CITI-NEWS LETTER...MP has potential to double its share in country's exports: FIEO Once ignored...
Transcript of CITI-NEWS LETTER...MP has potential to double its share in country's exports: FIEO Once ignored...
Cotlook A Index - Cents/lb (Change from previous day)
03-04-2019 86.90 (Unch)
03-04-2018 90.20
03-04-2017 87.40
New York Cotton Futures (Cents/lb) As on 05.04.2019 (Change from
previous day)
May 2019 77.24 (+0.08)
July 2019 78.25 (+0.48)
Dec 2019 76.32 (+0.07)
05th April
2019
Cotton crunch: Maharashtra ginning units working at 40% capacity
India’s export basket shows a welcome tilt to higher value-added manufacturing,
tech driven items: RBI
District-level ‘ease of doing business’ ranking to be launched soon: Suresh Prabhu
New government to announce the proposed industrial policy: Suresh Prabhu
RBI cuts repo rate to 6%, lowers GDP forecast to 7.2%
Cotton and Yarn Futures
ZCE - Daily Data (Change from previous day)
MCX (Change from previous day)
Apr 2019 22130 (+230)
Cotton 16110 (+15) May 2019 22400 (+210)
Yarn 24805 (0) June 2019 22670 (+220)
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2 CITI-NEWS LETTER
-------------------------------------------------------------------------------------- Cotton crunch: Maharashtra ginning units working at 40% capacity
India’s export basket shows a welcome tilt to higher value-added
manufacturing, tech driven items: RBI
District-level ‘ease of doing business’ ranking to be launched soon: Suresh
Prabhu
New government to announce the proposed industrial policy: Suresh Prabhu
FTA is key to resolving India-US trade disputes, says advocacy group
RBI cuts repo rate to 6%, lowers GDP forecast to 7.2%
Workshop on e-Sanchit portal
Government tightens check against Chinese e-comm players escaping taxes
Why textile cluster near Surat incurring heavy losses daily
MP has potential to double its share in country's exports: FIEO
Once ignored India’s handloom becoming latest trend among millennials
How handloom sarees are weaving a storm in Bengaluru
----------------------------------------------------------------------------------
Chinese companies ink agreement to invest in textile sector
Experts urge Kenya to diversify export to help cut trade deficit
Epic Group to enter India; revolutionise garment manufacturing industry
Italian textile machinery to come together in Frankfurt
A.T.E. launches automation division for textile mills
----------------------------------------------------------------------------------
NATIONAL
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GLOBAL
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NATIONAL:
Cotton crunch: Maharashtra ginning units working at 40% capacity
(Source: Nanda Kasabe, Financial Express, April 05, 2019)
The Cotton Association of India, the apex trade body, had pegged the crop size at 328 lakh
bales for the year. Some 2 lakh bales have been exported to Bangladesh. Another 40 lakh
bales have been exported to Vietnam, China and Bangladesh, among others. Another 5-6
lakh bales are expected to be exported, according to reports.
With cotton prices currently in the range of `6,100-6,200 per quintal and stock in short
supply, ginning units in Maharashtra are finding it difficult to source it for their units.
The 150-odd units in Khandesh — one of the major cotton processing regions in the state
— are working at 30-40% capacity.
Pradeep Jain, president, Khandesh Cotton Gin/Press Owners Association, said there was
very little cotton left in the market and what was left is of poor quality with reduction in
weight. Arrivals were meagre and barely 15% stock might be left with farmers in Khandesh
region, he said.
According to market reports, some 55-60 lakh bales are still with farmers across the
country. According to industry estimates, there could be a shortage of some 32-33 lakh
bales this season. Jain said normally, the units in Khandesh region have the capacity to
process some 30-35 lakh bales during a season.
In December 2018, the units were running at 50% capacity on weak arrivals. Prices are
firming up and likely to remain in this trend, with stock in short supply due to drought.
The cotton inventory with the government agencies is also reported to be lesser by 30%
as compared to the previous season. Currently, farmers in Gujarat, Maharashtra,
Telangana, Odisha, Tamil Nadu and Madhya Pradesh still have some stock left. Farmers
in Haryana, Punjab and Rajasthan have little or no cotton with them.
