Some newspapers have today highlighted a perceived set-back to the automated process of refunds for exporters under GST on account of the introduction of manual checks to curb large scale frauds in IGST refunds. These news items regrettably create a misleading impression that genuine exporters would suffer on account of the newly introduced verification process. The CBIC has recently instructed its Customs and GST formations to verify the correct availment of input tax credit (ITC) by few exporters who are perceived as “risky” on the basis of pre-defined risk parameters. Only 5,106 risky exporters have been identified so far as against about 1.42 lakh total exporters. Thus the risky exporters are only 3.5% of the total exporters. Further, in the last two days i.e. 17.06.2019 and 18.06.2019 only 1,436 Shipping Bills filed by total 925 exporters have been interdicted. Considering that about 20,000 Shipping Bills are filed by roughly 9,000 exporters on a daily basis, the intervention is negligible. Even for these risky exporters, the exports are allowed immediately. However, the refund would be released after verification of ITC within a maximum of 30 days. The new verification exercise is aimed at preventing unscrupulous exporters from defrauding the exchequer and bringing a bad name to the larger exporting community. CBIC would like to assure all genuine exporters that they would continue to get their IGST refunds in a timely manner in a fully automated environment.
Source: Press Information Bureau
The GST Council will on Friday consider slashing GST rate on electric vehicles to 5 per cent, from 12 per cent currently, along with extension of the tenure of the anti-profiteering authority by a year till November 2020, an official said. The 35th meeting of the GST Council and the first under Finance Minister Nirmala Sitharaman will also consider a couple of anti-evasion steps such as integration of eway bill with NHAI's FASTag from April 1, 2010, and asking businesses with a turnover of over Rs 50 crore to issue e-invoice for B2B (business-to-business) sales, as well as asking states to make e-ticketing mandatory for all movie halls. The Council will also consider tweaking GST rate on lottery. An 8-member group of state finance ministers could not reach a consensus on whether a uniform tax rate should be imposed on lotteries or the current differential tax rate system be continued. Currently, a state-organised lottery attracts 12 per cent GST, while a state-authorised lottery attracts 28 per cent tax. Also, the Council is likely to discuss a mechanism for single-point sanctioning and processing GST refunds. The current mechanism entails twin refund sanctioning authority of the central and state tax officers but that could well change by August when the proposed new structure involving a single authority comes in place. Besides, the Council would also deliberate on setting up a national bench of the Appellate Authority for Advance Ruling to reconcile the contradictory orders on similar issues passed by the Authority for Advance Ruling in different states, a move aimed at providing certainty to taxpayers. To give a push to manufacturing electric vehicles, the Council will consider slashing GST rates to 5 per cent from 12 per cent, the official said. GST rate for petrol and diesel cars and hybrid vehicles is already at the highest bracket of 28 per cent plus cess. Besides, the Council will also consider extending the tenure of the National AntiProfiteering Authority (NAA) by a year till November 30, 2020, as the authority continues to receive consumer complaints of profiteering against companies. The NAA came into existence on November 30, 2017, after its Chairman B N Sharma assumed charge. So far, the NAA has passed 67 orders in various cases. In a move to check evasion, the Council would also discuss the proposal of integrating eway bill with NHAI's FASTag mechanism from April 1, 2020. Such an integration would help find the location of the vehicle and when and how many times it has crossed NHAI's toll plazas and restrict transporters from doing multiple trips by generating a single e-way bill. Transporters of goods worth over Rs 50,000 would be required to present an e-way bill during transit to a GST inspector, if asked. However, lack of harmonisation under the 'track and trace' mechanism in terms of sharing information among different agencies is leading to misuse of e-way bill. The Council would also consider another anti-evasion proposal of issuance of e-invoices on a centralised government portal by businesses with turnover of Rs 50 crore and above for B2B sales. An analysis of return filing shows that as many as 68,041 businesses have reported a turnover of over Rs 50 crore and accounted for 66.6 per cent of total GST paid in 2017-18. Further, while these businesses account for just 1.02 per cent of GST payers, they make up almost 30 per cent of the B2B invoices generated in the system.
