New Delhi, January 15: Increase in exports of engineering goods and petroleum products helped the country register a 12.36 per cent rise in overall goods exports (year-on-year) to $27.03 billion in December 2017. This is the 16th month of growth over the last 17 months (exports fell in October 2017 mostly due to a decline in duty drawback rates) and exporters are hopeful of touching the $300-billion mark in the current fiscal. “Positive growth in exports for second month in a row, after a fall in October 2017, shows resilience of the Indian exporters. Since we have already achieved exports worth $224 billion in first nine months of the fiscal and global trade growth remains robust in 2018, we are on our course to achieve the milestone of $300 billion in 2017-18,” said Ganesh Kumar Gupta, President, FIEO. Imports during the month, posted a sharper rise of 21.12 per cent to $41.91 billion led by gold, silver, precious stones, petroleum and electronic goods. This widened the trade deficit to $14.88 billion in December 2017 compared to $10.54 billion in December 2016. Overall imports for the period April-December 2017-18 were valued at $338.36 billion which was 21.76 per cent higher than imports in the same period of the previous fiscal.
Source: Business line
New Delhi : Trade deficit hit a three-year high of $14.9 billion in December 2017 as imports of gold, precious stones and crude oil jumped sharply. Ratings agency, ICRA said nearly 80% of the $7.3 billion year-on-year rise in merchandise imports in December 2017 was on account of imports of gold, pearls, precious and semi-precious stones, and petroleum, crude and products. The 35% expansion in the imports of petroleum, crude and products in December reflects both higher prices and volume. “Contrary to expectations, imports of gold, and pearls, precious and semi-precious stones recorded a considerable expansion in December 2017, which may reflect restocking after the festive season”, ICRA said. Exports rose 12.36% in December to $27.03 billion year-on-year as sectors like engineering goods and petroleum products showed improved performance. Imports surged significantly to $41.91 billion, up 21.12%, on increased inbound shipments of crude oil and gold. The current account deficit is expected to suffer as a result of the mounting trade deficit. ICRA expects the current account deficit to record a considerable year on year deterioration to $16-18 billion in third quarter of the current fiscal. Overall, the current account deficit is likely to widen nearly three-fold to $42-44 billion in financial year 2018 from $15 billion in 2017.
Source : Tribunal
The presentation of the annual budget on February 1, first implemented last year, has already had an impact on expenditure patterns. The objective of advancing the budget day was to complete all budget-related legislative approvals by the end of March so that the funds can be released immediately in the next financial year. Hitherto, the budget approval process got pushed into May and first quarter allocation were made on an ad-hoc basis and were limited. The salutary effect of this change is evidenced by the fact that expenditure patterns have got more front-loaded, improving both quality and efficiency of government expenditure. This year the impact of the implementation of the goods and services tax (GST) will have its own impact on budget-making.
Upping the ante
The importance of the annual budget in India’s economic calendar received a boost after the major trade and regulatory reform in manufacturing which took place in the early nineties in the background of a severe foreign exchange crisis. Before that, budget-making did not quite catch the glare of publicity and was viewed as a normal annual statement of government expenditure and revenue. The early nineties saw the big bang announcements which was presented in part A of the budget speech of the finance minister. In the last decade, economic reforms became more incremental, as also many of the major policy announcements. In some sense, part B of the finance minister’s speech containing the taxation proposals acquired greater importance. The implementation of GST would now mean that earlier announcement of changes of central excise and service tax would now move out of the central budget as these central taxes have been merged into the CGST. Policy measures relating to GST (rates and exemptions) would now be decoded by the GST Council outside the budget process. Both the Centre and the State would jointly formulate the policy measure pertaining to GST and therefore change would happen throughout the year. Therefore, in the annual budget to be presented on February 1, the announcement on the indirect tax side which is normally contained in part B of the budget speech would now be confined to measures related to customs duty and taxes on other items like petroleum which are presently outside the GST. One can, therefore, now expect the taxation measures to be mainly focused on direct tax reforms and customs. The importance of direct tax reforms has already been emphasised by the Government through the constitution of a committee headed by Arbind Modi, member (legislation), CBDT. This committee will look at the entire gamut of the Income tax Act and draw up a new direct tax code.
Critical areas
With growth rates tapering off, the budget would have to look at measures to lift the growth rate, and here trade and investment policies are going to be critical. No country in the post-world war era has grown consistently at more than 8 per cent without an export growth of at least 15 per cent annually. Similarly, one can expect measures to boost investment both through further liberalisation of foreign investment policies. There would be deeper financial and capital market reforms and broadening of the corporate debt market to shift infrastructure financing patterns from banks to the bond market. Greater use of long-term pension and insurance funds would also be very important. All these announcements would come as part of part A of the budget speech. Therefore, the budget would probably see a return to what we saw in the early nineties when big policy announcements were announced in part A of the and provided a boost to the importance of the annual budget. With greater devolution of finances to the States and a cutback on centrally-sponsored schemes, a lot of programme formulation and implementation has to be done by the States. Therefore these details would also go out of the annual budget. Therefore, it would not be any surprising if GST in some ways brings back the importance of part A of the budget speech. This is welcome because what economic policy now needs is to see more signs of the architect and less of the plumber.