Maharashtra processes about 80 lakh bales annually. Around 60,000 labourers are
working in these units and the majority of these are located in Marathwada region. The
state has a capacity of producing 1 crore bales. Significantly, the Cotton Corporation of
India (CCI) has already commenced the sale of the commodity procured by the agency in
the current marketing season under the government Minimum Support Price
procurement programme. There has been a sharp decline in market arrivals in recent
weeks.
Since early March, prices have strengthened by `3,000 a candy (356 kg each) to `44,500
and spot prices are in `45,000-45,500 per candy. After 26% year-on-year increase in
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2018-19, the MSP for medium-staple variety of cotton is at `5,150 per quintal and that for
long staple at `5,450. After conversion, the MSP equivalent price comes at `41,000-
42,000 per candy.
CCI could purchase only 10.7 lakh bales under the MSP scheme. Over 70% of the
procurement has been from Telangana and Maharashtra. Market arrivals till April 1 stood
at 254 lakh bales of 170 kg each.
The Cotton Association of India, the apex trade body, had pegged the crop size at 328 lakh
bales for the year. Some 2 lakh bales have been exported to Bangladesh. Another 40 lakh
bales have been exported to Vietnam, China and Bangladesh, among others. Another 5-6
lakh bales are expected to be exported, according to reports.
Home
India’s export basket shows a welcome tilt to higher value-added
manufacturing, tech driven items: RBI
(Source: Shariq Khan, Economic Times, April 04, 2019)
India is now exporting more of higher value-added manufacturing and
technology-driven items, says RBI’s MPS.
The changing colour of India’s export basket is giving a cue to the country’s new trade
dynamics. One interesting observation noted in the Reserve Bank of India (RBI) first
bimonthly monetary policy statement (MPS) 2018-19, relates to a shift in the country’s
exports basket -- a clear swing away from primary and traditional low value-added
exports to higher value-added manufacturing and technology-driven items.
A comparison of key items of exports between 2011-12 and 2018-19 (April-February)
reveals that there has been a significant increase in the shares of chemical and related
products and engineering goods, and such a shift has imparted a measure of resilience to
export demand in a hostile international trading environment, says RBI’s policy
statement issued today.
This comes as India’s exports face tepid growth. RBI says against the backdrop of slowing
global trade and commerce-inhibiting trade tensions, India’s merchandise exports (y-o-
y) moderated during Q2 and Q3 of 2018-19 relative to Q1.
Attributing the shift to nothing but a slowdown noticed during the last 5-6 months in
chemical items’ exports from China to its major trading partners, Satish Wagh, Chairman,
Chemexcil, says, “In recent months, major Chinese trading partners including the EU has
raised environment-related concerns (with it) and this development has worked in favour
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of Indian exporters and India is now being regarded as a stable and quality destination
for chemical-based items.”
Highlighting that China’s administration has also tightened norms in the wake of the
explosion at Chemical factory last month in Yancheng city, in the eastern Jiangsu
province that resulted in the death of more than 75 people, Wagh added that the blast -
one of the worst industrial accidents in China in recent times, has also shaken the
confidence of Chinese suppliers significantly.
During Q2, the slowdown in Indian exports was accentuated by a decline in shipments of
readymade garments, rice and marine products; in Q3, exports growth was pulled down
by gems & jewellery, engineering goods, and meat, dairy & poultry. It is evident that
export slowdown is broad-based in nature and impacts most of India’s traditionally
strong export segments.
Ajay Sahai Sahai, Director General & CEO, Federation of Indian Export Organisations
(FIEO), however, believes that for all export profiles of a developing country like India,
an equal thrust on both the sunrise sectors and traditional ones should be the way
forward.
“We need to acknowledge that it’s the traditional sectors that help in creating jobs. Going
forward, for securing foreign exchange for the country, neither we can solely depend on
traditional sectors, nor solely on sunrise and knowledge-based sectors,” said Sahai,
adding that while knowledge-based segments such as IT, Pharma, automobile etc, should
be encouraged, a thrust on traditional domains such as gems and jewellery, textiles and
leather etc, needs to be equally followed.
