Covid-19 has changed our collective calculus of uncertainty. It is more global in scope, more profoundly impactful, and much more complex than any crisis that countries and companies have ever experienced. The next normal requires confronting uncertainty head-on and building it into decision-making. To my mind, ‘Respond, Recover, Thrive’ captures the spirit of the Indian government’s reactions to the pandemic, the economy and building for the future. That was evident in the announcements last week to revive and restructure India’s economy, with multiple policies that will find common cause with another fallout of the contagion — possible reconfiguring of the global supply chain by multinationals. The two are linked and is likely to become more so. Plainly, it makes sense for India’s domestic market of 1.32 billion consumers to be viewed as an opportunity. Equally, this is a market that global manufacturers need to target for their long-term viability in a riskier world. That is the real measure of the moment and the government is right to pursue a restructuring of India anchored by the following strategic objectives: *Unifying India with economic development that is plural and rural. *Balancing the approach to regional development. *Strengthening and leveraging India’s domestic market to attract FDI.
*Modernising agriculture, to create value-addition and advance rural aspirations.
clear differentiator for India, as it was for China two decades ago, is its large domestic market. It is a pathway to local scale, climbing the competitive value chain, as well as building an export base. This is the India that is on global companies’ radar as they consider derisking their manufacturing in an evolving new world order. There appear to be three strategies, and India is central in each.
Make it Here, Make it Now
First, multinationals are looking at ‘China Plus One’, effectively hedging against a primary location. Second, and less likely, is an alternative to China. Finally, companies want locationswith big local markets and low cost so they can scale up and produce for both, the domestic market and exports. Consider this. I see exports from China in several sectors, including pharmaceuticals, mechanical equipment, textiles and auto parts, totalling $1 trillion, which present an opportunity for India. These cover activities where China has no advantage (less than 30% of China exports), is sizeable (more than $5 billion), and where India can substitute (where India exports at least 1% of global trade). Part of India’s ‘pull’ is its engineering, computing and science workplace talent, from a higher educational network that graduates millions each year. That has been a competitive advantage for years, a global franchise. Foreign investor orthodoxy is that such systemic transition is fanciful, without a heroic unwinding of regulations, for instance, to buy land, let go surplus workers, or bid for contracts where procurement processes remain baroque. However, India’s aspirations have been whetted by its improving ease of doing business, though more needs to be done. There is also an accelerating network of clusters, boosting infrastructure in farming economies with large populations. Second, sectors such as auto manufacturing (India is the world’s fifth largest market) and a components ecosystem, are typical of industries incubated in an earlier phase of reform that have grown to world-class scale and quality, and today are a plug-and-play for incoming foreign manufacturers. In a world where supply chain security, and not just costs, could determine location, India feels like a good long position. Our information technology industry has demonstrated this during the pandemic. On this reasoning, five sectors, all big employers, as well as a force for rebalancing regional development disparities, were singled out in last week’s announcements by finance minister Nirmala Sitharaman. They are food processing, pharma, defence, textiles and electronics. Take food processing. At $500 billion in annual economic activity, this is the fifth-biggest industry in India by production, exports and consumption. We are among the leaders in producing milk, coffee, wheat, rice, sugar, fruit and vegetables. Yet, only one-tenth of produce is processed, yielding little value creation in either incomes or productivity. Food processing is potentially a big employer, from small units at the farm gate to industrial size in tertiary processing. Announcements on pricing deregulation and financing processing infrastructure at the farm gate should help producer organisations and micro enterprises.
Handholding, Each Other’s
That is brave, but there is scope for more. The answer, I believe, is a strategy of food diplomacy, consumer awareness and import substitution, and anchor investments that generate growth, scale and value. One quick accelerator would be to incentivise partnerships between food companies, machinery manufacturers, research and academic institutions and startups to develop processing and packaging technology. Food processing can become for this government what car and auto-components were to its predecessors two decades ago. In this past week’s announcements, the thread for me was empathy and prudence: the first in its attention to employment; the second in fiscal responsibility and a recognition of the value proposition at India’s core. Equally commendable has been the honest admission that we are in uncharted waters, and are willing to experiment and invest in what the future may hold.
