Mr Ravi Capoor, Secretary, Ministry of Textiles said that government is in the process of finalizing 40 new Harmonized System of Nomenclature (HSN) codes for technical textiles sector in coming months. Speaking at the 'TECHNOTEX 2019 - Technical Textiles: Technologies, Markets and Investments', Mr Capoor said that the government has already established HSN codes for 207 items, yet a large number of items are still not under any specific category of codes. "Another list of 40 such HS codes have been under consideration and in next few months we will have dedicated codes for 40 such items," he said.
Mr Capoor stressed on the mandatory use of technical textiles in over 90 areas, which the government is currently discussing. He further highlighted that 'technical textiles' is the sunrise industry of the country and we have to create an ecosystem for time-bound research in the institutions for technical textiles segment.
Highlighting the potential of this sector in India, Mr Capoor said that globally the technical textiles market is around US$ 200-250 billion with a very high CAGR and India is still not in the forefront in terms of annual growth rate of the sector. He emphasized on the need to have private sector participation in government's research system with a time-bound output strategy.
Dr V K Saraswat, Member, NITI Aayog highlighted the factors contributing to the growth of this sector which includes rising consumer awareness, usage and improvement in the overall process innovation. Dr Saraswat also highlighted the need for establishing a coordinated approach between various stakeholders and the government to boost the sector. "We need to have an umbrella organization for better coordination between the industry, R&D centers and government," he said.
Source: The Business Standard
Monthly exports of cotton yarn is at a 5-year-low
Export of cotton textiles continued their downtrend and registered a fall of 24 per cent during the April-July period. The provisional data released for the first three weeks of August also showed a decline of 25 per cent month-on-month.
Expressing deep concern about the declining trend in cotton textile exports, Dr KV Srinivasan, Chairman, Cotton Textile Export Promotion Council, said that a commodity-wise analysis of the data showed that while garment and made-up exports have shown a growth, exports of cotton yarn and fabrics continued their declining trend. “A sharp and precipitous decline, especially of cotton yarn during the last four months by about 35 per cent, has led to a crisis-like situation in the spinning industry,” he said.
In fact, the monthly exports of cotton yarn are at a 5-year-low of 59-60 million kgs.
Exports to major markets such as China has halved, and exports to Bangladesh and Korea has fallen 38 per cent and 45 per cent.
Policy intervention needed
Srinivasan said made-ups and garments exports are recording a positive growth mainly on account of ROSCTL (Rebate of State and Central Taxes and Levies) scheme extension. This measure has not only ensured that taxes are not exported by the garment and made-up sector, but also enabled them to regain competitiveness.
Texprocil has appealed to the government to also cover cotton yarn and fabrics exports in the ROSCTL schemes and refund the state and central taxes.
“These taxes account for seven per cent of the value, and will go a long way in mitigating the serious situation in the spinning and weaving sector,” said Srinivasan.
Many of the competing countries are gaining access in various markets such as China, South Korea and Turkey, mainly on account of the preferential access given to them by the importing countries, leading to the further erosion of India’s market share, he added.
While Vietnam has increased its exports of cotton yarn to China by 17 per cent during the last four months, India’s share has declined by 16 per cent in the same period.
In view of the sharp decline in exports, many production units are shutting down and need urgent policy support. He also requested the government to extend the 3 per cent interest equalisation to cotton yarn.
“These measures will help the cotton yarn sector and the spinning industry at large to minimise their losses and regain their competitiveness,” he said.
Source: The Hindu Business Line
A textile processing cluster will be set up at a private industrial estate at Thamaraipatti in Virudhunagar district of Tamil Nadu to promote more inclusive and eco-friendly garment production. Thirty six textile processing units have agreed to be part of the cluster, said project director of Southern Districts Textile Processing Cluster KR Gnanasambandam.
The cluster will have textile units where 96 per cent of the water used would be recycled. The remaining water, which is primarily dye-based, will evaporate. Steam will not pollute the environment. Sediments, which contain a large amount of limestone, will be shipped to cement factories, Gnanasambandam told a top south Indian English-language newspaper.
Primary operations will include bleaching, dyeing and spinning yarn. The units would deal with a variety of fabrics, but will primarily focus on cotton, silk and jute, he said.
An amount of ₹200 crore had been allocated for the projected under the ministry of textile’s Integrated Processing Development Scheme (IPDS). While the central government would bear half of the cost, the state and private industry promoters would contribute 25 per cent each, he said.