Source: Economic Times
Loss-making companies have among them lost Rs 2 lakh crore in FY19 — a 15-fold jump over the last 10 years. In contrast, a clutch of 316 firms in FY10 had reported a combined loss of Rs 12,995 crore. With global growth slowing and local demand subdued, more and more companies seem to be losing their grip on profitability. As a result, a record 510 companies posted losses in FY19, against 502 in the year ago period and 496 in FY17. On an average, about 445 companies reported losses every year over the last 10 years, data sourced from Capitaline showed. Loss-making companies have among them lost Rs 2 lakh crore in FY19 — a 15-fold jump over the last 10 years. In contrast, a clutch of 316 firms in FY10 had reported a combined loss of Rs 12,995 crore. Interestingly, state-owned companies with a combined net loss of Rs 64,106.25 crore account for a third of total loss made by all companies in FY19. Even though FY16 also had a similar number of loss-making companies as in FY19, the cumulative losses in that year were less than half the aggregate losses reported in the year gone by. FY11 saw the lowest number of loss making companies in the last 10 years. With 59 firms, the textiles sector dominates the list of loss making companies in FY19. It was followed by banks and finance with 56 entities. These three sectors between them account for about 23% of the total number of loss making companies. While the capital goods sector has 21 firms, others such as pharmaceuticals, steel and realty have 20 companies each with negative earnings. Some of the prominent companies that reported large losses in FY19 include Tata Motors (Rs 28,826.23 crore), IDBI Bank (Rs 14,986.76 crore), Vodafone Idea (Rs 14,603.90 crore), Reliance Naval and Engineering (Rs 10, 926.55 crore) and Punjab National Bank (Rs 9,570.11 crore). The analysis is based on 2,266 listed companies across sectors which are having financials for at least 10 years. While companies like GTL Infrastructure, Siti Networks, Gujarat State Financial Corporation, RMG Alloy Steel, Soma Textiles, Cranes Software and Future Consumer have been reporting losses for the last 10 years, GMR Infra, Tata Teleservices Maharashtra, EMCO, Hindustan Construction Company, Network.18 Media, Quadrant Televentures, KSL and Indus, Vardhman Polytex, Alps Industries, E-Land Apparel, K-Lifestyle, etc did so for nine years since FY10. It must be noted that many of the insolvency candidates, such as Videocon Industries (loss of Rs 5,264.04 crore in FY18), Jet Airways (Rs 636.45 loss in FY18) and Adhunik Metaliks (Rs 1,016.66 crore in FY18) are yet to declare their financial results for FY19.
Source: Financial Express
Representatives of the Federation of Indian Export Organisations (FIEO) said that they were formulating a strategy to place Telangana State among the top five exporting States in the country. Telangana currently stands at 11th position in India. Interacting with industrialists at Zonal Office of TSIIC (Telangana State Industrial and Infrastructure Corporation) in Patancheru here on Thursday, PT Srinath, the head of Telangana chapter of FIEO, said that they wanted to get feedback from industrialists in Sangareddy district on ways and means to improve exports from the State. Speaking to Telangana Today, Srinath said that there was a great potential in Telangana to enhance exports. Stating that the Industrialists from Telangana were only concentrating on bulk drugs and software exports, the FIEO-Hyderabad said there was a pressing need to concentrate on exporting on agri products, jewellry, automobiles, engineering tools, textiles, defence, mines and minerals apart from further enhancing the software and pharma exports from Telangana. Maharashtra, Gujarat, Tamil Nadu, Karnataka, and Uttar Pradesh were the five top exporting States in the country. However, Srinath said that there was enough potential to make the youngest State of the country one of the top five exporting States within five years. Srinath said that they were formulating the strategy regarding policy making, infrastructure development, ease of doing business (EoDB), logistics facilitation, skill development, promotion and encouragement. Assistant Director, FIEO, Manisha Jain, Industrial Local Area Authority, Chairman, Kala Ramesh, Zonal Manager, TSIIC, Kalavathi and representatives of various industries attended the meeting.