Source: Economic Times
Days after announcing a new set of criteria to define micro, small and medium enterprises (MSMEs) on which various official benefits will be extended, the government is considering a proposal to widen the definition again — a crucial move that will potentially benefit several thousands of firms. Days after announcing a new set of criteria to define micro, small and medium enterprises (MSMEs) on which various official benefits will be extended, the government is considering a proposal to widen the definition again — a crucial move that will potentially benefit several thousands of firms. MSME and transport minister Nitin Gadkari told FE his ministry is floating a proposal to raise the annual turnover limit for a medium enterprise to Rs 250 crore from Rs 100 crore. Similarly, the investment limit to qualify as a medium enterprise could be raised to Rs 50 crore from Rs 20 crore announced earlier this month. This proposal is subject to clearance by the finance ministry, he added. The Rs 250-crore turnover limit may also exclude export realisation of an entitiy. “The move is aimed at giving benefits to many such businesses. It is going to transform the MSME sector. It will also enable them to make more investments,” Gadkari told FE in an interview. There were about 6.34 crore MSMEs in India, of which 6.3 crore are micro units, while 3.31 lakh were small businesses and 5,000 medium enterprises, according to the NSS survey during 2015-16. The MSME status brings businesses certain assorted benefits — including the mandatory 25% official procurement and loans under the priority sector lending scheme — apart from periodic government and regulatory relief. For instance, subject to the conditions, they will be eligible for the recent package, including additional, collateral-free working capital loan (up to 20%) with a cap of Rs 3 lakh crore (with official guarantee), subordinate debt of Rs 20,000 crore and Rs 50,000-crore fund of funds to bolster the equity base of MSMEs that have growth potential and need some handholding. Just the collateral-free loan move is expected to help 45 lakh units, the government has said. Also, promoters of MSMEs who are not willful defaulters can bid for their stressed assets under the insolvency law, while those of large companies can’t. There will also be a special insolvency framework for MSMEs. Central public-sector enterprises procured products worth as much as Rs 33,264 crore from 42,458 small and medium businesses in FY19. This was 30% of their procurement in FY19, according to the MSME ministry data. Announcing the details of the Rs 21-lakh-crore relief package, finance minister Nirmala Sitharaman had announced that the definition of MSMEs would be tweaked on the basis of both investment and turnover, and not just investment, as had been the practice. According to the definition announced by her, a micro unit is one where the investment does not exceed Rs 1 crore and annual turnover limit Rs 5 crore, while a small enterprise is one where the investment is between Rs 5 crore and Rs 10 crore and a turnover limit of Rs 50 crore. A medium enterprise is one that has an investment of between Rs 10 crore and Rs 20 crore and a turnover limit of Rs 100 crore. Even this definition marked a substantial jump in the investments limit from the earlier definition. Elevated investment limits will enable the MSMEs to scale up without bothering about the loss of assorted government benefits if they grew in size, in sync with the idea mooted in the Economic Survey for FY19 that had argued against incentivising “dwarfs”. The Centre also proposed to end any distinction between manufacturing and services MSMEs. According to the earlier definition, a micro unit is one where the investment does not exceed Rs 25 lakh, while a small enterprise is one where the investment is between Rs 25 lakh and Rs 5 crore and a medium one has an investment of between Rs 5 crore and Rs 10 crore. In case of services, a micro enterprise must invest up to Rs 10 lakh in equipment. A small enterprise will have to invest between Rs 10 lakh and Rs 2 crore, while those investing from Rs 2 crore to Rs 5 crore will qualify as medium services enterprise. In its FY19 annual report, the MSME ministry said these businesses had created 11.10 crore jobs in FY16. They also made up for 29% of GDP. Highlighting policy anomaly that helps create “dwarfs”, the Economic Survey for FY19 had suggested that the government set a sunset clause of less than 10 years for all size-based incentives. While dwarfs (firms with less than 100 workers despite being more than 10 years’ old) make up for over a half of all organised firms in manufacturing by number, their contribution to employment is just 14% and to productivity a mere 8%. In contrast, large firms, with over 100 employees, account for three-quarters of such employment and close to 90% of productivity despite accounting for about 15% by number.
Source: Financial Express
MUMBAI: Several companies with China connections are raising funds through the external commercial borrowing (ECB) route after the government tightened foreign direct investment (FDI) norms, said people with knowledge of the matter. These curbs don’t apply to debt. At least three-four Chinese multinational companies (MNCs) are in the process of issuing ECB instruments to parent firms based in China and more will follow, said the people cited earlier. Any investment from countries sharing a land border with India, including the China and Hong Kong region, will need special pre-approval, the government said last month. If a company needs emergency funding from China, the ECB is the best route since the transaction can be closed within a week, legal experts said. “A couple of companies that approached us were in dire need of cash. We advised them to issue ECBs to their Chinese parent company,” said a Big Four tax consultant. “Subsequently, if the parent company wants, it can convert this debt into equity. However, such a conversion will need government approval since equity is part of FDI norms.” The ECB route has restrictions. The foreign entity should hold at least 25% of the Indian company. In other words, this route can only be used by Indian subsidiaries and joint ventures of Chinese companies. “As long as the company meets the requirements specified under ECB route, funding can be received by the Indian entity from China with an option to later convert the borrowing into equity with requisite government approval and other compliances being in place,” said Tejesh Chitlangi, partner, IC Universal Legal. If the target company is not an MNC or doesn’t have any China connection but wants to rope in new investors from the region, it can do so by issuing unlisted corporate bonds, experts said. However, the Chinese investor will have to register with the Securities & Exchange Board of India (Sebi) as aforeign portfolio investor (FPI) “The restrictions do not apply to foreign loans as well as investments under the FPI route,” said Rajesh Gandhi, partner, Deloitte India. “Investors from such land border countries can therefore lend money to their Indian entities without the need to approach the government for specific approval.” Currently, there are no restrictions on Chinese entities using the FPI route. If the target company is listed, any FPI can own up to 9.99% equity. However, if the company is unlisted or if the Chinese investor wants to take a bigger exposure, then unlisted nonconvertible debentures (NCDs) are the preferred option, experts said. The government had tightened the rules for Chinese funds due to concerns over distressed takeovers. The valuations of several Indian companies have plummeted since the Covid-19 outbreak halted economic activity. Experts said the government doesn’t have to impose restrictions on Chinese funds using the ECB or NCD route since they cannot take control of a company through debt instruments. If the company wants to convert the debt into equity, government approval will be needed in any case.
