The court on Tuesday said face masks and alcohol-based sanitisers are now easily available, and hence there is no need to regulate their supplies. “Rate of tax cannot be challenged in a court of law unless it is abundantly consecratory in nature. In the facts of the present case, nothing has been argued out about how the present rate of GST is conscatory in law,” the judgement said. The Delhi High Court has dismissed a public interest litigation seeking classification of face masks and alcohol-based sanitisers as essential commodities and reduction of goods and services tax (GST) on the latter to 12% or 5%. The court on Tuesday said face masks and alcohol-based sanitisers are now easily available, and hence there is no need to regulate their supplies. “We see no reason to issue mandamus and direct the respondents to extend the notification dated 13th March, 2020 or to include the masks and sanitisers as ‘essential commodities’ under the Essential Commodities Act, 1955,” Chief Justice Prateek Jalan said in the judgement. The GST on alcohol-based sanitisers is currently 18%. “Rate of tax cannot be challenged in a court of law unless it is abundantly consecratory in nature. In the facts of the present case, nothing has been argued out about how the present rate of GST is consecratory in law,” the judgement said. The court also noted that the government has removed face masks and alcohol-based sanitisers from under the essential commodities category and is not regulating their prices anymore. Face masks and alcohol-based sanitisers were included under the Essential Commodities Act in March after the coronavirus outbreak. The notification was in force till June 30. The government had issued a similar directive on regulating prices of face masks and alcohol based sanitisers, also in March, but decided not to continue with it, as per a July 1 notification, the court said in the order. The government, represented by Additional Solicitor General Chetan Sharma, however, said the government will monitor the situation carefully and take remedial action, if required. The court also dismissed the contention that in the absence of regulation, manufacturers and traders may take advantage of the situation. It termed it as “conjecture” and said regulation cannot be based on it.
Source: Economic Times
The two sides have been trying to thrash out a trade package with limited scope with the long-term aim of a free trade agreement (FTA) since last year, amid a plethora of unresolved trade issues. US-India trade negotiations will continue to be challenging and are likely to get delayed due to the Covid-19 pandemic, said Moody's Investors Service. The two sides have been trying to thrash out a trade package with limited scope with the long-term aim of a free trade agreement (FTA) since last year, amid a plethora of unresolved trade issues. Delay will be seen in other global trade negotiations as well, including phase two of the US-China agreement, European Union trade talks with the US and Britain, Regional Comprehensive Economic Partnership (RCEP) in Asia and African Continental Free Trade Area (AfCFTA) trade talks
Source: Economic Times
The commerce ministry has initiated a review to see whether there is a need for continuation of existing anti-dumping duty imposed on the import of certain auto components from China. Local company Bharat Forge Ltd has lodged a complaint with the ministry's investigation arm the Directorate General of Trade Remedies for the review of the duties on imports of front axle beam and steering knuckles, used in heavy and medium commercial vehicles, from China. Bharat Forge Ltd has requested for continuation of the anti-dumping duty imposed on the product coming from China. According to a notification of the directorate, the applicant has alleged likelihood of continuation or recurrence of dumping of the goods from China and consequent injury to the domestic industry. April 12, 2010 imposed the duty for five years. The duty was again extended for another five years in October 2015 after the first sunset review. The current anti-dumping duties are valid up to October 20, 2020. It has said that there is "sufficient prima facie evidence" that the normal value of the goods in China is higher than the ex-factory export price, "indicating, prima facie, that the subject goods are being dumped into the Indian market by the exporters" from China. "For the purpose of this investigation, China is the subject country...The period of investigation will be from 1st April, 2019 to 31st March, 2020. The injury investigation period will cover the periods 1st April 2016-31 st March 2019," it added. Countries initiate anti-dumping probes to check if domestic industry has been hurt because of a surge in below-cost imports. As a counter-measure, they impose duties under the multilateral WTO regime.
Source: Business Standard
New Delhi: The Goods and Services Tax (GST) Council will hold its next meeting on August 27, where it is likely to discuss critical issues of compensation to states and market borrowing for meeting the gap in compensation, following a legal opinion. The Council is also likely to take up the attorney general’s view that the Council can decide on raising funds from the market for compensating states, in case of revenue shortfall, and may also ask states to raise funds on their own. People aware of the development said that the meeting will be solely held for resolving the burning issue, which has had many states seeking compensation payments due for the ongoing financial year from the Centre. “This meeting will be on compensation issues, for all other issues, another meeting will be held next month,” said one of the people, asking not to be named. The 42nd meeting of the Council will take place on September 19, via video conferencing, another person said. States are likely to propose additional measures to raise funds such as bringing more products such as tobacco and cigarettes, and other goods used predominantly by the rich under the compensation cess ambit. Raising the rates for compensation cess from present levels to factor in inflation and restoration of wrongly diverted integrated GST for 2017-18 are among other measures that may be discussed. States have previously suggested that the Council should borrow and loan to states, because borrowing for states will attract higher rates. As per an SBI Research report, states have already borrowed over 50% more from the markets for the ongoing financial year than the amounts borrowed in the previous financial year. Compensation to states has to be paid over a five-year transition period—starting July 1, 2017 when GST was rolled out— for any potential loss in revenue due to implementation of the tax. Compensation is paid from the GST Compensation Fund through cess imposed on certain items. Increasing the period of payment to states beyond ve years may also be discussed to meet the shortfall. For 2019-20, the Centre has paid Rs 1.65 lakh crore as compensation to states. However, due to the impact of Covid-19 on the tax revenue, it may not be able to meet the requisite levels of compensation to states; the government told a parliamentary panel.