A degree of uncertainty
The implementation of GST has also created uncertainty in the tax collection. The monthly revenue collection for November fell well short of the ₹92,000 crore that would be required to meet the budgetary targets. Tax experts are attributing this shortfall to a number of reasons such as greater payment of export refunds, higher amount of transitional credits and the reduction in duty rates on a number of items announced with effect from October 1, 2017. The silver lining has been a pick-up in the growth of personal income taxes. Some of this could also represent the bump effect of GST implementation leading to higher turnover being declared in the income tax return. There is also the hope that the disinvestment target of ₹72,000 crore will be exceeded especially if the ONGC-HPCL merger goes through. Therefore, budget-making this year will confront the dilemma of either meeting the fiscal deficit target or slipping up in order to boost growth. Whatever be the outcome, GST has certainly queered the pitch. The Government response could be either an ‘aggressive drive’ or a ‘defensive push’. We will know, come budget day.
Source : Business Line
Diesel prices have touched a record high of Rs 61.74 per litre and petrol prices have crossed Rs 71 as international oil rates continue to rally. Petrol price rose to Rs 71.18 per litre in Delhi today, the highest since August 2014, according to daily fuel price list of state-owned oil firms. Diesel prices soared to their highest level of Rs 61.74 per litre in Delhi. It is being sold at Rs 65.74 in Mumbai, where the local sales tax or VAT rates are higher. Prices have been on the rise since December 12, 2017. Diesel in Delhi on that day was priced at Rs 58.34, and in past one month has risen by Rs 3.4. Petrol price has during the period risen by Rs 2.09, according to oil companies. Two the most traded benchmark crude globally have risen the most since December 2014 - Brent touched USD 70.05 a barrel last week and WTI reached USD 64.77. The rally in oil prices has renewed calls to the government to cut excise duty to cushion burden on common man. The BJP-led NDA government has during its tenure cut excise duty only once - by Rs 2 per litre in October 2017 when petrol price had reached Rs 70.88 per litre in Delhi and diesel was priced at Rs 59.14. Because of the excise duty cut, diesel prices had on October 4, 2017 come down to Rs 56.89 and petrol to Rs 68.38. However, subsequent rally has wiped away all the gains and prices have touched new highs. Last week, Oil Minister Dharmendra Pradhan had responded to questions on whether the Centre would cut excise duty on the two fuel, by asking states to first cut VAT. "Why dont you ask state governments to reduce first," he said on January 1 responding to reporters question on excise duty cuts. "Government of India reduced excise duty (in October last year). We are appealing to states to reduce VAT." Some state governments had followed that excise duty cut with reduction in VAT. "Why Delhi government has not reduced VAT," he asked. Price of petrol and diesel in Delhi is the lowest in all metros. Pradhan had said that Finance Minister Arun Jaitley has already written to the states seeking reduction in VAT. The October 2017 excise duty cut cost the government Rs 26,000 crore in annual revenue and about Rs 13,000 crore during the remaining part of the current fiscal year that ends on March 31, 2018. The government had between November 2014 and January 2016 raised excise duty on petrol and diesel on nine occasions to take away gains arising from plummeting global oil prices. In all, duty on petrol was hiked by Rs 11.77 per litre and that on diesel by 13.47 a litre in those 15 months that helped government's excise mop-up more than double to Rs 242,000 crore in 2016-17 from Rs 99,000 crore in 2014-15. State-owned oil companies in June last year dumped the 15-year old practice of revising rates on 1st and 16th of every month and instead adopted a dynamic daily price revision to instantly reflect changes in cost. Rates during the first fortnight starting June 16 dropped but have been on the rise since July 4. Since then prices are revised on daily basis. Today, price of petrol went up by 12 paisa per liter and that of diesel by 18 paisa.