Source: Economic Times
Health Ministry said that India has significantly ramped up its domestic production capacity related to Personal Protective Equipment, PPEs and N95 masks and the requirements of the States and Union Territories are being sufficiently met. Today, the country is producing more than three lakh PPEs and N95 masks per day. States and Union Territories as well as Central Institutions have been provided with around 111 lakh N-95 masks and 74.48 lakh PPEs. Ministry said, there are some reports in a section of media expressing concern about the quality of PPE coveralls. It clarified that HLL Lifecare Limited, HLL, procuring agency of the Ministry of Health and Family Welfare, is procuring PPE coveralls from manufacturers and suppliers tested and approved by the labs nominated by the Ministry of Textiles. Ministry said, procurement is being done only after their products qualify in the test prescribed by the technical committee of the Ministry of Health and Family Welfare. Ministry advised all the States and Union Territories to ensure procurement after following the prescribed testing for PPEs from Ministry of Textiles' nominated labs. In addition, manufacturers who have got their products qualified from these labs are also being brought on Government e-Marketplace, GeM. Information of manufacturers whose products have qualified the tests is available on Ministry of Textiles' website.
Source: AIR
Exports of personal protective equipment (coveralls) may be considered next as far as export curbs go India may allow export of certain category of face masks soon as the country has a surplus capacity, claimed government sources. The final decision is expected within a next few days as mask manufacturers have requested the government to allow them to export their surplus capacities. “A webinar is planned with the ministry of textiles on Tuesday. We will be discussing about the surplus production and the idle capacity available with manufacturers here. A decision on allowing exports is likely to be taken soon,” said a senior government official. He further added that the government is taking a cautious approach before allowing exports as it wants to gauge if there is any sudden demand spike in the domestic market. “With the lockdown easing and flights resuming, there can be a spike in demand for face masks in India too. We want to monitor the situation a bit and then take a call,” he added. Exports of personal protective equipment (coveralls) may be considered next as soon as export restriction relaxations go. The industry, too, had presented its case through lobby groups. The umbrella association of medical device makers in the country, the Association of Indian Medical Device Industry (AiMeD), had written a letter to pharma secretary P D Vaghela, who is also the chairman of the empowered committee of essential medical equipment. They requested him to intervene for opening up exports of surgical three-layer masks and N95 respirator masks as the country now has a surplus capacity. “These manufacturers are stopping or slowing down production since the last 15-20 days as they have unsold inventory amid falling demand. Prices are falling as clients in public and private health care are preferring to buy lower cost 2 and 3 layer masks or non-standard quality without nose clip,” Rajiv Nath, forum coordinator of AiMeD, had said in the letter. India had banned the export of all kinds of masks in March. In mid May, however, the director general of foreign trade allowed the exports of non-medical category masks like those made of cotton, silk, wool and knitted materials. “There is some confusion among manufacturers as to who can export and who cannot. However, export of surgical masks is still banned,” said an industry source, who claimed many manufacturers are sitting on inventories of tens of thousands of masks. Sudhir Reddy, promotor of Lesure Industries, said he has created capacity to make about 100,000 masks per day and was now waiting for exports to re-open. Meanwhile, the industry said the government needs to stress on proper certifications for masks and other protective gear as export of sub-standard quality products can earn a bad name.
Source: Business Standard
3.5 trn Atmanirbhar Bharat package for SMEs can increase credit to MSMEs by 18-19% which can address the short-term liquidity crunch. Here's a closer look at the measures announced, and their impact. The Rs 3.5-trillion Aatmanirbhar Bharat package for micro, small and medium enterprises (MSMEs) can potentially increase credit to MSMEs by 18-19 per cent, given that banks and other financiers lent around Rs 18-19 trillion to the sector in 2019-20. Actual disbursements, however, will also depend on the new MSME classification.While this will cushion the impact of the blow from the Covid-19 pandemic by addressing the short-term liquidity crunch MSMEs are facing, risks loom beyond the current fiscal year.
