To make matters worse, a sizeable number of labourers from Odisha are employed in the Surat textile industry, said Ashish Gujarati, president of Pandesara Weavers' AssociationAfter leaving a trail of destruction and damage in the eastern states of Odisha and West Bengal, cyclone Fani has wreaked havoc in faraway Surat in Gujarat, where the textile industry is reeling from post-cyclone losses of over Rs 500 crore, before leaving for Bangladesh. “The cyclone has disrupted the supply of cloth and garments from Surat over the past four days, and it would take another fortnight to restore the situation,” says Dev Kishan Mangani, chairman of South Gujarat Chamber of Commerce and Industry’s (SGCCI’s) textile committee. “Ahead of Ramadan festivities, textile units in Surat are flooded with orders from Odisha, West Bengal and Bangladesh. Over the past several days Rs 25 to Rs 30 crore worth goods were being transported from Surat to these eastern states on a daily basis. But, buyers have stopped taking goods in the aftermath of the cyclone. Most of the warehouses have been damaged in Odisha and Bangladesh, and are facing storage problems. Roads in the cyclone-hit areas of all three places have been badly damaged,” said Mangani. “By the time situation would normalise, Ramadan festivities would be over and goods manufactured specifically for the festival would not be sold elsewhere,” he said. “Cloths used to make garments such as burqas would remain unsold as the material used is seldom used for any other purpose,” he lamented. According to estimates, Surat-based textile units would suffer losses of nearly Rs 500 to Rs 600 crore. To make matters worse, a sizeable number of labourers from Odisha are employed in the Surat textile industry, said Ashish Gujarati, president of Pandesara Weavers’ Association. “These workers were already on extended holiday since Holy due to Lok Sabha polls. They were supposed to return to work by mid-May. Now, most of them would not able to come back soon on account of the losses they have suffered. It means most of the workers from Odisha and parts of West Bengal would be able to return earliest by June only,” he said.
Source: Financial Express
According to S&P Global Ratings the institutional framework for Indian states is evolving, but there is structural deficits due to persistent revenue expenditure mismatch. Goods and Services Tax (GST) regime in India is not likely to reduce the deficits of state governments significantly, amid large and growing expenditure mandates for the social sector as well as capital spending, says a report. According to S&P Global Ratings the institutional framework for Indian states is evolving, but there is structural deficits due to persistent revenue expenditure mismatch. S&P Global Ratings credit analyst YeeFarn Phua in the report titled "Public Finance System Overview: Indian States" noted that the passage of the GST bill in 2017 is a major overhaul of tax structure and will help to widen the tax base and improve revenues of state governments. "However, states will continue to run large deficits because a significant part of this imbalance is from the expenditure side. States are unable to cut expenditures because of large and growing expenditure mandates for the social sector as well as capital spending. Therefore, the revenue-expenditure gap will remain large," said Phua. Further, policy implementation remains sub-par in India, the report noted. Another significant development in recent years has been the adoption of an amended Fiscal Responsibility Management (FRBM) Act, which forms the fiscal framework, in March 2018, the report noted. Under the amended FRBM Act, the government will target a debt-to-GDP ratio of 60 per cent with the split being 40:20 for central government and states. Further, the government will use fiscal deficit as the key operational target, the report said but added that the FRBM committee lacks the authority to mandate its core recommendations.
Source: Money Control
A two-day interaction was organised by the Commerce Ministry and Indian High Commissions and embassies of eleven African countries to strengthen the India-Africa trade ties. The interaction was arranged over Digital Video Conference (DVC) over two days, on May 3rd and May 6th with the Indian business community in Africa. In order to build an effective engagement with the Indian Diaspora in Africa, the interactions with Indian Diaspora were held in Tanzania, Uganda, Kenya, Zambia, and Mauritius, Nigeria, Mozambique, Ghana, South Africa, Botswana, and Madagascar. The DVC was attended by over 400 members of the Indian business community in 11 African countries. This initiative of the Commerce Ministry emphasizes on the need for a multipronged strategy for further enhancing trade and investment ties between the two regions. During the interaction the Indian Business Community of these 11 countries also highlighted several issues including improving the line of the credit system and developing a facility for affordable and competitive funding and setting up of Indian banks and financial institutions in Africa. Reviewing and liberalizing visa policies from both sides and need for direct flights between India and African countries was also highlighted during the interaction. Department of Commerce assured the community that these suggestions will be shared with relevant stakeholders and departments in order to incorporate the suggestions in the India-Africa strategy for trade promotion. As per the ministry of commerce, India's total trade with the African region during 2017-18 was USD 62.69 billion which stands at 8.15 per cent of India's total trade with the World. "Today, African countries present immense opportunities for India with the world's largest land mass, 54 countries, a population growing to be almost equivalent to that of India, huge mineral resources, oil wealth, a youthful population, falling poverty levels and increasing consumption patterns", read a statement by the commerce ministry. The Indian community in Africa is playing a vital role in all fields like politics, business and education. As per the latest available estimates the current strength of the Indian Diaspora in the African countries stands at 2.8 million out of those 2.5 million are PIOs and rest 220967 are NRIs. Senior officers from the Department of Commerce and Ministry of External Affairs remained present during the interactions.
