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MARKET WATCH 09 AUGUST, 2018

NATIONAL

INTERNATIONAL

Polyester fibre market to witness  huge growth by 2024: Report

MUMBAI— The ‘New Polyester Fiber Market 2017 – 2024 Research Report’ released by MarketStudyReport.com has esimated that the growth of the market is rise at a 8.0% CAGR to 2024.  The reports say that polyester fiber market will likely surpass USD 165 billion by 2024. Polyester is said to have superior quality firm strength and with wrinkle-free  tear-resistant  and reduced  shrinking properties.  These properties help the fiber in maintaining strength once woven in certain cloth. Using of such superior quality material in the apparels home textiles  furnishing  carpets  and other such  products enhances its quality and looks.  Apart from these  the product is also used for insulating and  cushioning purposes along with tire reinforcements which further  augments the polyester fiber market.  With high stain resistance fabric made from the product is used in making higher quality  apparels and clothing series  the  report noted.  Extensive use of the product in apparels  home  furnishing & decor  mattresses  and other textiles will catalyze  the polyester fiber market in the  future years  the report noted.

Source: Tecoya Trend

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India needs to simplify GST, cut debts: IMF

In its annual country report, the IMF said the government’s decision to ensure a 50 per cent premium over cost of farm production “could skew farmers’ production decisions, add to inflation, and enlarge the fiscal burden”. The $2.6-trillion Indian economy is like an “elephant starting to run” and will remain one of the world’s fastest-growing economies, aided by structural reforms, the International Monetary Fund (IMF) said on Wednesday. However, it needs to simplify the goods and services tax (GST) structure and take advantage of strong growth to trim debt more aggressively than planned. In its annual country report, the IMF said the government’s decision to ensure a 50 per cent premium over cost of farm production “could skew farmers’ production decisions, add to inflation, and enlarge the fiscal burden”, so “their use (backed by assured procurement) should only be temporary and limited to correcting market failures”. It cautioned that India’s debt (at 70.4 per cent of the GDP in FY18) is “close to the thresholds that raise the likelihood of debt distress among emerging market economies”. So, a more ambitious medium-term fiscal consolidation path is required that is consistent with the FRBM review committee’s target of trimming the government debt to 60 per cent of the GDP by FY23. The government wants to achieve this target by 2025

Source: The Indian Express

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Import duty on textiles products won’t hurt B’desh shipments

Coimbatore: Though the union government’s decision to double import duty on 328 textile products has brought relief to the textile industry, the move would not impact shipments from Bangladesh, the primary source for the increase in garment imports into the country, industry officials said. “The decision does not positively impact the issue of imports from Bangladesh since there is a full exemption of ‘Basic Customs Duty’,” said Sanjay Jain, chairman, Confederation of Indian Textile Industry (CITI). Chinese fabric is easily coming to India ‘duty free’ through Bangladesh in the form of garments, he said. “Until and unless the government intervenes and puts a ‘Rule of Origin’ clause, imports from Bangladesh will keep coming in the same pace and would affect the fabric as well as other segments of the value chain,” Jain stated. There has been a continuous rise in imports of textile products, especially after the implementation of GST (Goods and Services Tax) last July. Imports of apparel from Bangladesh have surged 44% year-on-year (y-o-y) to $201 million in 2017-18. India imported textile and apparel products valued at about $7 billion in 2017-18, a 16% year-on-year increase. Industry officials said that Bangladesh imports Chinese fabric, converts them into garments using its cheap labour and exports them to India without paying any duties. Since import of ‘Made in China’ fabrics is meant for exports, Bangladesh doesn’t impose any import duties either. Some specified garment items imported into India from Bangladesh are exempted under the SAFTA South Asian Free Trade Area. India should have a made in country of origin clause and same should be put mandatory on the wash care labels on apoarel. Indian export to USA has this procedure.Yogesh Acharekar. In the pre-GST era, import of garments from Bangladesh was attracting Rs 77 per piece (where MRP is Rs 999 per piece) in duties and Rs 116/pc (where MRP is Rs 1,500/pc) in the shape of CVD (countervailing duty) plus education cess and thereon. However, in the post-GST scenario, there was no cost for import of garments from Bangladesh. Several industry associations have been continuously making representations to the government citing the vulnerability of the Indian textile industry and the serious threat to employment caused by imports. The government should consider imposition of safeguard measures including yarn forwarding rules and fabric forwarding rules on countries that have FTAs (free trade agreements) with India to prevent cheaper fabrics produced from countries like China routed through these countries, CITI said.