Source: Economic Times
NEW DELHI Based on data published by Directorate General of Commercial Intelligence and Statistics (DGCIS) after a brief period of decline in Textile & Apparel (T&A) exports including handicraft exports every month beginning May June July & October 2017 it can be observed that there is a turnaround in T&A exports with a 20% increase in November 2017 over October 2017. The 20% overall increase in T&A exports is marked by an increase of 24% in Readymade Garments 24% in Cotton 9% in Man Made Textiles 17% in Silk Products 28% in Handloom products 11% in Carpets and 10% in Jute Products
Source : Tecoya Trend
Mumbai: The Centre’s recent relaxations in FDI in single-brand retail will boost organised retail’s market share by 300 basis points in three years, according to research by credit ratings agency Crisil. In a report, Crisil said it expects the market share of organised retail in India to rise to about 10 per cent by fiscal 2020, compared with 7 per cent last fiscal. This will be supported by the government’s decision to permit 100 per cent FDI in single-brand retail under the automatic route from 49 per cent earlier, relaxation in sourcing norms, and healthy growth prospects for organised retail. Before the change in rules, the agency’s forecast for the share of organised retail was 9 per cent by FY20, based on healthy revenue growth of about 18 per cent of organised brick and mortar (B&M) retailers. Apparel, luxury goods, home decor, footwear and the electronics segments are those most likely to benefit from the new rules, and are expected to ratchet up about 45 per cent of India’s organised retail revenues, said Crisil. “Global single-brand retailers facing growth headwinds in their key geographies will now be more than keen to peg tent in India,” said Anuj Sethi, Senior Director, Crisil Ratings. “And those already present could step up investments. The previous sourcing norms were a bottleneck to scaling-up of operations.” While FDI approval under the automatic route will lower the time to commence business, the relaxation of 30 per cent local sourcing norms for the first five years by allowing inclusion of incremental sourcing for global operations will provide sufficient time for new entrants to set up and stabilise their sourcing base. This will also make the operating environment that much more competitive for domestic B&M retailers, the agency added.
Source: Business Line
New Delhi: General elections are around the corner, and the Union Budget that Finance Minister Arun Jaitley will present on February 1 is the NDA government’s last full-fledged Budget of its current term. That being the case, one can expect a lot of focus on the government’s proposals for skill development and employment generation, one of the key promises in its 2014 election manifesto. Though clear-cut policies that would have an immediate impact on job creation are unlikely, jobs are likely to be a top priority after the disruptions caused by demonetisation and GST rollout.
New programmes
The government is working on a National Employment Policy (NEP) and a universal social security scheme, which may be announced in the Budget, along with higher allocation for the MUDRA scheme for financing entrepreneurship. Additionally, a renewed focus on skill development and vocational training may also be seen in the Budget. The NEP is expected to have a sector-wise focus, especially on labour-intensive sectors such as textiles and handloom, and other small and medium enterprises. It will likely provide them with incentives for formal employment. “Creating jobs is India’s central challenge…India needs to generate jobs that are formal and productive, provide bang-for-buck in terms of jobs created relative to investment, have the potential for broader social transformationand generate exports and growth,” the Annual Employment-Unemployment Survey said, noting that the apparel, leather and footwear industries can provide a viable solution.
Labour code
Similarly, the Labour Code on Social Security, which is still under discussion, could also feature in the Budget. It aims to provide social security coverage to all workers, especially those in the informal sector. “Many of the policies that are now taking shape will have a huge impact on the job market over the next few years. “As private investment recovers, a lot more jobs will be created,” noted another official, adding that this is where a skilled workforce will also come into play. With 484 districts covered by Pradhan Mantri Kaushal Kendras for skill development, the government is now working on the Indian Institute of Skills to provide advanced courses such as energy efficient construction, industrial electronics and automation. While five such institutes are being planned, the construction of the first one, in collaboration with the Tata Group, will start in Mumbai soon. Under the Pradhan Mantri Kaushal Vikas Yojana, about 40.5 lakh candidates received training by mid-December. In 2017, as many as 11 lakh candidates were trained under the scheme, while another 3.7 lakh people were assessed and certified under the scheme of Recognition of Prior Learning. Similarly, 12.12 lakh candidates passed out from Industrial Training Institutes. “Out of 2.5 crore candidates who have been skilled under Ministry of Skill Development and Entrepreneurship (MSDE) programmes alone, more than one crore have been trained in 2017,” said an official release. A lack of sufficient wage employment has also been a key challenge for the MSDE, which has been training youth in vocational skills, though many have often not found jobs.
Lack of jobs
“We can only create an environment that is conducive to job creation and employment. The real jobs have to come from the private sector and that is not really happening,” noted a senior government official. While the Centre has launched policies such as Make in India and Skill India, labour markets have been mostly subdued, with private investment remaining muted due to both global and domestic economic factors. “The effort is to place candidates on successful completion of courses. Self-employment and entrepreneurship are also promoted as an alternative option amongst students,” noted an official. The Annual Employment-Unemployment Survey, conducted by the Labour Bureau, pegged the unemployment rate at 5 per cent in 2015-16 from 4.9 per cent in 2013-14 and 4.7 per cent in 2012-13. More recent data from the BSE-CMIE index estimates the country’s unemployment rate at 5.13 per cent for the week ending January 14. It, however, indicates that current unemployment rates (based on a 30-day moving average) is higher than a low of 3.06 per cent on August 3, 2016, but has gone down significantly from a high of 9.92 per cent on September 10, 2016. The NEP is expected to have a sector-wise focus, especially on labour-intensive sectors such as textiles and handloom, and other SMEs.