Source: Business Standard
The Commerce Ministry and Indian High Commissions and Embassies of eleven African countries arranged an interaction over Digital Video Conference (DVC) over two days, on 3rd and 6th May 2019, with the Indian business community in Africa. The interactions with Indian Diaspora were held in Tanzania, Uganda, Kenya, Zambia, and Mauritius, Nigeria, Mozambique, Ghana, South Africa, Botswana, and Madagascar. This initiative was held in order to build an effective engagement withthe Indian Diaspora in Africain order to further deepen and strengthen India-Africa trade ties. The DVC was attended by over 400 members of Indian business community in 11 African countries. India’s total trade with the African region during 2017-18 was USD 62.69 billion (8.15% of India’s total trade with the World). India’s share of exports to African countries as a percentage of India’s total exports to the world was of the order of 8.21% in 2017-18. Africa region’s share in India’s total imports from the World accounted for 8.12% in 2017-18. Today, African countries present immense opportunities for India with the world’s largest land mass, 54 countries, a population growing to be almost equivalent to that of India, huge mineral resources, oil wealth, a youthful population, falling poverty levels and increasing consumption patterns. Thus, Africa has a huge demand for new business models for market entry, stable market access, entrepreneurship and investments in transport, telecom, tourism, financial services, real estate and construction. This initiative of the Commerce Ministry emphasizes the need for a multipronged strategy for further enhancing trade and investment ties between the two regions. Commerce Ministry recognizes that for formulating an effective export strategy it is imperative to engage the Indian business community in Africa for mutual gain for both sides as trade relations between the people of same origin instill greater confidence amongst trade partners. The Indian community in Africa is playing a vital role in all fields like politics, business and education.As per the latest available estimatesthe current strength of the Indian Diaspora in the African countries is 2.8 million out of those 2.5 million are PIOs and rest 220967 are NRIs.Total overseas Indians are 30.83 million of which 17.83 million are PIOs and 13 million are NRIs. (Ministry of Overseas Indian Affairs, 2016). Indian Diaspora in Africa constitutes 9.11% of the total Diaspora of India. The inherent strength of India in Africa is its rich and vast Diaspora which has established strong links with the political, economic and social fabric of the African continent. In order to formulate astrategy to boost India-Africa Trade & Investment, the Indian Diaspora in Africa has to be leveraged furtherin order to ensure that the strategy is effective. Suggestionswere sought from the India business community. The major issues highlighted by the Indian Business Community in these 11 countries are:
Department of Commerce welcomed the suggestions of the Indian business community and assured them that these suggestions will be shared with relevant stakeholders /Departments in order to incorporate the suggestions in the India-Africa strategy for trade promotion. Senior officers from Department of Commerce and Ministry of External Affairs were present during the interactions.
Source: PIB
US Commerce Secretary Ross also conveys displeasure over ‘unstable’ e-comm policy. The US has indicated that it will not withdraw the Generalised System of Preferences (GSP) scheme offering duty free access to over 3,000 Indian products till the ongoing general elections in India are over and a new government is in place. US Commerce Secretary Wilbur Ross, in his meeting with Commerce Minister Suresh Prabhu, also expressed concerns over the “unstable’’ e-commerce policy of the government, which was adversely affecting US companies that have invested in India, an official close to the development told BusinessLine. “While the US did not include the GSP issue officially in its agenda for the meetings with the Finance Minister and the Commerce Minister, the team indicated clearly that India need not worry about the scheme getting withdrawn till the general elections are over and a new government is sworn in. This is possibly to give the new government a chance to sort out US’ concerns in the area of trade,” the official said. The US Trade Representative’s office had announced in March that the US planned to terminate India’s and Turkey’s designations as ‘beneficiary developing countries’ because they no longer complied with the statutory eligibility criteria. The withdrawal was to be implemented through a Presidential proclamation in May. On the changes in the e-commerce rules made by India in December last year, which barred e-retailers from holding a stake in seller-entities that sell on their marketplace and sourcing over 25 per cent of their inventory from a single vendor, Ross said India should not be changing its rules so frequently. “The US pointed out that its companies were hit badly because of changing rules as they had to completely overhaul their operational systems,” the official said. The new rules are being vehemently opposed by US-based Amazon and Flipkart (which has investments from Walmart) which dominate the Indian e-commerce space. “India tried to convince the US that the e-commerce policy was not final and that comments from different stakeholders, including the US, were being examined,” the official said.
Price caps on pharma
The US also raised the issue of price caps on medical equipment and pharmaceuticals, which is one of the reasons why the country is considering withdrawal of the GSP. While India agreed to implement the trade margin rationalisation (TMR) model by calculating the margin based on landed cost,, the US is insistent that it should be based on the first point of sale (price to stockist). “India assured the US that it was working in the direction of allowing TMR based on first point of sale,” the official said.
Source: The Hindu Business Line
International Monetary Fund Managing Director Christine Lagarde issued a fresh warning about the threat US-China trade tensions pose for the world economy and said it may take time for the two nations to resolve their issues. The comments came two days after tweets by U.S. President Donald Trump warning of new tariffs on China, marking an escalation of hostilities. The U.S. also accused China of retracting on commitments made during the negotiations. We thought this threat was waning and relations were improving and we were moving toward an agreement. We hope that is still the case but today rumours, tweets and comments are not very favourable, Lagarde said in Paris. Speaking later in an interview with Bloomberg, Lagarde said there may not be a quick resolution as both sides must tackle very important issues.
Takes Time
All the observers would like it to be done yesterday, but those matters actually take time, Lagarde said. Chinas top trade negotiator, Liu He, still plans to visit the U.S. this week for trade talks. Trump has said he intends to raise tariffs to 25 per cent (from 10 per cent) on $200 billion of Chinese goods and may also impose duties soon on $325 billion of Chinese goods that aren’t currently covered. Today, clearly the tensions between the U.S. and China are a threat for the global economy. It is imperative for trade tensions to be resolved in a satisfactory way for everyone, Lagarde added.
Source: The Hindu Business Line
An active role from the private sector would ensure more and more SMEs are able to take advantage of opportunities in the global market. Trading has been a major part of the world economy for a long time. The member nations of the World Trade Organization (WTO) alone contributed to a whopping $23 trillion last year in exports only and the global trade is expected to grow at a rate of 4-5% year-on-year. This goes on to show that there are huge scopes in the global markets to be explored by businesses around the world. This huge growth is going to create a vacuum between the current supply and the new demand—a vacuum which is there for the taking and small- and medium-sized enterprises (SMEs) are the ones who can take most advantage of it. SMEs are an integral part of any economy; they form the backbone of the economy. While the government consistently focusses on making India a $5 trillion economy and reach $2 trillion in global trade in the next few years, SMEs remain an integral part of this endeavour. Over the past few decades, the SME sector, comprising manufacturing, agro-industry, service industry, apparels & textile, gems & jewellery, food processing, metal & alloys, packaging, polymer & chemicals, etc. have emerged as one of the most vibrant and dynamic engines of Indian economic growth. For India to become a $5 trillion economy, the contribution of this industry will be the focal point. The growth of the 65 million SME businesses is surely going to make a huge difference in the overall economy of our nation.