Source: Economic Times
Lucknow: In yet another step to boost foreign investment in the state, the UP MSME department and Indian Ambassador to France, Jawed Ashraf, have agreed to set up a working group to explore the possibility of joining hands in sectors like defence/aerospace, textile, footwear industry and skill development. MSME minister Sidharth Nath Singh interacted with Ashraf via video conference on Wednesday and highlighted the initiatives taken by the state government in easing regulations to promote investments. Singh said the pandemic had provided the state an opportunity to relocate disrupted supply chains. “There is a huge opportunity to increase percentage potential of exports from India and UP to France. A large land parcel has been earmarked for maintenance, repair and overhaul (MRO) near the Jewar Airport in Greater Noida which can provide investment opportunities to French companies,” he said. Additional chief secretary (MSME and export promotion) Navneet Sehgal explained the state government’s policies for promotion of investments. “UP has excellent policies and incentives, and this is a great opportunity to promote investments in the state and exports out of the state to various countries,” he said. He added that the state’s connectivity, investment policies and upcoming infrastructure would make UP an attractive investment hub. Ashraf said UP was the first state to approach France for promotion of investments and exports and said the state was successful in changing its image over recent years. He indicated that in the aftermath of Covid-19 pandemic, French companies located abroad were either looking to return to France or finding an alternative to China. “France is the gateway to the European Union market and can be an attractive opportunity for Uttar Pradesh,” he said.
Source: Times of India
Even as India has iterated that Atmanirbhar Bharat and ‘vocal for local’ do not mean blanket isolation from the world, its policies at home regarding increase in import duties have become a cause of concern for big and small industry. “Certain raw materials are not available in India, certain technologies have very large economies of scale. So one should not aim at 100 per cent self-sufficiency in everything,” says R.C. Bhargava, chairman of Maruti Suzuki. But the point of caution is that what India produces must be globally competitive, both in quality and cost. “Manufacturing products that are not of high quality or cost-effective aren’t in the country’s interest,” says Bhargava. Some media reports suggest India may be considering further raising of import duties on some 300 Chinese products. Anil Bhardwaj, secretary-general, Federation of Indian Micro Small and Medium Enterprises, says: “In principle, our association does not endorse banning items. Trade is a very complex issue. Tinkering with trade will have unintended consequences. Unless there’s an emergency, such decisions should be avoided.” He adds that when it comes to e-commerce platforms importing certain items—items that India can produce, such as plastic buckets and mugs we are getting even those from China. Such imports, Bhardwaj feels, should be discouraged, but only after a thorough assessment. India’s steel ministry has sought an increase in import duties on finished steel products to 15 per cent, from the prevailing range of 7.5-12.5 per cent, citing a threat from Chinese imports and excess global capacity. However, owners of small businesses say such a move could spell disaster for the competitiveness of the manufacturing sector and give the big steel companies, which dominate the steel industry, an opportunity to increase prices. Since steel is a major component of industrialisation, this could have a ripple effect. Recently, the Directorate General of Foreign Trade imposed restrictions on importing nine categories of colour TV sets, including LCDs. Two years ago, Prime Minister Narendra Modi, while addressing global business and political leaders at the World Economic Forum in Davos, had said: “Climate change, terrorism and the backlash against globalisation are the three most significant challenges to civilisation as we know it.” But that was then. The world is a lot different from what it was even a few months ago. India's efforts to attract companies from around the world for its 'Make in India' programme have been ongoing, at least in terms of posturing. The economic realities triggered by Covid now have inspired its ‘Atmanirbhar’ pitch. In the 2020 Union budget, the government announced several measures to lower imports and address India’s growing trade deficit. The budget had increased import tariffs and removed exemptions to give domestic production a push and boost MSMEs (micro, small and medium enterprises). Taxes on imports of items, including kitchenware, fans and small electrical appliances, were doubled to 20 per cent. Simultaneously, the levy on furniture, including seats, lamps and mattresses, was raised to 25 per cent from 20 per cent. Economists feel India’s trade deficit is as much a consequence of stagnating exports as of too many imports. On the ground, the MSMEs rely heavily on imports for their finished products. The reasons for imports vary—from ensuring higher efficiency to better quality to merely the unavailability of specific components locally. As the rhetoric, backed by policy interventions, to become protectionist grows, businesses argue that the focus should be on ease of compliances and regulations. According to an analysis by TeamLease Services, MSMEs need to adhere to 364 compliances a year—that’s one a day. Of these, 194 compliances are labour-related. Kiran Mazumdar Shaw, chairperson of Biocon, recommends that India use Covid-19 as an opportunity to introspect, create a single-window system and do away with the stifling regulations. For long, businesses have argued that the focus should be on ease of compliances and regulations. However, with a global disruption of supply chains due to Covid and India’s heightened tensions with China, companies are exploring alternative sources. For instance, Japan and South Korea are in the reckoning as alternative sources for lithium batteries and other technical components. Businesses are also working on building alternative supply chains with partners in the Far East, Europe and the US. According to industry associations, the cement industry has proposed import duty on cement and clinker. Textile companies want rules of origin to be changed so that China cannot push its products into India through Bangladesh. The Indian government needs to do a balancing act as it works with businesses to find alternative supply chains to China and talks about building a self-reliant India. Blanket protectionism is not the path forward. The government needs to introspect on how it does business and nurtures intellectual capital; it should also gauge sector-wise dependence on imports. For instance, the pharmaceutical sector has said that raising import duty on chemicals from China could erode the Indian pharma sector's cost competitiveness. Never mind that scores of Indian app developers have rejoiced in the wake of the ban on over 50 Chinese apps in the country, including the popular TikTok.