Riding high on the back of the current dispensation’s policy initiatives such as hikes in
the interest equalisation rates for micro, small and medium enterprises (MSME) exports
from 3 per cent to 5 per cent as well as measures announced in the Agriculture Export
Policy (2018), the RBI hopes it will provide a further fillip to exports.
“Under services, software exports rode on the upside of a significant improvement in
export revenues of major IT companies in Q3. Optimistic forecasts of global IT spending
in the next two years also portend well for the outlook of software exports. Lower outgo
under income account also helped in containing CAD in Q3,” said RBI.
Home
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District-level ‘ease of doing business’ ranking to be launched soon: Suresh
Prabhu
(Source: The Hindu. April 04, 2019)
Minister stresses on need to attract FDI
Commerce and Industry Minister Suresh Prabhu said district level ‘ease of doing business’
ranking will soon be launched to ensure that smaller towns and districts become more
business-friendly and have broad-based growth.
Back-ground work for ranking districts has already started and a committee has been
formed for this purpose, Prabhu said at an interaction at the CII Annual Session 2019 on
Thursday.
The Minister also the proposed new industrial policy, that targets an annual Foreign
Direct Investment inflow of $100 billion, has been finalised and is likely to be announced
by the new government.
Emphasising the need to attract more FDI that declined in the April-December 2018
period by 7 per cent to $ 33.5 billion, the Minister said India needs to have a strategy to
attract overseas investments in both greenfield and brownfield projects. “We should
target those companies that can invest because they have surplus and at the same time,
we must have a matching sectoral strategy where in inbound investments can be
absorbed,” he said.
The Minister said India’s exports of goods and services would touch $540 billion and
overall trade deficit was likely to decline by about $10 billion for the first time. The
country’s goods exports grew 8.85 per cent to $298.47 billion during the April-February
period of the current financial year.
On Free Trade Agreements (FTAs) being negotiated by the country, Prabhu said the
government would interact with the industry more on the issue.
Home
New government to announce the proposed industrial policy: Suresh Prabhu
(Source: Economic Times, April 04, 2019)
Though the ministry has sent the final proposal of the policy to the Cabinet, but it was not
taken up for consideration.
Commerce and Industry Minister Suresh Prabhu Thursday said the proposed new
industrial policy has been finalised and the new government would announce that.
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"We have finalised the industry policy. I am sure that the new government will announce
that soon," Prabhu said at CII's Annual session 2019.
Though the ministry has sent the final proposal of the policy to the Cabinet, but it was not
taken up for consideration.
It aims at promoting emerging sectors and modernising existing industries. It will also
look to reduce regulatory hurdles, cut paper work and support emerging and new sectors.
The ministry has planned to set up an elaborate machinery including a steering
committee for effective implementation of the policy.
This will be the third industrial policy after the ones released in 1956 and 1991. It will
replace the industrial policy of 1991 which was prepared in the backdrop of the balance of
payment crisis.
Talking about increasing foreign direct investment (FDI) into India, he emphasised on
the need to have a proper strategy to attract overseas inflows in greenfield as well as
brownfield projects.
"We are trying to bring in more FDI. FDI will come either in greenfield area or it could be
through acquisition. So, we must prepare a strategy on both... We should target those
companies that can invest because they have investable surplus and same time, we must
have a matching sectoral strategy wherein inbound investments can be absorbed," he
said.
FDI in India during April-December 2018 declined by 7 per cent to USD 33.5 billion.
He also listed out steps which the ministry has taken to boost exports and further improve
ease of doing business particularly as district level.
He said that in 2018-19, India's exports of goods and services would touch about USD 540
billion.
The country's exports grew 8.85 per cent to USD 298.47 billion during the April-February
period of 2018-19.
Further, he added that thousands of start-ups have been recognised by the ministry and
it is also working on removing hurdles in their path to promote budding entrepreneurs.
Talking about free trade agreements (FTAs), Prabhu said the ministry is in the process of
preparing a template to negotiate future agreements by involving all concerned
stakeholders.
Industry has raised concern that FTAs which was signed by India is not benefitting
domestic players.
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On a question that ease of doing business is not visible on the ground, the minister said
they are working at district levels to improve business environment.