Source: Business Line
The government of Maharashtra plans to introduce a new textile policy in next two months. The aim is to attract entrepreneurs in the entire value chain, besides seeing that existing unit do not migrate to other major cotton-growing states. Over and above the Centre's textile package, the technology upgradation fund scheme and other incentives, all major growing states have introduced their own textile policies to attract investment. The governments of Tamil Nadu, Karnataka, Andhra Pradesh and Telangana have announced a number of incentives for textile units. And, effective October 1, 2017, the government of Gujarat renewed its state textile policy, which was originally introduced for five years in 2012. The earlier policy of Gujarat had seen a large migration of units into the state from across the country. Maharashtra saw the migration of all types of business units in the sector, given the similar business environment in the two states. "We have started taking inputs from co-operative and other sectors involved in the garment value chain. We will introduce our own textile policy in two months to stop migration of units to other states. These states have attracted investment in the entire textile chain with incentive schemes, electricity and labour being the major ones. Our textile policy would majorly focus on power availability at cheap rates," said a senior Maharashtra government official. Solapur is already being developed as a manufacturing hub. Amitkumar Jain, the joint secretary of the Solapur Readymade Kapad Utpadak Sangh, said, "We have requested the government to provide us with a monthly skill development fund of Rs 4,000 per man and Rs 3,000 per woman as offered by the government of Gujarat.We are bringing global buyers and sellers to Solapur through our annual exhibition, scheduled this year between January 27 and 29. Solapur is set to become a major sourcing hub of school and corporate uniforms in India." The government of Gujarat is offering electricity at Re 1 a unit, besides interest subsidy at five per cent annually, with a ceiling of Rs 70.5 million (Rs 7.5 crore). Through this, it estimates it would attract new investment of Rs 200 billion (Rs 20,000 crore) by 2022.
Source: Business Standard
An important key to making India an attractive destination for global firms is to create greater labour market flexibilities. Nothing explains India's job creation challenge better than a comparison between Reliance Industries (RIL) and Shahi Exports. While RIL is a familiar name to nearly all, most readers would not have heard of Shahi Exports. If we are to solve our jobs problem, this needs to change. The RIL reports $110 billion in assets and 250,000 employees across its various ventures. Therefore, it employs five workers for each $2.2 million in assets. Shahi Exports, which is India's largest apparel exporter, has assets worth $185 million and employs 106,000 workers in its apparel factories. Therefore, it employs 1,260 workers for every $2.2 million in assets. For the same investment, Shahi Exports creates 252 times the jobs that RIL does. Jobs that Shahi Exports creates are what India needs most today. Its factories can take someone with fifth-grade education and impart necessary training in just six weeks. On average, these workers earn Rs 15,000 a month. About 60% of Shahi Exports employees are women. If we could rapidly multiply what Shahi Exports does, we could begin expanding formal-sector jobs rapidly — especially for women. Apparel requires modest investment per job and the demand for it is there. In 2015, the apparel export market was $465 billion. India exported $18 billion of it compared with China's $175 billion. High wages are now forcing China to withdraw from this market. From $187 billion in 2014, its apparel exports have fallen to $158 billion in 2016. India must take the space China is vacating. To understand what needs to be done, we must ask why India has not done well in this sector to date. For decades, our policies reserved apparel for production by small-scale enterprises. These enterprises were too small and their product quality too low to succeed big in the export markets. Beginning in 1973, India's investment policy confined large firms and big industrialists to investing exclusively in a set of listed 'core' industries, which were all highly capital intensive. As a result, over time, our big industrialists have become hardwired into believing that sectors such as apparel are not for them. Although the core industries regulation ended in 1991, and small-scale industries reservation was withdrawn more than a decade ago, investment in apparel remains entirely off the radar screens of India's big industrialists and their children. Grab That GarbOne way to cut this Gordian knot is to encourage the global apparel firms exiting China to locate in India, instead of Bangladesh and Vietnam. These firms have the technology and management know-how to operate on large scale. They also have links to global markets. Once a few anchor firms locate in India, many more local Shahi Exports firms would emerge. An important key to making India an attractive destination for global firms is to create greater labour market flexibilities. This is something that has characterised all successful exporters of labour-intensive products such as apparel. We need better balance between the interests of those who already have formal sector jobs, and those who seek them. When protection to existing formal sector workers is extra-high, the incentive to hire more of them turns low. Firms choose to stay small, operate informally and, thus, escape costly labour regulations. Thus, consider, say, the minimum wage. If you live in Delhi, you are likely to think that a