The units’ zero waste design also had the approval of researchers at the Indian Institute of Technology -Madras, he added. (DS)
Source: fibre2fashion
India’s Gross Domestic Product (GDP) grew 5 per cent in the April-June 2019, much lower than 8 per cent growth in the same quarter last fiscal.
It is also lower than 5.8 per cent GDP growth in the March quarter in 2018-19. This is the second straight quarter when the quarterly GDP growth was lower than 6 percent.
It has opened the doors for more interest rate cuts by the RBI in the coming days.
The slowdown is broad based and GDP growth during the first quarter was dragged down by manufacturing growth at 0.6 percent as compared to 12.1 percent in same quarter last fiscal.
The Gross Value Added (GVA) for the June quarter stood at 4.9 per cent, lower than 7.7 per cent growth in the same quarter last fiscal.
The latest GDP growth print of 5 per cent is the lowest in six years. Private consumption, which was the bulwark of the economy, has fallen in the quarter under review.
The Reserve Bank of India has recently projected India’s GDP growth for 2019-20 at 6.9 per cent.
The RBI annual report released on Thursday said that it was difficult to diagnose the reason or nature of India’s slowdown.
“The diagnosis is difficult, these conditions are hard to disentangle cleanly, at least in the formative state”, the RBI report said.
Source: The Hindu Business Line
Mr Ravi Capoor, Secretary, Ministry of Textiles said that government is in the process of finalizing 40 new Harmonized System of Nomenclature (HSN) codes for technical textiles sector in coming months. Speaking at the 'TECHNOTEX 2019 - Technical Textiles: Technologies, Markets and Investments', Mr Capoor said that the government has already established HSN codes for 207 items, yet a large number of items are still not under any specific category of codes. "Another list of 40 such HS codes have been under consideration and in next few months we will have dedicated codes for 40 such items," he said.
Mr Capoor stressed on the mandatory use of technical textiles in over 90 areas, which the government is currently discussing. He further highlighted that 'technical textiles' is the sunrise industry of the country and we have to create an ecosystem for time-bound research in the institutions for technical textiles segment.
Highlighting the potential of this sector in India, Mr Capoor said that globally the technical textiles market is around US$ 200-250 billion with a very high CAGR and India is still not in the forefront in terms of annual growth rate of the sector. He emphasized on the need to have private sector participation in government's research system with a time-bound output strategy.
Dr V K Saraswat, Member, NITI Aayog highlighted the factors contributing to the growth of this sector which includes rising consumer awareness, usage and improvement in the overall process innovation. Dr Saraswat also highlighted the need for establishing a coordinated approach between various stakeholders and the government to boost the sector. "We need to have an umbrella organization for better coordination between the industry, R&D centers and government," he said.
Source: The Business Standard
Slowly getting back on their feet aer the losses caused due to twin policies of demonetisation and roll-out of Goods and Services Tax (GST), the knitwear and garment industry is faced with yet another crisis -- the removal of the crucial Merchandise Exports from India Scheme (MEIS) by the Centre.
Withdrawal of the scheme that provides four per cent incentive to garments’ exporters in the country would mean an increase in the prices of the products which puts exporters from Tiruppur in a disadvantageous position in the highly competitive international garments’ market that is now flooded with cheaper apparels from countries like Vietnam, Sri Lanka and Bangladesh.
Apparels from the above-mentioned countries are preferred by customers in the EU and the US due to the free market access that these nations possess. India does not have free market access to the EU and the US – major buyers of garments – and this is a major problem being faced by manufacturers from Tiruppur since entry tax is levied once goods reach the destination countries. Aer the introduction of GST in July 2017, the exporters are le with just the four per cent MEIS as all other incentives in the form of duty drawback, rebate on state levies, and concession on service tax were withdrawn. The twin policies had led to a seven per cent dip in the growth of the industry in 2017-2018 and the sector has begun picking up slowly only in the past few months
Withdrawal of MEIS would not just result in cost escalation of the products but defeat the morale of the exporters. If the customers go back once, it will be very diicult to bring them back because the international market now has plenty of options. The government blindly withdrawing the MEIS does not augur well for the multi-crore industry,” Raja M Shanmugham, President of Tiruppur Exporters’ Association (TEA), told DH. The MEIS, according to a notice issued to the exporters by the Union Government in July, would be withdrawn with eect from August 1, 2019. Shanmugham said the MEIS was oered to
exporters’ since the industry had some lacunae and withdrawing the incentive without filling the gaps is something that the government should have avoided.