Source: Telangana Today
The innovation centres would be used as tinkering laboratories to solve urban issues, including traffic congestion, mosquito breeding, stray dog menace or pollution due to local industries. The Centre has begun groundwork to deliver a major poll promise — 100 innovation zones across India. The innovation centres would be linked to Smart City Mission of Modi 1.0. The first 100 cities chosen through a competitive process would house one innovation centre each. The Prime Minister’s Office (PMO) has entrusted the spadework to Niti Aayog, Ministry of Housing and Urban Affairs, Ministry of Electronics and Information Technology (MeitY) and Ministry of Skill Development and Entrepreneurship. According to officials involved in the groundwork, the innovation centres would be used as tinkering laboratories to solve urban issues, including traffic congestion, mosquito breeding, stray dog menace or pollution due to local industries. A team of officials has been asked to see the best cities which would be best suited to launch at least 10 innovation centres. A source, involved in the planning process who did not wish to be identified, told ET, “The better performing cities chosen under Smart City Mission already have command and control centres, which have data and infrastructure to understand the urban issues plaguing that local body. Now, some urban local bodies would be chosen to launch pilot projects, which would showcase technological or economic innovations that could address a major challenge area.” In its 2019 manifesto, under “Entrepreneurship and Startups” section, BJP had promised, “India is now among the largest startup ecosystems of the world. We will further strengthen this ecosystem by… Creating 100 Innovation Zones in Urban Local Bodies.” Each urban local body would flag an issue and the idea would be throw open to entrepreneurs to come and suggest a solution. This would be done through the innovation zone or centre. Another official said, “There are many urban problems in cities. For instance, a city could flag mosquito breeding. With the systems in command and control centre, the city has been mapped on certain parameters. An entrepreneur could put in place a software which could set off alarms if there are some breeding spots discovered.” There are other problems in cities like Surat or Ahmedabad which have a flourishing textile industry, which is highly polluting. These innovation centres could help in addressing urban issues which have plagued the city for long but have not been solved. The government also wants the innovation centres to act as lighthouse projects. If an experiment is successful in one centre, it could be shared on a common platform for replication in other cities with similar issues. “This would also help in spawning an entire industry of innovation. We are looking at this as a way to encourage startups,” said the official quoted above.
Source: Economic Times
Director of Handlooms and Textiles Shailaja Ramayyar has instructed the weavers of Sircilla textile town to complete the order given by the government to produce Bathukamma saris before September 15. At a review meeting with the representatives of weavers and district officials here on Thursday, she said the government had placed orders for weaving 96 lakh Bathukamma saris to the weavers of Sircilla. She said at present, only 14,500 powerlooms were working against the targeted 20,000 powerlooms to produce the saris and urged the weavers to use more looms to achieve the target before the deadline. With regard to the increase of wages for powerloom weavers, she clarified that the government had fixed the rates in March before placing the orders and there was no question of increase the wages now. She urged the weavers to desist from their proposed strike call demanding increase of their wages in the interest of the textile sector. Collector D. Krishna Bhaskar said if the weavers go on strike, the government would be forced to give orders to weave Bathukamma saris to other agencies, he cautioned. AD (Handlooms and Textiles) P. Ashok Rao was also present.
Source: The Hindu
Knight Frank has launched on Wednesday it’s “India Warehousing Report 2019”. Knight Frank, the independent global property consultancy in association with REED Exhibitions India is participating in the region’s largest warehousing expo the “9th India Warehousing Show 2019”. As a part of this association, Knight Frank launches the latest edition of its flagship report, India Warehousing Market 2019 to give perspective on the scale and growth of the warehousing market in India. According to the report, top warehousing markets in India witness a growth of 77 per cent year-on-year in leasing in April 2018–March 2019. Total requirement of storage space in the Indian manufacturing sector accounts for 80% of the warehousing market today. The total warehousing space estimated to be 68 million sq m (739 million sq ft) in 2019 for the manufacturing sector which is projected to grow at a compounded annual growth rate (CAGR) of 5% in the next five years to 86 million sq m (922 million sq ft) by 2024. The report notes that logistics cost in India accounts for 13%-14% of the Gross Domestic Product (GDP) which is substantially higher than the (8-10%) logistics cost to GDP ratio in other developed countries. The primary reason for this is the skewed multi-modal mix and the fact that 60% of freight movement in India happens via roadways. Notes of Nagpur from the report: n Nagpur has the third largest population base in Maharashtra and is centrally located from major consumption markets. Popular for being an Orange City and food manufacturing hub, Nagpur is yet to make its mark on the state’s warehousing map. n Despite its strategic location, the major consumption markets such as Delhi, Mumbai, Kolkata, Bengaluru and Chennai are very far away from Nagpur (nearly 800-1000 kms). Tier II and III cities near Nagpur, such as Raipur, Jabalpur, Bhopal, Bhilai and Indore fare far below in the pecking order from a consumption perspective. Hence, Nagpur’s evolution as a warehousing hub remains uncertain due to lack of proximity to a major consumption center. While it is still premature to write off Nagpur, its warehousing clusters are not getting organized as fast as what is prevalent in other cities post the Goods and Services Tax (GST) implementation. n The Multi modal International Cargo Hub and Airport at Nagpur (MIHAN) project, due to its sheer size of economic development, is expected to attract a lot of investments and land allotment to various business conglomerates for both the Special Economic Zone (SEZ) and the non SEZ area is currently underway. This project is set to transform Nagpur into a major cargo hub. The SEZ area in MIHAN will be the one of its kind with the largest multi-product SEZ in India spread across 1,472 hectares. The manufacturing industry units will include multiple industries from sectors like food processing, pharmaceuticals and textiles. The large-scale concentration of industrial activity in this region is bound to give a fillip to quality warehouse developments in the vicinity. n For the growth of an organized warehousing market, erstwhile industrial suburbs developed by Maharashtra Industrial Development Corporation (MIDC) such as Butibori and Hingna have a major role to play. Both these micro markets account for majority of the city’s industrial activity and large warehousing and logistics park have come up in and around them. Gumgaon, Waddhamana, Hingna Road, Hingna MIDC area, Kotewada and Kamleswar are some upcoming warehousing locations. n Gumgaon, a surrounding district of Butibori, is home to Orange City Logistics Park which is in close proximity to the Mumbai-Kolkata Highway. This huge warehousing facility is ideally located to meet the upcoming warehousing requirements of large companies which will eventually set footprint in MIHAN. The report also observed that the warehousing sector has attracted around USD 6.8 billion (approximately Rs 47,385 crore) funds since 2014 from institutional investors and developers amid rising demand for logistic spaces from manufacturing and e-commerce players post implementation of GST, according to Knight Frank. “The warehousing industry has witnessed massive participation from institutional investors, as well as developers, who have collectively invested over USD 6.8 billion since 2014, with an average investment per deal of USD 282 million,” Knight Frank said.
Source: Hitvada
The rupee June 20 surged 24 paise to close at a one-week high of Rs 69.44 against the US currency on the back of a rally in equities and losses in the dollar after the US Federal Reserve hinted at a possible rate cut in near future. The rupee rose to a high of 69.35 to the dollar in the day trade on the US Federal Reserve's comments that a case for a rate cut has strengthened in view of the US-China trade war and low inflation. A spike in crude oil prices after Iran said it shot down a US drone in its coastal southern province, however, checked the rupee gains. Brent crude futures, the global oil benchmark, rose by 2.67 per cent to trade at USD 63.47 per barrel on heightening tensions between the US and Iran. At the interbank foreign exchange (forex) market, the domestic currency closed up by 24 paise or 0.34 per cent at 69.44, a level not seen since June 12. Meanwhile, the 10-year government bond yield fell to 6.79 per cent Thursday, following a global trend. The yield on US Treasuries dropped below 2 per cent -- the first time since 2016 after the Fed comments. Falling US yields make emerging markets attractive for global investors due to large rate differential. Foreign funds, however, pulled out Rs 438 crore from capital markets on a net basis Thursday, provisional data showed. The dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.49 per cent to 96.64. The BSE Sensex rallied 489 points Thursday, driven by gains in banking, healthcare and auto stocks. After gyrating over 700 points during the day, the gauge settled 488.89 points, or 1.25 per cent, higher at 39,601.63. Similarly, the broader NSE Nifty closed 140.30 points, or 1.20 per cent, higher at 11,831.75. The Financial Benchmark India Private Ltd (FBIL) set the reference rate for the rupee/dollar at 69.6677 and for rupee/euro at 77.9925. The reference rate for rupee/British pound was fixed at 87.4878 and for rupee/100 Japanese yen at 64.34.
