Union Minister for MSME and Road Transport and Highways, Shri Nitin Gadkari today held meeting via video conferencing with the members of Fragrances and Flavours Association of India on impact of COVID-19 on startup eco system and MSMEs. During this interaction, the members expressed concerns regarding various challenges being faced by MSMEs amid COVID-19 pandemic along with few suggestions and requested support from the government to keep the sector afloat. Shri Gadkari suggested to the Fragrances and Flavours Industry to focus on domestic production of products instead of using imported products and emphasized domestic production of bamboo. He added that industry should focus more on innovation, technology and research skill to become competitive in global market. Some of the major issues highlighted and the suggestions given included: Higher import duty on raw material and lower import duty on finished items, power and transport issues in North East region, payment of salaries to workers, strengthening access to finance, working capital issue, fast track Income tax refund to provide liquidity. Shri Gadkari responded to the questions from representatives and assured all possible help from the government. He informed that he would take up the issues with related departments.
Source: PIB
To make participation easier in anti-dumping probes during the Covid-19 pandemic by domestic and foreign businesses, the government has scheduled oral hearings of two important cases, both related to dumping of acrylic fibre into India, later this week through web-room mode and video conferencing. Both hearings, one related to anti-dumping investigations on import of acrylic fibre from the European Union, Belarus, Peru and Ukraine and the other, a sunset review for continued imposition of anti-dumping duties on imports of acrylic fibre from Thailand, are scheduled on May 8.
‘Sensitive for industry’
“Anti-dumping and other trade remedies cases are sensitive and important for the domestic industry. If remedial duties are not imposed on time, it could cause losses to the national economy. It is, therefore, not desirable for oral hearings to be deferred. That’s why the Directorate General of Trade Remedies is taking all steps to ensure that proper hearings are enabled in the digital mode where all can take part,” an official told BusinessLine. In the initiation notification of probe against import of acrylic fibre from the European Union, Belarus, Peru and Ukraine, following complaints of alleged dumping by the domestic industry, the Designated Authority stated that it prima facie found evidence of dumping of the goods, originating in or exported from the given countries. Injury to the domestic industry and causal link between the alleged dumping and injury also existed to justify initiation of an anti-dumping investigation, it added. In the second case, the Designated Authority, based on the facts and evidence presented by the domestic industry, found prima facie that there was a need to review for continued imposition of the duties in force from 2015 (for a period of five years) in respect of acrylic fibre. In a circular, the DGTR observed that it may be difficult for many participants to share their IP addresses in advance because the Covid-19 situation had placed severe restraints on technical capacities. Therefore, the DGTR decided to provide a web link which would enable participation in the web room by just clicking on the link. “The idea is to make it as simple and easy for participants to take part as possible. Both sides should get a fair chance to present their case,” the official said.
The circular has been sent to Embassies of the countries involved asking them to ensure participation.
Source: The Hindu Business Line
The Good and Services Tax Network (GSTN) on Tuesday available cash flow in an electronic cash ledger from one demand of taxpayers, have said that errors while filing the return would often lead to cash major head to another major head, keeping the minor head the same.said it has activated a new functionality in its system that will allow taxpayers to transfer cash available under one major head to another in the electronic ledger. This has been cash a long-standing being deposited who in the wrong head, which could then be retrieved only through a cumbersome refund process. The situation created a cash flow problem for many small businesses. “It helps with the intra-head or inter-head transfer of amount available in electronic cash ledger only. The major heads defined are CGST, SGST/UTGST, IGST and cess, whereas the minor heads defined in the law are tax, interest, late fee, penalty and others,” GSTN said in a statement. GSTN added that a taxpayer can now transfer the amount available in an electronic cash ledger from one major head to another major head, keeping the minor head the same. Alternatively, one can move the amount from one minor head to another minor head, keeping the major head unchanged, it added. “It has come as a major relief to taxpayers. For instance, if a taxpayers deposited some amount under the ‘cess’ head by mistake even though the assessed didn’t deal with any product involving cess, it would take months to get the money back,” Rajat Mohan, senior partner, AMRG & Associates said.