Here’s a closer look at the measures announced, and their impact:
Complete credit guarantee scheme: The Rs 3-trillion infusion under this includes collateral-free loans and subordinate debt. This will provide much-needed liquidity by providing an additional 20 per cent support to all existing accounts, subject to conditions. CRISIL’s analysis of 13,000 companies over a five-year period indicates that the MSMEs’ working capital cycle can stretch by 15-20 per cent during downturns. Subordinate debt of Rs 20,000 crore for stressed MSMEs: This includes a Rs 4,000-crore support to the Credit Guarantee Trust Fund for Micro and Small Enterprises (CGTMSE) — the highest infusion in the last two decades — and amounts to Rs 60 per cent of the CGTMSE’s cumulative corpus since inception. However, asset quality risk is the key monitorable. For instance, the Pradhan Mantri Mudra Yojana, which accounted for 14-15 per cent of MSME lending in fiscal 2018-19, has seen a rise in gross non-performing assets in recent years. Interest moratorium: Using the new MSME definition, CRISIL Research has analysed 12,000 companies (excluding traders) in its proprietary Quantix database. Their rated debt accounts for about 12 per cent of MSME debt outstanding. Considering the six-month interest moratorium and deferral on existing term and working capital loans, respectively, and the 12-month moratorium on fresh loans, the interest burden for 2020-21 will reduce by 25-30 per cent year-on-year. This will result in an estimated interest coverage ratio of 0.4 for the fiscal year, worse than last fiscal year’s 0.6, due to the severe impact on demand. Note: Of the Rs 3.5-trillion infusion in MSMES, Rs 3 trillion is the complete credit guarantee scheme and the remaining Rs 50,000 crore comprises equity infusion through a fund of funds.
Source: Business Standard
Over 12,000 workers found to be trained in garment making and tailoring so far; more than 2.3 million have returned to UP from different states Amid the influx of migrants from domestic textile centres of Gujarat, Punjab and Maharashtra following covid-19 lockdown, the Uttar Pradesh government is looking to replicate the success of Vietnam and Bangladesh in becoming major textile manufacturing and exporting hubs. With the state starting the process of skills mapping of incoming workers, more than 12,000 workers have so far, in the first phase of enlisting, been found to be trained in garment making and tailoring. Presiding over a review meeting here today, chief minister Yogi Adityanath said if Bangladesh and Vietnam could emerge as major textile hubs, there was every reason that UP could achieve the same status, especially with the growing availability of trained manpower returning to the state. “The CM has directed the officials to prepare a roadmap for developing the state as a leading textile hub,” UP additional chief secretary Awanish Kumar Awasthi said this evening. He said the skills mapping of the migrants had shown that they possessed vocational skills in different segments, including electronics, electrical, real estate, data entry, furniture, carpentry, auto mechanic, mobile phone repair, garment etc, which could now be harnessed locally. The state government has decided to involve the district level employment exchanges in the process of providing jobs to these workers by sharing their skills database. Yesterday, the state had announced to set up a Migration Commission for the welfare of migrants. The government has named the panel as Kaamgar/Shramik (Sevayojan evam Rozgar) Kalyan Aayog. “Apart from regular employment, we are aiming to create a system of apprenticeship, training and stipend to the migrants,” he added. The Commission will also take steps for insurance cover to the migrants. Besides, the government is planning to leverage the central stimulus package to provide housing facilities to the migrants. Under the comprehensive Rs 20 trillion economic stimulus package to overcome the covid-19 challenges, the Centre has announced a scheme to help the migrant labourers in getting residential accommodations. The central government will provide affordable rental housing to the migrants and urban poor under the flagship Pradhan Mantri Awas Yojana (PMAY) scheme. So far, more than 2.3 million workers have returned to UP from different states, including Gujarat, Maharashtra, Punjab, Delhi, Karnataka, Tamil Nadu, Uttarakhand etc. On an average, more than 150,000 migrants are coming back every day due to lockdown. The government has already arranged for 1,361 Shramik Special trains to ferry UP workers, of which 1,174 trains have already arrived carrying nearly 1.6 million labourers. Besides, estimated 6.5 million migrants had also returned either on their own or ferried by the roadways buses from mainly Haryana, Madhya Pradesh, Rajasthan, Uttarakhand etc. Meanwhile, the ASHA (accredited social health activist) workers have surveyed more than 0.85 million migrants and reported 892 suspected cases to the state medical department.