Govt focus on exports
There have been a number of reforms and schemes by the government to help the businesses in growing internationally. The flagship programmes such as Make in India, Digital India, Skills India, and Startup India are the strong foundations on which the sustainable growth for going global could be built. India’s overall exports (merchandise and services) were estimated to be $483.98 billion during April-February 2018-19, exhibiting a growth of 8.73% over the year-ago period. The Foreign Trade Policy 2015-20 and other schemes provide promotional measures to boost India’s exports with the objective to offset infrastructural inefficiencies and associated costs involved to provide exporters a level playing field. There are schemes such as Merchandise Exports from India Scheme (MEIS), Duty Exemption and Remission Schemes, zero duty EPCG scheme, Post Export EPCG Duty Credit Scrip Scheme, EOU/EHTP/STP & BTP SCHEMES, and interest subsidy scheme, etc. launched by the government to boost exports from India. The government has also taken initiatives to open newer markets for products, including plans to set up trade promotion bodies in 15 countries to boost exports from SMEs. There have also been other SME-specific initiatives, such as STICK (Science, Technology, Innovation and Creation of Knowledge) to keep the SMEs abreast of the changing paradigms of innovation and technological advancement. The initiative of Indian Customs introducing full and comprehensive digitisation of export/import transactions and the 'integrated declaration' will provide the importers and exporters a single point interface for customs clearance of import and export goods. Further, India ports infrastructure market stood at more than 1,212 MMT in 2018 and is projected to reach 1, 784 MMT by 2024, owing to increasing government initiatives to enhance the capacity and utilisation of the country's major and minor ports.
Low participation of SMEs in the global trade
Even though the government has taken the right steps, there is more that needs to be done to increase global trade to reach $2 trillion per year. Indian SMEs have been reluctant to export due to multiple reasons. For example, finding and qualifying a global trade counterpart is a big challenge on its own, and that’s only the beginning of the complex export process. With the lack of trade intelligence, it is hard for an SME to trust anyone due to lack of information about the counterparts and even the market on a whole. The local markets, although, marginally profitable, feel a lot more comfortable to SMEs due to access to first-hand market intelligence. While the government has been constantly working to make global trade more and more accessible to SMEs, when it comes to going global, an SME doesn’t have the bandwidth to nurture a global trading team and have them execute proper, and controlled, safe-trade. The situation actually presents a big issue of the lack of having a proper knowledge channel for the SMEs with limited resources to hand-hold them in global trading. While the government's policies and schemes have been an amazing boost for SMEs, reaping optimum returns from these still requires guidance, hand-holding, and partner-based approach.
Need for private sector involvement
While the government has come up with the right policies, the SMEs still need guidance to benefit from these policies and help fill the remaining gaps in global trading. Ground-level involvement and execution are still required to implement these policies. Global trade’s complexities and risk associated with it will always require the detailed trade intelligence and expert hand-holding for doing it right. This is where the role of private and public partnerships emerges as an important part of the bigger ecosystem that is looking to make India a major global trading player. What private, specialised entities need to deliver is to ensure we make our SMEs globally aware, visible, and competitive, and partner with these SMEs for end-to-end global trade hand-holding.
How would it help grow SME exports?
The private-public partnership could reap rich dividends
It is difficult to ignore the role of SMEs in realising India’s $5 trillion economy and $2 trillion global trade objective and it is important for the SMEs to realise the role of global trading in realising their business growth objective. While the government has been working really hard in pushing SME growths, involvement of the private sector is necessary for the efforts of the governments to reap fruits. The government is actively involved in increasing the size of the global trade pie for Indian SMEs, though an active role from the private sector would ensure that more and more SMEs are able to take advantage of opportunities in the global market. It needs active involvement, especially from companies who could provide a partner-based approach and end-to-end solutions and could work on the ground to enable and empower SMEs to export/import effectively. The global trade is no longer a luxury for SMEs, it’s a necessity they shouldn’t ignore and both the government and private sectors need to play a big and active role in helping our SMEs realise their true potential and help India become an economic superpower. The author is founder and CEO of Connect2India, a SaaS-enabled managed marketplace for global trade.
Source: Fortune India
At present only, an investment promotion office "Invest Hong Kong (InvestHK)" is operational in Mumbai, one of the 30 such offices located globally. Hong Kong was contemplating to open a country representative office in India to boost bilateral ties, an official said Tuesday. "Hong Kong does not have any direct government office in India. There is a plan to open one in Mumbai which could be similar to a consulate," Invest Hong Kong director general Stephen Phillips said on the sidelines of an interactive session with The Bengal Chamber. He, however, did not divulge anything about a timeline for the proposal. At present only, an investment promotion office "Invest Hong Kong (InvestHK)" is operational in Mumbai, one of the 30 such offices located globally, he said. Hong Kong is now governed by China under the principle of "one country, two systems", where the city would enjoy "a high degree of autonomy, except in foreign and defence affairs." A double taxation avoidance agreement between India and Hong Kong has come into effect recently which would stimulate more the two-way flow of investments and trade. "It will boost bilateral trade and investments but it is hard to quantify now," he said. Phillips is on a six day India visit to promote Hong Kong as a business attraction. Speaking about ongoing tariff war between US and China, he said, if it continues then trade rebalancing may take place. He, however, also pointed that trade relation with India will get traction as many Chinese companies are setting up their base in India.
