The Synthetic & Rayon Textiles Export Promotion Council

MARKET WATCH 19 JUNE, 2018

NATIONAL

INTERNATIONAL

 

GST helped gather info on small manufacturers, bring entire Textile chain under tax net: Fin Min

New Delhi : The Goods and Service Tax (GST) has helped both Centre as well as States to gather data on small manufacturers and consumption, entire Textile chain is now brought under tax net and segment of land and real estate transactions has also been brought into tax net “works contracts”, Finance Ministry said today. According to a release by the Ministry of Finance, GST has resulted in formalization of economy and consequently information flow would eventually augment not only the Indirect Tax collections but also Direct Tax collections. In the past, the Centre had little data on small manufacturers and consumption because the excise was imposed only at the manufacturing stage while the States had little data on the activities of local firms outside their borders. Under the GST, there will be now seamless flow of availability of common set of data to both the Centre and the States making Direct and Indirect Tax collections more effective, the Ministry said. There are early signs of tax base expansion. Between June and July 2017, 6.6 lakh new agents, previously outside the tax net, sought GST registration. This is expected to rise consistently as the incentives for formalization increase. Entire Textile chain is now brought under tax net. Further, a segment of land and real estate transactions has also been brought into tax net “works contracts”, referring to housing that is being built. This in turn would allow for greater transparency and formalization of cement, steel and other sales which earlier tended to be outside the tax net. The formalization will occur because builder will need documentation of these input purchases to claim tax credit, said the Ministry release. The introduction of GST, a common Indirect Tax for both the States as well as the Central Government with its end to end digitization of all processes, is the biggest reform measure which is already creating more jobs in formal sector and eliminating transactions which are not recorded earlier in the books of accounts and thus, were outside the tax net so far. GST is designed to bring about better tax compliance and transparency in tax system. It is putting a premium on honesty. It would make increasingly difficult for those (who are liable to pay tax) to remain outside the tax net. A number of procedural changes have also been made since the roll-out of GST on 1st July, 2017 in order to simplify the processes. An extensive exercise was undertaken for tax payers education and facilitation by way of knowledge sharing, dissemination of information and replies to FAQs among others. Further, steps are also being undertaken for further simplification in order to facilitate the tax payers and to extend benefit to the customers.

Source: Knn India

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Exporters waiting for Rs 250-bn refunds stuck in GSTN lacuna: Amit Mitra

He said an average of only 35-40% of these applications have come to states for manual verification.  West Bengal Finance Minister Amit Mitra on Monday said that exporters across the country were awaiting refunds to the tune of Rs 250 billion, which have been stuck due to the "inability" of the GST Network (GSTN). "There have been three lakh applications from exporters of the country, involving Rs 250 billion, which are awaiting refunds," Mitra, also a GST Council member, said here during an exports conclave, a part of the Bengal Global Business Summit 2019 roadshow. The GSTN auto verifies refund claims, but it is unable to do so, and therefore, manual verification is relied upon that leads to huge pileup of applications and impacts the working capital of the exporters, the minister said. He said an average of only 35-40 per cent of these applications have come to states for manual verification, and the situation remains grim for West Bengal as well. Mitra has been critical of the GST implementation in the past, too, accusing the Centre for its "hurried" introduction without adequate infrastructure, which has made the indirect tax system more "primitive" than the VAT regime. He also said that he will raise the issue with the GSTN. Mitra had earlier assured the state's exporters of some advance credit to partially tide over their crisis. The Bengal minister said the state was aiming to double exports from the existing $9.15 billion, over the next three years. Towards this goal, it has decided to adopt measures to improve infrastructure for exporters at the district level. The WBIDC and MSME will work together to set up export facilitation centres at district headquarters, he said. Mitra added that steel, foundry, garments and leather are among a few focus sectors to push exports from the state.

Source: Business Standard

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₹25,000 cr in GST refunds for exporters still pending; physical verification seen as key reason

Kolkata: GST may have made life easier for many. But for exporters claiming accumulated input tax credit against payment of CGST and SGST, things are in a pitiable shape. The IGST refunds by Customs are, however, smooth. On Monday, West Bengal Finance Minister Amit Mitra claimed ₹25,000 crore worth of refunds are payable to exporters against claims since July 1. Approximately a quarter of the unpaid refunds belong to Engineering Export Promotion Council (EEPC) members, who are mostly manufacturers. Mitra blamed the delays on the need for physical verification of documents as the auto-verification module is not in place yet. “The GSTN is still not in place and delay in auto verification of documents has delayed refunds for exporters,” he said at an exporters’ meet organised by West Bengal Industrial Development Corp. According to Imran Khan, a member of the committee of administrators of the Council of Leather Exports, the total due to the industry is ₹300 crore, of which one-third belongs to exporters from Bengal. “It is mostly the older refunds which are due. Settlement of refunds for recent months have become faster,” he said. According to Anshuman Kanoria, Vice-Chairman of the Indian Tea Exporters Association and Chairman of the Calcutta Tea traders Association, no exporter has received the refund for July 2017 (when GST was rolled out) as yet. However, refunds of some subsequent months were released. “There is no pattern in this. We received refunds for some months and the rest are pending for months. Even the provisional 90 per cent refund which was scheduled to be released in 15 days didn’t arrive,” Kanoria said. “We are in the process of collecting data to know the exact amount of refund pending to tea exporters. But some got 50 per cent some even lower,” he said. What agitates Kanoria the most is the need for physical applications and frequent changes in format for filing. Sources in GST bodies admit that GSTN is yet to launch the auto-verification module.

Formats changes is also a major issue.

A couple of months ago, GST authorities suddenly demanded repeat check of invoices, leading to delays.