Source: Business Standard
Yogi Adityanath said the Commission that will come up will provide migrant workers with all kinds of facilities. "We will stand with migrant workers wherever they go," he added. Uttar Pradesh Chief Minister Yogi Adityanath has said that any state government which wants to employ migrant workers from his state will have to seek permission first. He did not elaborate on how UP planned to ensure that permission was taken or how it would monitor the movement of lakhs of migrant workers once the lockdown is lifted and economic activity restarts. He, however, said his government would form a migrants' commission to help workers get employment within the state. "I have instructed my officers that there should be a commission made to get them employment within Uttar Pradesh itself," Yogi Adityanath said during an online interaction with the media. "If some other state wants this manpower, we will give them insurance and social security. But that state will not be able to take people from here without our permission because of the way our people have been treated in other states," he added. Since the slow easing of the lockdown started, states like Karnataka have been trying to retain the migrant labourers, saying they would be needed once construction work and industrial activities start. There have been reports that Tamil Nadu has also been trying to stop the exodus of migrant workers by keeping them comfortable, even though many industries have not been able to pay their salaries. Yogi Adityanath said the Commission that will come up will provide migrant workers with all kinds of facilities. "We will stand with migrant workers wherever they go," he added. So far, more than 20 lakh migrants have returned to Uttar Pradesh from other states. Since the lockdown started in March, people have been pouring into Uttar Pradesh by train or buses or illegally by trucks. Many more are estimated to have returned on foot or personal modes of transport like auto rickshaws. At the same meeting, the Chief Minister also claimed that migrant workers who returned to UP as coronavirus positives, are recovering faster than the other patients in the state. No data, however, was offered to back this claim. "We are aware that migrant labourers will bring the infection. But the labourer has the means to fight the infection. You look at the results. A normal person is taking 14 - 20 days to get cured , but among the migrant labourers, the person is getting corona negative only after seven or eight days. This is a big strength," he said. Uttar Pradesh so far has more than 6,200 of the 1.3 lakh coronavirus cases in the country. The numbers started spiking since the migrant workers started returning in huge numbers. More than 3,500 patients have recovered and 161 patients are dead.
Source: NDTV
Congress-ruled Rajasthan was the first state to increase the working hour limit to 12 hours from 8 hours through an order issued on April 11 The Rajasthan government has withdrawn an order issued last month to temporarily increase the daily working period in manufacturing units from 8 to 12 hours. Rajasthan has become the second state to withdraw such an order, after Uttar Pradesh. “The shortage of workers is no longer a concern with the revised lockdown guidelines by the Central government. Companies are no longer bound to cap workers in factories and many units have opened up in Rajasthan. There are no restrictions on the movement of workers, too. Hence, the order has been withdrawn,” Rajasthan Principal Secretary (Labour) Niraj Kumar Pawan told Business Standard over phone. The decision was withdrawn on Sunday. He said the situation was different when the order was first introduced for a period of three months as only limited workers were allowed to work in shifts. “We have withdrawn the notification in about a month,” Pawan said. "We welcome the decision of the Rajasthan government...All India Trade Union Congress (AITUC) would urge the other state governments to follow suit and withdraw all the changes being effected during the Covid-19 lockdown period," said AITUC general-secretary Amarjeet Kaur. Congress-ruled Rajasthan was the first state to increase the working hour limit to 12 hours from 8 hours through an order issued on April 11. In fact, Prime Minister Narendra Modi had lauded Rajasthan chief minister Ashok Gehlot during a meeting of the CMs on April 27 for the move which was aimed to compensate for the loss of production during the national lockdown. He had urged other States to follow it. At least 10 states in India have increased the working hours in India from 8 to 12 hours – with some States not even requiring overtime wages for the extra four hours of work. The States that have made the change so far are Maharasthra, Rajasthan, Gujarat, Goa, MP, Uttarakhand, Assam, Punjab, Haryana and Himachal Pradesh. This translates into 72 hours a week – much more than the norms prescribed by the International Labour Organisation. India is a signatory to the ILO’s convention of 1919 on working hours. Though all countries which signed it had to reduce working hours to 48 hours a week, India was given an exemption to keep it at 60 hours. So, the move by the State governments in India, which was vehemently opposed by the central labour unions, was in contravention of the ILO convention, too. The Karnataka government played it safe and recently increased the daily working hour limit to 10 hours (translating into 60 hours a week) to remain within the ILO's norms. Various State governments had used special powers under the Factories Act of 1948 to bring out the change for a period of 3 months. In fact, some States had exercised powers under Section 5 of the Factories Act which can be only used in case of a national emergency, war or internal disturbances – a move which has been legally challenged. On May 15, the Uttar Pradesh government withdrew its order increasing the daily working hour limit to 12 hours. The move came a day after the Allahabad High Court issued a notice to the State on a public interest litigation challenging the legality of the order.
Source: Business Standard
On Sunday, Hyundai Motor had said that in the first week of its operation, three of its employees showed mild symptoms of cough and cold and was tested positive for Covid-19 Even as the government is allowing industries to open their manufacturing units, it is subject to various restrictions. The industrial units in Chennai have already reported more than 20 Covid-19 positive cases in a short period of resuming operations with limited number of workers. The challenges faced by the companies include getting more tests done at an affordable cost, and keeping up the operations despite some of the employees are tested positive, among others. On Sunday, Hyundai Motor India Ltd has said that in the first week of its operation, which started on May 8, 2020, three ...