minimum wage of Rs 15,000 per month is only fair. And yet, such a wage will drive many labourintensive, formal sector firms out of business. Their employees would then end up in the informal sector. Reports that the Wage Code currently under consideration by Parliament may hike the national minimum wage to Rs 18,000 a month have left many formal sector firms very nervous. Exports, especially in the apparel industry, face very tight just-in-time delivery schedules. Therefore, rapid movement of imported inputs into the country and of export products out of it are essential. This requires concerted effort at trade facilitation. Unnecessary clearance requirements need to be eliminated and the turnaround time of ships at ports needs to be brought down to a few hours as in Hong Kong and Singapore. Coastal Employment Zones (CEZs) offer a convenient avenue to bringing about these changes expeditiously within limited geographical areas. Competitiveness also requires that all indirect taxes paid by apparel exporters, including those on products outside the goods and services tax (GST) net, such as petrol, be expeditiously reimbursed in full. All competing countries follow this practice and the World Trade Organisation rules permit it as well. The exchange rate has been a particularly sensitive issue for apparel exporters due to low profit margins on which they operate. Foreign investment and remittance inflows, which chase rupees, make them expensive. Sew That's HewedAnd an unduly expensive rupee makes Indian goods uncompetitive in the global marketplace. Therefore, the Reserve Bank of India (RBI) needs to manage foreign exchange inflows such that the rupee does not appreciate unduly. While apparel is the major sector where formal sector jobs can be expanded rapidly, what I have said above applies to a wide range of light manufactures including footwear, furniture, toys, kitchen utensils, paper, stationery, umbrellas and numerous other items of daily use. Therefore, the scope for creating good jobs for workers with limited skills through increased share in the global markets for these products is very substantial. It is difficult to think what alternative paths could advance this objective more effectively.
Source: The Economic
Ahmedabad, January 15: A 47-member, multi-sector trade and investment delegation from India will be in the Sultanate of Oman for four days from Tuesday to explore opportunities for business and investments between the two nations. The delegation, which includes businessmen from eight Indian States, will be in Oman from January 16 to 19, trade consultant Jagat Shah, Chief Mentor of Global Network and International Trade Advisory, said here on Monday. The delegation will participate in seminars to be addressed by the Oman Minister of Commerce and Industry and the Indian Minister of State for Transport, Shipping, Chemicals & Fertilizers, besides by the Indian Ambassador to Oman. Nearly 300 top Omani companies’ CEOs will attend the various events. Around 150 B2B meetings will also take place, Shah said. The Embassy of India, Oman, in association with the Muscat Gujarati Samaj, Vishwa Gujarati Samaj and Global Network is organising the largest-ever Indian multi-sector trade and investment delegation to Oman to encourage exports, imports, investments, joint ventures, tourism, technology transfer and franchise development between India and Oman. The India-Oman Business Delegation is a delegation of promoters of 40 companies from across India. The mission wishes to build long-term trade relations between India and Oman in different sectors by promoting investment opportunities, joint venture opportunities, technology-transfer, export and import of various products and services. A group of women delegates will meet Ms Iman Alghafri, Chairperson of the Omani Women’s Association, with the objective of a partnership between Oman and Indian women entrepreneurs. The delegation, which includes businessmen from eight Indian States, will be in Oman from January 16 to 19.
Source: Business line
Suddenly, in 2007, it was realised that India was a young country — it had tremendous potential for skill development, as all the ageing, developed economies would depend on India for skilled and trained manpower. Following this, the Centre announced the National Skill Development Mission (NSDM), a three-tier institution with the Prime Minister’s Office, Ministry of Finance and Planning Commission at the forefront. States, too, set up Skill Development Missions. The earlier National Skill Development Policy of 2009 had a target to train 500 million people by 2022, within a span of 13 years. The new policy of 2015 has targeted training 402.87 million persons by 2022.
Little presence
But, even after four years of existence, National Skill Development Agency is yet to mark its presence. For instance, the Labour Market Information System, for matching the demand and supply of skilled workforce in the country, is still in isolation without roping in the National Career Centres of the Labour Ministry. The role of the National Skill Development Corporation and the Sector Skill Councils also needs to be reviewed. From 2007 to 2017, 10 long years have been lost in experiments, and the future of a generation has been compromised. The government must realise that there are challenges within of conflict, competition and overlap, and look at some fresh re-organisation. Any discussion on skill development cannot be completed without a reference to Germany and South Korea. While one has a system evolved over time and the other has a system created by the government, both have strong Acts by their respective Parliaments in this regard. India also needs a very strong Skill Development Act that ensures the future of the country.
