Last month, Textiles Minister Smriti Irani said in the Rajya Sabha that the Centre is considering formulation of the National Textiles Policy after consultations with states. The textiles ministry has sought suggestions for formulating the much-awaited new National Textile Policy for the next 10 years, which will envisage positioning India as a fully integrated, globally-competitive manufacturing and exporting hub. The policy will entail the strategy and action plan for the country's textile and apparel sector. Last month, Textiles Minister Smriti Irani said in the Rajya Sabha that the Centre is considering formulation of the National Textiles Policy after consultations with states. The formulation of the new policy has been under consideration for some time now. In 2016, then textiles minister Santosh Gangwar had said the new policy will envisage creation of additional 35 million jobs. The existing National Textile Policy 2000 was framed about 13 years ago. Since then, the industry has undergone various changes on the domestic and international front. The domestic textile industry has seen large-scale modernisation and technological up-gradation in the last decade and faces new challenges. "The Ministry of Textiles, Government of India, is in the process of formulating a New Textile Policy for the next decade. This will include vision to position India as a fully integrated, globally competitive manufacturing and exporting hub, strategy and action plan for Indian textile and apparel sector," according to the ministry's website.
Source: Business Standard
Restructuring of tax slabs isn’t part of the GST Council agenda on Wednesday but it could still be discussed being part of the recommendations by a panel of tax officials, sources say. Restructuring of tax slabs isn’t part of the GST Council agenda on Wednesday but it could still be discussed being part of the recommendations by a panel of tax officials, sources say. However, they added that since multiple states have opposed these proposals as a way to boost revenue, a final call may not be made at Wednesday’s meeting. The 38th GST Council meeting would discuss the reasons for the decline in revenue collection and also consider measures to augment mop-up for the remaining four months of the year. The panel of officials would apprise the Council of the reasons for tepid revenue growth which includes tax rate changes below revenue neutral rate and hike in GST threshold limit, among others. According to tax department’s estimates, the government needs to collect nearly Rs. 1.14 lakh crore per month for the remaining four months to meet its estimates for gross collections. In the April-November period, average monthly GST collection is a little over Rs. 1 lakh crore. This suggests that the government could be staring at a revenue shortfall of around Rs. 50,000 crore in the year. “Most states aren’t agreeable to rate hike in lower or higher tax bracket. That is unlikely to be approved but such proposals could be discussed on its merits,” Sushil Modi, deputy chief minister of Bihar, said. The panel in their suggestion for revenue augmentation have proposed hike in cess on some items even in the 18% slab as a short-term measure.
Source: Financial Express
Commerce and industry minister Piyush Goyal on Tuesday said that India will not sign any free trade agreement (FTA) in a hurry or to the disadvantage of industry and exporters. At CII’s Exports Summit, Goyal said that New Delhi is talking to the EU and UK for trade pacts. “I can assure all of you that going forward, none of the FTAs will be settled in a hurry or will be settled to the disadvantage of Indian industry and exporters,” he said. Talking about the US, he said: “Even the first leg of our trade deal with them is for the benefit of both countries equitably.” Referring to the Regional Comprehensive Economic Partnership (RCEP) trade agreement, which India opted out of last month after negotiating it for seven years, Goyal said it had been reduced to an India-China FTA which nobody wants. “RCEP had become nothing but an India-China FTA which nobody wants. This was a bold decision as for the first time it reflected the resolve of the government that diplomacy will not prevail over trade. Trade will stand on its feet, on its leg.” In RCEP, Goyal said India's point of view was not being adequately addressed, national interest was being compromised and the country was not getting balanced outcomes. That is why India took the decision to stay out of the pact. The minister also said walking out of RCEP does not mean that India does not want to be a part of the global value chain. “But are the global value chains only in China...global value chains are across the world,” he said, and stressed “lets first prepare our industry” and empower those who want to be part of the global chain. He said industry should focus on becoming part of value chain with Europe, the US, ASEAN nations, Japan and Korea, among others. Goyal said that Indian business and industry have been put to disadvantage over the years and instead of addressing some of the real issues that industries face, more and more distress was caused to them. Simultaneously, India's export faced huge amount of trade barriers in other countries, he said. Goyal said after 2011 when FTAs were finalised, India's exports barely inched up while imports shot up drastically and therefore the country's trade imbalance became manifold. The minister also said that the government was working relentlessly to support and strengthen domestic manufacturing. He said India will have to prepare itself for a rules-based multilateral trading system and for that, it will have to look at ways which are WTO-compliant, support industry from the base and then stand on its own feet.
Source: Economic Times
Finance Minister Nirmala Sitharaman on Tuesday held discussions on regulatory environment impacting private investment and measures for promoting exports in a pre-budget consultation with stakeholder groups from industry, trade and services sectors. The representatives submitted suggestions concerning reduction of compliance burden and tax litigation, allowing self-certification in low risk industry, decriminalisation of tax and company laws. Besides, they demanded reduction of cost of equity capital, simplification and rationalisation of duties and labour laws, adoption of international standards of alternative dispute resolution, export development funds for helping MSME exporters and ease of investment flow into manufacturing sector. "The main areas of discussion during the aforesaid meeting included regulatory environment impacting private investment, measures for promotion of exports amidst rising protectionist tendencies, industrial production, logistics, media & entertainment services & IT & IT enabled services among others," an official statement said. Speaking to reporters after the meeting, CII President Vikram Kirloskar said:"They (ministers and government officials) have understood the situation, the headwinds in the economy and they have looked at all the possible suggestions whether it is to have fiscal easing which is what we have suggested, various ways to improve tax collection, improve demand". Ficci President Sandip Somany said the meeting delved into infrastructure bottlenecks in terms of the rules, regulations which can help free up business. Assocham Secretary General Deepak Sood said a common suggestion was how to increase the demand side of the economy and inject liquidity into the system. PHD Chamber of Commerce and Industry President D K Aggarwal said the chamber has sought creation of a Rs 25,000 crore fund for stressed micro, small and medium enterprises sector which faces difficulty in availing funds from banks and NBFCs. FIEO President Ajay Sahai said the exporters' body has highlighted the liquidity concerns of exporters and sought rollout of e-wallet recommended by the GST Council to ease liquidity of exporters. The meeting was also attended by Minister of State for Finance and Corporate Affairs Anurag Thakur; Finance Secretary Rajeev Kumar; Economic Affairs Secretary Atanu Chakraborty; Revenue Secretary Ajay Bhushan Pandey; among others.