Filing errors

But, according to a source, errors in filing is a major reason for the delay. “If there are discrepancies between returns submitted by the supplier of goods and the exporter, delay is inevitable. And, so far, a good number of applications had this error code,” he said. To speed up refunds, GST authorities organised a special refund fortnight in June. Officers were designated to sort out issues regarding specific errors. Over ₹100 crore claims from Bengal were settled during the fortnight.Sources in the exporting community admit that filing error is an issue, though they insist it is not behind the delay in refunds.

Source: Business Line

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Trade row: India, US officials to hold meet on June 26

Trade row, india, us, donald trump, trade war Senior trade officials from India and the US will hold a crucial meeting on June 26 to hammer out solutions to contentious trade issues, including the additional duty slapped by the Trump administration on Indian steel and aluminium. Senior trade officials from India and the US will hold a crucial meeting on June 26 to hammer out solutions to contentious trade issues, including the additional duty slapped by the Trump administration on Indian steel and aluminium, that have threatened to escalate into a broader trade war, sources told FE. The US delegation will be led by assistant US trade representative (south and central Asian affairs) Mark Linscott. Both the sides will first try to “address low hanging fruits”, including greater market access for each other’s products, in the meeting and see how to resolve all the crucial issues without further flaring up the situation, said one of the sources. New Delhi has proposed to impose up to 50% extra duty on 30 American goods, including Harley Davidson bikes, almonds and apples, stung by the US move to slap additional 25% import tariff on steel and 10% on aluminium supplies from a number of countries, including India. It raised a complaint against the US duty at the WTO, seeking retaliation claim to recoup the cost of $241 million levied on its steel and aluminium exports. India’s proposal for retaliation came after its efforts to persuade the US to exempt it from the extra levy on the metals failed to elicit a positive response. The next week’s meeting will lend more clarity as to where both the sides are heading and how serious are both the sides in addressing each other’s concerns. The decision to convene the meeting was made by both the countries during commerce and industry minister Suresh Prabhu’s visit to the US last week. India has already dragged the US to the WTO over the duty on steel and aluminium recently, having raised objections to massive illegal subsidies by the US in the renewable energy and agriculture sectors. The US has sought to raise a dispute at the WTO against India’s export subsidies, claiming that such sops hurt US workers. Apart from relief on the metal duty, India wants relaxed visa regime for skilled professionals; delinking of a special tariff regime from market access talks, among others. For its part, the US wants greater market access to reduce its trade imbalance with India; zero import duty on Harley Davidson bikes and removal of price curbs on stents and other medical equipment by New Delhi. US President Donald Trump recently attacked India for its alleged high tariff regime, which, he claimed, is as high as 100% in some cases. India accounted for only 2.8% of the US goods trade deficit of $810 billion in 2017 and occupied the 9th spot in the list of nations with which the Trump administration seeks to pursue a trade balance agenda.

Source: Financial Express

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‘Skilling has become a mainstream activity’

IL&FS Education, a leading social organisation under parent company IL&FS, has emerged as a leading player in the skills mission. It conducts a diverse range of skills training activities to suit the needs of specific local environments, besides being a skills partner with the National Skills Development Corporation (NSDC). RCM Reddy, MD and CEO, IL&FS Education, elaborates on his company’s activities and the evolving skills ecosystem in a telephonic interview with A Srinivas. Excerpts:

Is skilling in India adapting to emerging trends such as automation, AI?

India exists at different levels of economic development. Therefore, skills training should reflect this socio-economic diversity. There are regions where agriculture underpins the economy, and others where intermediate skills, required in sectors such as construction, hospitality, retail, apparel and driving, are crucial to job creation. Simultaneously, automation and AI are emerging as key factors in certain segments in manufacturing and services. Our 200 centres of IL&FS provide a range of skills depending on specific geographical needs to two lakh students annually. Hence, our training progammes vary, from making wine from Kiwi fruit in Arunachal Pradesh or a fisheries programme in Odisha, to running a ‘mechatronics’ programme in partnership with Alagappa University, Tamil Nadu. We are doing an AI training programme in partnership with Google. At the middle level, we impart skills for construction, hospitality, retail, apparel, drivers and others.

How does one achieve higher placement rates?

IL&FS, run by financial institutions, is a multi-stakeholder company that has entered into a PPP with the NSDC. Our industry touch-points are high. As a result, we as a policy identify the job needs and train people accordingly, rather than the other way around. The prerequisite for placement is real time industry connect and local job market information systems. If these two are facilitated, even the smaller concerns or NGOs, which run good quality training programmes, can achieve higher placement rates. How would you respond to criticism that overall placement rates of the Skills Mission scheme are barely 50 per cent, according to the 2016-17 Annual Report of the skills ministry? The statistic does not reflect the true success of the skills programme. The 49-50 per cent figure only includes absorption by the organised sector. If we were to take informal sector employment into account, the number would be at least 67 per cent. Of the 75 per cent who pass out, more than 90 per cent get an offer. And about 80 per cent of these offers are accepted. There is a serious shortage of entry-level people in sectors such as logistics and sales. In sectors such as apparel the placement rate is much higher than the average.

Would you say that the Skills India programme is a success?

The Skills India programme today has several streams, ranging from imparting skills in schools and colleges to short-term skills training for unemployed youth. All these streams are doing visibly well. The short-term training programmes focus on job roles that do not require the extended training period of two years under the ITI system. Therefore, the programme addresses the demand-supply gap in an efficient manner. Besides, a system of quality control and standards has developed in quick time. Sector skills councils, autonomous industry-led bodies under the NSDC, set occupational standards, train the trainers, conduct skills-gap studies and assess the candidates. Every State has a skills development mission. The skills programme has become a mainstream activity within very quick time.