Source: Financial Express
India is likely to continue export incentives worth Rs 40,000 crore till next year as the government looks to cushion the impact of Covid-19 on the country’s outward shipments. The commerce and industry ministry is considering a plan to extend the Merchandise Exports from India Scheme (MEIS) till March 31, 2021. The proposal was mentioned in a letter to development commissioners of special economic zones from the Department of Commerce. ET has reviewed the letter. India’s exports shrank almost 35% to $21.41 billion in March from a year earlier. They declined 4.8% to $314.31 billion in FY20 from $330.08 billion in FY19.MEIS extension will bring predictability to exports pricing and on the policy front. Exporters’ confidence will get a boost,” said Ajay Sahai, director general of the Federation of Indian Export Organisations. The scheme was extended to December 31, 2020, the government said last month when it announced the extension of the extant foreign trade policy by a full financial year till March 31, 2021. Under MEIS, the government provides duty benefits, depending on the product and the destination country. Rewards under the scheme are payable as a percentage of the realised free-on-board value (of 2%, 3% and 5%) and the MEIS duty credit scrips can be transferred or used to pay duties including basic customs duty. Exporters are estimated to have received benefits worth Rs 35,000-40,000 crore under MEIS in FY19. “Exporters would need financial support from the government to stand on their feet again… The government has to decide whether extending or increasing the MEIS rates is an option they would like to exercise,” said Pratik Jain, national leader, indirect tax, PwC. He said one specific recommendation of the industry was restora-tion of the 2% additional benefit of MEIS, which was withdrawn from January 1, 2020. However, the reward rates under the scheme won’t be revised nor would they be expanded to cover more products such as gems and jewellery, a government official said. This is because the scheme is transitioning to the Remission of Duties and Taxes on Exported Products. The government has also rejected a demand to provide an additional 5% benefit to all exports, saying it is “not feasible at this stage.” The government has also vetoed a suggestion that MEIS be granted based on shipping bills, stating that the benefit is provided only after payment is realised and also said free trade and warehousing zone exports are not eligible for MEIS. The scheme is being disputed at the World Trade Organization, with the US claiming India’s export subsidy programmes had hurt American workers.
Source: Economic Times
The Delhi High Court on Tuesday allowed taxpayers registered under Goods and Services Tax (GST) to claim accumulated CENVAT credit from pre-GST regime till June 30, 2020, and noted that the benefit of transitional credit will be applicable for three years (since launch of GST on July 1, 2017) which is the period mentioned in the limitation Act. Under the GST Act, taxpayers were allowed to carry forward input tax credits from excise and service tax regime by filing TRAN-1 form. Although the original deadline expired in September,2017, the government granted several extensions till December 27, 2017. Further, taxpayers who couldn’t file the claim due to technical glitch in the system were allowed to do so till March 31, 2020. While the rule 117 under the GST Act mandated a deadline for claiming the credit, taxpayers have argued in court that input tax credit was a right and not a taxpayer concession, which made a deadline ultra vires. “The time limit prescribed under Rule 117 was challenged before the Delhi High Court. The Delhi High Court in the virtual hearing held today clearly held that the prescribed time limit will not be applicable as it is directory and not mandatory. The court also ordered that extended time limit of three years should be applicable not only qua the petitioners but to all other petitioners who are facing the hardship of transitional credits”, said Abhishek A Rastogi, partner at Khaitan & Co, who argued for the petitioner Brand Equity Treaties. Since the early days of GST, the government has suspected that large amount of transitional credit was being availed illegally. The indirect tax department had also conducted an analysis on nearly Rs 2 lakh crore of transitional credit claimed till the original deadline.
Source: Financial Express
Nobel laureate Abhijit Banerjee on Tuesday urged the Centre to provide a larger stimulus package to help India tide over the economic fallout of the Covid-19 crisis. The economist also pitched for direct cash transfer to 60% of the population, issuing temporary ration cards and using ‘national’ Aadhaar cards to help the poor. While welcoming moratorium on debt payment, Banerjee suggested that government could cancel it for this quarter. “A lot of us have been saying that we (India) need a stimulus package. That’s what the US is doing, Japan is doing and Europe is doing. We really haven’t decided on a large enough stimulus package. We are still talking about 1% of GDP. United States has gone for 10% of GDP,” said Banerjee in a nearly 30-minute virtual interview with Congress leader Rahul Gandhi. In AICC’s transcript of the ‘Conversation between Rahul Gandhi and Abhijit Banerjee’, the Congress leader asked 24 questions, of which, 19 were in a format of 1-3 sentences, and Banerjee answered by giving his detailed perspective. On debt payment, Banerjee said, “We have done one thing that I think is wise, which is to kind of put a moratorium on debt payment....We could even say that the debt payment for this quarter will be cancelled... It’s not just a matter of rescheduling it, just permanently cancel it.” He felt enhancing the purchasing power of people could actually help MSMEs more. “It is more about reviving demand.” On helping the poor, including migrant workers, Banerjee, who had helped the Congress conceive the ‘Nyay’ scheme, said: “I would say bottom 60% of the population, we give them some money… If they spend it, it would have a stimulus effect.” While some Congress leaders think such interviews will project Gandhi as a person capable of conducting “serious conversations with intellectuals”, some others feel given his stature “as future PM face”, he should have been the one outlining his vision by being interviewed by his guests.