Source: Business Line
With the Union Budget 2018-19 inching closer, garment dealers here are hopeful of a reduction in the Goods and Services Tax (GST) rates levied on textiles, which, they believe, have drastically hampered sales. "After the GST was introduced, the volume of sale has significantly reduced, and the number of customers has dropped. We hope that the government will reduce taxes, thereby helping sales pick up again," Bhisham, a garment dealer said. The GST was rolled out on July 1 last year and has seen retaliation from the textile sector ever since. While the tax rates were reduced to 12 percent, and then further to 5 percent, the general opinion is that traders have been severely affected by the new taxation scheme. The Budget will be presented on February 1. The first Budget Session of the Parliament will be held from January 29 to February 9, while the second session will be held from March 5 to April 6. This will be the last full-fledged budget that will be presented by Prime Minister Narendra Modi-led Union Government.
Source : Sify Finance
The cancellations of export contracts and higher local prices could cut India's exports to 5 million bales, each of 170kg, in the 2017/18 marketing year started on 1 October—nearly a quarter below an initial estimate, said the president of Cotton Association of India, Atul Ganatra. Indian cotton traders have cancelled contracts to export some 400,000 bales of the fibre after a rally in domestic prices and the rising rupee made overseas sales unattractive. Prices surged more than 15% in the past six weeks after pest infestations squeezed supplies in the world's biggest producer of the fibre. The switch, triggering penalty payments by traders, has left cotton buyers in leading markets like Bangladesh, Vietnam and China seeking to make up shortfalls by tapping suppliers in the United States, Australia and Brazil. Some exports contracts for Bangladesh, Vietnam and China could not be fulfilled due to the sudden rise local prices, said Ganatra. After hurricanes raised doubts about the supplies from top exporter US late last year, Indian traders signed a flurry of contracts. The country's traders are offering cotton to Asian buyers at around 87 cents per pound, including cost insurance and freight, nearly 4% more than rival supplies from the US, the dealers said. But India has struggled to keep supplies steady after infestations of pests like pink boll worms cut output, lifting domestic prices to 87 cents per lb. Vinay Kotak, a director at Kotak Commodities, a Mumbai-based brokerage said that the Indian rupee recently rallied to its highest level in 30 months, further slashing exporters' margins and making it difficult for most merchants to stick to their export commitments. Depleting supplies from India have also led to a shortage in the global market, lifting international prices to their highest level in 3-1/2 years—and helping the United States, Brazil and some other key suppliers increase their market share, especially in Asia. Peter Egli, director of risk management at British merchant Plexus Cotton said that the mills have to go somewhere else to import cotton. They will come to the US, West Africa, and later to Australia and Brazil. Those are the main origin points. The US has committed to sell 678,720 bales of cotton to Bangladesh so far this season, more than double the quantity sold a year earlier, according to the US Department of Agriculture. Bangladesh emerged as a big buyer of Indian cotton thanks to competitive prices and lower freight costs, sourcing nearly half of its annual import requirement of 7 million bales from India. Muhammad Ayub, finance director at the Bangladesh Cotton Association said that now they are in trouble, as many of their contracts with India got stuck over a sudden jump in prices. Indian traders have so far shipped 1.5 million bales of the 2.5 million bales contracted since 1 October, when the current year began. Last year India exported 5.8 million bales of cotton.
Source: YarnsandFibers
More than 200 Pakistani companies took part in the four-day Heimtextil fair, the world’s biggest exhibition of home textile that ended on Friday. They had put up stall in the pavilion set up by the state owned Trade Development Authority of Pakistan. The Pakistan exhibitors received encouraging response from European consumers, but still regional rivals edge out Pakistani companies in many cases due to cost advantage. Apart from home textiles such as bed linen and towels, the European buyers have also expressed great interest in the textile products used in health facilities. However, an increase in prices of yarn and cotton, which are vital inputs in textile production, has pushed up production cost by 15 to 20%, making it tough for the exporters to finalise orders at competitive prices. Shahab Textile Mills Chief Executive Officer Sheikh Ali Ahmed Sadiq said that they had found great demand for health-care textile products from across the world. Sadiq has been participating in Heimtextil since 2013 and considers it a great platform for interacting and forging linkages with big textile buyers. He chastised the government for its “lack of attention” and high production cost of businesses, saying exporters had got bogged down because of these factors. With the business cost staying high, the exporters also could not reap the rewards of the rupee’s sharp depreciation against the dollar in December 2017. A weaker currency gives price advantage to exporters in the international market, but at the same time it makes imports expensive for businesses. Europe, the US, Middle East and Africa were big markets for such textile goods, he revealed, adding Canada too was a major consumer of health-care textile products, but it had levied 18% duty on exports from Pakistan. On the other hand, Bangladeshi exporters are enjoying duty-free status there. Pakistan produces scores of health-care textile products of excellent quality which include clothes for patients, bed sheets, specialised bed sheets and towels for operation theatres, gowns for doctors and paramedical staff. Though Pakistani products have drawn a great response, their high production cost has left the country uncompetitive in relation to regional rivals. They are losing orders to companies from China, Bangladesh, Turkey, Vietnam, India and Egypt. The Indian government has given concessions to its industries in a bid to help them compete well in the global market. Speaking on the occasion, Multimet International Executive Director Zafar Saeed revealed that an old customer of the company had come up with a huge order for the Spanish market. Spanish buyers were willing to offer a 3 to 4% higher price compared to the previous order, but over the past year production cost in Pakistan had gone up in the range of 15 to 20%, he said. Even if they minimise their margins, the goods will still be expensive by around 10%, making it difficult for them to win orders, he said while pointing out that new buyers from Spain, Poland and Albania had also expressed interest in Pakistan’s home textiles. Gul Ahmed Textile Mills Chairman Mohomed Bashir pointed to the latest technological advances including digital printing and online export orders being embraced by the home textile industry worldwide. He suggested that Pakistani companies should adapt themselves to the changing trends in order to secure their place in the international market.