Source: Business Line

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Petroleum Minister to take up oil price issue at OPEC meets

New Delhi: The government will take up the crude price issue with the Organisation of Petroleum Exporting Countries (OPEC). Petroleum Minister Dharmendra Pradhan has been invited to address the conference, scheduled to be held from June 20-21 at Vienna. Meanwhile, Interim Finance Minister Piyush Goyal said that the GST Council, in its next meeting, may discuss a proposal to bring various petroleum products under GST. However, no date has been finalised for the meeting. Pradhan said that he will put across to OPEC and non-OPEC producers at Vienna that crude oil price should be regulated and pricing should be ‘reasonable and responsible.’ “We don’t want crude prices to be $25 a barrel, but now it is beyond reach. Why is it going beyond $55-60?” he asked while talking to reporters on the sideline of a conference organised by the CII. “I will be telling them that if you don’t regulate oil prices, we will be looking at alternate sources such as electric transportation and renewable energy,” he said. India has for long sought to end the Asian Premium on oil being charged by OPEC producers. This issue was raised again in a meeting last week with the ambassadors from OPEC countries to India. India has a strong engagement with OPEC countries, who are the top eight suppliers of crude to India. The block accounted for about 83 per cent of India’s total crude oil imports, 98 per cent of LPG imports and 74 per cent of LNG imports during the last financial year.

GST on petroleum products

Earlier, Goyal said the GST Council has to take a decision on bringing petroleum products within GST. At present five petroleum products — crude oil, petrol, diesel, natural gas and aircraft fuel  are out of GST’s ambit.

Source: Business Line

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Rupee up 2 paise versus dollar

Mumbai : The rupee staged a recovery towards close of session on Monday to end with a marginal 2 paise gain at 67.99 against the US dollar. After selling off drastically over the weekend, the rupee resumed substantially weak at 68.16 at the interbank forex market. Extending the downward pressure, the local unit lost further ground to test a low of 68.18 briefly in midmorning deals. But it later reversed the initial negative momentum and managed to pull back and hit a fresh intra-day high of 67.94 towards tail-end trade before closing at 67.99, showing a small gain of 2 paise against the US dollar.

Source: Business Line

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Naveen govt push to handloom exports

Bhubaneswar: The promotional activities of the Naveen Patnaik government in Odisha has resulted in a sharp rise in the export of handloom and textile products. The state exported handloom and textile products worth Rs 398 crore during the last five years. The export, which was a meagre Rs 10 lakh in 2012-13, went up gradually over the years and reached Rs 240 crore in 2016-17, said handloom and textiles minister Snehangini Chhuria. "We have achieved the growth because of export promotion measures by our department," she said. Odisha is famous for its handloom products manufactured by weavers. The government identified over 1.03 crore weavers, according to the handloom census in 2009-10. Prominent among the export promotion measures was the establishment of an International Marketing Cell and awareness camps across the state by the Handloom Export Promotion Council. The council has initiated steps for registration of weavers for export through it. The government has also introduced the Handloom Mark and India Handloom Brand in the state to promote export of handloom and textile goods. National award recipients and weavers, who have registered through India Handloom Brand, are being given opportunities to take part in international exhibitions, said Chhuria. The other major export promotion measures include buyer-seller meets, participation in international and national handloom expos and providing financial assistance for geographical indication registration and brand building. For skill upgradation, the government is training weavers on designs that have international demand and providing financial and technical assistance to produce products through export promotion schemes. As part of its efforts to promote the state's handloom products, the government recently decided that the uniforms of teachers would be made out of this material. Sources said apart from helping the branding of these products, it would also augment revenue. All the concerned departments had been asked to cooperate.

Source: The Telegraph

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TN to organise international textile fair in Coimbatore

To encourage and also for the development of the textile industry in Tamil Nadu, the state government would organise an international textile fair at Codissia Trade Fair Complex, Coimbatore this year. This was announced by chief minister Edappadi K Palaniswami in the state legislative assembly. The government would spend Rs 2 crore in organising this event. Welcoming the announcement, Tiruppur Exporters’ Association (TEA) president Raja M Shanmugham said Tamil Nadu is a major player in the country’s textile value chain, so organizing the international textile fair would largely help in promotion of the industry, including exports. “The textile industry in Tamil Nadu is exporting about Rs 45,000 crore worth of goods annually, and organising such a fair will help in increasing exports,” Shanmugham said in a press release. “The textile industry will get an opportunity to showcase quality products and penetrate new markets and also get new buyers.” Shanmugham thanked Phanindra Reddy, secretary, Handlooms, Handicrafts, Textiles & Khadi Department, for his unstinted support and efforts for the announcement of international textile fair in Coimbatore.

Source: Fibre2Fashion

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A textile for all seasons

Khadi will be presented in all its glory with yardage, saris and dupattas at the Dastkar Andhra Exhibition at Serenity boutique from June 19 to 23. The yardage in khadi will be of two types — handspun or hand-woven and handloom, but contains mill-spun yarn and is hand woven. Dastkar Andhra uses natural and environmentally friendly dyes for its products. “It is authentic, it is comfortable,” says Arati Monappa, of Serenity Boutique. “I am a textile designer. I also use it in my line. It is a beautiful product to work with. You don't have to starch it. You can accessorise it, you can embroider on it, you can make any kind of embellishment. And it has some meaning behind it, and I think that makes a very big difference, apart from the comfort factor.” Serenity is a not-for-profit venture that focuses on uplifting artisans and selling eco-friendly products. “We support Dastkar Andhra because their whole marketing strategy is democratic, participative and equitable. They guarantee 365 days of work to their weavers. The profits are equitably distributed. They are working with co-operatives. We don't want to let this industry die; especially that of handwoven khadi.” Latha Tummuru, who is organizing the event, works with Dastkar Andhra Marketing Association, which works with 22 cooperatives and over 500 weavers across 22 villages in seven districts in Andhra Pradesh and Telangana. For her, the importance of the exhibit is in promoting hand woven cloth to the urban customer. “We believe that these people are already skilled. We just need to provide them with employment so that they can use their skills sitting in the village. Otherwise, they migrate to cities and become unskilled. Our organisation intervenes to make sure products come in the form that people can use. The innovations are in the fabric and the dupattas. Traditionally, weavers only make saris and dhotis.” She believes that the dupattas and the wide variety of yardage will be some of the popular products at the exhibition. The Ponduru Khadi sari is another product that is frequently asked about. “We look forward to popularising handlooms, which I have always been passionate about,” says Arati. The Dastkar Andhra exhibition will take place at the Serenity Boutique in Jayamahal Extension from June 19 to 23.