Source: Business Standard
Many are out of work and are struggling to make ends meet; products worth crores of rupees remain unsold Hundreds of cotton lungi weavers in villages like Guruvarajapet, Panapakkam, Podhatturpet and Ammayarkuppam near Arakkonam have been adversely affected by the COVID-19 lockdown. They don’t have fresh raw material, i.e., dyed thread, to work with, and have been unable to send finished products worth crores of rupees to the market due to a lack of transportation facilities. According to K. Selvam, a master weaver, they are normally busy during this time of the year due to the Ramzan demand. Their products are sold in Chennai, Kolkata, Bihar, Uttar Pradesh, Assam and even in Sri Lanka. “This time, I am stuck with products worth lakhs of rupees. With no income, weavers are finding it difficult to run their families. Most of them normally get an income of ₹20,000 a month, and those who procure products from them and sell the items in bulk get around ₹50,000 a month,” he said. K. Prakasam, who has been working as a weaver for 32 years, said he had three children, and his family was just about managing. “We don’t even have enough money for food. Sometimes, our children go hungry, and it pains me to see them asking for more. We are not used to asking around for help, and others don’t have money to spare either,” he said. A cash dole would help them be free of hunger this month, he added. In the light of the lack of work, he said he was worried about his children’s education expenses for the coming month. Powerloom weavers say government assistance in the form of a dole, subsidies or facilitation of the sale of their products would go a long way in supporting their livelihood.Not just weavers, but even those who are engaged in dyeing the threads and making the spindles in Nagari, Rajapalayam and Kancheepuram are out of work and are looking to the government for relief.
Source: The Hindu
|
Item |
Price |
Unit |
Fluctuation |
Date |
|
PSF |
823.32 |
USD/Ton |
0% |
27-05-2020 |
|
VSF |
1240.24 |
USD/Ton |
0% |
27-05-2020 |
|
ASF |
1594.09 |
USD/Ton |
0% |
27-05-2020 |
|
Polyester POY |
760.26 |
USD/Ton |
-0.64% |
27-05-2020 |
|
Nylon FDY |
1961.96 |
USD/Ton |
0% |
27-05-2020 |
|
40D Spandex |
3993.99 |
USD/Ton |
0% |
27-05-2020 |
|
Nylon POY |
5157.15 |
USD/Ton |
0% |
27-05-2020 |
|
Acrylic Top 3D |
994.99 |
USD/Ton |
0% |
27-05-2020 |
|
Polyester FDY |
1835.83 |
USD/Ton |
0.77% |
27-05-2020 |
|
Nylon DTY |
1737.74 |
USD/Ton |
0% |
27-05-2020 |
|
Viscose Long Filament |
980.98 |
USD/Ton |
0% |
27-05-2020 |
|
Polyester DTY |
2270.27 |
USD/Ton |
0.62% |
27-05-2020 |
|
30S Spun Rayon Yarn |
1723.72 |
USD/Ton |
0% |
27-05-2020 |
|
32S Polyester Yarn |
1387.39 |
USD/Ton |
1.02% |
27-05-2020 |
|
45S T/C Yarn |
2116.11 |
USD/Ton |
0.67% |
27-05-2020 |
|
40S Rayon Yarn |
1555.55 |
USD/Ton |
0% |
27-05-2020 |
|
T/R Yarn 65/35 32S |
2004.00 |
USD/Ton |
0% |
27-05-2020 |
|
45S Polyester Yarn |
1891.89 |
USD/Ton |
0% |
27-05-2020 |
|
T/C Yarn 65/35 32S |
1639.64 |
USD/Ton |
0% |
27-05-2020 |
|
10S Denim Fabric |
1.12 |
USD/Meter |
0% |
27-05-2020 |
|
32S Twill Fabric |
0.64 |
USD/Meter |
0% |
27-05-2020 |
|
40S Combed Poplin |
0.93 |
USD/Meter |
0.76% |
27-05-2020 |
|
30S Rayon Fabric |
0.48 |
USD/Meter |
0% |
27-05-2020 |
|
45S T/C Fabric |
0.63 |
USD/Meter |
0% |
27-05-2020 |
Source: Global Textiles
Note: The above prices are Chinese Price (1 CNY = 0.14014 USD dtd. 27/05/2020). The prices given above are as quoted from Global Textiles.com. SRTEPC is not responsible for the correctness of the same.