Source: Economic Times
The cotton spinning industry, which had already been facing multiple challenges — low demand, unfavourable duty structure and volatile cotton fibre prices — is confronting another trouble in the form of the Covid-19 pandemic. The shutdown of manufacturing units and weak demand are expected to take a heavy toll on the cotton yarn industry in the next two quarters. This will lead to a drop in revenue and a fall in profit margins, said CARE Ratings. Smaller companies with high debt levels, less access to bank funding and limited liquidity buffer are expected to be impacted the most, the rating agency said.
Challenges ahead
For the past few years, cotton yarn exports have taken a hit, mainly on account of subdued demand from China (the largest importer of Indian cotton yarn).
In the first 10 months of FY20, the average monthly exports of cotton yarn stood at ₹1,616 crore, significantly lower than the monthly average of ₹2,278 crore logged in the same period last year. China’s major cotton yarn demand is now being catered to by Vietnam, which enjoys duty-free access to China. In the last few years, Chinese companies have invested heavily in Vietnam to expand their spinning capacities, leveraging low labour cost in that country and favourable trade agreements. In 2019, China also allowed Pakistan to supply 3,50,000 tonnes of yarn at nil rate of duty, while Indian cotton yarn attracts a duty of 3.5 per cent in China, making Indian cotton yarn less competitive in the Chinese market.
Gloomy future
The Cotton Association of India has projected a 14 per cent increase of cotton crop in the cotton season 2019-20, to 354.5 lakh bales, against the 312 lakh bales logged in the previous year.Cotton prices (Shankar-6 variety) fell 9 per cent between last July and February 2020 compared with the same period last year. Owing to subdued demand, yarn prices also started to crash, squeezing the spreads. The last quarter of the financial year is usually the best quarter for the Indian cotton spinners, signalling a recovery in the industry.However, domestic spinners are staring at a long recovery road ahead, with the Covid-19 pandemic leading to shutdown of manufacturing facilities and retail outlets, along with supply-chain disruptions at various places.
Source: The Hindu Business Line
The government gave further relaxations to taxpayers for goods and services tax (GST) compliance for filing annual returns and audits, increasing the time duration for some, meanwhile extending the validity of e-way bills till the month end. In a notification dated May 5, the Central Board of Indirect Taxes and Customs (CBIC) has allowed registered persons to furnish GSTR-3B verified through electronic verification code between April 21 and June 30. This was not permitted earlier. Further, a registered person can furnish a nil GSTR-3B through text messages, using their registered mobile number, which will be verified through a one-time password facility. The Board has also extended by a quarter the time limited for furnishing of the annual return and GST audit for the financial year 2018-2019, till 30 September, 2020. Date of filing GSTR 3B has been extended from November 2019 to March 2020, for the state of Jammu & Kashmir. The Board also made changes to the Insolvency and Bankruptcy Code (IBC), clarifying that the resolution professional shall be liable to take a new registration in each of the states or Union territories where the corporate debtor was registered earlier, within thirty days of its appointment or by June 30, 2020, whichever is later. Extension of the lockdown till May 17, has pushed the government to give a second extension - till May 31 - for all the e-way bills generated on or before the March 24, where the period of validity expires between March 20 and April 15. The earlier deadline of April 30 had resulted in non-movement of goods when the lockdown rules eased from May 4, ET had reported on Tuesday.