Source: Economic Times
An increasingly combative approach being adopted by the Trump administration could seriously harm multilateral trade. A full-blown trade war between the United States and China is looming large over the global economy, the implications of which India cannot escape. As is his wont, the maverick President Donald Trump took to Twitter to spring a surprise and announce his plan to impose 25% tariffs on another $325 billion worth of Chinese imports. This has triggered a panic in the global markets and clearly unnerved Beijing. Since India’s own growth figure projections tend to be broadly in sync with global trends, it will not be able to insulate itself from the impact. It requires some tactful trade diplomacy on the part of New Delhi to convert the adversities into opportunities and stay in the game. It is time major economic powers realised that there can be no real winners in such a battle in a globalised and interconnected economy. Harmonious multilateral trade is the way forward. Bilateral trade arrangements can only provide supplementary benefits. An increasingly combative approach being adopted by the Trump administration could seriously harm multilateral trade. A full-blown trade war will badly hit the assets market, economic growth and impact investment flow into India. Given India’s exports basket to the US being vastly different from China’s, the battle of wits between the two giants is unlikely to open near-term opportunities for India. The impact of the tariff war goes beyond the trade. It upsets the global economic order. Though India can become more competitive in segments like textile, garments and gems and jewellery, it cannot hope to become an effective substitute in the short-term because China’s exports to the US are much more diverse and it would be too ambitious to expect India to fill the gap. At a time when the two sides were on the verge of an amicable agreement, Trump’s belligerent stand has worsened the situation. As things stand now, it appears that the US will not agree for a truce unless Beijing abandons or scales down the subsidies to its companies, stop pressuring foreign companies to share their trade secrets and give them more access to the Chinese market. The biggest implication for India is that its growth figures, based on the assumption that international trade and investment flows will remain stable, might go haywire. Moreover, Trump has mastered a policy that is irksome to both his friends and foes alike. While acknowledging India as a strategic partner and a dependable ally in the war against terror, his administration has not shown any leeway when it comes to trade policies. Though the amounts involved in the Indo-US trade face-off are very small compared with the US-China stakes, the situation could have an adverse impact on investor sentiment.
Source: Telangana Today
While the country was busy with elections, there were some major developments in India-Nepal trade relations. First, the containerised rail cargo carrying third-country imports of Nepal through the Indian ports of Kolkata and Vizag will no longer require clearance by Indian Customs authorities as both ports have introduced the electronic cargo tracking system (ECTS). The ECTS is an electronic seal that, unless tampered with, ensures free movement of the container through the international border. The system has already been introduced at Vizag port in line with a project undertaken by the Asian Development Bank (ADB) and was introduced by Kolkata port a few months ago. The electronic cargo system at Kolkata now does away with Indian Customs’ check of Nepal’s third-country imports. Nepal had for long been resisting checks by Indian Customs of its third-country imports, while the Customs authorities had defended the move, citing the prospect of diversion of cargo.
Road cargo movement
With rail movement of containers easing up, Kolkata port authorities are planning to introduce ECTS for road movement of containers, in phases. While Vizag doesn’t have any road cargo for Nepal, a large section of the third-country container imports through Kolkata take the road. Meanwhile, the transition to ECTS has resulted in a shift of cargo from Kolkata port to Vizag. According to sources in the Container Corporation of India (Concor), till two months ago, 70 per cent of the Nepal-bound container cargo was through Kolkata port. The ratio reversed over the last two months as Kolkata port now handles 30 per cent of the Nepal-bound container cargo. The rest went to Vizag. According to sources, this is because of increase in costs while operating through Kolkata due to imposition of high handling charges by the shipping lines vis-à-vis Vizag, which enjoys the advantage of lower ocean freight.
Coal handling improves
But Kolkata port authorities are confident of bouncing back. According to Chairman Vinit Kumar, over the last year, the port has taken a number of measures to ease the movement of Nepal-bound cargo. The most important of such steps was handling of coal at Kolkata dock system. Kolkata port has two dock systems and bulk cargo is normally handled by the Haldia dock system. Low rake availability and inadequacies in handling led to a pile-up of coal cargo at Haldia. The problem has been resolved as Kolkata shared the burden and rake handling ratio improved substantially.
Source: The Hindu Business Line
After the shift to powerlooms, the number of handlooms has declined from 40,486 in 2009-10 to 29,377 today Ilkal sari weaver Shamanna Bandi, in his 60s, is well aware that shifting to powerloom will make his work easier and also augment his earnings. But he has resisted doing so for over a decade. He finds the ‘rhythm of a handloom soothing’ when compared to the ‘noise’ of the powerloom. As the debate continues, Mr. Bandi is among the last few thousands who prefer to work on a handloom even as thousands of other weavers have migrated to powerlooms — either owning one or working for a master weaver. Some have entirely opted out of the profession. Others like Mahadevappa Mallappa Kvatakundi, who sold their handlooms or abandoned them, say that working on a powerloom has at least increased their earnings. For, a weaver on handloom earns about ₹200 for a basic sari woven over two days. Mr. Kvatakundi, who works on a powerloom owned by a master weaver, earns ₹60 a sari and produces three saris a day. “It has been ten years now that I stopped working on handloom. It is much better here than the physical exertion that I had to endure earlier,” he says. Data shows that while the number of powerlooms increased from about 60,000 in 2009-2010 to about 1.20 lakh now (as per the fourth Handloom Census), the number of handlooms has declined from 40,486 then to 29,377 now. Over the last three years, only around 10 handlooms have been sanctioned for installation under the handloom development scheme that offers 50% subsidy while a few thousands of powerloom, which also receives subsidy, have been added. The collapse of mills in Bombay in the 60s, officials and activists recount, led to proliferation of powerlooms to the weaving centres across India. “Mill owners unable to pay salaries to their senior employees gave away looms, and the employees in turn returned to their homes, especially in Gujarat and Maharashtra to set up these. They are essentially a decentralised mill,” says theatre activist Prasanna, who has been working with the weaver community. “These looms became successful and rendered a blow to handlooms that had sustained the livelihood of thousands,” he added. Sources in Department of Handlooms and Textiles concede that government policies since the 1990s are quite contrary to the interests of the handloom sector. “On the one hand, we want to safeguard the interest of handlooms, while on the other we promote powerlooms. If power subsidy is given to powerloom to make the production viable, how can handloom product, which is already expensive compared to a powerloom product, sell? Also, an ordinary buyer cannot differentiate between a handloom and powerloom product,” the official added.
