhancement assumes importance," it said. Crops in particular and agriculture in general are highly dependent on monsoons and overall status of weather, the ministry said, adding that even small variations in weather tend to influence agriculture adversely, as seen for example, in the area coverage by August 2017.
Source: Business Standard
WhatTheyThink today announced the launch of a new special interest section dedicated to the digital transformation in the textiles industry. This includes digital printing of fast fashion, home goods and other textile applications. Printing technologies, supporting workflow and other software, key suppliers to the industry and manufacturers using digital technologies will be covered, along with textile/fast fashion trends. The section will be moderated by Senior Editor Cary Sherburne. “I’ve personally been interested in digital printing of textiles for quite some time,” Sherburne said, “and I’m thrilled that it is gaining enough momentum to deserve its own section on WhatTheyThink. We’ve already started talking to industry innovators and thought leaders and have several trade shows on our agenda for 2018.” Sherburne points out that increasing adoption of digital production in the world of textiles is being driven by the desire of brands for more flexibility and faster time to market without breaking the bank. “Just as we have seen digital technologies overtake conventional production methods in other segments,” she adds, “this transformation is really gaining steam in textiles. Both retired Baby Boomers and Millennials increasingly want customized clothing and home goods to personalize their style and living environment, another factor that is driving demand for very short runs that can only be produced digitally.” The new section, accessible from the main WhatTheyThink navigation bar, will be a one-stop location for news, features, videos and other coverage of this exciting and rapidly-evolving industry segment. “Our first trade show of the year for textiles is THREADX, powered by SGIA, where WhatTheyThink will be a media partner and will be conducting video interviews with speakers, attendees and other thought leaders,” Sherburne reported. “The event is scheduled for 25-28 February in Palm Springs and is designed specifically for Garment Decoration business owners and managers in an effort to capture the zeitgeist of consumer culture and how it will affect the industry. Be sure to watch for our coverage!” WhatTheyThink is the printing and publishing industry's leading media organization. We offer a wide range of publications that deliver unbiased, real-time market intelligence, industry news, economic and trend analysis, peer-to-peer communication, and special reports on emerging technology and critical events. Special interest sections include Economics, Data Analysis, Wide Format, Labels & Packaging, Production Inkjet, Textiles and Print Software. WhatTheyThink hosts webinars and live events as well as providing content through a syndication program, delivering content directly to related websites. In addition, WhatTheyThink offers a wide range of lead generation and branding programs that help print- and publishing-related companies achieve business growth.
Source: What they think
Vietnam’s textile and garment industry has targeted a year-on-year increase of 10 per cent in export value to $34 billion in 2018 despite difficulties in markets at home and abroad, according to Le Tien Truong, general director of the Vietnam National Garment and Textile Group (Vinatex). He recently reported Vinatex’s performance at a meeting in Hanoi. Vinatex reported its total revenue in 2017 was 45.55 trillion VND ($2.02 billion), out of which domestic sales contributed 10.39 trillion VND, which is 22.8 percent of the total revenue. The pre-tax profit in 2017 reached 1.43 trillion VND, the group disclosed. The organisation has set a revenue target of 48.5 trillion VND and a pre-tax profit of 1.45 trillion VND for 2018, a Vietnamese news agency reported. As Vietnam’s textile and garment industry will face more competition this year, Truong urged the industry to continue to invest in technology to create stability, sustainability and efficiency in production. Last year, the country exported textile and garments worth $31 billion, higher than its target of $30 billion. Major markets such as the United States, the European Union, Japan and the Republic of Korea maintained good growth, while there were breakthroughs in exports to other markets such as China, Russia and Cambodia, said Truong. The Korean market jumped to the fourth position in 2017, close to the Japanese market, reaching an export value of $2.7 billion. Exports to China last year was $3.2 billion, the same as the export value to Japan. This year, the ministry of industry and trade will withdraw 53.5 per cent of its shares in Vinatex as part of the prime minister’s divestment initiatives.