COVID-19 pandemic has caused an unprecedented disturbance on social, political and economic structures all over the world. World leading economies have been brought to an almost complete halt. International Monetary Fund (IMF) has warned of a recession that is expected to be as bad or worse as that experienced during the global financial crisis of 2008. Measures that have been put in place by countries to mitigate the spread of Coronavirus include lockdown that has brought global business to its knees. As the spread of Coronavirus is picking up speed, countries not only need to prepare strategies to combat COVID-19 but also effectively plan for life after the virus. IMF has already suggested that one of the measures to fight against COVID-19 must include a plan for recovery that will reduce potential scarring effects of the pandemic through policy action. Economic recovery after this fatal disease is only possible by 2021, as predicted during an emergency meeting by G-20 nations to develop strategies for combating the effects of COVID-19. Most nations have already been hit by a recession that has seen close to 80 countries requesting financial help from the IMF. Kenya has so far been granted a total of Sh84.6 billion, 5.3 billion in April (used in the production of sanitizers, protective gear for medical workers and scaling up bed capacity for Coronavirus patients) and an additional Sh79.3 billion in May to help fight COVID-19. Various sectors have already experienced a strain in both demand and supply due to the broken global supply chain caused by the virus. The health sector is one of such sectors that has been most hit. Rising demand, panic buying, misuse and hoarding of personal protective equipment (PPE) has seen a disruption in worldwide supply. This has prompted the World Health Organization (WHO) to appeal to governments and industry to increase the manufacture of PPE by 40 per cent. The government of Kenya through the Kenya Fashion Council and Kenya Association of Manufacturers recently sent out an appeal to local textile and apparel industry players to provide information on their production capacities to make PPEs such as face masks, scrubs, surgical gowns, headgear, footwear, and gloves. Through the cabinet secretary Ministry of Trade and Industry, the government disclosed that the Kenyan textile industry has risen up to the task and is currently able to produce as many masks as required including PPEs. It is estimated that material in stock among local manufacturers as of April 3 was sufficient to make approximately 60 million masks. This, therefore, demonstrates the importance of the textile industry in healthcare. It also shows the potential of existing local textile industries considering that most of these textiles were being imported before the pandemic. The textile and apparel industry remains among the most labor-intensive manufacturing industries with geographically disperse production that rapidly adapts to market-driven changes. International Labor Organization (ILO) identifies it as having the potential for providing millions of employment opportunities especially to women, therefore significantly contributing to the economic and social development of a country. It was one of the leading manufacturing sectors in Kenya both by employment and size after independence. The success of the textile industry was pegged on government policy then that ensured backward integration of textile mills. The government assisted cooperative societies’ buy ginneries, fixed producer prices, controlled marketing margins and invested heavily in textile mills. Imposing 100 per cent duty on imported textile products also protected the local textile industry. During this time, the local textile industry had an average production capacity of close to 70 percent. In the late 1980’s, new government policies made it difficult for the country’s textile industries to operate competitively on the international stage. Around this time, massive dumping of used clothes (mitumba) and liberalization of the Kenyan economy undermined competitiveness and growth prospects of the textile and apparel sector leading to a reduction in production by about 50 per cent. During the development of policies to support the textile industry, the government needs to provide tailored support and incentives that prioritize technological upgrading, workforce development and backward linkage. Kenya apparel and textile industry report published in 2016 estimates that there are about 52 textiles mills, with only 15 that are currently operational at 45 percent of total capacity. This is occasioned by outdated technology and a lack of skilled labor. High equipment cost and low financial capabilities to expand for textile firms and raw material producers is also a major bottleneck. Existing incentives need to be reviewed, their effectiveness measured and tailored to suit different stakeholders. Government institutions that support the growth of the textile industry need to be facilitated to ensure university-industry linkages are strengthened to meet the demands of the sector. Financial and technical support should be provided for domestic manufacturers. The government also needs to take advantage of Global trends favorable to the textile industry in Kenya, such as partnering with stakeholders with programs that seek to address key challenges in the textile and apparel sector especially in Africa. The government through relevant state departments needs to determine the sub-sector of the textile value chain with the most activity and investigate reasons why other sub-sectors are lagging behind for the overall growth of the entire value chain. Apart from the development of policies, a review of policies to align them with current developments and constraints locally, regionally, and globally needs to be undertaken regularly. These policies should be performance-based to enable measurement of their effects on the Kenyan textile and apparel sector. For example, measures such as the ban on importation of used clothes and shoes by Kenya Bureau of Standards (KEBS) in March to mitigate against the spread of Coronavirus need to be considered long-term to enable the country to promote local textile production. Plans and projects set out by the government need to be adequately facilitated, monitored and evaluated to ensure they achieve the intended outcome. For example, the Kenya textile and clothing value chain roadmap of 2016-2020 needs to be thoroughly reviewed to elucidate key achievements, constraints, and ways forward to guide the next phase of planning. As the government plans for life after this pandemic, it is important that they hasten the revamping of textile and apparel industries in Kenya, a manufacturing sector that is currently playing a key role in the fight against COVID-19 and is core in the governments Big 4 Agenda.