Source: The Hindu
Textile manufacturer Arvind Limited is the latest company to join the global sustainability initiative Fashion for Good. With Arvind, a global leader in apparel manufacturing and trailblazer in advanced materials, the Fashion for Good Innovation Platform gains a well-experienced partner “committed to testing and implementing sustainable innovations” according to a press release published today. “By having Arvind join Fashion for Good, all of the innovators and stakeholders are gaining in-depth knowledge and support from a unique pioneer in manufacturing. We are immensely proud to see the entire fashion ecosystem come together, to implement and scale innovative solutions across the fashion value chain,” commented Fashion for Good’s managing director Katrin Ley. “Sustainability and innovation are our key strategic growth pillars and we have always attempted the adoption of innovation in textile manufacturing. We are pleased to partner with Fashion for Good and are committed to promote the sustainable technologies originating from the FFG platform. We are looking forward to work with these technologies to fuel the next set of growth in manufacturing for us with the aim of growing with drastically less environmental impact,” said Punit Lalbhai, board of directors, Arvind Limited. The Fashion for Good Centre in Amsterdam was launched two years ago, with the aim of transforming the fashion industry by driving its transition to a circular economy and bringing industry players together to reimagine how fashion is designed, made, used and reused. The global initiative focuses on 'five Goods' in particular: materials, economy, energy, water and lives. Arvind is powering high-fashion brands across the world with fibre innovations and sustainable manufacturing processes while delivering excellence across the garment value chain. With Arvind by its side who pioneers vertically integrated apparel solutions, increases the use of sustainable yarns and tests innovative recycling solutions, Fashion for Good and its stakeholders will have an opportunity to drive innovation solutions across the fashion value chain. Arvind is a 1-billion-US-dollar textile company with a focus on textiles, advanced materials, environmental solutions and omni-channel commerce. Arvind Limited is an integrated solutions provider in textiles with strong fibre to fashion capabilities for a global customer base. It is also a design powerhouse implementing innovative concepts and generating intellectual property. It ranks amongst the top suppliers of fabric worldwide. Its denim, woven, knit and voile products are known for being innovative and sustainable.
Source: Fashion United
CHENNAI: Yarn spinners, garment makers and finished fabric manufacturers of Tamil Nadu’s western belt have been producing less over the past few weeks as a significant portion of their workforce returned home to cast votes in the parliamentary elections underway, a disruption signalling significant dependence on migrant labour for production. An internal survey conducted by the Indian Texpreneurs Federation, which has over 500 mills in Coimbatore, Tirupur — the exporters’ hub — and other regions of TN showed a majority of the mills running at a 10-20% loss in capacity utilisation. The survey took into account mills that make up 75 lakh spindles of capacity in the under -two-crore spindle capacity in the state. The drop accentuates a prevailing shortage in labour, a perennial condition in the western cluster. “For the past two years, worker shortage is continuing in our industry — this is happening even without any new big factories. With a burgeoning service sector absorbing workforce, getting labour for factories has become a challenge. There is a supplydemand mismatch,” said Prabhu Damodharan, convenor of ITF. “They usually go in batches to visit their families. In a mill of 600 workers, we used to send 25 workers at a time. Compared to the 2014 elections, the migrant labour ratio has increased and its effect has begun to affect production this season,” said Raja M Shanmugham, president of the Tirupur Exporters Association. “In terms of real numbers, their count cannot be less than 2.5 lakh in Tirupur alone,” he estimated. The drop in production arrives at a time of fragile European market recovery, which has ensured decent order flows to Coimbatore and Tirupur, dubbed Dollar City for its active exports scene. The Tirupur cluster is expected to have crossed Rs 50,000 crore in business, including supply to the domestic market, in the fiscal 2018-19 year. Exports alone should have crossed Rs 26,000 crore, estimated Shanmugham, with targets set for Rs 30,000 crore in the current fiscal. Migration of low-skilled workers from Bihar, Jharkhand, Uttar Pradesh and the Northeastern states to Tamil Nadu’s factories has become a permanent fixture. Entrepreneurs have embraced the influx enthusiastically, building hostels and offering flexible work contracts, ringing in change in a once-unionised industry cluster. Textile mill owners say the high demand for workers, addressed largely by migrants, has had a debilitating effect on unionism in Coimbatore: Ridden with conflicts and strike-calls in its heyday, unionism in the western belt’s textile factories is now plateauing off, say local leaders with CITU in Coimbatore.