Source: YarnsandFibers
Temirbek Erkinov, Kyrgyzstan’s Honorary Consul appointed in Dhaka, during his meeting with Bangladesh Garment Manufacturers and Exporters Association (BGMEA) President Siddiqur Rahman at the latter’s Dhaka office on January 9, 2018 placed the proposal of investing in readymade garment in Kyrgyztan. Kyrgyzstan wants Bangladeshi apparel manufacturers to set up readymade garment factories there and has even invited businessmen for joint investment in developing the sector. He assured Bangladeshi businessmen that Kyrgyzstan would provide all the needed assistance, be it in terms of providing land, gas, electricity and other infrastructural support if Bangladeshi apparel makers invest in the country. At the meeting, they also discussion different bilateral issues, including possible scope of trade cooperation between the two countries. They expressed their keen interest to each other in terms of expanding business. They both expected that it would create a new gateway of business between the two countries. The BGMEA President informed the Honorary Consul about the development and prospects of the garment industry in Bangladesh, and urged the Kyrgyz businessmen to import more apparel from Bangladesh. Temirbek Erkinov called on Bangladeshi entrepreneurs for making mutual investment in different emerging sectors, including apparel industry in Kyrgyzstan. In case of mutual investment, the Kyrgyz government will facilitate easy loan for the Bangladeshi investors who will also be able to take workforce from Bangladesh if they want. A business delegation from Bangladesh will be invited by the Kyrgyz Republic to visit Kyrgyzstan very soon. The principal export products of Bangladesh to Kyrgyz are woven garments, knitwear and home textile etc. The import items from Kyrgyz include textiles, textile articles, glass and glassware etc. It may be mentioned that Bangladesh exported total amount of US $0.04 million to Kyrgyzstan in 2016-17 and imported the amount of US $0.09 million in 2015-2016. A business delegation of BGMEA is expected pay visit to the country in March/April.
Source: YarnsandFibers
US cotton prices have been on a rollercoaster ride in 2017, ending the year on a high. Last April, we looked at whether this could be the end of high cotton prices. We concluded that yes, cotton prices should fall as latest figures showed rising US cotton planted area for the 2017/18 season. Our expectations became reality, as prices fell throughout the year until recently, when cotton prices rose 22% since the beginning of November, reaching high levels last seen in 2014. So why have US cotton prices grown, when forecasts for planted area are still up 20% year-over-year for the current season? The answer: India. Supply in India has tightened, with production revised down 2% month-over-month to 29.5 million bales and consumption revised up 1% m-o-m to 24.8 million bales. Many believe, however, that this production figure is still quite optimistic for the region, as an outbreak of pink bollworm infestation has damaged the crop, largely reducing yields. This has resulted in India’s ending stocks revised down 10% m-o-m to 13.2 million bales. Lower domestic supply in India has caused them to seek cotton from elsewhere, and the US fit the requirements perfectly. In the US, cotton ending stocks for 2017/2018 have since been revised down 5% m-o-m in December, to 5.8 million bales. This is due to increasing demand, with exports revised up 2% m-o-m to 14.8 million bales and domestic consumption revised up 2% m-o-m to 3.6 million bales. Is this upward price trend expected to last? First of all, this upward movement is unexpected in the market as five months into the 2017/2018 season, forecasts for production and ending stocks still remain 9% and 18% higher y-o-y respectively. Early indications from the 2018/19 season released by the USDA this month, however, suggest that although high supply is expected to be carried over from the current season, reduced production caused by lower planted area is likely to see lower ending stocks next season. To further this, uncertainty around the cold snap brought on by the bomb cyclone and its effect on crops will likely add volatility to the market over the next few weeks. This suggests that prices could continue to recover from years of low levels, following a near seven-year low in 2016.