Source: Times of India
Mumbai: India's GDP is likely to contract by 20 per cent during the rst quarter of the current scal on account of the COVID-19 pandemic-induced disruptions, Care Ratings said. The Central Statistics Oice (CSO) will release the gross domestic product (GDP) data for the rst quarter of FY21 on August 31, which is expected to statistically mirror the adverse impact of the pandemic led lockdown on economic growth. "Notwithstanding the fact that considerable uncertainty prevails regarding the quarterly economic performance, taking cognizance of the adverse impact of lockdown we are pegging the real GDP growth at (-) 20 per cent YoY for Q1 FY21," the rating agency said in a report. The agency said disruptions caused by the countrywide lockdown crippled most economic and commercial activities across the country as has been depicted by various high frequency indicators slipping into red during these months. Although the government had exempted certain select activities pertaining to agriculture, banking including NBFCs and HFCs, construction activities in rural areas from lockdown restrictions, these activities have remained muted due to labour shortages and other operational issues. It said gross value added (GVA) is expected to have contracted by nearly 19.9 per cent in Q1 FY21, led by broad based contraction across sectors, barring agriculture and public expenditure. Low tax collections weighed on GDP, dragging down the growth further, the report noted Among the eight sectors under the broad categorisation of GVA, two sectors namely -- agriculture, forestry and shing and public administration; defence and other services -- are expected to register positive growth rates, while others are expected to de-grow in Q1 FY21, the report pointed out. It said the industry is likely to witness a steep de-growth of 35.9 per cent year-on-year in the June quarter. Services sector may contract by 16.8 per cent, but increase in government expenditure will provide modest support, the report said. Increase in spending on public administration by the government following announcement of stimulus measures is expected to drive growth in the sector in Q1 FY21, it said. On demand side, the rating agency said investment scenario has been dwindling with lower capacity utilization (below 70 per cent). Private sector consumption remained below par as a side eect of lockdown. Exports have contracted by a considerable 37 per cent in Q1 FY21 due to muted demand in global markets and trade restrictions imposed by certain countries due to the pandemic. Tax collections were also hit as aggregate GST collections in Q1 FY21 were 41 per cent lower at Rs 1.85 lakh crore as compared with Q1 FY20 on account of restrictions on movements of goods and muted demand due to lockdown, it added.
Source: Economic Times
The report is based on interviews with business, public sector and citizen leaders, sectoral analysis, and a country-wide survey. By removing frictions exposed by the Covid-19 crisis and using this ‘transformative’ moment to fast-track key activities over the next three years, India can reach its ‘full potential’ growth rate of 9%, consultancy firm PwC India said in a report. “If we can increase our average growth rate to 9% from the pre-Covid-19 five-year average of 6.8%, and by deepening and widening our economy make the growth more inclusive, we can create three additional Indias with a cumulative additional GDP of $10 trillion, in a decade post-recovery,” according PwC’s ‘Full Potential Revival & Growth – Charting India’s medium term journey’ report. The report is based on interviews with business, public sector and citizen leaders, sectoral analysis, and a country-wide survey. It concludes that over a three-year time frame by removing frictions that have been highlighted, and through joint action, a fast revival and subsequent higher growth can take place. The report analyses nine key sectors that make up 75% of our pre-pandemic GDP and MSME segment. It said investing in physical infrastructure, in the semi-urban and rural centres, will give an immediate targeted boost to the economy and create widespread employment. Activating the over `100-lakh-crore spending earmarked under the National Infrastructure Pipeline is critical for building infrastructure in the next five years. Digital support can engage more people, make connections to markets, and make supply chains and finance more effective. The focus should be more on improving digital infrastructure, not merely in metropolitan and urban centres where internet penetration is well developed, but also in smaller towns and districts, the report noted. Improved healthcare and pharmaceuticals will likely have their own ‘Y2K’ moment, it said. The Indian IT industry benefitted from the threat posed to computers by the 2000 date change. Indian pharma companies that are already supplying generics to a significant portion of the global population can leverage key shifts resulting from the pandemic to upgrade, become self-reliant and support both an Indian and a global health revival process. MSMEs ecosystem creation will be vital for employment in the revival and growth phase given their employment-generating potential, it added. “As we reconstruct our economy, it is imperative that we remove frictions that have hampered growth historically. While each sector must grow on its own, increasing flow of data and convergence between sectors and across institutions will be key,” said Shashank Tripathi, government strategy, PwC India.