Source: Economic Times
Amid talks of the government likely to miss tax collection target this fiscal, the Finance Ministry has set a Rs 1.1 lakh crore monthly GST mop-up target for the remaining four months of 2019-20 financial year, ministry sources said. Revenue Secretary Ajay Bhushan Pandey had a video conference meeting with top tax officials and impressed upon them to step up measures to achieve direct and indirect tax collection target. Officers have been particularly urged to ensure that during field enforcement drive and visits, no taxpayer is overreached or troubled, the source said.
Source: Economic Times
The Centre’s move to release to the states Rs 35,298 crore of the pending compensation for GST shortfall is welcome. It will help shore up states’ spending to counter the slowdown in the economy. However, the GST Council must resist any pressure to raise GST rates to make up for revenue shortfall in a slowing economy. An increase in rates will fuel inflationary pressures and burden the consumers, at a time of rising food prices. There is talk of raising the base slab from 5% to 9-10%, while doing away with the 12% rate, and moving 243 items segment to the 18% slab.
This is a bad idea.
Sure, there is a case to rationalise rates and the GST structure. Fewer and lower rates — a central rate for a vast majority of goods, a merit rate and a demerit rate — will boost revenues. Revenue authorities should also vigorously pursue audit trails in the income and production chain to track the sources of funds and use data analytics to track the physical volumes of critical raw materials along their trail into tax-evaded goods. In sectors such as synthetic textiles and phones, the GST rates on assorted inputs are higher than the tax rate on the output. This leads to accumulation of credit in the books of manufacturers. Although rules allow refund of GST paid on inputs, it is complicated and blocks working capital. The problem must be remedied. The council should also revise the tax regime for restaurants, of 5% GST with no input tax credit. This results in restaurant chains accumulating huge tax credits on their input purchases that they cannot claim. This incentivises businesses to get cash into the system. Levying a 12% GST with input tax credit makes sense. Taxes such as electricity and petro-fuel duties are embedded in domestically manufactured products, making domestic products more expensive. Instead of adding an offsetting layer of import duty to level the playing field for Indian producers, the government should bring all indirect taxes under GST, levy GST on imports and give exporters their input tax credit on time, to level the tax playing field and raise efficiency.
Source: Economic Times
Industry has sought simplified and more convergent GST rates with fewer slabs and lifting of long-term capital gains tax to boost disposable incomes that would help revive consumption. The suggestions came up on Tuesday during finance minister Nirmala Sitharaman’s prebudget consultations with industry, trade and services sectors amid discussions on regulatory environment impacting private investment, measures to promote exports, industrial production, logistics, media and entertainment services and IT and ITenabled services. “With a view to give boost to Indian economy, the representatives of industry, services and trade sectors submitted several suggestions,” the finance ministry said in a statement. There were discussions on ease of doing business by lowering compliance burden, reducing tax litigations, allowing self-certification in lowrisk industries, decriminalising tax and company laws, and cutting down cost of equity capital. It has suggested the government to leverage the goods and services tax (GST) compliance data and use big data analytics to widen the base for corporate tax and income tax. CII has sought an expansionary fiscal policy with around 0.5-0.75% deviation from the fiscal deficit target, the proceeds from which could be spent on asset creation, especially in rural infrastructure. It also asked for an integrated eportal to capture all pending payments by the central and state governments and public sector enterprises to all industries. “Decriminalising taxation laws and procedures on the lines of what is being done for the Companies Act would address this trust deficit greatly,” it said. The Federation of Indian Export Organisations has demanded an export development fund and a scheme to help MSMEs through a double tax deduction scheme to help explore wider markets. It has also sought GST refunds to foreign tourists.
Source: Economic Times
Textile sector which was identified as a priority sector, witnessed large scale investments which can generate massive employment. With agriculture production expected to go up in the State, the Industries Department has initiated efforts for attracting investments in food processing sector and thus, create large scale employment for youth in rural areas. IT and Industries Minister KT Rama Rao directed officials to tap the potential for employment generation in food processing industry in the wake of the government giving high priority for agriculture and irrigation projects. The State government is aiming to renew efforts in attracting investments targeting priority sectors to generate large scale employment in the State. Due to the government’s industry-friendly initiatives, around 11,569 companies received approvals for establishing their units through TS-iPASS in the last five years and about 80 per cent of them commenced operations, providing employment to over six lakh people. “Special emphasis should be laid on companies from textile, electronics and food processing sectors which can generate large scale employment. Officials must set targets to attract investments within a fixed timeframe,” said Rama Rao, in a review meeting with the officials of IT and Industries Department on Tuesday. The Minister pointed out that due to pro-active policies of the State government, many major companies had established their units in the State, while several others had signed memoranda of understanding for setting up their units. Textile sector which was identified as a priority sector had witnessed large scale investments which could generate massive employment. Korean textile giant Youngone would be setting up its manufacturing unit at the country’s Mega Textile Park coming up in Warangal, while several other major companies were lined up to invest in textile sector, he said. In continuation to his meetings with electronic industry representatives in Bengaluru, Rama Rao will be holding more meetings in other metro cities in India and abroad for attracting investments from electronics sector. While One Plus, Skyworth and other companies have already expressed commitment to set up manufacturing units in the State, the government has decided to approach manufacturing companies involved in electronics, electric automobile and batteries. The Minister himself will hold separate meetings with representatives from all three priority sectors of food processing, electronics and textiles soon. The officials were instructed to prepare a detailed report comprising information pertaining to available land bank, industrial parks and the government policies as a ready reckoner for investors. They were also directed to provide skill development training to youth through Telangana Academy for Skill and Knowledge (TASK) and provide them placement in upcoming companies. Principal Secretary for IT and Industries Jayesh Ranjan, Telangana State Industrial Infrastructure Corporation Managing Director Narsimha Reddy and other officials were present.