Source: Economic Times
|
Item |
Price |
Unit |
Fluctuation |
Date |
|
PSF |
1278.81 |
USD/Ton |
0% |
5/7/2019 |
|
VSF |
1850.13 |
USD/Ton |
0% |
5/7/2019 |
|
ASF |
2522.09 |
USD/Ton |
0% |
5/7/2019 |
|
Polyester POY |
1250.68 |
USD/Ton |
-0.59% |
5/7/2019 |
|
Nylon FDY |
2812.19 |
USD/Ton |
0% |
5/7/2019 |
|
40D Spandex |
4677.12 |
USD/Ton |
0% |
5/7/2019 |
|
Nylon POY |
2664.18 |
USD/Ton |
0% |
5/7/2019 |
|
Acrylic Top 3D |
2738.19 |
USD/Ton |
2.78% |
5/7/2019 |
|
Polyester FDY |
1383.89 |
USD/Ton |
-0.53% |
5/7/2019 |
|
Nylon DTY |
3078.61 |
USD/Ton |
0% |
5/7/2019 |
|
Viscose Long Filament |
5594.78 |
USD/Ton |
0% |
5/7/2019 |
|
Polyester DTY |
1487.50 |
USD/Ton |
0% |
5/7/2019 |
|
30S Spun Rayon Yarn |
2545.77 |
USD/Ton |
-0.29% |
5/7/2019 |
|
32S Polyester Yarn |
2005.54 |
USD/Ton |
0% |
5/7/2019 |
|
45S T/C Yarn |
2878.79 |
USD/Ton |
0% |
5/7/2019 |
|
40S Rayon Yarn |
2812.19 |
USD/Ton |
-0.52% |
5/7/2019 |
|
T/R Yarn 65/35 32S |
2412.56 |
USD/Ton |
0% |
5/7/2019 |
|
45S Polyester Yarn |
2160.95 |
USD/Ton |
0% |
5/7/2019 |
|
T/C Yarn 65/35 32S |
2530.97 |
USD/Ton |
0% |
5/7/2019 |
|
10S Denim Fabric |
1.36 |
USD/Meter |
0% |
5/7/2019 |
|
32S Twill Fabric |
0.81 |
USD/Meter |
-0.36% |
5/7/2019 |
|
40S Combed Poplin |
1.08 |
USD/Meter |
0% |
5/7/2019 |
|
30S Rayon Fabric |
0.63 |
USD/Meter |
0% |
5/7/2019 |
|
45S T/C Fabric |
0.70 |
USD/Meter |
0% |
5/7/2019 |
Source: Global Textiles
Note: The above prices are Chinese Price (1 CNY = 0.14801 USD dtd. 07/05/2019). The prices given above are as quoted from Global Textiles.com. SRTEPC is not responsible for the correctness of the same.
A project is being implemented in Vietnam to improve the eco-friendliness of the local textile-apparel industry, which is a big foreign currency earner of the country but also has considerable impact on the environment. The Vietnam Textile and Apparel Association (VITAS) and the World Wildlife Fund (WWF) held a meeting for the VITAS’ environment committee in Hanoi on May 7 to seek ways to step up the sector’s environmental responsibility. VITAS Vice Chairman Truong Van Cam said the garment-textiles sector raked in 31.7 billion USD and 36 billion USD in exports in 2017 and 2018, respectively. It has set a target figure of 40 billion USD this year. However, it is also among the biggest greenhouse gas emitters, following electricity production, agriculture, road transport, and oil and gas production. The sector also faces serious social and environmental problems that have affected its reputation, he admitted. In addressing these issues, WWF Vietnam and VITAS have been working together to carry out a project on Vietnam’s garment-textiles sector, improving water management and energy sustainability. This project, being implemented from 2018 to 2020, looks to transform the sector into a sustainable and environmentally responsible industry. Hoang Viet, sustainable development programme manager at WWF Vietnam, said global consumers are shifting their preferences towards environmental sustainability. This has forced many famous brands to change their production modes in which they have to meet higher environmental and social standards. Therefore, if production modes are not changed soon, Vietnam will lose its competitive edge and many future opportunities, he noted.
Source: Vietnam News Association
The decline in textiles production would also lead to a decline in garment exports of between $320 million and $381 million, the World Bank said. Cambodia could lose as much as $600 million if the European Union decides to suspend it from a lucrative preferential trade scheme over human rights concerns, the World Bank has estimated. In an official assessment of the cost to Cambodia’s economy if the E.U. withdraws the country from the Everything But Arms (EBA) scheme, the Bank on Monday said the value of Cambodian goods exported to Europe would drop by between $513 million and $654 million as increased tariffs put off buyers. The decline in textiles production would also lead to a decline in garment exports of between $320 million and $381 million, it said. E.U. officials are currently reviewing Cambodia’s EBA membership after a sustained campaign by the ruling Cambodian People’s Party against the former opposition Cambodia National Rescue Party, activists and independent media prompted criticism from Brussels and Washington. If the E.U. decides to remove Cambodia from the scheme, tariffs on textile products would almost double. Neav Chanthana, deputy government of the National Bank of Cambodia, told reporters the World Bank’s findings were announced that the removal of Cambodia from EBA would have serious consequences but argued the government was prepared with contingency plans. “It’s a concern but the government has planned to respond if it [EBA] is withdrawn. But we hope that they need 18 months to do research and negotiation, and study what to do with it. We’ve prepared and we hope that they will not withdraw it,” she said. Last year, Cambodia exported $9.5 billion of garment and footwear products. The E.U. accounted for a third of these exports, according to the World Bank. In February 2019, the European Commission announced an official procedure that could lead to the temporary suspension of Cambodia due to a decline in human rights and democratic standards. The World Bank has warned that “downside risks are the erosion of export competitiveness, a potential slowdown in China, an overextended financial sector [which is associated with banks’ exposure to construction and real estate.” “Given Cambodia’s heavy reliance on capital inflows and tourists from China, a sharp slowdown in the Chinese economy could dampen growth prospects,” reads the report. However, it noted that preliminary estimates show Cambodia’s real growth achieved a four-year high of 7.5 percent in 2018, compared to 7.0 percent in 2017. “Driven preliminary by the rapid expansion of exports and robust internal demand, the economy performed better than expected.”
Source: Voa Combodia
By the middle of last year, the U.S. had hit the European Union with steel and aluminum tariffs, the EU had responded with counter-tariffs on American goods, and some feared the situation could escalate into a full-blown trade war. But then U.S. President Donald Trump and European Commission President Jean-Claude Juncker had a meeting and emerged with an agreement—the two sides would try to strike a new free-trade deal to give their countries easier access to each other’s markets. The good news: preliminary talks are finally starting this week, more than nine months after that agreement. The bad news: the talks are probably already doomed before they start. That’s in part because of a long-running catch 22: the U.S. won’t contemplate a deal that doesn’t include agricultural goods, and the EU, keen to protect its own farmers and maintain food standards, refuses to allow a deal that does include them.