Source: The Star
Nine Line Apparel has partnered with Gerber and Top Value Fabric to develop several types of protective masks to ensure the health and safety of millions. Nine Line Apparel is an American lifestyle brand founded by patriots for patriots. Gerber delivers industry-leading software and automation solutions for apparel and industrial customers. When the COVID-19 pandemic began and caused a global shortage of PPE, Nine Line Apparel stayed true to their core values and immediately jumped in to protect the nation’s heroes by producing several types of face coverings, including a 100 per cent reusable, medical grade mask of medical grade TPE. The mask comes with a ten pack of replacement filters to ensure breathable, comfortable and effective protection, according to Gerber.
Nine Line contacted Gerber to assist them in finding a state-of-the-art facility that would allow them to produce quickly and efficiently. After learning about Nine Line’s needs such as fabric width, roll size, quantity, and packaging requirements, Gerber connected them with Integrated Textile Solutions. By leveraging two multi-ply GERBERcutters and a multi-ply GERBERspreader at the Integrated Textile Solutions facility, Nine Line is able to produce 2,000 masks and 100,000 replacement filters per day with the capacity to produce up to five million masks and 50 million filters in one month. “We are so proud to support our customers in every way possible as they develop creative and innovative solutions to the current PPE shortage. Nine Line Apparel is working tirelessly to ensure everyone has access to effective protective equipment that they can be sure is going to keep them safe,” Pete Doscas, VP and general manager Americas of Gerber said. “The only way we’re going to get through this pandemic is if everyone works together and we are so lucky to have such an amazing network. Gerber has been incredibly helpful throughout this entire process by helping us find a facility to produce at and connecting us with our partners,” Tyler Merritt, CEO of Nine Line Apparel said. In addition to the reusable masks, Nine Line is also working with a fellow US manufacturer to provide consumers with a one-size-fits-all mask at cost. For each mask sold, Nine Line will be donating a mask to a frontline worker in need.
Source: Fibre2Fashion
Sateri the largest producer of viscose fibre, has commenced production of lyocell fibre in Rizhao, Shandong, China. In collaboration with Asia Symbol, a producer of pulp and packaging board, the new 20,000 ton per annum production line will broaden Sateri’s portfolio of high quality fibre products and bolster lyocell supply to textile & non-woven markets. “Lyocell is not only a higher value product but also an eco-friendly fibre that is bio-based and minimises chemical use and emissions. Sateri’s investment in lyocell is very much aligned with the aim for technical and product upgrading for China’s textile industry,” Duan Xiaoping, deputy president of China National Textile and Apparel Council (CNTAC) and president of the China Chemical Fibres Association (CCFA), said in a press release. A natural and biodegradable fibre, Sateri’s lyocell is made from wood pulp sourced from sustainable plantations. It is manufactured using closed-loop technology, requiring minimal chemical input during the production process, and utilising an organic solvent that can be almost fully recovered and recycled. Lyocell is used to produce high quality textiles and personal hygiene materials. Textiles made from lyocell possess high tenacity and bright lustre, and share similar qualities with textiles made from viscose – soft and silky with good drape, breathability, and absorption. “The in-house development of lyocell is part of Sateri’s pursuit of innovation. We have worked intensively on developing this in recent years,” Allen Zhang, president of Sateri, said. While we may be the world’s largest viscose producer, we are not wedded to any single technology or process for fibre production. We are steadfast in our commitment to innovation and continuous improvement even in the face of global health and economic challenges currently confronting us.” Sateri is part of the RGE group of companies which has committed to investing $200 million to advance next-generation textile fibre innovation and technology. In March this year, Sateri achieved a breakthrough in commercial production of viscose using recycled textile waste.
Source: Fibre2Fashion
Modishchey Creations is producing reusable face masks, a new fashion line that is using indigenous banana fiber woven textile. The Department of Trade and Industry (DTI) of Davao del Norte introduced this idea to Gleizl Joy Cabahug Soo of Modishchey Creations as part of the office’s assistance to the company to sustain its business operation and to provide employment amid the constraints brought by the current situation. DTI Regional Operations Group (ROG) Undersecretary Blesila Lantayona has been dynamic and responsive to the needs of the sector equipping them to venture into opportunities fit in the pandemic crisis. The banana fiber “musa,” the scientific name of banana, is the main material of the textile produced by the Davao del Norte’s Indigenous People (IP) women weavers as well as the prisoners or people deprived of liberty (PDLs). These banana fiber woven textiles are the output of DTI’s initiative last year, the training on banana fiber-weaving among the IPs and the prisoners. DTI has noted the primary aim of this project, which is to promote sustainable livelihood for the IPs especially among the prisoners who have no means of providing for their families. Within a short period after its introduction to the market on May 8, 2020, a total of 60 pieces were already sold. Aside from this, Soo received an order of 1,000 pieces from Visayas and as far as the United States. Soo’s new product line has initially provided jobs to seven tailors and 20 weavers. It is also expected to expand and generate more income for them as the “musa” fabric is getting more market attention. Meanwhile, DTI-Davao del Norte is committed to continue its support to the project, also helps the banana fiber production sustainable through the Department’s Shared Service Facility (SSF) program.
Source: Business MB