Source: The Hindu

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Hosiery exporters welcome CM's announcement on global fair

The Tirupur Exporters' Association (TEA) today welcomed the Tamil Nadu govenment's proposal to organise an international textile fair here this year, saying it would help in promotion of the textile industry. In a statement here, TEA president Raja M Shanmugha said the Chief Minister K Palaniswami's announcement on the fair in the assembly was a welcome measure. The textile industry in the state ws exporting about Rs 45,000 crore worth products annually and the fair would help in increasing the exports, he said. It would provide an opportunity to showcase quality products and help the exporters penetrate into new markets, the TEA official added.

Source: Business Standard

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With last year’s unsold groundnut stocks, Gujarat farmers turn to cotton

Groundnut sowing in Gujarat is set to dip this kharif season as last year’s crop lies unsold and rains are delayed. Nafed-led agencies procured over 8 lakh tonnes (lt) of groundnut at the minimum support price, but a negative sentiment prevails. A 25 per cent decline in acreage as compared to last year's 16.61 lakh hectares (lha). "Farmers have suffered heavy losses. As against the cost of Rs 8,000-10,000 per `bigha’ (about half of an acre), we got a market price of Rs 3,500 per quintal on a yield of three quintals. Also, there are chances of crop failure in groundnut due to pest and climate conditions. Hence, most of the farmers in our region have decided to turn to cotton or other short-duration pulses crop," said Lalitbhai Vagadiya, a farmer from Mithapur in Junagadh District. But there is a section of farmers who prefer groundnut crop for this kharif season. Jagdish Rangaliya of Halvad in Morbi district asked, "What else can we sow? Chana didn't fetch remunerative prices. For cotton, it is difficult to get labourers for picking. There is no crop that earns well for us. At least we are accustomed to groundnut crop and it doesn't affect the soil even if cultivated repeatedly." Rangaliya, plans to continue with groundnut on his 15 biga (about 7 acres). "Groundnut was the backbone for farmers and for Gujarat's economy too. There was a complete ecosystem around it. But after surge of cotton, there were political interests linked to it. Hence groundnut was ignored, which led to its decline and also the allied sectors," said Vitthal Dudhatra, president - Gujarat Pradesh of Bhartiya Kisan Sangh (BKS). According to Gujarat government data, groundnut area had peaked to 20 lha in 2003 with production of 44.77 lt, which fell to as low as 12.85 lha in 2013 with production dropping to 7.62 lakh tonnes. Similarly, during same period, cotton acreage increased from 16.47 lha in 2003 with production of 46 lakh bales (each of 170 kg), to 26.91 lha 2013 with production of 112.8 lakh bales. Dudhatra further stated that cotton, being a global commodity had multiple factors supporting it, hence cotton market remained robust even in the slack period. Groundnut, however, failed to create such acceptability due to its limitations on consumption. With tepid response to groundnut oil consumption and step-motherly treatment meted to groundnut exports has left groundnut growers into despair. Rangaliya said, "There is no hope from farming. I had two of my kids in a private school near Halvad. But I can't afford it anymore. I got my son transferred to a village school and kept daughter in the private school."

Source: The Hndu Business Line

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Global Textile Raw Material Price 18/6/2018

Item

Price

Unit

Fluctuation

Date

PSF

1359.13

USD/Ton

-0.17%

6/18/2018

VSF

2302.21

USD/Ton

0%

6/18/2018

ASF

3058.23

USD/Ton

0%

6/18/2018

Polyester POY

1398.71

USD/Ton

0.11%

6/18/2018

Nylon FDY

3617.09

USD/Ton

0%

6/18/2018

40D Spandex

5433.40

USD/Ton

0%

6/18/2018

Nylon POY

3260.04

USD/Ton

2.44%

6/18/2018

Acrylic Top 3D

1645.54

USD/Ton

0%

6/18/2018

Polyester FDY

3702.47

USD/Ton

0%

6/18/2018

Nylon DTY

5852.55

USD/Ton

0%

6/18/2018

Viscose Long Filament

1664.17

USD/Ton

0.19%

6/18/2018

Polyester DTY

3228.99

USD/Ton

-0.24%

6/18/2018

30S Spun Rayon Yarn

3073.75

USD/Ton

0%

6/18/2018

32S Polyester Yarn

2219.93

USD/Ton

-0.35%

6/18/2018

45S T/C Yarn

3073.75

USD/Ton

0%

6/18/2018

40S Rayon Yarn

2732.22

USD/Ton

0%

6/18/2018

T/R Yarn 65/35 32S

2328.60

USD/Ton

0%

6/18/2018

45S Polyester Yarn

2608.03

USD/Ton

0%

6/18/2018

T/C Yarn 65/35 32S

3244.52

USD/Ton

0%

6/18/2018

10S Denim Fabric

1.46

USD/Meter

-0.11%

6/18/2018

32S Twill Fabric

0.90

USD/Meter

0%

6/18/2018

40S Combed Poplin

1.25

USD/Meter

0%

6/18/2018

30S Rayon Fabric

0.71

USD/Meter

0%

6/18/2018

45S T/C Fabric

0.74

USD/Meter

0%

6/18/2018

Source: Global Textiles

Note: The above prices are Chinese Price (1 CNY = 0.15524 USD dtd. 18/6/2018). 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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Global re-insurers Amlin, Markel International enter Indian market

Mumbai : MS Amlin and Markel International, two of the world’s leading insurers, have entered the Indian market to write re-insurance business. Amlin is the re-insurance partner (along with GIC Re) of New India Assurance Co for its newly-launched and India’s first protection and indemnity (P&I) cover for Indian-registered ships that ply on local routes. P&I insurance deals with third-party liabilities, which include a carrier’s liability to the owner of the cargo for damages, the liability of a ship after a collision, and environmental pollution.