Intractable problem
The biggest problem facing the fresh trade negotiations is that of food. “The United States has made it clear to the EU on many occasions that a trade agreement between the United States and the EU needs to include agriculture if the agreement is to get support in Congress,” said a U.S. Trade Representative (USTR) official Monday. The EU has long opposed opening the way for more U.S. farm foods to come into the bloc. This is partly to protect Europe’s small farmers from their larger U.S. competitors, and partly to keep out food that has been heavily genetically modified or—like chlorinated chicken—treated in ways that fall short of EU sanitary standards. France in particular strongly resists any deal that includes agricultural goods, and France is one of the EU’s most influential members.
Trump’s Word
The EU has a fairly good argument for not including agricultural goods in these talks: they weren’t part of the agreement struck between Trump and Juncker last July. The two presidents talked about a free-trade deal encompassing non-auto “industrial goods”—a category that takes in everything from chemicals to textiles, but not meat, fruit or wine. Accordingly, when the EU’s member countries last month gave EU negotiators permission to start talks with their American counterparts, they did so on the basis that the talks would be “strictly focused on industrial goods, excluding agricultural products.”
The Commission is not budging on that point, with sources there saying it is “convinced that a strict implementation” of what was agreed with Trump would “benefit both sides and could help address current challenges for the multilateral trading system.”
No dice, say the Americans.
“U.S. agricultural exports to the EU face high tariffs and unjustified non-tariff barriers. American farmers and ranchers need to be allowed to compete on a level playing field in the EU,” said the USTR official. All of which should make for lively discussions this week in Washington, D.C., where EU and U.S. teams are meeting to pave the way for formal talks between USTR Robert Lighthizer and EU Trade Commissioner Cecilia Malmström in the coming weeks. Because the official talks are yet to begin, the two sides are free to discuss the agricultural goods issue at this stage—but later on, it’s most likely going to be off the table.
Business hopes
The business community in the EU is certainly keen to see the talks succeed, though not at any cost. “The United States [is] the most important export destination for the German economy,” said Ilja Nothnagel, a member of the executive board at the German Chambers of Commerce and Industry. “Continued trade tensions not only endanger trade flows but jobs in Germany and the U.S. Many German companies…have invested in the U.S. and employ around 850,000 people there. That is why the trade talks are an important step.” Nothnagel said German companies have long been struggling with bureaucracy in U.S. states and in public procurement there, and are hoping a deal would cover non-tariff-related trade barriers of this sort. The biggest lobbying group that represents European farmers, COPA-COGECA, claims it’s in favor of agriculture being part of a comprehensive trade package—but not a cut-down deal of the sort that U.S. and EU negotiators hope to strike. “We believe that it would be beneficial if agriculture is included in a comprehensive trade negotiation, but we need to talk about all key issues… and not only tariffs. This would help to reduce tensions,” said the organization’s secretary general, Pekka Pesonen, in an emailed statement. “Nevertheless we know that the calendar and current trade/political environment wouldn’t give much room for a comprehensive agreement.”
Other problems
Agricultural products aside, there are quite a few hurdles to overcome if the U.S.-EU free-trade deal—the first attempted since the Transatlantic Trade and Investment Partnership (TTIP) talks—is to become reality. The TTIP talks failed in 2016, and the impasse over agricultural goods was a major factor. This time round, there are several new problems that generally stem from the policies of the Trump administration. For a start, France doesn’t even want the fresh talks to be taking place, because of the U.S. withdrawal from the Paris climate agreement. Then there are the tariffs that are still in place between the two sides—the U.S. metals tariffs and the counter-tariffs that followed—plus the tariffs that Trump keeps threatening to levy on European cars—and the tariffs the EU is threatening to introduce in response. On top of that, the EU is currently setting up a new payments channel to bypass U.S. sanctions on Iran. There are also big tensions over the U.S.’s decision to fully implement sanctions against Cuba in a way that could hurt European companies that have invested there. And there’s also the ongoing spat over subsidies and tax breaks given to the U.S.’s Boeing and the EU’s Airbus. In short, the outlook for any new deal is about as good as it was for TTIP—unlikely at best.
Source: Fortune
The government of Ethiopia and global fashion brands have failed Ethiopians working in the textiles factories ignoring the lowest wage in the world the employees are getting, a new study said. The NYU Stern Center for Business and Human Rights have found that textile industry workers in Ethiopia are struggling to live on less than a dollar pay. “Ethiopia’s plan to become a major garment-exporting nation rests in large part on the assumption that workers would accept the extremely low base pay of $26 a month, which isn’t enough to live on, even in Ethiopia,” said Paul Barrett, Deputy Director of the NYU Stern Center for Business and Human Rights. “Rather than the compliant, cheap workforce promoted in Ethiopia, the foreign-based suppliers have encountered employees who are unhappy with their compensation and living conditions and increasingly willing to protest by stopping work or even quitting.” Barrett and the Center’s Research Director, Dr. Dorothée Baumann-Pauly, visited several factories at the flagship Hawassa Industrial Park, located 140 miles south of the Ethiopian capital of Addis Ababa. They spoke with employees producing garments for Western brands including Gap, Guess, Levi’s, and PVH, among others. The researchers also spoke with managers, most of whom come from South or East Asia, an arrangement that has created cross-cultural tension on factory floors. The park, one of five the government has inaugurated since 2014, currently has some 25,000 employees and is supposed to grow to 60,000. Ethiopia has ambitions for a multibillion-dollar industry, but if wages remain below what is needed to afford housing and food, sustained growth will be difficult, if not impossible, to achieve.