Source: Times News Network

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Fabric makers oppose recommendation impose anti-dumping duty on nylon yarn

Surat: Manufacturers of nylon fabrics in the country’s largest man-made fibre (MMF) sector in the city have opposed the recommendation by the commerce ministry’s investigation arm, Directorate General of Trade Remedies (DGAD), for imposing anti-dumping duty up to $719 per tonne on import of nylon filament yarn from European Union and Vietnam. The nylon fabric manufacturers feel that the increase in anti-dumping duty on nylon filament yarn will allow indigenous yarn manufacturers to monopolize prices of nylon yarn, thereby creating problems for nylon fabric makers in Surat and other parts of the country. The unprecedented increase in yarn prices has cast a dark shadow on the city’s weaving sector, which is totally dependent on various types of synthetic yarns. City’s textile industry, which contributes to nation’s 40 per cent of the man-made fibre demand, has more than 6.5 lakh powerloom machines weaving about 3 crore metres of cloth per day with the annual consumption of 6 lakh metric tonnes of different types of yarns and fibres. Market sources said yarns and fibres, including nylon filament yarn (NFY), polyester filament yarn (PFY), polyester yarn (POY), viscose filament yarn (VFY) etc. manufactured in Vietnam and EU is 20 per cent cheaper than the ones made by domestic players. Following imposition of anti-dumping duty, the domestic manufacturers of yarns and fibres will get a free hand to increase the prices, especially when the demand increases from local market. “The domestic spinners are taking advantage of anti-dumping duty, as they know that import of yarn from Vietnam, China and other countries has become a costly affair. They want to earn as much profit as possible from the weavers,” said a yarn dealerMayur Golwala, leader of powerloom weaving industry, said, “We urge the central government not to accept the recommendation of DGAD for anti-dumping duty on nylon yarn. The government should not think of only five to six nylon yarn manufacturers in the country, but thousands of weavers and workers who are attached with the industry.”

Source: Times News Network

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India Development Debate: Signs of rising protectionism?

New Delhi: Call it Swadeshi Movement 2.0. The Modi government on Tuesday doubled the import tariffs on almost 330 textile products in a bid to give a fillip to the desi manufacturers. The move, which is in line with Prime Minister Narendra Modi's Make In India push, is expected to work as an antidote against cheap imports. It will also boost job opportunities in the textiles sector, a highly labour-intensive industry. Remember, last week the import duty on 50 textile products, including jackets, suits and carpets, was hiked to curb cheap imports from China. Interestingly, poorer neighbours like Bangladesh have been exempted from the new tariffs. Trade experts say that although these tariffs compatible with WTO guidelines, it could be seen as a protectionist move by the international community. There is also a belief that it is a classic case of the NDA government once again surrendering to the likes of the Swadeshi Jagaron Manch. On the flip side, it is a raw deal for consumers, who will have to shell out more for their clothing requirements. Make in India push it may be, but how long will this hand-holding help? Isn't it time to think of long-term solutions like tech upgradation and higher competitiveness? On ET NOW's India Development Debate, experts discussed the impact on the local industry and consumers.