Source: Money Control
Tamil Nadu’s Erode Vhisaithari Urimayalargal Sangam (Erode power loom owners association) recently urged the Indian Government not to impose import duty on man-made fibre (MMF) viscose yarn as it will affect the sector. In a letter to textiles minister Smriti Irani, it said it has learnt about plans to raise the import duty on MMF yarns or ban it completely. The power loom industry in the region, spread across Erode, Coimbatore, Tiruppur, Salem and Namakkal districts, has been producing cotton and rayon fabrics and selling to markets in New Delhi, Faridabad, Mumbai, Jaipur, Ahmadabad and Surat. Due to frequent increase in the price of yarn in the domestic market, power loom units started importing rayon and modal yarn from China, Vietnam and Indonesia which was cheaper by ₹15 to ₹20 per kg, a top South Indian newspaper reported citing the letter. Hence, more units started importing the yarn forcing the spinning mills in the domestic market to reduce price, said the letter. (DS)
Source: Fibre2fashion
High manufacturing costs are affecting the competitiveness of apparel exports, especially in low value-added products, according to a survey conducted by the Indian Texpreneurs Federation. The Federation conducted a survey to find out reasons for apparel and made-up exports remaining stagnant though the Union Government had implemented special packages for these products. As many as 320 manufacturers and exporters took part in the survey that was open for three to four days and gave their top three reasons from 13 factors identified as impediments to apparel and made-up exports. Indian exporters compete with countries that are seen as low-cost destinations and are struggling to match the prices quoted by these countries. The other main reason is that Indian garment exporters focus on just three or four major countries/zones where countries such as Bangladesh have free trade agreements. The domestic industry has not improved its manufacturing efficiency and faces labour shortage; raw material, mainly man-made fibre, is expensive compared to other countries; and even for blends the industry lacks cost-effective eco system, according to the study. “There are no magical solutions for textile and apparel sector to revive its growth. There are no short-term solutions. The industry needs long-term initiatives,” said Prabhu Dhamodharan, convener of the Federation. Explaining the factors identified by the exporters as impediments to growth, he said the manufacturers in this region are mainly in low-value segment. They have not gone in for product diversification. A buyer needs suppliers for more blended and MMF products compared to cotton products and Indian manufacturers should be able to meet the requirement. While free trade agreement with Europe may take time, India should at least look at agreements with Eurasia. In an effort to address the issues that cripple the growth of the garment sector, the Federation has sought a “Fibre Neutral” policy. All raw materials used by the Indian textile industry should be on a level-playing field. This will enable to industry move faster towards blended products. The Government should also announce a Cotton Technology Mission to increase cotton productivity. Countries such as China have crossed 1,000 kg per hectare where as in States such as Maharashtra in India, it is lower than 500 kg per hectare. The Government should extend incentives and promote large-scale manufacturing as scale of production is important. It should also form a task force with stakeholders from the industry as members and higher officials of the Ministry should visit the textile clusters regularly to understand the issues that the industries face, the ITF said.
Source: The Hindu
Ravi Kumar, who has an engineering micro unit at Velandipalayam, manages the facility with his wife Thilagamani, aged 42. His wife not only takes care of the unit when he has to go out but also operates the machinery. “She started operating the cutting machine three or four years ago. Now, she can operate the heavy lathe,” he says. Many micro unit owners are involving their family members, including the women, in operating the machinery. This trend in micro units started two years ago as migrant workers started moving to other jobs. “They (migrant workers) used to quit in groups and join larger units. We cannot increase the salary every month. There are minor works where women were initially employed. Now, they (women) are into lathe operation too,” says Mr. Ravi Kumar. However, they cannot be employed for loading or unloading and need support in the engineering units, he adds. According to J. James, president of Tamil Nadu Association of Micro and Tiny Enterprises, women are employed for various jobs in the micro units. But, they are just 10 % to 15 % of the total workers in the micro industries. “Employment of local women started because of labour shortage,” he says. Earlier, micro units went in for group insurance (medical) for their workers. It was discontinued as the annual premium amount went up. In an effort to ensure safety to the workers, especially women, “We are trying to bring the insurance scheme back,” he says. It is not just the micro units, but several manufacturing industries across industrial verticals in Coimbatore that are employing women at shop floor, mainly to address worker shortage. In the pumpset units, two factories are operated only by women and others are increasingly employing women. “We are having plans for employing more women, especially for jobs such as motor winding. We take ITI candidates. We need to provide initial training,” says V. Krishnakumar, president of Southern India Engineering Manufacturers’ Association, who is also the vice-president - Marketing of Aquasub Engineering. Industries need to ensure they provide basic facilities when women are employed. Some factories have health centres too, he says. K.V. Karthik, vice-president of the association, says that foundries face nearly 30 % worker shortage while pump industries face nearly 25 % shortage during peak season for skilled jobs. Factories employ women to tide over worker shortage and also because of reliability. They can do only specific jobs but women employment is on the rise and most of them are aged below 35, he says. In the textile mills, women employment to operate the machinery started in the 1990s. Initially, they were trained by the machinery operators at the mills. Since 2000, there are structured training programmes for all jobs and they are employed for all the three shifts. Women constitute nearly 30 % of the workforce in the mills. Earlier the number was higher. It has reduced now as more women in rural areas opt for higher education. Further, the State has nearly 2,500 textile mills and worker requirement has increased. In order to meet the requirement, mills started employing workers from other States. They are almost 50 % of the workers at the mills, says an official of the Southern India Mills’ Association.