Source: Spend Matters
Iran’s textile and leather sector’s exports value have increased by 18 percent to $908 million during the first eight months of the current fiscal year (started March 20, 2017). The sector covers textile and clothing products, shoe and leather products as well as carpet, according to Masoud Kamali Ardakani, director general of Trade Promotion Organization of Iran(TPOI) for exports development. Iran exported $279 million worth of textile (23 percent increase) and clothing products (32 percent increase). The export of textile products to Turkey increased by 45 percent, clothing exports to Afghanistan raised by 37 percent. Carpet export has touch worth $512 million (including hand-made carpet) in the 8-month period. The export of hand-made carpets to Germany and Japan has increased by 66 percent in the period. The export of machine-made carpet increased by 10 percent, meanwhile the country’s hand-made carpet exports registered a rise by 28 percent in the period, the official added. The US, Germany, Japan, Iraq, Afghanistan, Turkey, India, Italy and Pakistan are main destinations of Iran’s textile and leather sector’s exports.
Source: YarnsandFibers
Electronics For Imaging, Inc. (EFI), a global technology company leading the worldwide transformation from analogue to digital imaging, has launched the new EFI Fiery TextileBundle, a set of design and production workflow innovations that can help businesses, looking to grow with digital industrial textile production for apparel, advance their operations. The bundle, used with EFI Reggiani digital inkjet printers, includes new Fiery DesignPro Adobe Illustrator and Photoshop plug-ins to create professional textile designs efficiently, and the newest Fiery proServer digital front end (DFE) for high-quality textile production. With the launch of Fiery DesignPro, EFI provides the ability to accurately match colours to the printed result, share colour palettes across the design team in real time, design professional repeat patterns and create multiple colourways from one design. The plug- ins work as part of designers’ familiar environment within Adobe Photoshop and Illustrator, resulting in reduced learning curves and shorter design time. The bundle also includes the new version 6.5 of the EFI Fiery proServer DFE, an advanced offering for wide- and superwide-format inkjet printers that brings superior EFI Fiery performance and colour technology to the EFI Reggiani family of industrial textile printers. Used by major textile brands for sampling, Fiery proServer provides colour consistency in the production workflow with colour profiles that can be used across the design and production process. EFI Reggiani vice president and general manager Adele Genoni said, “The Fiery Textile Bundle brings valuable new tools to further automate and streamline the design and prep process for EFI Reggiani customers looking to stay on the leading edge of innovation. Now, with this bundle,
including the newest Fiery proServer, Reggiani customers get the proven, high-end advantages Fiery technology offers so they can be more efficient, more productive and more profitable.” Version 6.5 of the Fiery proServer includes textile-specific capabilities such as support for multiple ink types and colour technology to ensure the highest print quality with saturated black, fine details and smooth gradients. Superior half-toning technology keeps pastels and light tones clean, and reduces graininess in highlights and large solid areas. The new version supports digital production operations in both direct-to-textile and transfer printing, plus it provides the production tools to handle step and repeat, changes in fabric dimensions during production, and brand colour accuracy.
Source: Fibre2Fashion
Bangladesh Textile Today, in partnership with Dysin organized Textile Youth Leadership Summit 2018 with a view to engage youth leadership in the industry on Friday 12 January 2018 in Dhaka. The theme of the summit was “Innovation and Entrepreneurship for Transformation”. The program was chaired by Prof Dr Engr Ayub Nabi Khan, Pro-Vice Chancellor of Bangladesh Garment Manufacturers and Exporters Association (BGMEA) University of Fashion & Technology, and graced by the attendance of Engr Shafiqur Rahman, President, Institution of Textile Engineers & Technologies. The summit focuses on the energetic arms of the young ones in textile sector in Bangladesh. So, she wants to inject young blood into the industry, for what is being said as a boost for achieving the next level of transformation of its US $ 30 billion apparel industry. Experts feel the inclusion of young entrepreneurship in the industry will help achieve its US $ 50 billion export goal by 2021 and place Bangladesh as a global leader in apparel exports. Amanur Rahman, Managing Director of Dysin, a chemical supplier of Bangladesh’s textile industry said that Bangladesh’s apparel industry needs to invest in youth leadership. The youth can give a new direction to the industry, which the apparel industry needs. At the summit all of them emphasized on the participation of young people in RMG sector of the country. They said that this is high time for the bold measures to be taken, this is the time when youth can make it count.
Among others who spoke at the event were Mohammad Hatem, Ex-vice President of Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), Mohammad Abdullah Zaber, Deputy Managing Director of Zaber & Zubair Fabrics Ltd., Jamil Tipu, Executive Director of Akij Group, and Maj Md Mizanur Rahman (Retd.), President, Bangladesh Apparel Professionals Society.
Source: YarnsandFibers