Source: ET Now

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Union Minister Suresh Prabhu launches Niryat Mitra – mobile App

Union Minister of Commerce & Industry and Aviation Suresh Prabhu launched Niryat Mitra – mobile App in New Delhi on Wednesday. The app developed by the Federation of Indian Export Organisations (FIEO) is available both on Android and on IOS platforms. It provides wide range of information required to undertake international trade right from the policy provisions for export and import, applicable GST rate, available export incentives, tariff, preferential tariff, market access requirements – SPS and TBT measures. The most interesting part is that all the information is available at tariff line. The app works internally to map the ITC HS code of other countries with that of India and provides all the required data without the users bothering about the HS code of any country. Presently the app comes with the data of 87 countries.

Source: DD News

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Discussion on bilateral trade issues with USTR“positive”, says Prabhu

New Delhi : United States Trade Representative Robert Lighthizer and Commerce & Industry Minister Suresh Prabhu discussed the state of bilateral trade ties between the two countries in a conference call last week pushing aside bitterness over contentious issues such as the on-going spat over US tariffs on Indian steel and aluminium. “The call was very positive,” Prabhu said in an interaction with the media on Wednesday, adding that India wanted to develop good relations with all whether it is the US, the EU, the ASEAN or China.

App for exporters

Prabhu, who launched a mobile app for exporters -- `Niryat Mitra’ -- developed by the Federation of Indian Export Organisations, said his Ministry was ready with the strategy for increasing India’s exports by $100 billion. “We have done market research on potential items and destinations,” Prabhu said, adding that the focus would be on diversification. The app could help the users find out details on India’s export policy for a product, the available export benefits, the import tariff and the preferential tariff of the product in the destination country, rules of origin and quality standards and requirements. India threatened the US with retaliatory duties on import of 29 items after Washington imposed penal duties of 25 per cent on steel and 10 per cent on aluminium from the country. New Delhi recently put off the date of implementation of the retaliatory duties by 45 days and the two sides are in talks to sort out the issue. The Minister also said that India was engaged positively with China on the trade front and Beijing had taken steps to deliver on the promise of importing rice and pharmaceuticals in order to bridge the growing trade deficit that crossed $160 billion last fiscal.“We are also looking at the possibility of exporting sugar and milk powder to China,” he said. The Minister said that it was heartening that India’s export growth was on a positive track but the country had to be cautious as other countries were growing protectionist.

Source: Business Line

Govt needs to look at problems faced by exporters trading with Iran: FIEO

The government needs to look into the problems being faced by exporters shipping consignments to Iran in view of the increasing threat of US economic sanctions against the Persian Gulf nation, FIEO said today. Federation of Indian Export Organisations (FIEO) President Ganesh Gupta said that the rupee account currently used for payment settlement has limited funds to meet export requirement only for 3-4 months. "Other than UCO Bank, no other bank is willing to deal with exporters who are trading with Iran in view of the US sanctions. The government needs to immediately look at the situation and take steps," Gupta said on the sidelines of a function here. The US has told India and other countries to cut oil imports from the Gulf nation to "zero" by November 4 or face sanctions. Iran is India's third-largest oil supplier after Iraq and Saudi Arabia. Iran supplied 18.4 million tonnes of crude oil between April 2017 and January 2018 (first 10 months of fiscal 2017-18). US President Donald Trump has warned other countries from doing business with Iran.

Source : Business Line

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India faces a stern test of its commitment to RCEP

New Delhi : India may need to take a view on whether it wants to remain a part of the Regional Comprehensive Economic Partnership (RCEP) that is being negotiated among 16 countries, including China, before Prime Minister Narendra Modi attends the RCEP Summit in Singapore in November. “While the RCEP may not be ready to be signed in November, most members want significant commitments to be taken by leaders at the summit. India needs to make its negotiation position clear before the meeting of Trade Ministers of RCEP countries this month-end,” a government official said.