KTR completes a year as TRS working president
Wishes poured in for IT and Industries Minister KT Rama Rao on Tuesday when he completed one year as TRS working president. Several Ministers, elected representatives, party leaders and activists queued up to congratulate him on his successful leadership, at his camp office here. Ministers Koppula Eshwar, Satyavathi Rathod, V Srinivas Goud, Ch Malla Reddy, MPs Kavitha and Ranjith Reddy, legislators and the party leaders called on Rama Rao at his camp office and presented saplings, extending greetings on completion of one year as TRS party working president. TRS activists organised celebrations in various district headquarters to mark Rama Rao’s completion of one year in the post. Soon after the Assembly elections last year, TRS President and Chief Minister K Chandrashekhar Rao appointed Rama Rao as the working president of the party. The appointment was necessitated due to hectic work for the Chief Minister in governance. During his one year stint, the TRS working president successfully led the party to victory during bypolls in the State including Huzurnagar by-election and Panchayat Raj elections. Further, he commenced efforts to strengthen the party from grassroot level after a massive membership drive resulting in over 60 lakh party activists. Construction of the party offices in all district headquarters also began under his leadership. The ruling party is now gearing up for municipal elections.
Source: Telangana Today
The government is likely to trim personal income tax rates and cut the tax on long-term capital gains from equity investments in its next budget, in a bid to spur economic growth, four government officials. Government officials are also debating whether to offer more help to troubled financial services and whether to increase import duties boost private investments and domestic manufacturing. "We are discussing tinkering with ... income tax rates so that more money is put in the people's hands," a senior government official directly involved in budget discussions told Reuters. Many groups have been urging the government to cut personal income tax rates to spur demand and lift economic growth, which sank to a six-year low of 4.5% in the JulySeptember quarter from 7% a year ago. Prime Minister Narendra Modi earlier this year cut corporate tax rates to 15% for new manufacturers and to 22% for existing companies, from about 30%. Finance Minister Nirmala Sitharaman is expected to present the budget for 2020/21 fiscal year on Feb. 1. She has promised a budget that will do more to boost growth. Another government official said a proposal to relax long- term capital gains on stock investments was under consideration, to attract investors. "There are various suggestions, including completely removing it," the official said, adding the issue was discussed at the level of the Prime Minister's office. He said a final decision was still to be taken. The government might also change import duties on select items to promote domestic manufacturing, a trade ministry official said. Industry groups have urged the government to withdraw the long-term capital gains tax to encourage retail investment in mutual funds and shares, instead of other assets like gold or real estate. "Additional net disposable income resulting from reduction in personal tax rates could enhance consumption and spur overall demand for goods and services," the Federation of Indian Chambers of Commerce and Industry said in a submission to the government.
Source: Economic Times
With IMO (International Maritime Organization) 2020 regulation round the corner, the global container shipping industry is expected to witness a cost escalation of $15 billion, experts said. “A new component called Low Sulphur Surcharge (LSS) will be added to the freight rate when ships start using cleaner fuel. LSS on the busy Asia-Europe trade route would be $250 for forty-foot container, while on the Far East to Indian ports, it would be $100 for the same, taking total freight rate up by the same quantum,” Vishal Kashav, senior analyst-maritime supply chain at Drewry Shipping Consultants told Business Standard. The IMO has mandated that sulphur content in shipping fuel must be reduced to 0.5 per cent from the current 3.5 per cent starting January 2020. The body has laid out this mandate due to high sulphur emissions that have caused damage to marine environment, especially in Northern European countries, with UK suffering the most. IMO2020 regulations compel shipping companies to either fit scrubbers or use cleaner fuel for its fleet. Scrubber equipment is fitted to clean fuel on the ship. It is a one-time cost and an alternative to clean fuel usage. APM-Maersk, Mediterranean Shipping Company (MSC), China Ocean Shipping Company (COSCO), CMA-CGM, Hapag-Llyod, Ocean Network Express (ONE), Evergreen Line, Yang Ming Marine Transport, Hyundai Merchant Marine, Pacific International Lines (PIL) are among the top 10 container shipping companies in the world. Global players such as Maersk and France-based CMA-CGM are present in India’s container shipping market. "In order to recover the increased costs, we have introduced two mechanisms for our customers, the Environmental Fuel Fee (EFF) for short-term contracts (less than 3-months) with effect from December 1, 2019 and Bunker Adjustment Factor (BAF) for long-term customers to be effective from January 1, 2020," Steve Felder, managing director at Maersk South Asia said in an emailed response. The company has already established joint initiatives with Vopak, Koole and PBF Logistics for 0.5 per cent compliant fuel storage and processing facilities in Rotterdam, Netherlands and New Jersey in United States. The EFF and new BAF levels will vary by trade route corridor, based on a transparent formula, he said. The freight hike is purely dependent on fuel price and will vary as long as the fuel prices vary. Also shipping being a low margin business, the industry cannot absorb the additional costs resulting from the new IMO 2020 regulations, and Maersk therefore intends to pass it on increase in cost to the customers entirely, said Felder. State-owned Shipping Corporation of India (SCI) is also present in container shipping business but it contributes only 5 per cent to the company's total revenue. "The retrofit scrubber cost is being priced at $4-$5 million per very large container ship. Retrofit scrubber would mean ships that are already active and need to undergo scrubber fitting immediately. Alongside, for a new built container vessel the cost is comparatively less around $3 million," said Kashav from Drewry. Meanwhile, Indian shipping companies such as Essar Shipping, Shipping Corporation of India (SCI) and Great Eastern Shipping among others, which are largely in bulk trade of both dry and liquid, are looking to have a combination of scrubbers clean fuel option depending on their cost calculations.