Premium cover

Amlin holds the second spot globally in the fixed premium P&I cover and insures more than 5,000 ships worldwide. It is a part of the global top 10 insurance group MS&AD, with operations in the United Kingdom. The fixed premium P&I cover of New India Assurance has a limit of $5 million (₹33 crore) per vessel. Amlin will underwrite the risk on a “case-to-case” basis ranging from 40 to 60 per cent, a person briefed on the arrangement, said. While the initial set of P&I cover has been issued with Amlin and GIC Re as the re-insurer, New India Assurance could partner with other global re-insurers also, going forward, the person said. Specialist insurer Markel International has secured a licence from the Insurance Regulatory and Development Authority of India to write reinsurance business. Capacity will be provided by Markel’s Syndicate 3000 at Lloyd’s and written through the Lloyd’s India platform. Markel India will provide treaty and facultative reinsurance to local Indian insurers, in a broad range of commercial classes. It will initially focus on marine, energy, contingency, professional and financial risks. Markel International Limited is a subsidiary of Markel Corporation, a US-based holding company that trades on the New York Stock Exchange. Markel International writes insurance and reinsurance business through four divisions and through offices across the UK, Europe, Canada, Latin America and Asia Pacific. “We think there will be a strong level of demand from Indian insurers for the sort of specialty products and expertise that we can now deliver locally. Our plans in India can now start to be realised,” said William Stovin, President of Markel International.

Source: Business Line

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Kenya levies higher duties on mitumba import

Kenya’s treasury secretary Henry Rotich recently raised the duty on imported second-hand clothes and shoes, known as mitumba, from previous $0.2 per kg to $5 per kg or 35 per cent, whichever is higher, to protect local textile companies and create jobs. He said the step will guard against low mitumba prices that make it tough for local companies to thrive. However, anxiety does exist in the country about the loss of thousands of jobs within the mitumba industry, according to Kenyan media reports. The East African Community (EAC) member nations in the past had proposed a ban on import of mitumba. However, some buckled under pressure after the United States threatened to suspend Uganda and Tanzania from duty-free access under the African Growth Opportunity Act (AGOA). Rwanda currently faces a ban. Kenya has, however, preferred to use tax measures and incentives to encourage the growth of the local industry. According to the Economic Survey 2018, the textile sector recorded a decline of 1.7 per cent last year but production of wearing apparel increased 5.6 per cent due to a growth of 10.4 per cent in the production of T-shirts. (DS)

Source: Fibre2Fashion

http://www.globaltextiles.com/info/detail/001-24215/Kenya-levies-higher-duties-on-mitumba-import.html

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US retail imports to hit record numbers: NRF

Imports at major US retail container ports are likely to set record numbers in summer and fall 2018, according to the monthly Global Port Tracker report released by the National Retail Federation (NRF) and Hackett Associates. Consumers are buying more, so retailers are importing more, said NRF vice president for supply chain and customs policy Jonathan Gold. “Imports continue to be the primary source of high-quality, mass-produced necessities at affordable prices and will be for the foreseeable future. If tariffs are imposed on consumer goods, that will only drive up prices for American families while doing little or nothing to punish those responsible for unfair trade practices,” an NRF press release quoted Gold as saying. “Despite an environment where the US administration is enacting measures that could well lead to a trade war with most of its Asian and European trading partners, we see imports continuing to grow,” Hackett Associates Founder Ben Hackett said, noting that manufacturers have seen increased orders that reflect solid consumer demand. Ports covered by the Global Port Tracker handled 1.63 million twenty-foot equivalent units (TEU) in April, which was down by 5.8 per cent from March and up 0.3 per cent year-over-year. A TEU is one 20-foot-long cargo container or its equivalent. May was estimated at 1.77 million TEU, up 1.3 per cent year-over-year. The first half of 2018 is expected to total 10.2 million TEU, an increase of 3.8 per cent over the first half of 2017. The total for 2017 was 20.5 million TEU, up 7.6 per cent from 2016’s previous record of 19.1 million TEU. (DS)

Source:Fibre2Fashion

http://www.globaltextiles.com/info/detail/001-24211/US-retail-imports-to-hit-record-numbers:-NRF.html

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Rwanda to pay tax of exporters affected by AGOA suspension

Rwanda will take over the tax obligations of its apparel exporters to ensure they are not adversely affected by the anticipated suspension of duty-free access to the US market under the African Growth Opportunity Act (AGOA). The US Government had announced in March its intention to suspend duty-free treatment to all AGOA-eligible apparel items for Rwanda. The Rwandan Government is putting up an adjustment facility to pay taxes imposed on the exporters for the next one year. This would allow firms work on accessing new markets as well as meet existing contractual obligations to the US market, Rwanda Development Board CEO Clare Akamanzi told in an exclusive interview to a leading Rwandan daily. The suspension is a result of implementation by Rwanda of an East African Community decision to phase out second-hand clothes imports to help boost the region’s textile industry. The aim is to identify alternative markets in Europe, Asia and the African continent that can allow duty free access, Akamanzi said. (DS)

Source: Fibre2Fashion

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Trade wars may contribute to the decrease of prices

China promised a symmetrical response to the increase in import duties in the US. Will cotton prices fall? Earlier, Donald Trump reported that the US imposed a 25% duty on a number of Chinese goods supplied to the country at a cost of $50 billion a year. China, in return, will most likely raise duties on some US goods. The main export goods are soybean and cotton. Let us note that China continues to sell cotton from state reserves. At the last auction on Friday, 12.5 thousand tons were sold, which was approximately 40% of the declared volume. Another negative factor for prices may be the forecast of the Confederation of Indian Textile Industry. According to the Confederation of Indian Textile Industry, the cotton crop in India in the 2017-2018 season will increase by 8.1% compared to the previous season due to an increase in crop areas by 13%. On the daily timeframe, Cotton: D1 breached down the support line of the accelerated uptrend. The medium-term uptrend endures, but the prices are corrected down from the maximum since March 2014. China's duties on the import of cotton from the United States can contribute to the further price decrease.