Meeting tomorrow

A group of four Ministers — Suresh Prabhu, Piyush Goel, Nirmala Sitharaman and Hardeep Puri — has been tasked with steering the discussions with Secretaries of key Ministries and Departments. The committee, which also includes the Cabinet Secretary, will meet on August 10. “The Commerce Ministry has started discussions with other Ministries and Departments, including agriculture, steel, heavy industries, economic affairs, revenue and textiles. The August 10 meeting with Ministers and Secretaries will provide guidance on the stance at the RCEP,” the official said. The RCEP includes the ten-member ASEAN, India, China, South Korea, Japan, New Zealand and Australia. While it would be an important strategic move for India to be part of the world’s largest free trade area, the high ambitions of its members, including China, and the impact it could have on the Indian industry holds negotiators back. “In our consultations with other Ministries and Departments, we have to determine whether we should have red lines in certain areas, and if we should exit the negotiations if other members do not agree with them,” the official said. For instance, agreeing to dismantle tariff barriers for Chinese goods could be disastrous for the industry beyond a limit. “Our negotiators have to be clear on how much liberalisation would be too much as far as China is concerned,” the official said. Also ASEAN’s aggressive push to dismantle tariffs on about 90-92 per cent items and reduce tariffs to below 5 per cent on an additional 7 per cent of items is equally worrying for India; it would expose sensitive items, including farm and dairy goods, automobiles and steel products, to tariff cuts. In the investment chapter, too, there are contentious areas such as liberalising based on a negative list (wherein all items are to be included except those specifically mentioned in a list) and the inclusion of an Investor State Dispute Settlement mechanism. This could lead to India getting involved in costly legal suits filed against it by corporates. New Delhi needs to decide if it should agree to a liberalising pact on goods if nothing worthwhile is offered in the area of services by others, the official added.

Source: Business Line

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GST amendment bills tabled in Lok Sabha

New Delhi: The government on Tuesday introduced four bills in the Lok Sabha to amend GST laws to increase the upper limit of turnover for opting for composition scheme. The amendments, among other things, seek to raise the turnover threshold from Rs 1 crore to Rs 1.5 crore. The Central GST (Amendment) Bill, Integrated GST (Amendment) Bill, Union Territory GST (Amendment) Bill and GST (Compensation to States) Amendment Bill were tabled by Finance Minister Piyush Goyal. The minister said the bills would help the micro, medium and small enterprises. The GST Council in its July 21 meeting had recommended several amendments to GST laws including raising the turnover threshold for registering as composition dealers who are supposed to file quarterly returns instead of monthly returns. The Council had also recommended amendments to the GST laws to allow taxpayers to opt for multiple registrations within a state or union territory in respect of multiple places of business located within the same state.

Source: Financial Express

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Centre to bring final draft of e-commerce policy within next 10 days