Source: Economic Times
Business and industrial activities in the textile town of Ichalkaranji have remained shut even though it has been included in the orange zone. The densely populated town, with population of around 2.88 lakh, on Sunday reported its fourth Covid-19 positive patient. The areas where positive patients have been found have been sealed and declared containment zones. District collector Daulat Desai said, "After one person was found positive for Covid-19, we have asked the local administration to be alert. Some restrictions have been relaxed in the district from May 4 as per the government rules but we expect that the lockdown in Ichalkaranji will continue as it is. We may have to tighten the restriction if people do not follow the rules and advisory issued by the local administration." Vikas Kharat, sub-divisional officer (Ichalkaranji), said, "Orders have been issued to the health department officials to conduct door-to-door survey and prepare the list of the people that came in contact with the new positive patient." An industrialist from the textile town said, "The government has relaxed norms for industries that fall in the MIDC area and not in the areas falling under the municipal council or municipal corporation. Almost all the processing units and power looms in Ichalkaranji are concentrated in Ichalkaranji town. With the chances of spread of coronavirus pandemic the industrialists are not keen on starting operations. But some want to start operations so that the migrant workers that are in mood of leaving to their hometowns in Uttar Pradesh and Madhya Pradesh will stay back."
Source: Times of India
The exporters are happy as the relaxation will help them to get the much-needed export orders for autumn and winter collections. Come May 6, and sewing machines will swing back into action in the Tirupur garment cluster in Tamil Nadu, one of the biggest textile manufacturing hubs in the country. The garment manufacturers and exporters in Tirupur have heaved a sigh of relief as the district administration allowed the export units to resume operations, though by strictly adhering to the safety guidelines at their units. The exporters are happy as the relaxation will help them to get the much-needed export orders for autumn and winter collections. “We missed the spring- summer collection season, but by resuming operations now, we can still catch orders for autumn and winter collections. The relaxation will give some boost to the sector, but the revival from losses will take a long time,” said A Sakthivel, chairman of Apparel Export Promotion Council. The garment manufacturers need to send samples to different brands overseas, and if approved, they get export orders. Sakthivel said AEPC has issued strict orders to the firms to follow safety norms. Earlier, Tirupur Exporters’ Association had written to Central and state governments seeking reopening of the textile hub, so that they can send samples to clients in the US and Europe and retain export orders for spring-summer collection. Else, they could have lost the orders to countries like China, Bangladesh and Pakistan, where factories were functional. The relaxation has brought relief to the sector. TEA president Raja M Shanmugam said that in first phase, at least 600-700 export units will resume operations with at least 25 per cent of the workforce. “We will follow all sanitation measures... Social distancing will be maintained in the units. Slowly, looking at the situation, we will ramp up production,” Shanmugam said.
Source: The New Indian Express
Collector Shilpa Prabhakar Satish on Tuesday held comprehensive discussions with officials and representatives of traders and entrepreneurs on the issue of reopening businesses in the district. Chairing the meeting at the Collectorate here, the Collector said large commercial complexes, supermarkets, teashops, salons, beauty parlours, massage centres, automobile and jewellery showrooms, air-conditioned textile stores, domestic appliances outlets, cabs and autorickshaws would not be allowed to function as per norms. The larger industries should apply separately for permission to resume operations. Shops in urban areas would be allowed to function from 10 a.m. to 5 p.m., while those in rural areas could start their operations an hour earlier. Restaurants and eateries could allow only ‘take-aways’ as serving food on the premises was strictly prohibited. Construction workers should be allowed to stay at their workplace instead of being ferried to the site everyday. At the same time, there would be no bar on hospitals, pharmacies, agriculture and related businesses, Ms. Shilpa said. Gunasingh Chelladurai, president, Chamber of Commerce and Industries, Tirunelveli, suggested that cement and hardware dealers might be allowed to work twice a week so that aspiring buyers could stock construction material for the next couple of weeks. “It will be a win-win situation for all concerned. While this arrangement will fulfil consumer needs, it will also ensure decent business to the stockist. At the same time, shops functioning for only two days a week will not affect vehicular traffic within the city,” he said.
The Collector agreed to the suggestion.