Source: Financial Express
To preserve its traditions and jobs, India must stop textile-related imports from China with Covid-19 causing a dramatic rupture, and with Chinese aggression at the border, India must reassess its approach to trade, especially the import of textiles and other artefacts of religious use from China. This is essential to preserve India’s traditional strengths and ensure it doesn’t fall into the same trap as other countries, which have lost their livelihoods and indigenous traditions. In India, textiles comprise the second-largest sector after agriculture. Its potential for creating wealth is enormous. India has a living tradition of handicrafts, practised on an everyday basis. All India’s crafts are inherited through guilds which have a long history, and this is their inherent intellectual property. This specialisation offers employment to an estimated 16 million people in the country. When the pandemic hit Europe, Italy, Spain and France were among the countries affected. But think of another element they had in common. The relentless growth of fashion empires, and their diversification into billion-dollar licensing arrangements made fashion in Europe very powerful, early on in the game. They began to dictate the terms of the luxury goods trade through very effective marketing, and new products. These companies dominated global markets. They soon started producing their prime goods elsewhere, and to better their margins, began hiring Chinese tailors, off the books, and gave them licence to manufacture copies of their garments, cheaper and faster. In the process, they were willing to teach them the secrets of family-owned businesses and enhance their capability to produce couture garments — sometimes giving them the patterns to do so to buy them at a fraction of the cost of European manufactured goods. The Chinese learned the craft swiftly and, very soon, they were a force to be recognised, as they used “Made in France” labels on much cheaper copies. In Italy, the hub of luxury good manufacturers, too, their numbers proliferated and they displaced traditional Italian family enterprises. One of the major production areas, incidentally, is in and around the city of Wuhan, a textile hub of low-end garments for the world. The Western world, in its pursuit for cheap merchandise, has still not recognised that selling their know-how created adverse long-term consequences, and perhaps not just in fashion. This story has repeated itself elsewhere. Uzbekistan is at the heart of a complex nomadic and oasis culture in Central Asia and is a significant stretch of the famous Silk Road route. The cities down the historic road were the most prolific in their textile language and produce, as caravans, traded their textile ikats and embroideries with the world down the ages. A few years ago, I went there on a trip to study their traditional ikats. The Fergana valley, the birth place of Babar, was supposed to be the richest in terms of traditional crafts. But, barring a few exceptions, the genius of textiles that I was looking for was elusive. The women, unfortunately, were clad in velvet and synthetic kaftans, looking quite alien from their surroundings. They were all wearing kaftans, manufactured and printed in China, using copies of patterns from traditional ikats. The only place today where genuine textiles still exist is India. And that is the issue. India is as prone to losing its textile crafts to another country as the others. It only needs to look at its past. The British brought down India’s share in textile exports to the world from 25% to 2%, taking over the production of Indian-inspired cloth from the 18th to the 20th century. By a miracle, Indian textiles have survived through the efforts of revivalists in the post-Independence era, such as Kamala Devi Chattopdhyaya and Pupul Jayakar. We are already seeing Chinese inroads in the Benaras sari markets, where there are jacquard copies of the Benaras-bordered tanchoi saris selling in the market for a song. China is predatory. It has always been known for its sericulture, as India has been for its unusual silk yarns, which were hand twisted and woven with a great deal of expertise to keep the saris pliable, soft and easy to pleat. I have done wardrobes for the Miss Universe and Miss World pageants for many years. I always would propose they wear the Benaras sari to a function, but gave up as I could not find a sari which draped softly and looked the way the Ravi Verma saris looked in his paintings. I then studied Benaras silk saris for a few years in an effort to find out what had changed the saris radically from exotic, sexily-contoured unstitched garments to the present, stiff totally unwearable, saris which balloon out. It was incredible to discover that the reason was that the original yarns from Bhagalpur which were hand-spun, with no twist, called paat-baana, without which the beautiful masterpieces of Benaras could not have been woven, had been substituted by Chinese yarns. This changed the structure totally and made them unattractive to wear. The tragedy of the silence of the looms of Varanasi is that people continue to weave this imported yarn because it is cheap. Benaras can survive and sustain itself adequately if we revert to the original yarns. We have indigenous mulberry silks from Karnataka, which are softer, finer, lighter and allow for more pliability when woven and have a wonderful texture. Organic ahimsa silks from the terai regions, India’s tussars and mogas, are an intrinsic part of our heritage. If even one family in India owns one good Benaras sari in their wardrobe, which a young bride would like to possess, the city will have no problem keeping its weavers employed. China dumped silk yarn in India at prices a fraction of their costs initially and then slowly raised the prices to set up a lucrative business. The business, unfortunately, is run by middlemen, ignorant of the fact that they are producing goods which are unwearable and at the same time enhancing dependence on Chinese silk yarn. A ban on imports of this yarn will perhaps affect production for a while, but we have the resilience in our textile techniques and as a country that taught the world the beauty of producing textiles, can easily find alternatives. Covid-19 is a wake-up call. India must preserve its textiles. The beauty of the peacock must not succumb to the fire of the dragon.