  • The Parabolic indicator gives a bullish signal. It can be used as an additional support level, which needs to be breached before opening a sell position.
  • The Bollinger bands have widened, which indicates high volatility.
  • The RSI indicator is below 50. It has formed a negative divergence.
  • The MACD indicator gives bearish signals.

The bearish momentum may develop in case Cotton falls below its last fractal low and the Parabolic signal at 88. This level may serve as an entry point. The initial stop loss may be placed above the two last fractal highs and the 4-year high at 95. After opening the pending order, we shall move the stop to the next fractal high following the Bollinger and Parabolic signals. Thus, we are changing the potential profit/loss to the breakeven point. More risk-averse traders may switch to the 4-hour chart after the trade and place there a stop loss moving it in the direction of the trade. If the price meets the stop level at 95 without reaching the order at 88, we recommend to close the position: the market sustains internal changes that were not taken into account.

Source: FX Street

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Vietnam: Garment-textile sector seeks to optimise opportunities from CPTPP

Hanoi (VNA) - The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) is expected to come into force in early 2019, which will open up numerous opportunities for Vietnamese garment-textile sector. According to the Vietnam Textile and Apparel Association (VTAA), the industry could access many markets with huge potential, including those with which Vietnam has yet to sign free trade agreements (FTA). Under the CPTPP, import tariff on most products will reduce to zero over the course of seven years, which will help businesses achieve high economic efficiency and increase competitiveness. Garment-textile firms will be also able to make use of raw material supply and learn about production technology and management skills from CPTPP member countries. To realise an annual export growth of 10 percent, the sector needs to make best use of markets of member countries of the trade deal. The pact will provide new opportunities for businesses in both export and import. For example, currently Vietnamese apparel makers have to rely on materials imported from China, Japan and the Republic of Korea. With the CPTPP, enterprises could import material from other CPTPP countries such as wool from Australia. In order to capitalize on opportunities presented by the CPTPP, enterprises will need strong support from State management agencies. On their part, the enterprises must spare no effort to penetrate into the markets, first of all by studying thoroughly their target markets. They should also invest in modern machines and sharpening skills for workers. The original Trans-Pacific Partnership (TPP) was signed by 12 countries in February 2016 but US President Donald Trump pulled his country from the deal upon taking office in January 2017. The remaining 11 countries, namely Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam, continued to sign the pact and renamed it the CPTPP in March 2018 in Chile. The pact, which delivers a strong message against the protectionism in the world, is expected to boost economic growth, create more jobs, reduce poverty and improve the quality of life for people in member countries. The deal will create one of the world’s largest free trade blocs with a combined market of 499 million people and GDP of around 10.1 trillion USD, accounting for 13.5 percent of the global GDP. More than 2,000 foreign businesses from 16 countries and territories worldwide have invested some 15.75 trillion USD in Vietnam’s garment and textile sector so far, according to the VTAA. The total textiles and garment import turnover of the CPTPP member countries exceeded 53 billion USD in 2017. Vietnam earned over 4.8 billion USD from exporting textiles and garments to the other CPTPP member nations in 2017, making up 9.07 percent of the market share

Source: Vietnam Plus

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Textile Machinery: New Skill Sets Required For Industry 4.0

MILAN — Once again, innovation has taken a front row seat at the general meeting of ACIMIT, the association that represents Italian textile machinery manufacturers. In presenting the latest figures for the sector for 2017, President Alessandro Zucchi reiterated the inevitability of the digitalization process regarding the entire textile industry. Partnerships between technology suppliers and textile manufacturers have become an essential component in providing solutions to the needs of fast-fashion and increasingly more significant e-commerce retail channels. However, the digitalization of production processes requires a whole new set of skills, and consequently new training solutions. The declaration of intent launched by the trade association is essentially to strength the current link with educational institutions. “We need to consolidate the dialogue with schools,” states Zucchi, “making sure that our needs are met in professional terms, created by the new digital context and the ensuing opportunities young people can seize upon in sectors such as textile machinery production, in which Italy plays a pre-eminent role in providing excellence worldwide.” At the general meeting’s opening remarks, Prof. Fortis, Vice President of the Edison Foundation, illustrated Italy’s global leadership within the textile machinery industry, both in terms of exports and trade balance. The quality and distinction of Italian textile machinery has been reiterated by the latest figures provided by President Zucchi. In 2017, production rose by 8%, for a value of 2.4 billion euros, while exports grew by 7% (2 billion euros). Production benefitted from a growing demand abroad for Italian machinery, as well as the crucial recovery of Italy’s domestic market, mainly due to the boost generated by the fiscal incentives for the digitalization process of the companies.

Source: Textile World

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Vietnamese textile stocks failing to woo investors

In June 2017 the Viet Nam National textile and Garment Group (Vinatex) listed on UPCoM under the ticker VGT at VND13,500. After remaining steady for more than six months, the price of VGT shares suddenly soared by 70 per cent to VND19,400 last January. But it soon gave up all its gains and plunged to VND11,000. A similar fate has befallen many other textile and apparel companies too. Viet Tien Garment Corporation (VGG) was for a long time trading at the highest price in the industry. But it has also been on a downward trend for the last three months. VGG is now being traded at around VND49,200, down by 20 per cent from January. The price of Phong Phu Corporation (PPH) fell to VND20,000 and has remained there since listing on UpCoM last August with a reference price of VND25,000. This is a paradoxical situation since most textile companies are doing pretty well on the business front. An analysis by Dau Tu Chung Khoan newspaper found that only one of the 20 largest listed companies reported a loss in the first quarter of this year. Most of the rest achieved high growth rates. The Viet Nam Textile and Apparel Group is a typical example: It achieved an estimated profit of VND178.4 billion (US$7.85 million), up 41 per cent year-on-year. Many of them even achieved 100 per cent growth, including Nha Be Garment Corporation, (204 per cent) and Ha Noi Textile and Garment Corporation (Hanosimex, 181 per cent).