N M Ravichandran, a partner of Santex Inc, said withdrawal of the incentive scheme would push the prices of the products which have been decided much in advance. “Usually, we take advance orders and agree on a particular price. If the incentive is withdrawn and if we increase the price of the product suddenly, no customer will buy it. And he is under no obligation too because there are cheaper products now available in the market,” he told DH. Shanmugham said though the government had promised to introduce another scheme to help the industry, nothing has come so far. Industrialists say the sudden removal of MEIS would result in achieving the target of Rs 1 lakh crore business by 2020. “Removal of MIES would result in structural damage to the garment and apparel industry that is the second-largest employer aer agriculture. The industry is put into trouble continuous and loss for any individual is a loss for the country too,” Shanmugham said.
Source: The Deccan Herald
Modi, Putin to discuss ways to boost trade ties in Vladivostok next month.
Prime Minister Narendra Modi (Right) and President Vladimir Putin (File Pic)
NEW DELHI: India and Russia are seeking to cut dependence on foreign currencies like the dollar that leave a hanging threat of unilateral sanctions and have increased trade using the Rupee-Rouble route five-fold since the Modi government has taken over.
Speaking with ET, deputy ambassador Roman Babushkin shared that over 30% of bilateral trade is now in national currencies and said that additional measures to increase this will be discussed during the upcoming bilateral talks between prime minister Narendra Modi and President Vladimir Putin in Vladivostok next month.
“In the past six years, there has been a five fold increase in payments in national currencies from about 6% to over 30% now. This has made business operations more comfortable and in some ways we were forced to use this practice to avoid a situation when our economic interaction was depending on a universal currency like the dollar,” Babushkin said.
India, which has a robust defence partnership with Russia, is currently facing the threat of unilateral sanctions by the US for the purchase of the S-400 air defence systems and other military equipment. The two sides have found a non-dollar route to make payments but the threat of sanctions pushed back the project by several months.
The Russian diplomat said that discussions in Vladivostok will revolve around increasing trade, with an ambitious target of $30 billion annually by 2025. Currently, the bilateral trade stood at around $11 billion but Russia is seeking to increase this by opening up opportunities in its far east that is hopes will bring joint projects into play.
The two sides are also looking at starting a direct trade route between Vladivostok and Chennai, that would cut down shipping time by half to just over 20 days from the current route.
Source: The Economic Times
A persisting liquidity crisis in the MSME added to the manufacturing sector's woes
Manufacturing growth slumped to a dismal rate of only 0.6 per cent in the first quarter (Q1) of the current fiscal year (2019-20 or FY20) from 3.1 per cent in the fourth quarter of 2018-19 (FY19).
In Q1FY19, manufacturing growth was 12.1 per cent. For the whole of FY19, the sector had clocked growth of 6.9 per cent, up from 5.9 per cent in the previous fiscal year.
The share of manufacturing in gross domestic product (GDP) came down to 15.3 per cent in Q1FY20 against 16.2 per cent in Q1FY19. The government’s flagship programme, Make in India, aims to increase this share to 25 per cent by 2022.
Low consumer demand has negatively affected production in the automobile and allied sectors, as well as consumer goods, said economists. “While the base effect has pushed it down, the slowdown in the auto and durable goods segments is quite palpable and is getting reflected slowly in other sectors, too. The industries that have done well such as cement and steel find a reflection in construction activity, which has witnessed an increase of 5.7 per cent,” said Madan Sabnavis, chief economist at CARE Ratings.
Policymakers at the Department for Promotion of Industry and Internal Trade have, however, cited various factors for the slowdown such a slackening domestic demand, global uncertainty weakening demand for exports, and prevailing low levels of investment.
Economists said slack performance of the manufacturing sector was expected after manufacturing output in the Index of Industrial Production (IIP) had seen a slowdown. In June, it rose only 1.2 per cent, down from 4.5 per cent in May. The manufacturing sector constituted the bulk of IIP, at 77.6 per cent. Policymakers fear the sector is headed towards deep negative growth.
As of June, 15 of the 23 subsectors in the manufacturing segment of the IIP recorded a year-on-year contraction. Slowdown in the automobile sector intensified, with production falling 13 per cent in June; in May it had dipped 6 per cent. Apparels, wood products and basic metals continued to see healthy growth in June; paper, furniture, and fabricated metal products were the biggest losers.
Production of electronic goods continued to see good growth, rising 10 per cent. This came after the government pushed manufacturing in the sector on a sustained basis over the past year through a series of benefits and the phased manufacturing program aimed at reducing imports.