Source: Fibre2fashion
PolyOne Corporation, a provider of specialised polymer materials, services and solutions, has acquired IQAP Masterbatch Group, a privately owned provider of specialty colourants and additives based in Spain with customers throughout Europe. IQAP has built a technical and broad solutions portfolio that serves high-growth end markets, as is PolyOne's focus.Founded in 1979 by Xavier Rovira, IQAP has built a technical and broad solutions portfolio that serves high-growth end markets, including transportation, packaging, consumer, wire and cable, and textiles. With two production facilities and a technology lab located in Spain, plus additional manufacturing capability in the Czech Republic, PolyOnewill implement its proven invest-to-grow approach to integration and customer service. "IQAP is a fantastic addition to our longstanding and growing expertise in colour and additives innovation," said Robert M Patterson, chairman, president and CEO, PolyOne Corporation. "The end markets that IQAP serves are perfectly aligned with areas PolyOne knows very well, and together we will advance the possibilities for our European customers working to meet demanding new standards for design, functionality and performance."Rovira added, "I'm thrilled for IQAP customers and employees whose future can continue to grow and prosper as part of the global PolyOne family. We evaluated many potential buyers for IQAP, and PolyOne was the clear choice that best aligns with our vision and ideals for world-class innovation and customer service." (SV)
Source: Fibre2fashion
The United Kingdom is exploring options to become a member of the Trans-Pacific Partnership (TPP) to boost exports after it leaves the European Union (EU) in March 2019 and has held informal discussions with the trade group, say British media reports. The UK department for international trade is said to be developing the proposals to join the group. TPP is regrouping after it lost the United States last year. The 11 remaining members include Canada, Mexico, Singapore and Australia. If the proposals fructify, the United Kingdom will be its first member without having borders on the Pacific Ocean or the South China Sea.Any agreement would likely have to wait until TPP has been revised after the United States withdrew and Brexit departure is settled, the reports say. The United Kingdom is not allowed to make trade deals before it formally leaves the EU. Combined spending from the 11 TPP countries make up less than 8 per cent of the UK’s export market. The plan to join TPP has attracted criticism from some domestic political quarters. (DS)
Source : Fibre2fashion
Kordsa, operating in tire, construction reinforcement, and composite technologies in a wide geography from America to Asia Pacific, has opened an additional line in Izmit, Turkey to increase polyester yarn capacity by 7 thousand tons on December 19, 2017. Kordsa also opened a “polypropylene monofilament” line in the field of construction reinforcement. Following the completion of the building construction and upon the arrival of new equipment, Kordsa aims to have an additional polyester yarn capacity of seven thousand tons with an additional 3,500 square metres area in the current facility by 2018. Kordsa CEO Ali Çaliskan said, “The role of our Izmit factory in Kordsa’s long-term expertise in reinforcement technologies and its market leadership is enormous. In 2016, we announced our US$ 30 million investment of additional capacity in our facilities in Turkey and Indonesia. With the new line in our Izmit plant, we will be able to meet the growing demand faster and more efficiently. I am glad to share with you that our new polyester yarn line in Indonesia is operational now. We increased the polyester yarn capacity in this facility by 7 thousand tons. This investment will strengthen our position in the Asia-Pacific market that we have been operating since 2007. With our intensive R&D efforts and open innovation mindset, we will continue to invest in developing innovative, value-added products that globally shape the industry.” Kadir Toplu, Kordsa’s COO for Europe, Middle East, and Africa region said, “As Kordsa, we distinguish in the construction reinforcement market with easy-to-use products that provides durability and high performance. Now, we expand our product range with the investment of 'polypropylene monofilament’, which is a new type of our synthetic fibre reinforcement product, Kratos. Following its launch in 2018, this product will offer both sustainable high performance for our customers with its durable characteristic as well as cost advantage compared to its benchmarks in the market. We will provide this efficient and durable fibre reinforcement material both in Turkey and the European market.” (GK)
Source: Fibre2Fashion