On the possibility of opening centrally air-conditioned supermarkets, jewellery and textile showrooms, Ms. Shilpa made it clear that multi-storeyed buildings could not be allowed to reopen as per norms laid down by the government during lockdown. “Though shops with ‘ground plus one’ structure can open and transact business, there should be proper ventilation on the first floor as per the norms,” she pointed out, indicating that prospects for resumption of business were not bright. Deputy Commissioner of Police (Law and Order), Tirunelveli City, S. Saravanan said supervisors of liquor shops, which would be opened on May 7, should erect casuarina poles and draw 100 circles to make the crowd line up within them. “The supervisor should ensure that there is no crowding at any point of time.” Although retail vegetable sale went on at Schaffter Higher Secondary School, the wholesale market continued to function from Nainarkulam Market for transporting produce to various destinations including neighbouring Kerala. Fearing that the gathering of a large number of traders at the spot would lead to viral contraction, Corporation officials sealed the market on Tuesday. When the wholesale traders appealed to the Collector to allow them to continue their business from the same place, Ms. Shilpa told them that they should cooperate with the district administration and shift their shops temporarily to the now deserted new bus-stand at Vaeinthankulam. But traders, who were not ready to shift, indefinitely closed the market, which was subsequently sealed by Corporation officials.
Source: The Hindu
The industries of Gujarat are staring at a huge crisis as migrant labourers are rushing to their home states. The exodus of migrants to Uttar Pradesh, Bihar and Odisha is going to make it difficult for industries in Gujarat to open after the lockdown period. Many industries fear that they will be able to resume operations only after Diwali as many migrants will be engaged in farms at their native places during the monsoon season. The textile industry of Surat, which employs 12-14 lakh migrant workers, seems stranded for a long time with lakhs of workers gone and more to follow in the coming days. Similar is the case with ceramic industry, construction, engineering tools and other industries which employ more than 50% of their workforce from other states. “They (migrant workers) are supposed to be treated as labour, factor of production as well as human beings. They were treated as neither in this lockdown period,” said Indira Hirway, director and professor of economics at the Centre for Development Alternatives in Ahmedabad. She said the government should have acted swifter for the migrants to return home after March 24 when a nationwide lockdown was imposed to curb the spread of Covid-19. Surat is the hub for diamond cutting and polishing and about 90% of the world’s rough diamonds are processed here. The industry employs about 7 lakh diamond workers of whom about 10% are from other states. But more than 70% of the workers are from Saurashtra who have also begun to return home to Bhavnagar, Amreli and other regions of Gujarat. Surat has the largest proportion of migrants among cities in India. “We don’t think that the industry will be back to normal before a few months,” said a senior official working with a reputable diamond firm in Surat. The fear runs deeper for the textile industry that employs lakhs of migrant labourers for weaving, processing and embroidery. “The migrant workers are angry. They suffered a lot in the first 40-odd days of the lockdown and despite numerous representations nothing was done,” said Tarachand Kasat, senior vice-president and chairman of textile committee at Federation of All India Vyapar Mandal. “We fear that 15% of the businesses will shut down permanently. Majority of the migrant workers who have gone to their natives will not return for long, not before Diwali,” Kasat said. Every month the textile industry of Surat is staring at losses to the tune of Rs 11,500 crore, he added. Gujarat government has operated 39 trains over the past four days and sent more than 46,000 migrant labourers to their respective states, according to a media statement. Thirty more trains will leave from Gujarat on Wednesday to send 82,000 migrant workers back home, it said. Around 3.25 lakh labourers have been sent to their respective native places through trains and buses till date, it added. The state government shall continue the necessary arrangements for the coming 15 days. At the cermaic hub of Morbi the situation is not very different from Surat’s textile industry, for it is also largely dependent on the migrant workforce. “The workers who have left for their native places will not return for a long time,” said Divyesh Patel, director at Clayris Ceramics. “About 60% of the workforce at Morbi’s ceramic industry is from other states. For instance, the sanitaryware industry is largely dependent on workers from Odisha.” Patel said that the industry will not be function fully before Diwali as many of the migrants will be engaged in farming in their villages with the onset of monsoon season next month.