The government has also come under fire from retailer bodies for lax implementation of existing FDI norms. The government will be bringing out the final draft of a policy on e-commerce policy within the next 10 days, amid opposition to the proposed foreign direct investment (FDI) clause in it. The final draft is being considered by a national think tank chaired by Commerce and Industry Minister Suresh Prabhu, a senior ministry official confirmed on Wednesday, at a discussion on the proposed policy by the Confederation of All India Traders (CAIT). Major retailer associations, trade bodies, and even online seller associations have opposed most of the proposals in the draft policy, alleging these favour some of the major e-commerce players such as Ola and Paytm. They are also critical of the proposal to introduce FDI in the inventory-based model of e-commerce, up to 49 per cent for Indian-owned businesses that procure exclusively from within India. Current norms allow foreign capital in e-commerce only when the entity acts as a marketplace, facilitating other businesses and not selling directly to consumers. “The proposal to push FDI in the inventory model should be scrapped, as it threatens the livelihood of millions of small traders. Online and offline businesses are considered separate by the Competition Commission of India itself and should be kept so. Despite the commerce ministry announcing Press Note 3, which bans all such FDI, major e-commerce players have managed to channel into India millions of dollars,” says Ashwini Mahajan, co-convenor of the Swadeshi Jagran Manch, a Rashtriya Swayamsevak Sangh-supported entity. The first draft of the proposed policy prepared by the national task force on e-commerce had argued that allowing domestic e-tailers to access foreign investment would boost growth. “The recommendations of the task force have pointed out that smaller firms, artisans, and businesses in rural areas need access to crucial capital to grow and take advantage of the e-commerce boom,” says the official mentioned earlier. The government has also come under fire from retailer bodies for lax implementation of existing FDI norms, whereby major players such as Amazon and Flipkart have been accused of raising front companies to circumvent the rules. “The government doesn’t know how many e-commerce companies are functioning in India. None of our proposals has been taken up and we have received no response from the commerce ministry despite multiple pleas,” complains the All India Online Vendors Association. Retailers have also raised the issue of a rising number of complaints regarding product quality and services against e-commerce players. While the Enforcement Directorate under the finance ministry is currently tasked with handling violations of FDI norms, most complaints about e-commerce products are forwarded to the consumer affairs Ministry. CAIT contends most product-related complaints are not properly addressed and it is compiling data in this regard. A national regulator for the e-commerce sector, with which all digital businesses will be legally bound to register, has been recommended by the e-commerce task force.

Source: Business Standard

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Andhra Pradesh CM N Chandrababu Naidu announces sops for handloom weavers

ONGOLE: Chief Minister N Chandrababu Naidu announced several sops for the weavers’ community at Vetapalem in Prakasam district on Tuesday on the occasion of National Handloom Day. Addressing the weavers at a public meeting in Tallareddypalem of Vetapalem mandal, he said he will take care of all the problems of weavers. “Despite Centre’s objection, my government has waived Rs 114 crore worth weavers’ loans. Now, I am thinking of waiving individual loans of weavers instead of the societies,” he said. Promising to speed up the setting up of NIFT in the region, he said 20 acres of land will be allocated for a textile park in Amaravati. He promised 100 units of free power to weavers for the work sheds and said it will put an additional burden of Rs 29 crore on the State exchequer. When he agreed to provide Rs 8,000 as financial aid to the weavers’ families for two months during the lean period of rainy season, when the loom pits are flooded, the entire area echoed with huge applause from the weavers. He also promised to enhance input subsidy and market rebate. Naidu also agreed to clear Rs 49 crore dues to APCO from the State government at the earliest. Serifed centre at Chirala, weavers park in 20 acres with 10 acres for residential localities and 10 acres for work sheds, G+3 housing for weavers, were other sops announced by him. Earlier in the day, he laid the foundation stone for Dr APJ Abdul Kalam IIIT at Dubagunta village of Pamur mandal. Speaking on the occasion, he said the State government is determined to ensure development of the backward regions educationally. “My only aim is to see the State become number one in every aspect,” he averred.

Source: The New Indian Express

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Rupee gains 5 paise versus dollar

The rupee further consolidated its gains by 5 paise to end at 68.63 against the US currency on Wednesday, extending its recovery momentum for the second straight day as the dollar weakened on worsening US-China trade war. The rupee opened a tad higher at 68.66 from Tuesday’s close of 68.68 at the interbank forex market on sustained dollar selling by exporters and bank. It later strengthened to hit a session-high of 68.57 in mid-morning deals, but eventually halted the sharp upmove and settled at 68.63, showing a gain of 5 paise, or 0.07 per cent. A record-setting rally in domestic equities too played a positive role in the forex trading arena.