Source: The Hindu Business Line
|
Item |
Price |
Unit |
Fluctuation |
Date |
|
PSF |
1094.76 |
USD/Ton |
2.72% |
6/20/2019 |
|
VSF |
1607.39 |
USD/Ton |
0% |
6/20/2019 |
|
ASF |
2519.69 |
USD/Ton |
0% |
6/20/2019 |
|
Polyester POY |
1144.00 |
USD/Ton |
1.02% |
6/20/2019 |
|
Nylon FDY |
2331.44 |
USD/Ton |
0% |
6/20/2019 |
|
40D Spandex |
4344.30 |
USD/Ton |
0% |
6/20/2019 |
|
Nylon POY |
5473.82 |
USD/Ton |
0% |
6/20/2019 |
|
Acrylic Top 3D |
1368.45 |
USD/Ton |
1.07% |
6/20/2019 |
|
Polyester FDY |
2201.11 |
USD/Ton |
0% |
6/20/2019 |
|
Nylon DTY |
2678.99 |
USD/Ton |
0% |
6/20/2019 |
|
Viscose Long Filament |
1274.33 |
USD/Ton |
1.15% |
6/20/2019 |
|
Polyester DTY |
2577.62 |
USD/Ton |
0% |
6/20/2019 |
|
30S Spun Rayon Yarn |
2345.92 |
USD/Ton |
0% |
6/20/2019 |
|
32S Polyester Yarn |
1687.04 |
USD/Ton |
0% |
6/20/2019 |
|
45S T/C Yarn |
2621.06 |
USD/Ton |
0% |
6/20/2019 |
|
40S Rayon Yarn |
2664.50 |
USD/Ton |
0% |
6/20/2019 |
|
T/R Yarn 65/35 32S |
2157.67 |
USD/Ton |
0% |
6/20/2019 |
|
45S Polyester Yarn |
1868.05 |
USD/Ton |
0% |
6/20/2019 |
|
T/C Yarn 65/35 32S |
2316.96 |
USD/Ton |
0% |
6/20/2019 |
|
10S Denim Fabric |
1.33 |
USD/Meter |
0% |
6/20/2019 |
|
32S Twill Fabric |
0.76 |
USD/Meter |
0% |
6/20/2019 |
|
40S Combed Poplin |
1.04 |
USD/Meter |
0% |
6/20/2019 |
|
30S Rayon Fabric |
0.61 |
USD/Meter |
0% |
6/20/2019 |
|
45S T/C Fabric |
0.69 |
USD/Meter |
0% |
6/20/2019 |
Source: Global Textiles
Note: The above prices are Chinese Price (1 CNY = 0.14481 USD dtd. 20/06/2019). The prices given above are as quoted from Global Textiles.com. SRTEPC is not responsible for the correctness of the same.