Source: Times of India
New Delhi, May 7 (PTI) The government needs to give direct push to MSMEs to ramp up export of consumer goods to reap the benefits of its comparative advantage over products made in China in the post-pandemic world, a report said. India can look in the range of incremental exports growing by USD 20 billion (in the least favourable outcome) to a significant USD 193 billion jump in the five-year horizon, only if it builds its capabilities and captures share from China, according to SBI’s Ecowrap report released on Thirsday. “Although, the revealed comparative advantage (RCA) for India is lower than China as far as capital goods exports are concerned, India can still capitalise on this opportunity to push its capital goods exports. “However, the bigger opportunity right now is in the consumer goods sector, in which India has an RCA greater than China,” said the report. Looking at the micro, small and medium enterprise (MSME) profile of the country in terms of the consumer goods sector, the biggest concentration is in the textile and clothing sector (17.30 per cent), food products (12.30 per cent) and crop and animal production (10.0 per cent). “Although we do have a comparative advantage in textiles and animal goods, in food products we are not competitive. The government can give a direct push to this sector, so that MSME firms involved in food products manufacturing get benefitted,” the report said. It further said that although 2020 is a lost year, in terms of trade, India can think long-term and build relations so that it can occupy the space vacated by China. "When we look at the value of merchandise exports, for 2019, China exported USD 2.5 trillion worth of goods, while India exported USD 0.3 billion worth of merchandise. This means that China exports 7 times the amount of goods India exports in a year," it said. Taking a look at Vietnam, which has rapidly captured merchandise exports, it is also touted that a fair number of the factories being rapidly put up in Vietnam are owned and financed by the same Chinese companies being dislodged in their home country, the report said. However, it added that there is no denying the fact that Vietnam has gained in this trade war, with its cheap labour and cheap currency. "How India maneuvers the geopolitical space will clearly determine how successful it is in becoming an export behemoth. With just 1.7 per cent in world''s merchandise exports, India has a long road ahead to catch up with China. But it must be now...," it asserted. As per the report, India is one country that can fulfill global demands with its sizeable population. However, India will have to take a hard look at its labour reforms and currency outlook to gain market share. Although COVID-19 can dampen demand for the coming years, it does provide an opportunity for global trade rebalancing, and India needs to play its cards right to gain something out of this catastrophe, said the SBI Ecowrap report.
Source: Outlook India
As 1.5 milion workers in the South African economy returned to work this week, Trade, Industry and Competition Minister Ebrahim Patel has met with representatives of the clothing textile, footwear and leather sector. Monday's virtual meeting with the sector was held to review the readiness of shops and factories for the new Level 4 lockdown which kicked in on 1 May. "The meeting agreed to develop a common framework on implementation of COVID-ready workplaces that can serve as a guide for the industry," said the Department of Trade, Industry, and Competition ( Dtic) on Tuesday. The recent move from the hard lockdown to Level 4 has seen greater parts of the retail and manufacturing value chain open up. Starting 1 May, clothing and footwear retailers started opening for customers to buy winter and children's apparel and footwear. This was the first time that dedicated clothing and footwear retailers have opened since the initial lockdown started on 26 March 2020. Level 4 of the lockdown also enables manufacturers to begin manufacturing with at least 30% normal employment for all clothing, textile, footwear and leather goods; up to 50% for winter goods; and up to 100% for children's and baby clothes, and personal protective equipment like face masks. Retail CEOs provided the meeting with feedback on the reopening of stores and measures they have taken to manage the return to work. Anthony Thunström, the Foschini Group's Chief Executive Officer (CEO) and chair of the National Clothing Retail Federation (NCRF) welcomed the move to reopen clothing retail stores and noted the value of close collaboration between government and industry. During the meeting, the Minister, retail CEOs, manufacturers and labour representatives engaged on matters that could be covered in the framework agreement for the industry to protect employees in manufacturing and retail. The framework also aims to protect customers in retail stores well. CEO of Woolworths SA Zyda Rylands said the NCRF aims to support government's initiatives. "The spirit of collaboration within the NCRF is to support government's initiatives. The terms of all back-to-work protocols starts with us. We [retailers] are a big employer of people, so if we take care of our workforce in support of government's initiatives then we should also identify how to communicate to our customers the same health and safety protocols. We have capabilities to also support our customer to implement government's initiatives, " she said. Meanwhile, the Apparel and Textile Association of SA's (ATASA) chairperson Herman Pillay, said the industry should look into supporting more of government's response efforts in workplaces. The industry now has more than 350 manufacturers who have said they are ready to produce cloth face-masks, ranging from micro-enterprises employing a few people, to SMEs and larger firms.