Investments
"We are installing scrubbers on seven of our larger ships and total cost of installation on these ships is around $20 million. For the rest of the fleet, we will just switch to the low sulphur fuel oil/marine gas oil (LSFO)/(MGO) from Jan 2020. Installation on one ship is already done, the rest will be done by Jan/Feb 2020," Great Eastern Shipping official said via email responses. The company has a fleet size of 47 vessels and is after state-owned Shipping Corporation of India with fleet size of 60 vessels. SCI has small presence in container segment with five vessels in its kitty. "We are installing scrubbers and will make capital investments of about $6 million in four out of our 12 owned vessels. Rest has been lined up for installation of scrubbers,” informed Ranjit Singh, executive director and chief executive officer (CEO), Essar Shipping. While cost rise for shipping companies in inevitable from January, analysts were of the view that actual global freight rate hike could remain pressured in select regions. “Overall freight rates will surely go up but the East-West trade routes could witness some pressure due to lower trade growth because of the US-China war, higher competition and overall weak demand due to global downturn,” said an analyst on condition of anonymity. Comparatively, intra-Asia and North-South trade routes that are smaller routes but have trade growing due to presence of developing economies such as India, Iran and Russia among others will see a higher quantum jump in freights, he added. The US represents the largest market for container shipping followed by Canada in North America. In Europe, Germany, UK, Spain, Italy, and France hold the major share of the container shipping market. In Asia, with manufacturing units on a rise, demand for containerised cargo is expected to go up. Japan, China, and India are expected to be the fastest-growing container shipping market in this region, said industry officials.
Source: Business Standard
The Reserve Bank of India Governor Shaktikanta Das today said while the central bank was ahead of time in cutting interest rates as it saw momentum in growth slowdown building up, he hopes that the decision to hold on to rates earlier this month would be proven as a right call. "In the last MPC (Monetary Policy Committee) meeting when we took a pause, I don't know why the market said that they were surprised. February, I was told that the markets were surprised but subsequently I'm happy and thank all of you for accepting that it was a right call to take," he said while speaking at Times Network India Economic Conclave. "This time the call that we've taken, I do hope that the events will unfold in a manner which will prove that the MPC decision was right" he said. After cutting repo rate by 135 basis points since February, the MPC kept the repo rate unchanged at the December policy. "We want the earlier rate cut to play out fully and we cannot be sort of mechanically keeping reducing the rates at a time. We have to see that whenever the rate cut is undertaken, it is done in a manner that it has maximum impact," Das had said during the media interaction post Dec 5 policy announcement. "The timing of the rate cut is also very important to optimise its impact. So you must cut when the impact is maximum," Das had said. Das said while RBI's mandate is price and financial stability, it also takes growth into consideration. He said RBI would do "whatever is necessary" to address growth slowdown, spikes in inflation, and issues in the banking sector. His comments come at a time when growth has fallen to a 26-quarter low of 4.5% in Jul-Sep and industrial output contracted for the third month in a row in October to (-)3.8%, and headline inflation based on the Consumer Price Index (Combined) surged to a 40-month high of 5.54% in November. According to Das, focus and revival in manufacturing activity is key for growth and India needs to strive to be a part of global supply chain. He said RBI's survey of Apr-Sep results of 1,539 listed manufacturing companies showed they were raising their investment in fixed assets, indicating revival in investment. The survey also pointed to deleveraging by companies, which have reduced their borrowings but will aid growth in the future. As per the survey, 45.6% of the funds available with 1,539 odd companies were deployed into fixed assets in Apr-Sep compared with 18.9% a year-ago period. Terming the findings interesting, Das said further analysis was required. "It points to some kind of an investment cycle, probably beginning to show some signs of revival. Again, I must qualify by saying that it is too early to rush into any conclusion but this is an interesting fact which deserves attention," he added. Apart from manufacturing, Das said sectors such as food processing, textiles and tourism are areas that have the potential to push up growth along with increased spend on infrastructure. According to Das, there is a need for states to step up capital expenditure on infrastructure spending. End
Source: Cogenics
The government is set to amend Section 49 of the Goods and Services Tax (GST) law that would allow tax officers to block input tax credit of companies if they suspect fraud, an agenda note for the GST council meeting circulated to all state finance ministers and senior tax officials indicated. “Fraudulent ITC (input tax credit) availment based on fake invoices has become quite rampant. As investigations get initiated, if the utilisation of such suspected credit continues, the investigation efforts get frustrated,” the government document reads. “The commissioner or an officer authorised by him on this behalf, may restrict utilisation of full or part amount from the credit available in the electronic credit ledger for making any payment towards output tax or claiming input tax credit refund,” part of the amended section reads. Industry trackers said giving additional powers to the tax officers may create problems in the coming days. Senior tax officers would be able to partially or fully block input tax credit of companies henceforth. This comes at a time when indirect tax officers have been arresting promoters if they suspect “circular trading” with an aim to avail input tax credit. “Giving arbitrary and unfettered powers to commissioners to reject or withhold input credit claims based on whims and fancies will lead to harassment and eventually impact the already traumatised economy. There is a problem in the law which needs to be changed, but to propose to amend a section without actually coming out with regulations on how to determine whether the input tax credit is actually fake, will only add to the existing problems,” said Sujay Kantawala, high court advocate who also represents several promoters arrested by indirect tax officials. Tax experts also question what would happen in cases where a company challenges taxman’s stand and wins a case in the court. “It is important to understand whether in cases where credit has been wrongly blocked, the taxpayer will get the interest for the delayed period of non-utilisation as the tax payer should be appropriately compensated for delay in utilisation of credit,” said Abhishek A Rastogi, partner at Khaitan & Co. Several promoters have challenged in different forums indirect tax officials’ right to arrest them. ET on December 11 reported that several promoters had filed a joint writ petition in the high court, challenging the validity of the GST statutory provisions related to arrest and freezing of bank accounts.