The United Kingdom and South Korea signed a statement recently noting their consensus for a free trade agreement that will allow businesses to continue trading freely after the British exit from the European Union (EU). UK international trade secretary Liam Fox signed the joint statement in Seoul on June 10 with Korean minister of trade Yoo Myung-Hee. The agreement will be formally signed after formal checks and parliamentary procedures. This marks the end of formal trade discussions between the two sides, according to a UK Government press release. The agreement allows businesses to continue to trade on preferential terms with Korea. In 2018, around 99% of British exports to Korea were eligible to be exported tariff free. Trading on these terms rather than on World Trade Organization terms will deliver significant savings and help to safeguard British jobs, the press release said. The trading relationship between the two nations was worth £14.6 billion last year and has increased by an average of 12 per cent per year since the EU-Korea Free Trade agreement was signed in 2011. Demand for British products in South Korea continues to grow rapidly and exports have increased by an average of 18 per cent per year since 2011. (DS)
Source: Fibre2fashion
Uganda's import bill of second hand clothes has increased fivefold from $27.4m (Shs102b) in 2001 to $137m (Shs511b) in 2016, a report by Economic Research Policy Centre (ERPC) indicates. The report, "Fostering a sustainable agro-industrialisation agenda in Uganda" highlights Uganda's performance across nine agricultural product value chains. According to the report, worn clothing and worn textile otherwise known as second hand clothes are a major component of Uganda's import textile bill. "Of critical significance to note is that the worn textile products and clothing is a major component of Uganda's import textile products, accounting for $27m in 2001 and $137m in 2016," the report reads in part, highlighting the potential domestic market that lies untapped in the textile and apparel market. The report indicates that in 2001, Uganda imported second hand clothes worth $27.4m, which grew to $36m (Shs134b) in 2005 and $86m (Shs320b) and $102m (Shs380b) in 2010 and 2015, respectively. Uganda's overall textile import bill has increased by three fold from $56m in 2001 to $210m in 2016 with a cumulative sum of $657m (Shs2.4 trillion) over the years with the highest contribution from second hand clothes making up $390m (Shs1.4 trillion) representing 57.7 per cent. Importation of new clothes "apparel and clothing products" make up $83.6m, (Shs309b) man-made staple fibres $77m (Shs287b) and other textiles accounted for $122m (Shs455b) during the period. The report attributes the growth in textile importation to high population growth and limited local capacity for apparel production. Importation of second hand clothes has been a contentious topic because aside from employing numerous Ugandans, foreign powers such as US have vested interests. The East African countries, including Kenya, Uganda, Tanzania, Rwanda, and Burundi in 2016 came up with a three year plan to ban imports of second hand clothes as part of EAC vision 2050 to boost industrialisation. However, the move raised concerns with the US threatening to review trade benefits enjoyed by EAC member states under African Growth and Opportunity Act (Agoa). The ban was to be enforced by introducing and increasing taxes on used clothes. However, the 2019/20 regional budgets made no mention of taxes on used clothes despite emphasising the industrialisation agenda. In January, Uganda Ginners and Cotton Exporters Association asked government to ban importation of used clothes.
Performance of the cotton sector (exports)
While the import bill of used clothes has tripled in the last 15 years, earnings from cotton exports, the report indicates, have minimally grown from $12.8m (Shs47.7b) to only $24m (Shs89.5b) in over 15 years. Nearly 95 per cent of Uganda's cotton is exported as lint, the report says, which undermines opportunities for increased earnings from upgrading in the value chain. Mr Swaibu Mbowa, a senior research fellow at EPRC, said government must invest and support the cotton industry to produce competitive products, which will tame importation of second hand clothes. "Money should come from the budget to support cotton industries and they will apply the technology to cut down the cost of production and we will be competitive," he said, adding: "We have installed capacity, 39 ginneries in Uganda, 18 of which lay idle while those operating are below 39 per cent capacity." Ministry of Finance in the 2019/20 financial year allocated Shs1 trillion to agriculture.
Source: All- Africa
The Ministry of Industry and Trade (MoIT) on Thursday officially launched an electronic certificate of eligibility (C/E) issuance system for garment and textile exports to Mexico. The move is part of efforts to accelerate administrative procedure reforms and facilitate imports and exports of garment and textiles products in line with the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). According to Deputy Minister of Industry and Trade, Trần Quốc Khánh, member states of the new-generation trade pact account for 13.5 per cent of global GDP, and the CPTPP is expected to bring them many trade opportunities, particularly in the garment and textile sector. The MoIT has worked with competent authorities in Mexico to build a rational mechanism to control the flow of garment imports and exports between the two countries, he said, adding that the electronic issuance of C/E will help connect supply chains in both nations. Attending the launch ceremony, Mexican Ambassador to Việt Nam Valdes Bolano described Việt Nam as a significant trade partner of the American country while speaking highly of the former’s response to its commitments in the garment and textile sector. Deputy head of the MoIT’s Foreign Trade Agency Trần Thanh Hải said that, along with CPTPP’s documents and commitments so as to enjoy favourable duties, Việt Nam should abide by two exchange letters on garment and textile tariff rate quotas and monitoring system signed between the two industry and trade ministries. In a bid to receive preferential taxes, exporters are required to have certificate of origin (C/O) and C/E, he added.
Source: Vietnam News