Source: Hindustan Times
Skills development ministry has so far received data of 2,79,736 shortlisted candidates from 99 districts.A total of 35 sectors have been proposed by the districts across the six states with more than 450 job roles identified. Having identified demand for migrant workers from construction, apparels, electronics and hardware, agriculture and telecom, the skills development ministry will soon invite applications from training providers to provide demand based training under the Garib Kalyan Rojgar Abhiyan, nearly two months after the scheme was launched. “NSDC shall be oating the expression of interest (EOI) to invite applications from eligible and interested training providers to apply for demand-based job role training targets with the objective of imparting short term training to the migrantworkers in applicable districts out of the total 116 districts,” skills ministry said in its internal note. According to the note, the top ve sectors witnessing maximum demand under the short term training program and the recognition of prior learning (RPL) are construction, apparels, electronics and hardware, agriculture and telecom. In the category of job roles, most of the demand is for the roles of mason general, self employed tailor, sewing machine operator, electrician and quality seed grower, the note said. Skills development ministry has so far received data of 2,79,736 shortlisted candidates from 99 districts.A total of 35 sectors have been proposed by the districts across the six states with more than 450 job roles identified. The Garib Kalyan Rojgar Abhiyan (GKRA) is a 125-day abhiyan, launched by the PM on June 20, 2020, with a mission to address the challenges faced by returnee migrant workers. As on June 2, 2020 an estimated 67 lakhs migrant workers were recorded to have returned in the 116 districts identied across six states, Uttar Pradesh, Bihar, Rajasthan, Odisha, Madhya Pradesh and Jharkhand, under the scheme due to impact of COVID 19 and nationwide lockdown. Government has set a target of imparting training to three lakh migrant workers with 1.5 lakh each under the short-term training and the recognition of prior learning programme of the skills ministry.
Source: Economic Times
Surat: There seems to be some good news for the Surtis as Indonesia has shown its interest for starting a direct flight to the city. Consul general of the Republic of Indonesia, Agus P Saptono, had visited the Southern Gujarat Chamber of Commerce and Industry (SGCCI) along with the Indonesian delegation on Wednesday. Saptono stated that Indonesia is keen to start the flight service to Surat for the promotion of trade, commerce and tourism in the next couple of months. “The government of Indonesia has given a go ahead for starting direct flight connectivity to Mumbai and Delhi once the international flight restrictions are lifted in India. We have proposed to connect Indonesia with Surat for the business and tourism purpose,” said Saptono. “In the educational field, both the countries have developed scholarship programme to help students in Indonesia and India under the education exchange programme. There is a huge opportunity for the textile traders in Surat for getting business opportunities in Indonesia,” added Saptono. “This was first time post-lockdown that any foreign delegation has visited the SGCCI. The consul general of Indonesia visited Surat and he has proposed to start a direct flight between Indonesia and Surat. At present, Surat has a lone international flight to Sharjah. The consul general will be speaking with the Indonesian government for starting the flight services,” said Dinesh Navadiya, president of SGCCI. “Bali in Indonesia is not only the tourism destination for Surti travellers, but it is also the business destination for the entrepreneurs from the textile and diamond sectors. We have urged the Indonesian representatives for starting direct flight connectivity between Surat and Bali to facilitate the business and leisure travellers from the city,” said Rohit Mehta, president of Indo-Thai chamber of MSME.