Source: Business Line

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Global Textile Raw Material Price 2018-08-08

Item

Price

Unit

Fluctuation

Date

PSF

1441.74

USD/Ton

0.51%

8/8/2018

VSF

2066.74

USD/Ton

0.14%

8/8/2018

ASF

3117.68

USD/Ton

0%

8/8/2018

Polyester POY

1536.89

USD/Ton

0%

8/8/2018

Nylon FDY

3410.42

USD/Ton

0%

8/8/2018

40D Spandex

5049.77

USD/Ton

0%

8/8/2018

Nylon POY

1741.80

USD/Ton

0%

8/8/2018

Acrylic Top 3D

3512.88

USD/Ton

0%

8/8/2018

Polyester FDY

5525.47

USD/Ton

0%

8/8/2018

Nylon DTY

1763.76

USD/Ton

0.42%

8/8/2018

Viscose Long Filament

3088.41

USD/Ton

0%

8/8/2018

Polyester DTY

3220.14

USD/Ton

0%

8/8/2018

30S Spun Rayon Yarn

2751.76

USD/Ton

0%

8/8/2018

32S Polyester Yarn

2239.46

USD/Ton

0%

8/8/2018

45S T/C Yarn

2956.67

USD/Ton

1.51%

8/8/2018

40S Rayon Yarn

2415.11

USD/Ton

4.43%

8/8/2018

T/R Yarn 65/35 32S

2488.29

USD/Ton

1.19%

8/8/2018

45S Polyester Yarn

2927.40

USD/Ton

0%

8/8/2018

T/C Yarn 65/35 32S

2517.56

USD/Ton

0%

8/8/2018

10S Denim Fabric

1.37

USD/Meter

0%

8/8/2018

32S Twill Fabric

0.84

USD/Meter

0%

8/8/2018

40S Combed Poplin

1.17

USD/Meter

0%

8/8/2018

30S Rayon Fabric

0.65

USD/Meter

0%

8/8/2018

45S T/C Fabric

0.70

USD/Meter

0%

8/8/2018

Source: Global Textiles

Note: The above prices are Chinese Price (1 CNY = 0.14625 USD dtd. 8/8/2018). 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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India doubles apparel import duty eying China; B’desh exporters see opportunity

Bangladeshi readymade garment exporters, already enjoying duty-free access, see further opportunity in Indian market as the country (India) has doubled the import tax on 328 textile products to 20 per cent, mainly to reduce its imports from China. India on Tuesday hiked the tax hoping to bring down textile imports to $6 billion in current fiscal year 2018-19 from $7 billion in last fiscal year, according to a Reuters report on Tuesday. ‘The decision of India for doubling import tax on more than 300 textile products will benefit Bangladesh as we have duty-free market access to the country,’ Faruque Hassan, senior vice-president of Bangladesh Garment Manufacturers and Exporters Association, told New Age on Tuesday. It was obvious that India’s import of textile products from China would decrease due to the tax hike and Bangladesh would be benefited as the next nearest import source, he noted. Faruque also said that the decision of India would create opportunity for increasing bilateral trade and business between Bangladesh and India. ‘If India increases its import of RMG product from Bangladesh, Bangladesh will also increase its import of yearn, febrics and dies chemicals from India,’ he added. Reuters reports that India has doubled the import tax on more than 300 textile products as the world’s biggest producer of cotton tries to curb rising imports from China. It was the second tax hike on textiles in many months after an increase of tax on other products including fibre and apparels last month. The moves are expected to provide relief to the domestic textile industry, which has been hit by cheaper imports. Total textile import of India jumped by 16 per cent to a record $7 billion in the fiscal year to March 2018. Of this, about $3 billion were from China, according to Reuters. The Indian government did not disclose details of the 328 textile products that will be subject to the duty increase announced on Tuesday. ‘It is logical that if India’s textile products import from China decreases, Bangladesh can grab the space. But it is not confirm whether India would meet their demand through import or local production,’ former Bangladesh Knitwear Manufacturers and Exporters Association president Fazlul Haque said. Bangladesh’s RMG export to India in the financial year 2017-18 increased by 114.68 per cent to $278.67 million, according to the data of Bangladesh Export Promotion Bureau. Reuters reports that rising imports sent India’s trade deficit with China in textile products to a record high $1.54 billion in 2017/18, alarming industry officials as India had been until recently a net exporter of textile products to China. Sanjay Jain, president of the Confederation of Indian Textile Industry, told Reuters he did not expect China to retaliate to the Indian duty increases as it still had a trade surplus with India. He said India’s textile product imports could fall to $6 billion in 2018/19 as a result of the tax hike to 20 per cent. India’s imports of textile products from Bangladesh, Vietnam and Cambodia also jumped in the last few years as they are not subject to any duty under free trade agreements signed by India with these countries. The 20 per cent duty will not be applicable to products sourced from those countries due to the FTA, Jain said. Industry officials say in the last few months Chinese fibre has been shipped to Bangladesh and processed and exported to India with zero duty. ‘Rules of origin need to be implemented for textile products. Otherwise Chinese products will land from other countries,’ said a Mumbai-based garment exporter, who declined to be named. Jain said India’s textile and garment exports could rise 8 per cent to $40 billion in 2018/19 due to a weak rupee and as the government was expected to introduce incentives to boost overseas sales. India’s trade differences with the United States have also been rising since president Donald Trump took office. India, the world’s biggest buyer of US almonds, in June decided to raise import duties on almonds and some other US imports by 20 per cent, joining the European Union and China in retaliating against Trump’s tariff hikes on steel and aluminum. The increased tariff on US goods will be applicable from September 18.