So why this paradox?

Some market observers thought this was simply because investors are now obsessed with banking and real estate stocks to the exclusion of all else. Others said textile shares are not fancied because of the industry’s low profit margins. Besides, they are facing huge competition from cheap imports from China, the Philippines and Bangladesh. While Vietnam’s accession to the CPTPP will indeed offer a huge advantage to domestic players, they need to meet many conditions for that. One of them is that textile and garment producers must prove the origin of all the materials used to make a product. Not many Vietnamese textile companies can do this. Constant increases in input costs and the need to embrace technology 4.0 to reduce them are other issues. However, experts still expect textile and garment companies to grow solidly because globally the industry is expected to grow at a whopping 25 per cent a year from now through 2025. This also makes the Viet Nam Textile and Garment Association believe that the export target of US$35 billion this year is well within reach. Banks likely to plead for hike in credit growth cap, again. Many banks will have to seek the State Bank of Vietnam’s permission to lend further since they have almost used up their full-year lending quotas within just five months. A spokesperson for a major bank based in HCM City said his bank had been allowed 14 per cent credit growth but has already achieved nearly 10 per cent. Some banks have even used up their entire quota already, like Viet A Bank, Nam A Bank, AB Bank, and Eximbank. The SBV said as of June 1 overall credit growth was 5.6 per cent. This has been attributed to the fact that many banks were worried about the possibility of negative credit growth like last year and so stepped up their lending activities. Besides, many banks have been licensed by the SBV to open more branches and transaction offices this year while their credit growth quotas were allocated before that. Many banks have said they would find it difficult to do business if they are not allowed to lend further this year. This situation is not new and has in fact happened often in the past. According a report from the State Audit Office, last year many banks, including Vietinbank, BIDV, Vietcombank, Agribank, SeABank, and HDBank, ended up with credit growth rates that exceeded the levels set by the SBV. They had to seek permission to continue lending after hitting the limit. But the SBV refused to permit certain lenders to exceed the limit. Some people have questioned the need for the central bank to control credit activities through quotas for banks. This began in 2012 when many banks reported credit growth of up to 50 per cent, causing a spurt subsequently in non-performing loans (NPLs). The central bank began to allocate quotas based on banks’ health and performance. It has divided banks into four groups for allocating credit growth quotas: Group 1 (healthy banks), Group 2 (average banks), Group 3 (below-average banks), and Group 4 (weak banks). Those in Group 4 might not be allocated quotas at all. It has become evident that this system is going a long way in ensuring the safety of the overall banking system. But many experts feel it is now time for the central bank to scrap the credit quota policy since the monetary market has finally stabilised after many years of volatility. Besides, liquidity in the banking industry is high and the Government has adopted tough measures to clean up NPLs and stop cross-ownership of banks, they say. Many banks themselves are now cautious about lending since they are well aware of the consequences, including the NPLs they are likely to be burdened with in case of reckless credit growth. The experts say that in this changed scenario the central bank should stop using administrative measures to intervene, and instead allow the market to determine. They further said that authorities now have a handy tool to closely and effectively control banks’credit activities: capital adequacy ratio (CAR). CAR is an international standard that measures a bank’s risk of insolvency from excessive losses. Currently, the minimum acceptable ratio is 8 per cent. Maintaining an acceptable CAR protects banks’ depositors and the financial system as a whole. The experts said controlling banks’ credit growth through CAR is preferable and in line with current trends.

Source: Vietnam Net Bridge

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NCTO wants textiles added to China tariffs list

Washington – The National Council of Textile Organizations (NCTO) is renewing its call for Chinese textiles to be added to the Trump administration’s new tariffs roster. Last week, the administration announced that additional 25% tariffs will fall on 1,102 products beginning in July. It also released a second list of products that could become subject to tariffs. Home textiles were not on either list, although most types of textiles machinery were included – a move supported by the NCTO. Now, the organization is urging the government to go farther. “NCTO is pleased that some textile products are on the second list. It would have a greater deterring effect, however, if more textile and apparel end products were included. As such, NCTO looks forward to working closely with the Trump administration to refine it,” said NCTO president and CEO Auggie Tantillo. Last month, he represented a group of textiles-related organizations testifying in favor of adding textiles to the original tariffs lineup. The new list of products being eyed for tariffs must also pass through a public comment period. The Home Fashion Products Association and most retail lobbying groups are opposed to the administration’s tariff strategy.

Source: Home Textiles Today

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China strengthening environmental monitoring efforts

The government of China is now strengthening its environmental monitoring efforts as its economic development has shifted from that of a traditional industrial economy to a green economy where economic development and the ecological environment co-exist in harmony. Environmental protection agencies can now order illegal polluters to cut or cease production. TUV Rheinland, leading provider of technical services, and the Alliance for Water Stewardship (AWS) recently hosted a symposium entitled Environmental Supply Chain Management Under the New Normal 2018. Experts from industry associations, businesses, and higher education gathered in Shenzhen to discuss industry environmental management, sustainable water management, green supply chains, and other trending topics concerning how businesses can cut emissions and achieve green production. The ministry of environmental protection was renamed the ministry of ecology and environment in 2018. The new environmental protection tax and introduction of regular environmental audits mean that brands and suppliers are now facing more challenges in compliance. China is now embarking on a large-scale campaign of environmental governance due to the severity of its air, water, and soil pollution. Strengthened environmental monitoring is now inevitable. The continued escalation of environmental issues in China represents serious challenges for brand-name enterprises. “Environmental risk develops in a dynamic way. It affects every brand supply chain and is connected to every citizen. TUV Rheinland will do all it can to help Chinese enterprises refine their environmental supply chain management and support the green, orderly, and sustainable development of China's industrialization,” said Frank Dorssers, vice president systems, customized services at TUV Rheinland Group. Businesses in China need to pay more attention to environmental supply chain management. Uniform global standards must be adopted in order to turn their supply chains ‘green’, said TUV Rheinland in a press release. TUV Rheinland said its new supply chain environmental risk assessment tool can help businesses identify external risks and carry out environmental risk assessments. The three dimensions of Environmental Policy Survey, Environmental Characteristics Analysis, and Environmental Performance Assessment help businesses conduct total reviews and implement environmental management for global suppliers.