Source: Times of India
The recent announcement by the Ministry of Defence to indigenise production of 101 items and thereby substitute imports is very laudable. The monthly Index of Industrial Production (IIP) report for June states that growth of the industrial segments in the recent months, in the grip of pandemic, need not be compared with those before the outbreak as the production of all units has suffered due to the prolonged lockdown, disappearance of market demand, diversion of government funds towards health, medical relief with not much of investible resources left after meeting the unprecedented level of social protection needed for millions of our countrymen. Government revenue took a severe beating with declining collection of GST, other taxes and levies. Among the industry sectors, the FMCGs, the two-wheelers and tractors are exhibiting increasing sales, which indicate a rise in rural demand with agricultural income getting a boost from the government’s recent farmer-friendly announcements and rise in food prices. On the other hand, thrusts on Atmanirbhar Bharat, Vocal for Local and Make in India programmes provide a signal that the government is keen to pull up manufacturing from the labyrinth of poor productivity, lacklustre growth and little contribution to employment and income generation. The Indian manufacturing sector, to recall a historical perspective, lost its prominence after the third Five-Year Plan, when it was felt that industrial orientation, specifically the policies helping the heavy industry, need to be changed towards the primary sector to resolve the recurring food problems in the country. Subsequently, India experienced spectacular growth in the services sector, the IT and ITES, and received global recognition with record receipt of foreign exchange through exports of knowledge and skill in software technology. The manufacturing sector all along played a second fiddle, but was recognised by the government to enhance its share in the GDP from 16-17% to 25% by 2022, which remained a dream in the last few years till the recent thrust of enhancing the finished goods production capability to cater to domestic and global demands while discouraging export of raw materials by converting them into finished goods. This came as a major plank of the manufacturing policy. Undoubtedly, this is what is presently required to take Indian manufacturing sector to a glorious journey ahead. Some of the recent announcements indicate the government’s desire to handhold the manufacturing sector. India imports annually around 6-7 million tonne of engineering goods that contain a good number of special alloys, SS grades and high-grade carbon steel. If these steel grades can be made available indigenously, the vendors manufacturing these goods would be encouraged to set up facilities in India and can participate in the Global Value Chain (GVC). The ability to supply these goods in the international market would increase the total requirement of the special grades steel (alloy/SS and carbon) and incentivise local steel producers to manufacture these grades. It is essential to draw up a clear policy that would require an inter-departmental team manned by domain experts, policy planners and industry representatives to implement this policy in right earnest within a time schedule. Many localised efforts are already on. However, the import substitution of such a massive scale urgently needs cohesive policy guidelines, covering a number of industries in various segments under manufacturing like food processing, textile, printing, chemical products, fabricated metals, electrical equipment, vehicle and other transport manufacturing, machinery and equipment etc. The recent announcement by the Ministry of Defence to indigenise production of 101 items and thereby substitute imports is very laudable. It would create business opportunities worth of Rs 4 lakh crore in the next five-seven years. The major items like artillery guns, assault rifles, light combat helicopters, armoured vehicles for the army, submarines for the navy, light combat aircraft and others for the air force would face an import embargo. Around 69 different items would have no imports beyond December 2020, 11 items beyond December 2021, four items beyond December 2022, eight items beyond December 2023, eight items beyond Dec ember 2024 and one item beyond December 2025. In addition, the Defence Acquisition Council has decided to acquire 106 basic Trainer Aircraft from HAL worth of Rs 8722 crore as a step for higher indigenisation of defence imports. BEML, GRSE are developing new facilities to serve the defence infrastructure. It is needless to add that Indian manufacturing sector is predominated by MSME sector for whom the government has endeavoured to increase liquidity by empowering NBFCs, loan restructuring and moratorium and easy availability of credit. The implementation of these measures must be smooth to encourage the sector to participate whole heartedly in the Atmanirbhar revolution. The current expansion of the definition of MSME sector would help more production capacities to come up. It is imperative that many big players can identify competent small industry partners and associate them to produce engineering goods hitherto imported, based on supply assurance of required steel grades. Import substitution always offers a tremendous challenge of matching the quality and price competitiveness. Being a part of Global Value Chain provides relief to achieve economic scale of operation and offer competitive prices. Thus, the process of GVC in each component and sector must start immediately. The government wings, Niti Aayog and other professional agencies, can initiate sector and component specific studies on huge potential of the global market. It is observed that issuance of global tender for procurement of goods and services has made limited efforts towards indigenisation. The call for a self-reliant India would be successful if only Indian manufacturing is able to pull up its strings in all fronts.
Source: Financial Express
India, Japan and Australia have begun discussions on launching a trilateral Supply Chain Resilience Initiative (SCRI) to reduce dependency on China, necessitated by Beijing's aggressive political and military behaviour. The initiative, first proposed by Japan, is now taking shape, ET has learnt. Dates are being worked out to hold the first meeting of the commerce and trade ministers of the three countries by next week. ET's Pranab Dhal Samanta has more.
Source: Economic Times
A pan-India fake invoice racket involving transactions of about Rs 434 crore by 23 firms has been busted by the Directorate General of GST Intelligence (DGGI), Nagpur, an official release said on Wednesday. Rs 78.13 crore of fraudulent input tax credit was availed by those involved in the racket, it said. Simultaneous searches were conducted by the officers of DGGI, Nagpur Zonal Unit at number of places in the city, which led to further searches at Jalandhar, Sonepat and New Delhi, it said. Probe revealed that 23 firms across India, from Tamil Nadu to New Delhi, were involved in issuance of fake invoices to get fraudulent 'Input Tax Credit' without supply of any goods, it said. These firms engaged only in paper transactions of goods, ranging from iron and steel products, insulated wires, plastic articles to copper/aluminum waste. No actual movement of goods took place, the release said. “The declared places of business of these entities were residences and the supporting documents uploaded by these entities had been forged. “The modus operandi...was to obtain GST registrations on the basis of documents of unrelated individuals and carry out bogus transactions," the release said. The value of fake transactions was found to be Rs 434 crore, while Rs 78.13 crore of fraudulent input tax credit was availed, it said, adding that further probe was on.