Source: New Age Business

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Malaysia's Parliament repeals GST, set to replace it with SST in September

KUALA LUMPUR (BERNAMA) - Malaysia's Parliament on Wednesday (Aug 8) repealed the Goods and Services Tax Act 2014 after its third reading in the House. The unpopular consumption tax was abolished just over three years after its implementation in April 2015. Speaking in Parliament, Finance Minister Lim Guan Eng said: "Finally, GST is dead." The three-month old Pakatan Harapan (PH) government is replacing the GST with the Sales and Service Tax (SST) that will be implemented in September. The Lower House of Parliament on Wednesday also passed the Service Tax Bill 2018, a day after passing the Sales Tax Bill 2018. The abolishing of the GST fulfilled a key election promise by the four-party PH alliance to voters. The two new bills will now head to the Upper House of Parliament, or the Senate, for approval. Following this, the SST Bills will need the assent of the Malaysian King. Malaysia for long years had implemented the SST, which is a narrower form of taxes on sales and services. Former prime minister Najib Razak, in a Facebook posting on Tuesday (Aug 7) said abolishing the GST would weaken the country's economic structure. "Malaysia has now lost all economic advantages, competitive traits and economic catalysts that were accorded by GST. The problems and weakened economic structure which we had back then (before GST) such as high corporate tax, tax evasion and illicit financial flow will return," he said.

Source: The Straits Times

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US finalizes next China tariff list targeting $16 bn in imports

The United States will begin collecting 25 per cent tariffs on another $16 billion in Chinese goods on August 23, the US Trade Representative's office said on Tuesday as it published a final tariff list targeting 279 import product lines. The action is the latest by US President Donald Trump to put pressure on China to negotiate trade concessions after imposing tariffs on $34 billion in goods last month. China has vowed to retaliate to an equal degree. The latest $16 billion list will hit semiconductors from China, even though many of the basic chips in these products originate from the United States, Taiwan or South Korea. The 25 per cent tariffs also will apply to a broad range of Chinese electronics, plastics, chemicals and railway equipment that the Office of the US Trade Representative (USTR) has said benefit from the “Made in China 2025” industrial plan, aimed at making China competitive in high-technology industries. USTR removed a handful of items from its original list after a 46-day public comment and review period found they would cause “severe economic harm”. These were intermodal shipping containers, floating docks, splitting and slicing machines used with wood, bone and hard plastics, extremely thin slicing tools known as microtomes, and alginic acid, derived from seaweed and used in pharmaceuticals, textile printing and dental impressions. The latest list brings the total Chinese imports that face a 25 per cent tariff to about $50 billion in a rapidly escalating trade war that could eventually slap duties on all goods traded between the world's two largest economies. Trump has also threatened 25 per cent tariffs on another $200 billion worth of Chinese goods, and possibly another $300 billion worth, in his administration's quest for changes to China's intellectual property, market access and industrial subsidy policies.