Source: Fibre2 Fashion

http://www.fibre2fashion.com/news/textile-news/china-strengthening-environmental-monitoring-efforts-242843-newsdetails.htm

 

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Emerging Asia Hit by Biggest Foreign Investor Exodus Since 2008

A falling tide lowers all boats, it seems. Amid an exodus from emerging markets, investors are pulling out of even Asian economies with solid prospects for growth and debt financing. Overseas funds are pulling out of six major Asian emerging equity markets at a pace unseen since the global financial crisis of 2008 -- withdrawing $19 billion from India, Indonesia, the Philippines, South Korea, Taiwan and Thailand so far this year, according to data compiled by Bloomberg. While emerging markets shone in the first quarter, suggesting resilience to Federal Reserve tightening, that image has shattered over the past two months. With American money market funds now offering yields around 2 percent -- where 10-year Treasuries were just last September -- and prospects for more Fed hikes, the bar for heading into riskier assets has been raised. Headlines on trade disputes that could hit Asian exporters haven’t helped. “It’s not a great set-up for emerging markets,” James Sullivan, head of Asia ex-Japan equities research at JPMorgan Chase & Co., told Bloomberg TV from Singapore. “We’ve still only priced in about two thirds of the U.S. rate increases we expect to see over the next 12 months. So the Fed is continuing to get more hawkish, but the market still hasn’t caught up.” While many emerging-market investors and analysts have praised Asian economic fundamentals, pointing to world-leading growth rates and political stability, some are starting to raise red flags as global liquidity starts to shrink. The Bloomberg JPMorgan Asia Dollar Index sank to a 2018 low on Monday, extending two weeks of declines after the Fed and European Central Bank both took steps toward policy normalization. Yet some still remain optimistic. Bank of America Merrill Lynch expects some of the regional currencies including the baht and the Philippine peso to appreciate slightly by the end of the year, a research note sent Monday showed. Six of 10 best-performing emerging currencies so far this year are in Asia, led by the ringgit’s 1.2 percent advance and the Chinese yuan’s 1.1 percent gain. Developing nations including Turkey, Indonesia, India and Argentina have raised rates, while Brazil’s central bank has sold extra foreign-exchange swap contracts in an effort to stabilize their markets. A falling tide lowers all boats, it seems. Amid an exodus from emerging markets, investors are pulling out of even Asian economies with solid prospects for growth and debt financing. Overseas funds are pulling out of six major Asian emerging equity markets at a pace unseen since the global financial crisis of 2008 -- withdrawing $19 billion from India, Indonesia, the Philippines, South Korea, Taiwan and Thailand so far this year, according to data compiled by Bloomberg. While emerging markets shone in the first quarter, suggesting resilience to Federal Reserve tightening, that image has shattered over the past two months. With American money market funds now offering yields around 2 percent -- where 10-year Treasuries were just last September -- and prospects for more Fed hikes, the bar for heading into riskier assets has been raised. Headlines on trade disputes that could hit Asian exporters haven’t helped. “It’s not a great set-up for emerging markets,” James Sullivan, head of Asia ex-Japan equities research at JPMorgan Chase & Co., told Bloomberg TV from Singapore. “We’ve still only priced in about two thirds of the U.S. rate increases we expect to see over the next 12 months. So the Fed is continuing to get more hawkish, but the market still hasn’t caught up.” While many emerging-market investors and analysts have praised Asian economic fundamentals, pointing to world-leading growth rates and political stability, some are starting to raise red flags as global liquidity starts to shrink. The Bloomberg JPMorgan Asia Dollar Index sank to a 2018 low on Monday, extending two weeks of declines after the Fed and European Central Bank both took steps toward policy normalization. Yet some still remain optimistic. Bank of America Merrill Lynch expects some of the regional currencies including the baht and the Philippine peso to appreciate slightly by the end of the year, a research note sent Monday showed. Six of 10 best-performing emerging currencies so far this year are in Asia, led by the ringgit’s 1.2 percent advance and the Chinese yuan’s 1.1 percent gain. Developing nations including Turkey, Indonesia, India and Argentina have raised rates, while Brazil’s central bank has sold extra foreign-exchange swap contracts in an effort to stabilize their markets. In Asia this week, the Philippine central bank, which raised its key rate in May for the first time since 2014, is expected to lift the benchmark again by 25 basis points to 3.5 percent, a Bloomberg survey shows. The Bank of Thailand will keep its benchmark unchanged at 1.5 percent the same day, according to a separate Bloomberg survey, though JPMorgan for one sees an increase coming next quarter. The baht has tumbled 4.6 percent against the dollar this quarter, despite Thailand having a current-account surplus in excess of a whopping 9 percent of gross domestic product. Thailand is also in the midst of the longest stretch of 3.5 percent plus GDP growth since the early 2000s, according to the IMF. Thai Finance Minister Apisak Tantivorawong, for his part, said Monday he’s not concerned about capital outflows, and the country’s central bank need not follow the Fed in raising rates. Meantime, the baht hit its 2018 low in Monday trading, and the main Thai stock index was down 1.2 percent as of 2:02 p.m. in Bangkok.

Source: Bloomberg

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