Source: Business Standard
|
Item |
Price |
Unit |
Fluctuation |
Date |
|
PSF |
794.75 |
USD/Ton |
-0.45% |
20-08-2020 |
|
VSF |
1221.03 |
USD/Ton |
0.72% |
20-08-2020 |
|
ASF |
1706.55 |
USD/Ton |
0% |
20-08-2020 |
|
Polyester POY |
756.46 |
USD/Ton |
-0.85% |
20-08-2020 |
|
Nylon FDY |
1921.85 |
USD/Ton |
0% |
20-08-2020 |
|
40D Spandex |
4017.10 |
USD/Ton |
0% |
20-08-2020 |
|
Nylon POY |
1878.50 |
USD/Ton |
0% |
20-08-2020 |
|
Acrylic Top 3D |
939.25 |
USD/Ton |
0% |
20-08-2020 |
|
Polyester FDY |
2174.73 |
USD/Ton |
-0.33% |
20-08-2020 |
|
Nylon DTY |
5202.00 |
USD/Ton |
0% |
20-08-2020 |
|
Viscose Long Filament |
963.82 |
USD/Ton |
-0.45% |
20-08-2020 |
|
Polyester DTY |
1813.48 |
USD/Ton |
-0.40% |
20-08-2020 |
|
30S Spun Rayon Yarn |
1667.53 |
USD/Ton |
0% |
20-08-2020 |
|
32S Polyester Yarn |
1351.08 |
USD/Ton |
0% |
20-08-2020 |
|
45S T/C Yarn |
2174.73 |
USD/Ton |
0% |
20-08-2020 |
|
40S Rayon Yarn |
1676.20 |
USD/Ton |
0% |
20-08-2020 |
|
T/R Yarn 65/35 32S |
1531.70 |
USD/Ton |
0.95% |
20-08-2020 |
|
45S Polyester Yarn |
2051.90 |
USD/Ton |
0% |
20-08-2020 |
|
T/C Yarn 65/35 32S |
1849.60 |
USD/Ton |
0% |
20-08-2020 |
|
10S Denim Fabric |
1.14 |
USD/Meter |
0% |
20-08-2020 |
|
32S Twill Fabric |
0.64 |
USD/Meter |
0% |
20-08-2020 |
|
40S Combed Poplin |
0.93 |
USD/Meter |
0% |
20-08-2020 |
|
30S Rayon Fabric |
0.47 |
USD/Meter |
0% |
20-08-2020 |
Source: Global Textiles
Note: The above prices are Chinese Price (1 CNY = 0.14450 USD dtd. 20/08/2020). The prices given above are as quoted from Global Textiles.com. SRTEPC is not responsible for the correctness of the same.
The Nordic countries’ first industrial end-of-life textile refinement plant will open in Paimio in 2021. Rester Oy, which is developing the plant in Paimio, recycles companies’ end-of-life textiles, and Lounais-Suomen Jätehuolto Oy (LSJH), which will hire a production area at the same facility, processes households’ end-of-life textiles. The plant will process 12,000 tonnes of end-of-life textiles every year, which represents about 10% of Finland’s textile waste. About 100 million kilograms of textile waste are generated annually in Finland alone. Reusing this material could reduce the textile industry’s carbon footprint and significantly reduce the use of natural resources. Rester Oy and LSJH will drive the textile sector towards a circular economy and begin processing textile waste as an industrial raw material. The Nordic countries’ first industrial end-of-textile refinement plant will open in Paimio in 2021. The 3,000-squaremetre plant is being developed by Rester Oy, which recycles companies’ end-of-life textiles and industrial waste materials. LSJH, which processes households’ end-of-life textiles on its production line, will hire part of the plant. The future plant will be able to process 12,000 tonnes of end-of-life textiles annually, which represents about 10% of Finland’s textile waste. Both production lines produce recycled fibre, which can be used for various industrial applications, including yarn and fabric, insulating materials for construction and shipping industries, acoustic panels, composites, non-woven and filter materials, and other technical textiles, such as geotextiles.