Ensuring workplace safety
Proposals were heard on the phasing in of shift workers, social distancing for employees and customers and other necessary health protocols, to avoid a sudden increase in the spread of COVID-19 now that more parts of the retail and manufacturing are opening up. Government provided details of the risk factors taken into account in the different alert levels and what could be done to reduce risks, enabling the economy to move more rapidly to Level 3 and below. "As we navigate the uncharted terrain of the COVID-19 reality, it will take our collective efforts to ensure we reduce risks of infection while we reopen our economy and adjust to our new normal," said the Minister. Meanwhile, the Apparel and Textile Association of SA's (ATASA) chairperson Herman Pillay, said the industry should look into supporting more of government's response efforts in workplaces. The industry now has more than 350 manufacturers who have said they are ready to produce cloth face-masks, ranging from micro-enterprises employing a few people, to SMEs and larger firms.
Ensuring workplace safety
Proposals were heard on the phasing in of shift workers, social distancing for employees and customers and other necessary health protocols, to avoid a sudden increase in the spread of COVID-19 now that more parts of the retail and manufacturing are opening up. Government provided details of the risk factors taken into account in the different alert levels and what could be done to reduce risks, enabling the economy to move more rapidly to Level 3 and below. "As we navigate the uncharted terrain of the COVID-19 reality, it will take our collective efforts to ensure we reduce risks of infection while we reopen our economy and adjust to our new normal," said the Minister.
Source: All Africa
The World Trade Organization (WTO) has asked its members if there is a need to consider new and practical e-commerce solutions to enable fast and secure cross border movement of goods and services to help economic recovery and job creation after the Covid-19 pandemic. The organisation has also raised questions related to the assistance it can offer developing countries and LDCs to reduce the digital divide, aid MSMEs and promote economies that are more resilient to possible future crises or shocks. Highlighting that network capacity and higher bandwidth services have proved to be crucial, not only during the pandemic itself, but also for e-commerce and economic inclusion in general, it said in an information note: “What can WTO members do to improve communications networks and services?” The WTO Work Programme defines "electronic commerce" as the production, distribution, marketing, sale or delivery of goods and services by electronic means. The organisation said that the information note has been prepared by its secretariat on its own responsibility and is without prejudice to the positions of members or to their rights or obligations under the WTO. “The measures/examples/issues mentioned are illustrative only and not exhaustive,” it said as it highlighted a “glaring” need to bridge the digital divide, both within and across countries, as the digital economy has played a key role during the current Covid-19 crisis. Emphasising that online consumer protection and compliance with health and safety regulations are the other challenges, the organisation also said that the experiences and lessons emerging from the crisis could be a further incentive for global cooperation in the area of e-commerce, which could help to facilitate cross-border movement of goods and services, narrow the digital divide, and level the playing field for small businesses. “The pandemic has highlighted the glaring need to bridge the digital divide, both within and across countries, given the central role the digital economy has played during the crisis,” it said, and added that the pandemic has made it clear that e-commerce can be an important tool or solution for consumers. It added that the global nature of Covid-19 and its impact on e-commerce may encourage strengthened international cooperation and the further development of policies for online purchases and supply. "E-commerce can also support small businesses and, by making economies more competitive, be an economic driver for both domestic growth and international trade,” it said. As per the report, certain traditional obstacles have been accentuated and have continued to hamper greater participation in ecommerce activities by small producers, sellers and consumers in developing countries, particularly LDCs. It also said that e-commerce for goods and services trade has been adversely impacted by the factors that have caused disruption in supply and demand overall and such disruptions have resulted in delivery delays or outright cancellation of orders. Several other e-commerce-related challenges have arisen or been further amplified during this pandemic such as increasing prices to unreasonably high levels, product safety concerns, deceptive practices, and cybersecurity concerns. It, however, said the enforcement of social distancing, lockdowns and other measures in response to the pandemic has led consumers to ramp up online shopping, social media use, internet telephony and teleconferencing, and streaming of videos and films. “This has resulted in spikes in business-to-consumers (B2C) sales and an increase in business-to-business (B2B) e-commerce. The increase in B2C sales is particularly evident in online sales of medical supplies, household essentials and food products,” it said, adding that demand has also increased for internet and mobile data services. Many WTO members have formed a plurilateral to negotiate guidelines for e-commerce.