Source: Economic Times
The Confederation of Indian Industry (CII) has suggested to the government to increase India’s participation in regional trade agreements (RTA), diversify its export markets and products amid slowing global trade, and offer tax exemptions to special economic zones. “Globally, a large part of international trade is happening via the preferential route. To increase India’s share in value chains, diversifying our export markets and export products, the country must increase its participation in RTAs,” the CII said in a report titled ‘India’s Exports — Trend, Challenges and Future Strategy’, released on Tuesday. Commerce and industry minister Piyush Goyal, who launched the report, said India would not hurry into any trade agreement and assured industry that it would not be at a disadvantage with such pacts. Last month, India opted out of the Regional Comprehensive Economic Partnership trade agreement as its concerns were not met. As per the report, increased protectionism across economies, the ongoing US-China trade war, slowed growth in the EU and the lack of nominations to the appellate body of the World Trade Organization are behind the global trade slowdown. As per the report, India’s low participation in RTAs is seen through its low free trade agreement (FTA) utilisation. It suggested the government to set up a market facilitation cell to help Indian industry diversify export markets and products, and develop a mechanism to leverage and navigate RTAs. Citing official data, the CII said a total of 1.19 crore preferential certificates of origin had been issued from 2005-06 to 2018-19, amounting to total trade of $307.04 billion. This is a low number compared with India’s total trade and this includes generalised system of preferences (GSP) certificates.
Source: Economic Times
Global leader in reusable healthcare textile industry, MIP Inc., was launched in India recently by Tor Lund, President and CEO of MIP Inc. and Bollywood actor Ameesha Patel in Delhi. MIP Inc. has come to India after being in the business of reusable healthcare textiles for the last 40 years. MIP started its journey in 1977 from Canada. It is a manufacturer and distributor of high performance textile and related products to healthcare facilities and distributors and outsourced laundry service providers. It has manufacturing facilities in Quebec, China and Germany. The brand is worth Canadian Dollar $115 million. Speaking at the launch, Tor Lund said, “This is an exciting time for MIP as the brand has experienced strong growth in revenue and market share across the globe. Having make our presence felt it in Canada, US, UK and Europe, we felt this was an opportune time to enter the growing Indian healthcare sector. With a proud history of supplying quality products and providing outstanding service we have a long-term strategy for India. We wish our employees and stake-holders in India the very best.” Adding her views, Ameesha Patel, said, “I am happy to be here at the start of MIP Inc. India journey. It is a well-recognized brand and a leader in its segment and I believe that they will revolutionize the reusable healthcare textile segment in India.” On what motivated MIP to enter the Indian market now, Tor said, “The Indian health care market is growing rapidly and increasingly becoming more sophisticated and we have had the fortune of teaming up with a local team that has the passion, dedication, knowledge as well as shared values with the MIP culture. In addition, there seems to be an increasing need for high quality textile products that support the world class medical infrastructure and expertise that currently exists.” On what the brand hopes to achieve in its first year of operations in India, Tor added, “We hope to have our products used in 20 private as well as public hospitals and that these will serve as showcases and proof of concept for further growth in 2021 and beyond.” The company now in India aims to power the healthcare segment with effective, affordable and quality healthcare textile products.
Source: Bio Spectrum India
After making National Electronic Funds Transfer (NEFT) 24x7, the Reserve Bank of India (RBI) is planning to make its real-time gross settlement (RTGS) system become available round the clock, according to sources familiar with the matter. This could become a reality in a month or two, said a source. RTGS is used to transfer large sums, the minimum amount being Rs 2 lakh. This mode is used primarily to facilitate trade and market transactions. As of November, 229 banks, including scheduled commercial and cooperative banks, were offering this service with total value of transactions reaching Rs 86.8 trillion in November. Once this mode is made available round the clock, vast opportunities open up. “This will enable round the clock transfers and settlements in the international financial centre to start with this. Thus, a great bottleneck will be removed,” said a senior banker requesting anonymity. The domestic market, though, will likely continue to function as per normal market hours, but an international financial centre operates round the clock in such markets where investors could be taking positions in assets in the opposite end of the globe.
No doubt, the primary beneficiary would be the capital markets. convertibility in future,” said Soumyajit Niyogi, associate director at India Ratings and Research. According to Ashvin Parekh, a financial sector expert, a 24x7 transaction system gives a huge push to trade and commerce. “This will be creating a good infrastructure to go in sync with the rest of the world who could be working. Already you can do real-time transfers for retail payments, if RTGS comes too becomes round the clock it would be a big help,” Parekh said. The RBI has already waived off its fees for clearing NEFT transactions, and for outward transactions using RTGS. On Monday, the RBI said banks should not charge their savings bank customers for using NEFT even as the system remains operational throughout the day and night. On Monday, between 12 am to 8 am, over 11.40 lakh transactions were settled, according to RBI. Freeing up such transactions were to give further impetus for such digital retail payments. "RBI now joins an elite club of countries having payment systems which enable round the clock funds transfer and settlement of any value," RBI tweeted on Monday. So far countries such as Australia, Hong Kong, Mexico, Sweden, Turkey, the UK, South Korea, Singapore, South Africa and China have such payment system that operates round-the-clock and offers settlement of any value.
Source: Business Standard
|
Item |
Price |
Unit |
Fluctuation |
Date |
|
PSF |
1006.98 |
USD/Ton |
3.76% |
12/17/2019 |
|
VSF |
1425.24 |
USD/Ton |
0% |
12/17/2019 |
|
ASF |
2054.78 |
USD/Ton |
0% |
12/17/2019 |
|
Polyester POY |
1005.54 |
USD/Ton |
0.14% |
12/17/2019 |
|
Nylon FDY |
2098.47 |
USD/Ton |
0% |
12/17/2019 |
|
40D Spandex |
4110.99 |
USD/Ton |
0% |
12/17/2019 |
|
Nylon POY |
5414.47 |
USD/Ton |
0% |
12/17/2019 |
|
Acrylic Top 3D |
1253.35 |
USD/Ton |
1.16% |
12/17/2019 |
|
Polyester FDY |
1991.04 |
USD/Ton |
0% |
12/17/2019 |
|
Nylon DTY |
2191.57 |
USD/Ton |
0% |
12/17/2019 |
|
Viscose Long Filament |
1145.92 |
USD/Ton |
1.91% |
12/17/2019 |
|
Polyester DTY |
2377.78 |
USD/Ton |
0% |
12/17/2019 |
|
30S Spun Rayon Yarn |
2005.36 |
USD/Ton |
-0.28% |
12/17/2019 |
|
32S Polyester Yarn |
1582.80 |
USD/Ton |
0.91% |
12/17/2019 |
|
45S T/C Yarn |
2406.43 |
USD/Ton |
-0.30% |
12/17/2019 |
|
40S Rayon Yarn |
2191.57 |
USD/Ton |
0% |
12/17/2019 |
|
T/R Yarn 65/35 32S |
2334.81 |
USD/Ton |
0% |
12/17/2019 |
|
45S Polyester Yarn |
1890.77 |
USD/Ton |
0% |
12/17/2019 |
|
T/C Yarn 65/35 32S |
1733.20 |
USD/Ton |
0% |
12/17/2019 |
|
10S Denim Fabric |
1.27 |
USD/Meter |
0% |
12/17/2019 |
|
32S Twill Fabric |
0.69 |
USD/Meter |
0% |
12/17/2019 |
|
40S Combed Poplin |
0.97 |
USD/Meter |
0% |
12/17/2019 |
|
30S Rayon Fabric |
0.54 |
USD/Meter |
-0.27% |
12/17/2019 |
|
45S T/C Fabric |
0.67 |
USD/Meter |
0% |
12/17/2019 |
Source: Global Textiles
Note: The above prices are Chinese Price (1 CNY = 0.14324 USD dtd. 17/12/2019). The prices given above are as quoted from Global Textiles.com. SRTEPC is not responsible for the correctness of the same.