Source: Recycling Magazine
The sale of yarn and fabrics of export-oriented spinning and weaving mills is on the rise thanks to a higher inflow of work orders from international clothing retailers. This has put the country's primary textile sector, which incurred losses of more than Tk 20,000 crore for the economic whiplash by the coronavirus pandemic, on the path of a quick recovery although prices remain below expectations, said millers. Both textile millers and garment exporters say more and more of the production capacity of their factories was coming to use for the higher inflow of work orders from retailers. On the other hand, normalcy has returned to the supply chain with China, the main sourcing destination for Bangladesh's textile and garment-related raw materials. As a result, the business of textile production and garment exports are witnessing improvements fast, according to industry insiders. "We have just completed our marketing for next seasons," said Faisal Samad, vicepresident of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), adding that the inflow of work orders is also better than that of the previous three months. A good number of buyers have been reissuing work orders they had previously cancelled and placing new ones as the retailers in the EU and US have opened up their stores. The shipment of the new work orders will start from November, Samad said. His views were echoed by A Matin Chowdhury, managing director of Malek Spinning Mills, a leading spinner and garment exporter. Sales from his spinning mills had increased compared to what was in the last few months but the prices are not what he was expecting. This is because of cheaper yarn from other countries that have been flooding the domestic markets of late, although there was no such smuggling of yarn over the last few months because of the coronavirus pandemic. As a result, the sale of fabrics from local mills for the domestic markets had witnessed a surge. But as normalcy is being restored in business, cheap yarn from neighbouring countries has started pouring in, he said. American buyers are increasingly placing more work orders, presumably because their sales have increased with the reopening of stores, he said. A $600 payment to American citizens under an unemployment scheme by the US government has helped to create new demand for goods in their markets. This is why the sales of clothing items in the US markets have improved a lot. So the shipment of clothing items to the American markets is also increasing a lot from the country, Chowdhury added. A Narayanganj-based yarn merchant, seeking anonymity, also blamed the invasion of cheap yarn from neighbouring countries for giving rise to challenges at his factory. Moreover, some unscrupulous traders were selling yarn imported under the bonded warehouse facility in the domestic markets. "We received better prices from the sales of yarn in January, February and March of this year," the yarn merchant told The Daily Star over the phone. He went on to urge the National Board of Revenue to monitor the use of bond facilities such that they were not abused. "The government should also improve patrolling at the bordering areas so that the invasion of cheap yarn is stopped for the sake of the domestic textile industry." The local entrepreneurs have already invested more than $8 billion in the primary textile sector and have been acting as the main player in supplying raw materials for the exportoriented garment industry by reducing lead time substantially. Sometimes, the prices of even smuggled clothing items are less than that of the local yarn, which is absurd in business. The Bangladesh Trade and Tariff Commission should also set out a proper valuation of local and imported clothing items to discourage the smuggling, he added. Demand has been increasing a lot from the buyers for yarn and fabrics but the prices are not at the satisfactory level, said Mohammad Ali Khokon, president of Bangladesh Textile Mills Association (BTMA), the platform for spinners and weavers. Some of the mills are now running at 70 per cent capacity, while the others are operating at 65 per cent and some less than 60 per cent as the demand for yarn and fabrics has been increasing. Before the pandemic, he used to sell yarn worth $55 lakh on an average every month but during the pandemic, the sales from his mill were negligible. However, with the reopening of the economy, he sold yarn worth $23 lakh last month and another $12 lakh this month. "Maybe this month's sale will be low, but I am hopeful that the sales will grow from next month as I am receiving a lot of response from my buyers," Khokon added. The widely consumed 30 carded yarn sold between $2.50 to $2.53 per kilogram in the local markets in July and August, said Monsoor Ahmed, secretary to the BTMA. Before the pandemic, the same 30 carded yarn had sold between $2.80 to $2.90 per kg in February and March, he said. Although prices of cotton, the raw material of yarn, has declined in the international markets, local spinners cannot take advantage of this as the cotton they had was imported before the pandemic at 75 cents to 80 cents per pound, Ahmed said. Currently cotton is selling between 64 cents and 65 cents in the futures markets in New York.
Source: The Daily Star
The Department of Trade, Industry and Competition (the dtic) are today hosting a South Africa-Ghana Trade and Investment webinar. Business people in South Africa and Ghana are set to engage in trade and investment talks that get underway today. The Department of Trade, Industry and Competition (the dtic) are today hosting a South Africa-Ghana Trade and Investment webinar. The aim of the two-day webinar is to reinvigorate and rekindle bilateral economic relations between the two countries post the COVID-19 pandemic. Speaking ahead of Tuesday's session, Deputy Minister Fikile Majola said the webinar will afford South African and Ghanaian business people the chance to exchange ideas and information on how to increase trade and investment between the two countries. "It is important that we continue the conversation and interaction between South African businesspeople and their counterparts from other African countries, despite the Coronavirus pandemic and the lockdown. "This is to ensure that we continue to work with our businesses to identify new opportunities that we can explore in order to increase bilateral trade and investment between South Africa and other African countries," said the Deputy Minister. Majola said the session is also part of South Africa's economic strategy for Africa, which is premised on the development integration approach focusing on advancing the priorities for Africa as set out in the country's Re-imagined Industrialisation Strategy, and the Integrated National Export Strategy (INES). "This is also part of South Africa's commitment to increasing intra-African trade and investment in line with the spirit and letter of the African Continental Free Trade Agreement (AfCFTA)." Bilateral trade between South Africa and Ghana was on an upward growth trajectory before the outbreak of the COVID-19 pandemic and subsequent lockdown in South Africa. Two-way trade between the two countries increased considerably from almost R4 billion in 2014 to R14 billion in 2019. The webinar which will conclude on Wednesday is being held under the theme "Developing Afrocentric Solutions and Forging Partnership in Response to Covid-19". Companies operating in agro-processing and agricultural equipment, pharmaceutical, mining, rail, textile, energy and infrastructure will participate in the sessions.
Source: Dev Discourse