Source: Economic Times
The domestic textile and garment industry faced an export value reduction in the first four months of this year due to difficulties in production due to the COVID-19 pandemic. Statistics showed Việt Nam's textile and garment exports in April decreased by 20 per cent compared to March, Trương Văn Cẩm, vice chairman of the Việt Nam Textile and Apparel Association (Vitas), said at an online seminar held by the association on Monday. The total textile and garment export value in the first four months of this year dropped by 6.6 per cent to US$10.64 billion year-on-year. Meanwhile, the total import value was $6.39 billion, down 8.76 per cent compared to the same period last year."Việt Nam's textile and apparel industry has never faced negative growth in both imports and exports like that," Cẩm said. Export value reduced by about 6 per cent to $8.27 billion for garment products, 0.3 per cent to $664 million for fabric products, 11.5 per cent to $1.19 billion yarn products and 6 per cent to $354 billion for textile materials. Meanwhile, import value also declined by about 8 per cent to $893 million for cotton, 2.5 per cent to $758 million for yarn products, 11 per cent to $3.63 billion for fabric products and 5.8 per cent to $1.11 billion for textile materials. The reduction reflected the industry's lack of export orders, said Cẩm, adding that those figures are forecast to drop further in May and June because most export orders for those months have been cancelled. Many enterprises in the industry have bad debts, he said. Many export garment enterprises are operating at reduced capacity because they do not have new orders. The association reported the cancellation of contracts and lack of new contracts was due to the reduction of demand for textile and garment in the US and EU during the pandemic. Meanwhile, China also has less demand for importing yarn from Việt Nam due to the suspension of production during the outbreak. With a lack of new export orders leading to fewer jobs and pressure in wage payment, the association has proposed many solutions to support enterprises. However, those solutions could not help them maintain production until the end of this year. Trần Thanh Hải, Deputy Director of Ministry of Industry and Trade’s Import-Export Department, said the COVID-19 pandemic had affected exports of many products, including textiles and garments. Many enterprises had shifted to producing cloth face masks to meet domestic demand and exports. However, the export value at $63 million from face masks from January 1 to April 19 was too small compared to the total export value of textile and garment at $10 billion in the first four months of the year, according to Vitas. The textile and garment industry is predicted to have a strong reduction in total export value for this year. In the most positive scenario, its export value will reach about $35 billion this year, down 10 per cent year-on-year. In a realistic scenario, the industry's export value is estimated to reach about $33.5 billion. In a bad case, the export value will only reach $30-31 billion in 2020.
Source: Vietnam News
Ready-made garment (RMG) export in April 2020 declined by 84.86 per cent, which is $366.58 million over the corresponding month in the last calendar year. Export earnings from the apparel sector were $2.42 billion in April 2019. Also, export receipts from RMG products last April registered over 81 per cent fall from that of $1.97 billion in March, says the Bangladesh Garment Manufacturers and Exporters Association (BGMEA). The BGMEA made the disclosures citing the National Board of Revenue (NBR).Experts and exporters attributed slow demands due to lockdown in major destinations, including the United States, the European Union and Canada. The fall in export performance was also due to closure of most of the garment factories in line with public holidays in Bangladesh until April 25. Exporters said global apparel buyers have either cancelled or put on hold existing orders as they are not placing new orders amid the coronavirus pandemic. According to the BGMEA, more than $3.0 billion work orders were cancelled or withheld to date since March. It, however, projected that export receipts from garments might decline by an estimated $5.0 billion between March and May due to the impact of COVID-19. Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) senior vice-president Mohammad Hatem said the drastic fall in export was expected as most units remained shut for nearly one month since March. The performance was the result of late March and few days of April production, he told the FE. Factories resumed production to do the previous orders, Mr Hatem said, adding that the performance would be the same in May. There are no new orders and demand side in future is still uncertain, observed the business leader. According to industry insiders, multiple global buyers like H&M, Inditex, Marks and Spencer, PVH, Kiabi and Target have committed to receiving the previous orders and make full payment. Meanwhile, Industrial Police said a total of 2,805 industrial units remained open on Sunday. Of them, 975 are non-RMG units and 289 are under the Bangladesh Export Processing Zones Authority (BEPZA). Of the units in operation, 1,074 are BGMEA members, 314 registered with the BKMEA and 153 listed with the Bangladesh Textile Mills Association. A total of 517 factories did not pay wages for March and other allowances until Sunday. Of them, 335 are non-RMG, seven BEPZA members and the remaining 175 textile and garment factories listed with the three trade bodies. Workers from eight garment factories located at Ashulia and Gazipur demonstrated on Sunday on different issues, including payment of wages, according to the police.
Source: Global Times