The report’s key findings include:
• Entry-level workers in Ethiopian garment manufacturing — most of whom are young women — are typically paid a base salary worth only $26 a month, leaving them struggling to get by and unable to save or send money home. Ethiopia has no legally mandated minimum wage for the private sector. In their eagerness to create a “Made in Ethiopia” brand, the government, global brands, and foreign manufacturers failed to anticipate that the base wage was simply too little for workers to live on.
• Given relatively little training (sometimes as short as two weeks), frustration over worker pay, combined with homesickness and other unfavorable aspects of factory life, has led to a sense of alienation and lack of commitment to working productively. Workers, many of whom come from small rural villages, don’t receive sufficient training in the culture of factory life. They often don’t understand why they would be disciplined for lateness, absenteeism, or chatting with workstation neighbors at the expense of completing their sewing tasks.
• Cultural differences exacerbate already frustrating working conditions. Many foreign managers from South and East Asia shout at workers to get their attention, which is normal for factory culture in their countries of origin. But Ethiopians consider shouting offensive. This and other examples of cultural friction contribute to worker dissatisfaction and attrition.
• Unions have played no role in organizing workers or advocating for better pay or conditions at Hawassa. Ethiopian law, in theory, guarantees freedom of association, but the country has a weak trade union movement, which hasn’t attempted to organize employees at the industrial park. In place of traditional union representation, “workers’ councils” are supposed to promote factory employees’ interests at Hawassa. But the Center’s interviews revealed that fully functional worker councils operate in only a handful of the 21 manufacturing sites.
• During its first year of operation, overall attrition at the park hovered around 100 percent. This means that, on average, factories were replacing all of their workers every 12 months, driving training costs up and pushing down efficiency rates. Viewed through this lens, it actually costs more to make a basic t-shirt in Hawassa than in a Bangladeshi supplier, one expert told the Center. Ethiopian labor has turned out to be considerably more costly than the government had initially advertised. “Brands can mitigate these challenges for suppliers and their employees by aligning business practices with realities in Ethiopia,” said Dr. Dorothée Baumann-Pauly, Research Director for the NYU Stern Center for Business and Human Rights. “Long-term sourcing commitments, investment in on-boarding and on-the job training, and the provision of non-financial benefits like meals, transportation, and housing subsidies can help to increase the currently low efficiency levels and eventually lead to higher wages.” To address the issues identified above, the Center recommends that the Ethiopian government and Western brands take a number of steps, including the following:
Recommendations for the Ethiopian government:
1. Establish a minimum wage that ensures decent living conditions for garment workers. The government is considering such a move, which must be done gradually so as not to drive away foreign manufacturers.
2. Address ethnic tension in Hawassa and elsewhere. Ethiopian Prime Minister Abiy Ahmed needs to apply his ample political skill to defusing potential violence that could threaten Hawassa and other industrial parks.
3. Craft and implement a long-term economic plan for strengthening the apparel industry, including developing a domestic supply chain, shoring up industrial parks, and diversifying into other sectors.
The study also suggested the following recommendations for foreign manufacturers and Western brands:
1. Provide more extensive training on both hard and soft skills. Evidence of the need for more training comes in the form of low efficiency numbers and high attrition rates.
2. Promote more Ethiopians more quickly into middle-management jobs. Doing so would alleviate the tension between managers from East and South Asia and their Ethiopian charges.
3. Build worker dormitories that offer subsidized rent. The lack of decent housing is the most pressing form of worker deprivation in Hawassa.
Reports show that since the opening of the first industrial park of the country, Hawassa Insdustrial Park, the employees have been compaining the low wage, which is not enough to live on.
Source: New Business Ethiopia
Chief Coordinator Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA) Ijaz A Khokhar has said that initial preparation for holding World Fashion Convention in the country is under way. The international event would be held in November this year at Lahore he said.Talking to Business Recorder on Monday he said that he will leaving for Frankfurt to attend a high level meeting of International Apparel Federation (IAF) to discuss the necessary issues for finalizing a arrangements for the international event and will also attend Techtextil a leading trade fair for technical textiles and non-woven to invite the international brands personally to attend the world fashion convention in Pakistan. Ijaz revealed that delegates from 45 countries are expected to attend the convention and showcase their products. The speakers from across the globe would express their views particularly width of supply chain, from raw material to apparel sourcing and from production to retail trends he said. The PRGMEA Chief Coordinator said that most the delegates would visit Pakistan for the first time and will view Pakistani products, standard of textile and garment companies physically adding that the delegates will visit different garments and textile factories of Pakistan. The World Fashion Convention will provide an opportunity to SMEs engaged with textile and garments industry in showcasing their products and enabling them to develop individual contacts with the participating delegates he said. Ijaz said the convention will provide an opportunity to domestic businessmen to develop not only B2B links bout also help in establishing joint ventures with their foreign counterparts. The B2B links will enable the domestic and international businessmen to develop direct links as well as provide an opportunity to understand each other's business viewpoints he added.
Source: Business Recorder
HANOI- Vietnam gained over 9.4 billion U.S. dollars from exporting garments and textiles in the first four months of this year, up 9.8 percent year-on-year, according to the country's Ministry of Industry and Trade on Wednesday. In April alone, the country raked in 2.3 billion U.S. dollars from selling the products offshore, rising 7.1 percent. Between January and April, largest importers of Vietnamese garments and textiles included the United States, Japan, the European Union and South Korea. The revenue surge was mainly attributable to strong market demand, with many orders already placed for the first six months of this year or even the whole year, said the ministry. Vietnam's garment and textile export turnovers may reach 40 billion U.S. dollars in 2019, the Vietnam Textile and Apparel Association forecast. Vietnam, which is among the world's five biggest exporters and producers of garments and textiles, posted garment and textile export turnovers of over 30.4 billion U.S. dollars in 2018, up 16.6 percent from 2017. However, Vietnam had to spend more than 12.9 billion U.S. dollars importing cloth last year, up 13.5 percent, the association said, noting that most of local cloth has yet to satisfy quality requirements of the country's key garment export markets.
Source: Xinhuanet