A persisting liquidity crisis in the micro, small and medium enterprises (MSME) added to the manufacturing sector’s woes. The MSME sector accounts for 30 per cent of the country’s GDP, anchoring 45 per cent of total industrial production. It also made up 48.1 per cent of total exports in 2018-19.
Source: The Business Standard
The rupee appreciated by 38 paise to close at a two-week high of 71.42 against the US dollar on Friday led by a rally in domestic equities and renewed hopes of the US-China trade talks.
At the interbank foreign exchange, the rupee opened up at 71.76 and gained further strength to touch a high of 71.38 against the US dollar.
The domestic currency finally settled with a gain of 38 paise at 71.42, a level not seen since August 16.
On Thursday, the rupee had closed at 71.80 against the US currency.
The rupee sentiment revived as concerns over US-China trade friction receded after China said it will not retaliate against the latest US tariffs, dealers said.
Source: The Hindu Business Line
Indonesia's textile industry entered the year with high optimism, which was subsequently followed by steady growth throughout the year. But due to the ongoing trade war between the United States and China, Indonesia's textile industry is due to see some bumps in its trajectory.
Previously, the sector saw an 8.7 percent expansion in 2018, according to data from the Central Statistics Agency (BPS), and is one of the country's five industry mainstays on the Making Indonesia 4.0 Roadmap, set to create more jobs and become a big contributor to the country's exports.
Amid concerns over the industry's future, chairman of the Indonesian Textile Association, Ade Sudrajat suggested that the government formulate a strategy to overcome the impact of the trade war and said bumps might have on the economy.
"The US-China trade war will have a negative impact on developing countries no matter what. We [the industry] should survive, but in order to do so, the government must implement clear policies," Ade said.
Ade noted three points that the industry and the government must focus on in order to keep the industry going strong.
"First, we must keep our domestic market on high alert for potential fallout from the trade war. We must ensure regulations do not hamper or create difficulties for industry stakeholders," Ade said.
"Second, we must expand outside our traditional markets, to regions like the Middle East, Africa and South America," he added.
Ade said South America had great potential and added that Indonesia already has an ongoing trade deal with Chile.
"Thirdly, businesses must use their market access as far as possible; don't be inactive, be aggressive," he said.
According to the API chairman, the textile industry has been doing fine so far. Indonesia's textile exports have increased for three consecutive years, to $13.3 million in 2018 from $12.8 million in 2017 and $12.3 million in 2015. Ade believes this may rise to $15 million this year
Viscose staple fibers (VSF) or artificial cotton fibers are natural and biodegradable. These fibers are obtained from wood pulp and cotton pulp, which share the characteristics of cotton fibers. These are versatile and easily bendable fibers and have a wide range of application in apparels, home textiles, home furnishings, dress materials, and woven & knitwear.
According to Fiber Organon, world demand for viscose is expected to increase by 7 percent to 8 million ton in 2020, four times bigger than 2001. Fibre2fashion predicts in 2023 viscose staple fiber consumption will increase significantly in Asia Pacific region with China recording the biggest potential growth by 6.1 percent, followed by India by 7.2 percent and Indonesia by 5.7 percent compared to this year.
"Our strongest exports are garments. But the biggest obstacle to that is the need to import raw materials. But now we are looking into [locally produced] rayon fibers," he said.
Asia Pacific Rayon (APR) leads the cellulose fiber industry in Indonesia. APR answers the global call for sustainability among the world’s industries, including textile. As the fashion industry's demand for more environmentally friendly materials keeps increasing, APR has also made sure that all its rayon comes from renewable and biodegradable materials,
APR has invested in the construction of a viscose rayon factory with an annual production capacity of 240,000 tons. The company has been exporting its products to 14 countries since the start of operations early this year. The countries are Turkey, Pakistan, Bangladesh, Vietnam, Mauritius, Sri Lanka, Nepal, Brazil, Germany, Portugal, Italy, the United Arab Emirates and India.
Indonesia is currently one of the largest producers of rayon in the world. By keeping its rayon production domestic, APR hopes not only to help the local fashion industry grow, but also to reduce its reliance on imported raw materials.
"Businesses must learn about trade missions [to other countries]. APR could go to Chile, for example, and introduce its rayon there," Ade said.
With falling prices of Chinese products, the company may face tighter competition. However, Ade said APR could offer semi-finished materials to China.