All Pakistan Textile Mills Association (APTMA) Punjab Senior Vice Chairman Abdul Rahim Nasir has urged the government to provide five-year policy for textiles and clothing to attract long term investment. He was speaking to a delegation of Trade & Development Authority of Pakistan (TDAP), including fifteen (15) probationary Officers from 26th Specialized Training Program (STP) at the APTMA Punjab office on Tuesday. He said textile industry was planning to establish as many as 1,000 garments plants near major textile producing cities, including Lahore, Sheikhupura, Faisalabad, Kasur, Multan, Sialkot, Rawalpindi, Karachi, and Peshawar. The government should allow Long Term Finance Facility (LTFF) to both direct and indirect exporters for building infrastructure in addition to existing scheme for plant and machinery, he added. He said the prospective investors reluctant to make new investment decisions due to high cost of doing business and textile industry had lost technological advantage over its competitors. The competitors were giving various investment incentives to promote investment, production and exports. He lamented that Pakistan's textile and clothing export share in global trade had dropped from 2.2 percent to 1.7 percent therefore, fresh investment was an urgent need of the hour. However, he stressed that the textile exports could increase to $50 billion in 2019 from existing level of $13 billion at present provided that the government ensures long term policy for the textile industry. According to him, only the availability of regionally competitive energy i.e. Gas @ 6.5$/mmBTU and electricity @ 7.5 US cents/kWh can materialize this dream of fresh investment in the country. Also, he said, the government should extend duty drawback scheme for 5 years and drawbacks should be increased every year by one percent for garments (up to 12%) and made-ups (up to 10%).He has further expressed the hope that the government would ensure skill enhancement facilities in collaboration with the industry. He has also sought amendment in labour laws to encourage productivity and implementation of social standards.
Source: Business Recorder
Textile was once a thriving industry in East Africa. Today, the region sees an opportunity for growth, even though the problems have not gone away. Plus, there is a China connection. At the 10th edition of the annual textile event Origin Africa (Dar-es-Salaam, October 28-30), representatives from the cotton farming sector, the creative industries (fashion design) and several governments—all stressed the importance for East Africa to get more deeply involved in global value chains. How to get there? Easy question, difficult answer. Textile was once a thriving industry in East Africa. And once again, according to Jas Bedi, honorary chairman of the African Cotton & Textile Industries Federation (ACTIF), it has a window of opportunity for growth. Antoinette Tesha, director (textiles & apparel) of consulting company Msingi East Africa Ltd, from Nairobi, supports the optimistic vision of ACTIF. Msingi designed a textiles industry strategy for the Ugandan government and tried to estimate the impact of the textiles and apparel industry on exports and employment in East Africa (not including Ethiopia and other countries from the Horn of Africa) focusing on Kenya, Tanzania, Uganda and Rwanda. The Msingi consultants expect high growth rates in the East African textiles and apparel industry resulting in $2.7 billion exports and 200,000 jobs by 2030.
ICAC App for Small Farmers
The cotton boards of the East African countries are expecting much from the hundreds of thousands of small cotton farmers in East Africa. They hope that farmers will be able to at least double the yield per hectare, adapt farming practices to climate change and increase the share of organic cotton. Kai Hughes, executive director of the International Cotton Advisory Committee (ICAC), argued during Origin Africa that seed development has to be a priority. However, small farmers don’t need Bt cotton to increase their productivity. He said: “Bt cotton does not increase yields, it only protects cotton from pests. It makes sense to grow Bt cotton in large fields of 200 hectares or more, not in the very small fields.” He pitied the African smallholder farmers who mostly don’t have any information about the impact of climate change. ICAC wants to change this. Hughes announced the introduction of an ICAC app that will be given for free to the member governments. It will be an exceptional analytic tool which will inform smallholder cotton farmers, in their own language, about local weather forecasts and pests, and what to do about it. Hughes also insisted that the governments would have to play a more active role in teaching farmers best practices and in financing cotton research. Though it’s generally admitted that African cotton is of fairly good quality, often it is internationally sold at a discounted price. So, it’s not surprising that many farmers shift to other crops. In Malawi, for instance, the number of cotton farmers decreased from 300,000 to 80,000 in the last few years, while cotton production fell from 100,000 metric tonnes to 15,000 metric tonnes. Fortunately, organic cotton gets a premium price. With a share of only 1 per cent, organic cotton is still a marginal phenomenon in the global cotton market. But in Africa, organic cotton is strongly on the rise ( per cent in the last two years). According to Marco Mtunga, director-general of the Tanzania Cotton Board, in Tanzania the share of organic cotton is nearly 10 per cent. After China, India and Turkey, Tanzania is the world’s biggest producer of organic cotton. Also in Uganda, production of organic cotton is achieving high growth rates. It’s clear that organic cotton is a market niche in which East Africa can be successful.