Source: The Hindu Business Line

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Withdrawal from RCEP may not be conducive to India’s economy: expert

The Indian government reportedly plans to discuss whether to withdraw from the 16-member Regional Comprehensive Economic Partnership (RCEP) negotiations, which an expert said is quite "immature" and may not be good for India's future economic development. The Indian government will establish a group of ministers to look into issues related to RCEP, and the first meeting of this group is expected to be held on Friday, Indian news site livemint.com reported on Monday. Pressure on India has been rising in relation to the RCEP deal, as it would mean more market access to its adversary China, the report said. As protectionism trends become stronger in the global market, the RCEP can become a new discussion area, said Zhao Gancheng, director of the Shanghai Institute for the International Studies Center for Asia-Pacific Studies. Zhao told the Global Times on Tuesday that the ultimate goal of the RCEP is to establish a free trade zone (FTZ), but based on India's current power in economy, technology and finance, the country is not that able to jointly establish an FTZ with the other 15 members. If the RCEP framework would give some favorable policies to India, such as in its agricultural and manufacturing sectors, India would welcome it, according to Zhao. "If India withdraws from it, the other 15 members could discuss the partnership as usual." If India could integrate into the economic cooperation system in the Asia-Pacific region, it would bring close ties to countries and regions in the Indian Ocean area and the Asian-Pacific region and would also be a good thing for India, Zhao said. The partnership comprises 10 group members of the Association of Southeast Asian. Nations and their six free trade agreement partners including China, India, Japan, South Korea, Australia and New Zealand.

Source: Global Times

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$44b export target set: Cash incentives to nine new products

The government has approved cash incentive for nine new export products with a view to promote their sales in overseas market. These products are frozen soft-shell crab, pharmaceutical products and its raw materials, ceramics, galvanizing sheets, photovoltaic module, razor and razor blade, chlorine, hydrochloric acid, Sodium Hydroxide (caustic soda)(NaOH) and Hydrogen peroxide (H2O2). The government policymakers at a meeting on Wednesday brought these products under its cash incentive programme. High officials of the Ministry of Finance and Commerce, Bangladesh Bank (BB) and concerned divisions and agencies attend the meeting held in the Bangladesh Secretariat. "Cash incentive has been approved for nine new products considering their export potentials in global market," a senior government official told The New Nation yesterday on condition of anonymity. He said the products will receive 10 per cent cash incentives on their exports from the current fiscal year. Besides, export of readymade garments to new markets will enjoy 4 per cent cash incentive from this fiscal instead of 3 per cent earlier. "The government has expanded the list of the export subsidy eligible products in line with its goal to reach the country's export earnings to US$60 billion by 2021," he added. A total of 27 categories of goods and products got cash incentive ranging from two per cent to 20 per cent in the immediate past fiscal year 2017-18(2017-18) fiscal year when the government extended Tk 4,500 crore cash subsidy against their exports. Meanwhile, the government has set an export target of US$44 billion for fiscal 2018-19 (FY19), projecting a 6.4 per cent growth. Of the target, US$39 billion has been projected from merchandise export while US$5 billion from services. Export target for readymade garments fixed at US$39.69 billion. Commerce Minister Tofail Ahmed announced the target in a media briefing held in the conference room of the ministry yesterday. He said the government has decided to provide cash incentive to nine new products along with the existing 27 items in the current fiscal to boost export. Bangladesh's export income stood US$36.67 billion US dollars in fiscal year 2017-18 with ready-made garments accounted for 82 per cent of its total export.

Source: New Nation

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