"There is no problem with China. By doing this, APR could increase its exports and production capacity," Ade said.
Source: The Jakarta Globe
An exhibition showcasing the developments in the country’s textile and garment industry will begin in Dhaka on September 4. The four-day exhibition, titled ‘20th Textech Bangladesh International Expo 2019’ will be organised by Conference & Exhibition Management Services Ltd (CEMS-Global) along with two concurrent exhibitions on yarn and fabric and dye and chemicals.
The ‘16th Dhaka International Yarn & Fabric Show 2019-Summer Edition’ and the ‘38th Dye+Chem Bangladesh 2019 International Expo’ will run parallel, Meherun N Islam, president and managing director of CEMS Global USA and Asia Pacific, announced recently.
Source: fibre2fashion
After coming to power, Trump has imposed hefty tariffs on import of Chinese products, resulting in a trade war between the two biggest economies of the world.
Trump asserted that the farmers are happy and they want him to continue the fight.
WASHINGTON: As a fresh set of US tariffs on Chinese goods kicks in on September 1, President Donald Trump Friday said 13 per cent of companies are going to leave China "in the fairly near future".
After coming to power, Trump has imposed hefty tariffs on import of Chinese products, resulting in a trade war between the two biggest economies of the world.
"It's a bad situation they (Chinese) have put themselves in. And I just saw -- it came over the wires -- that 13 per cent of certain companies are going to be leaving China in the not-too-distant future. That's a big thing," Trump told reporters at the White House.
"Thirteen per cent of the companies will be leaving China in the fairly near future. And I'm not surprised to hear that. I think it's going to be much higher. Because they cannot compete with the tariffs. They can't compete," he said in response to a question.
A fresh set of tariffs are set to be imposed on Chinese products on September 1. "They're on. We've taken in billions and billions of dollars from those tariffs. As it's starting to come out, if you look at the Chinese government what they've done with tariffs is very interesting. They've devalued their currency so much, which hurts them ultimately. It costs them much more to buy things outside of China," he said.
He said, despite the Chinese tariffs, the US is not paying more and instead, it has taken in tens of billions of dollars.
"I gave farmers USD 16 billion, which makes them totally whole on China. That's what China spends in a good year. I gave the farmers -- because they were targeted. The farmers were targeted by China," he said.
Trump asserted that the farmers are happy and they want him to continue the fight.
"They want me to win the fight. And we're going to win the fight," he said, adding that the administration is continuing to have conversations with China.
"Meetings are scheduled. Calls are being made. I guess the meeting in September continues to be on. It hasn't been cancelled. And we'll see what happens," the president said.
At the same time, China has lost a lot of companies, he said.
"A lot of companies have left China and a lot more are leaving. And they are not doing well. They are having the worst year they've had, I understand, in 61 years. That's a lot of years," Trump said.
The tariffs, he said, have put the US in an incredible negotiating position. "I say that to China directly. And it's only going to get worse for China. But I say it to China directly. Because of the tariffs, we're in an incredible negotiating position, and we happen to be taking in billions and billions and billions of dollars. And we haven't taken in 10 cents from China," he said. PTI LKJ
Source: The Economic Times
World Bank is ready for providing technical and financial advisory services to public and private sector by assisting local and foreign companies to venture into priority sectors of manufacturing and agribusiness in Pakistan.
A delegation of International Finance Cooperation (IFC), World Bank Group called on Adviser to Prime Minister on Commerce, Textile, Industries and Production, and Investment Razak Dawood, to deliberate upon the issues pertaining to manufacturing-cum-export sectors in order to revitalization of economy of the country, said a press release issued by Ministry of Commerce here on Friday.
The delegation was headed by Regional Industry Director of Manufacturing, Agribusinesses and Services Asia and Pacific Ms. Rana Karadshseh-Haddad, She apprised the Adviser to PM that Pakistan is the priority country for IFC projects in agribusinesses and services and IFC has undertaken various projects in this regard to attract investment in these areas.
The Adviser highlighted that Pakistan has huge business potential in food processing, power, textile, leather and rice sector which has not been exploited optimally, so far, owing to lack of value addition in the production of same sectors. He emphasized to attract investment in aforementioned sectors and urged IFC to provide necessary assistance to public and private sector companies.
Razak said that businessmen are very much interested to make investment in Pakistan owing to huge investment opportunities.
He further informed that big companies, both local and foreign, are interested to invest in different projects, pertaining to value addition like PepsiCO and Cargill has started to invest in food processing business in Pakistan.