African Cotton, African Textiles
Much to the regret of East African governments, most of the region’s cotton is exported to countries like China and India. That’s not what the governments want. They want to develop a complete cotton textile supply chain in their respective countries. Their development strategies are not totally similar. Just like Ethiopia in the Horn of Africa, also Kenya, Tanzania and Zambia are East African countries with a strong desire not only to increase significantly their cotton production, but also to retain much more added value in the country. Some other countries, like Botswana, want to become successful garment exporters but don’t dream of building a supply chain with spinning, weaving and textile processing mills. They think it’s more realistic to import yarns and fabrics at sharp prices from the most competitive (Asian) textile countries. Tesha remarked during Origin Africa that East Africa has a comparative advantage compared to countries like Bangladesh, Vietnam, Sri Lanka and Cambodia, which built successful garment export industries though they have never been cotton-growing countries. In Tanzania, the government is of course happy with the growing number of jobs created by companies like JD United Manufacturing from China (denim articles, mainly for VF), the Tanzanian-Sumitomo (Japan) 50:50 joint-venture A to Z Textile Mills (knitted garments), or Mazava, a company of the Winds Group, with headquarters in Hong Kong (15,000 employees, focus on performance wear). However, the government would be pleased if, instead of CMT (cut, make, trim) garment factories, a number of local and foreign investors would set up FOB-oriented companies in Tanzania, producing yarns, fabrics and apparel in integrated hi-tech factories that would enjoy economies of scale. The government’s textile vision is not yet clear. Should Tanzania specialise in bed linen and napkins, or rather in clothing textiles, or in both? Should the country try to attract denim manufacturers? Or should, after all, the government of Tanzania use its scarce financial resources to boost investments in a highly labour intensive CMT garment industry? Tanzania, with its 60 million inhabitants needs jobs, the more so since President John Magufuli has urged women to stop taking birth control pills, saying the country needs more people. Comparing Tanzania with India, the consultants of Msingi East Africa pointed out that the monthly wage in Tanzania is only $90–95, around half that in India at $160–180. Also, the power cost is lower at 6–9 US dollar cents per kilowatt hour compared to 10–12 US dollar cents in India. Thanks to the textiles policy initiated by its first president (1961–85), the legendary Julius Nyerere, Tanzania has a complete cotton-to-clothing supply chain. Will it eventually decide to make a priority of the development and modernisation of the textile and garment sector? Adam Zuku, CEO of Tegamat, the Textile and Garments Manufacturers Association of Tanzania, says: “The government has the intention to boost the sector. Now, action must follow. And action means money.” Mtunga confirms that the government is ready to take action.
Designers Want Recognition
As never before, female fashion designers raised their voice during Origin Africa 2019. After having listened to some speeches, they criticised the (male) sector experts and even the Tanzanian deputy minister of industries Stella Manyanya for not referring to the potentially important role of fashion design in the regional cotton-to-clothing supply chains and in service-oriented garment exporting factories. The minister was, however, warmly applauded when she proposed that Tanzanians should be encouraged to wear traditional clothing every Friday and Sunday, the holy days of respectively Muslims and Christians. Tanzanian fashion designer and entrepreneur Kemi Kalikawe (brand Naledi) reacted: “When experts talk about the future of the African cotton-to-apparel value chain, not only the smallholder cotton farmers but also the designers are mostly forgotten. However, at the end of the day, we the designers are the ones who create most value. Unfortunately, in my country this is not recognised by the government and by the large clothing companies. I went to India and saw there that designers can work with factories and that factories want to work with designers. At the same time, I learnt that East African designers lack up-to-date training for working with factories and brands. We should learn making patterns and using CAD. Unfortunately, here in Tanzania we don’t even have fashion schools. That’s why I founded the Naledi Fashion Institute and the Naledi Fashion Incubator.” Tanzanian designer Jamilla Vera Swai remarked: “International designers and brands are very interested in our creations and shows. However, though they get inspiration from us, our creative work is not respected or rewarded as intellectual property.” Tesha stressed that African fashion is one of the few fashions worldwide to have a strong identity. She pleaded for keeping this precious heritage alive. A key event making East African fashion visible to the world is the annual Swahili Fashion Week, which this year will take place in Dar-es-Salaam from December 6 to 8. The event was launched in 2008 by Mustafa Hassanali, the chairman of the Tanzanian Fashion Association.
Africa United in AfCFTA
On May 30, Africa made history as the agreement establishing the African Continental Free Trade Area (AfCFTA) officially entered into force. With 54 of the 55 member states of the African Union signing the agreement (small Eritrea is the only exception), Africa brought into being the largest trading bloc since the formation of the WTO in 1995. The bloc will unite 1.3 billion people, create a $3.4 trillion economy and boost trade within the continent itself. Experts say that African and international investors will both benefit from the agreement, as AfCFTA will make it easier for businesses to expand operations across the continent. Many observers are sceptical. They point to the meagre results of existing regional trade agreements. In East Africa, inter-country trade remained modest in spite of EAC (East African Community), COMESA (Common Market for Eastern and Southern Africa) and SADC (Southern African Development Community). Sceptics are wondering how many years it will take for the AfCFTA to function effectively. The rules of origin are still to be negotiated and many obstacles need to be removed. What’s the use of 90 per cent tariff liberalisation between two countries by July 1, 2020 if no navigable roads connect these countries? China is said to have played a role in the AfCFTA trade pact. In 2017, China-Africa trade amounted to nearly $150 billion. Tesha points out that in the coming years China will reduce its textiles and clothing exports by more than $50 billion. First, Chinese textiles and clothing groups will probably continue relying on Southeast Asia for alternative production and export capacities. But since this region is rapidly becoming too expensive, within ten years East Africa will be the preferred investment region of the Chinese. In Ethiopia, the Addis Ababa- Djibouti railway, constructed by China Railway Group with complete adoption of Chinese railway standard and equipment, is a demonstration project of China-Africa industrial capacity cooperation. The $4 billion railway of 752 km, which started commercial operations in January 2018, reduces transport time and costs—for Chinese yarns and fabrics and other textile materials entering Africa via the port of Djibouti and garments manufactured in Ethiopia to be shipped to consumer markets. In Tanzania, a $10 billion project to build a new modern seaport in Bagamoyo, some 50 km north of Dar-es-Salaam, is backed by the state-owned China Merchants Port and an Omani sovereign wealth fund. It will include a special economic zone. In 2018, the project got the go ahead. However, in October 2019, the government of Tanzania has issued an ultimatum to the Chinese investor to either accept and work with its terms and conditions of the contract or leave. American entrepreneur and consultant Samuel Meeks (ex-international training director at Levi Strauss International, now CEO of GCI, Garment Consulting International), who lives in Madagascar, sees soaring interest from Chinese groups. He predicts that within two or three years, Madagascar will be Africa’s biggest apparel exporter under the AGOA (African Growth and Opportunity Act), beating Kenya and all other AGOA-entitled African countries. It’s difficult to predict what will be the impact on Mauritius’ well-developed apparel sector of the free trade agreement that the island country on October 17 signed with China. Will Chinese textile groups use Mauritius and its production base in Madagascar as a base to do business in the AfCFTA?
Source: Fibre2Fashion
The prospect of a Brexit cliff-edge at the end of 2020 will be used by British Prime Minister Boris Johnson to push for the European Union (EU) to offer him a comprehensive free trade deal encompassing everything in less than 11 months. He will reportedly use his control of parliament to outlaw any extension of the Brexit transition period beyond 2020. The prime minister will cut the amount of time he has to strike a trade deal to 10-11 months from nearly three years by enshrining in law his campaign promise not to extend the transition period beyond 2020 end, a global news wire reported. A comprehensive free trade deal would cover everything from financial services and rules of origin to tariffs and state aid rules, though the scope and sequencing of any future deal is still open for discussion. After the United Kingdom leaves the EU on January 31, it enters a transition period in which it continues to be a namesake EU member, while both sides try to hammer out a deal on their post-Brexit relationship. Johnson is being perceive to be sending a message to the EU, whose leaders have cautioned London that more time would be needed for a comprehensive trade deal. If the United Kingdom and the EU fail to strike a deal on their future relationship and the transition period does not get extended, then trade between the two sides would be on World Trade Organisation (WTO) terms, which is more burdensome for businesses. The EU, which has insisted it will not seal a trade deal with a large, economically powerful neighbour without solid provisions to guarantee fair competition, hopes to start trade talks with the United Kingdom by March, leaving just 10 months to strike a deal and get it approved by London and the EU, including member states’ parliaments. The EU’s demands will focus on environmental and labour standards, as well as state aid rules to ensure the United Kingdom would not be able to offer products on the bloc’s single market at unfairly low prices.
Source: Fibre2Fashion
At an event held yesterday at the headquarters of the United Nations in New York, the Texpertise Network of Messe Frankfurt, the Conscious Fashion Campaign and the United Nations Office for Partnerships provided insights into their future cooperation. Over 100 guests from the press, business, politics and associations met to learn how the partners plan to collaborate in furthering the implementation of their Sustainable Development Goals (SDGs) in the fashion and textile industry. The Executive Director of UNOP Robert Skinner, opened the event and highlighted the importance of global engagement of the private sector and other stakeholders for achieving the Sustainable Development Goals. Mr. Skinner said that the international fashion and textiles industry have the potential to advance the Agenda 2030 for Sustainable Development. Together with Messe Frankfurt and Conscious Fashion Campaign, UNOP welcomes the opportunity to reach a broad and professional audience, raise awareness of the goals and galvanize support. Mr. Skinner, who moderated the event, invited Ambassador Jürgen Schulz, Deputy Permanent Representative of Germany to the United Nations, to deliver opening remarks. Detlef Braun, Member of the Executive Board at Messe Frankfurt, explained: “Along with digitalisation, sustainability is a topic currently exerting a significant influence on the global textile industry. Messe Frankfurt has been accompanying this development with its worldwide textile events under the umbrella of the Texpertise Network for more than ten years. It is therefore a logical conclusion that the Sustainable Development Goals should be integrated in our worldwide textile events to generate acute awareness of the importance of sustainability in the textile industry.” Kerry Bannigan, Founder of the Conscious Fashion Campaign, stated that we need more examples of leadership for change like Messe Frankfurt to make the next decade the most impactful yet. Through our global event partners, the Conscious Fashion Campaign will integrate education, advocacy and ultimately engagement while also seeking to implement sustainable and circular event operations and logistics. With its Texpertise Network Messe Frankfurt supports the Sustainable Development Goals within the framework of the cooperation with the Conscious Fashion Campaign and UNOP. The goals will be presented at the more than 50 textile events organised by Messe Frankfurt at venues around the globe. Planning currently includes interactive information stands, presentations, discussion forums, fair tours and the integration of special activities in the trade fair programme. Heimtextil, the world's biggest and most important trade fair for home and contract textiles that attracts around 3000 exhibitors and expects 65,000 trade visitors from 7-10 January 2020, will be the next stop on the tour to present the Sustainable Development Goals. During the opening press conference Lucie Brigham, Chief of Office for the United Nations Office for Partnerships will present on 7 January. Moreover, the goals will be presented and discussed at an interactive stand in the Green Village and be integrated into the Green Directory for the first time. For the past 10 years, this index has listed sustainably producing companies at Heimtextil. In 2020, the Green Directory will comprise a record 262 entries. as well as in the form of panel discussions. The next event directly after Heimtextil is Neonyt (14-16 January 2020), which takes place once again during Berlin Fashion Week. In the framework of its international conference format Fashionsustain, Neonyt will feature, amongst others, the panel ‘SDGs X Fashion – The UN’s Fashion Industry Charter for Climate Action’. Speakers will be Lucie Brigham, Zachary Angelini, Environmental Stewardship Manager at Timberland, Alexander Gege, Manager Sustainable Business Development at the Otto Group, and Harold Weghorst, Global Vice President Marketing at Lenzing AG.
Source: Innovation in Textiles