Home
FTA is key to resolving India-US trade disputes, says advocacy group
(Source: Economic Times, April 04, 2019)
An India-US FTA would be able to address the Indian concerns over import
of Chinese goods.
A free trade agreement between India and the US is a key to resolving their trade disputes
as it will cover biggest irritants in ties including tariffs and mobility of Indian
professionals, a top American business advocacy group has said.
Observing that the relationship between India and the US in the last five years has
progressed tremendously, the advocacy group said the interest of the two largest
democracies of the world are much more aligned than ever.
"The challenge which we have is that we need to work out a trade deal. And when you look
forward next five years, I believe India should sign an FTA with the US. Once you have
FTA, all this issue of tariffs will go away," Mukesh Aghi, president and CEO of the US-
India Strategic Partnership Forum (USISPF), told PTI.
An India-US FTA, he observed, would be able to address the Indian concerns over import
of Chinese goods.
"Because we are concerned about Chinese goods coming to India, that under WTO
guidelines, everything with the FTA, India can put as much tariff, it has no impact on US
tariffs itself,” he said.
"The FTA once signed should have what I call mobility on H-1B. You give FTA partner
more exception," he said adding that going forward the two countries need to be creative
and bold and drive this relationship on a path where there's much more better
understanding on the trade side.
The H-1B visa programme, popular among Indian technology professionals, allows
foreign workers to obtain temporary authorisation to work and stay in the US.
While there has not been much talks between the two countries on this issue, Aghi said
he believes that FTA is key to resolving the trade disputes.
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"Within the FTA, you can have BIT (bilateral investment treaty) also. It covers a lot of
stuff. It takes the biggest irritants in the relationship out,” he said.
"It provides mobility to Indian professionals who could come into US and work. It
provides almost zero tariff for US goods coming into India. I think this has to be a bold
move on part of the new government whoever comes in," Aghi said.
With India into an election mode, where the government of the day cannot take any major
policy decision due to the enforcement of the model code of conduct, Aghi said this would
be the recommendation of the USISPF to the new government to "be bold about it, start
discussion FTA with the US because for this president (Donald Trump) trade is the biggest
thing."
If the two countries are able to quickly put an FTA together, where it has impact on
mobility of professionals, it's a win-win situation, he asserted.
When asked if the two countries are on a collision course on trade and tariff issues, Aghi
said, "There is a danger, that the tail is going to start wagging the dog itself and we got to
avoid that."
"I also sincerely believed that there's enough maturity, we'll find a way to solve this issue
out, because at this stage India cannot afford to get into a trade collision with the US
neither can US. So, we have to find ways to short out these issues," Aghi said.
Observing that tariff is one aspect of the trade dispute.
Trump has repeatedly claimed that India is a "tariff king" and imposes "tremendously
high" tariffs on American products.
Steel tariff, Generalized System of Preferences (GSP) are issues, he said,
On March 5, the US decided to withdraw import duty benefits, which was in the range of
1- 6 per cent, under its GSP programme.
"I think, the e-commerce policy, the way it was handled is an issue. Data localization is a
challenge. We need to look at overall, a process which protects both countries' interest
and find a common ground to have a win win value proposition,” he said.
Responding to a question, Aghi said some of the policies coming from India in recent past
are protectionist in nature.
"It has to do either the election now or others. It doesn't help. For example, medical
devices. Yes, we put two price cap on them, but at the end, the consumer still paying the
same,” he said, adding that it still has not been solved.
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10 CITI-NEWS LETTER
"As we move forward next five years whoever comes in, should focus on a driving an FTA,
which should take a lot of this irritants out in the relationship,” said the USISPF head.
He refuted the impression in some quarters in India that that Indian policy is in reaction
to protectionist measures from the US.
While India has made lots of efforts in last five years, it has moved slightly towards being
more protectionist, Aghi said.
Home
RBI cuts repo rate to 6%, lowers GDP forecast to 7.2%
(Source: Manojit Saha, The Hindu, April 04, 2019)
Economy facing headwinds, need to spur private investment, says central bank
The monetary policy committee of the Reserve Bank of India (RBI) for the second
consecutive time cut the benchmark lending rate by 25 basis points to 6% on Thursday.
It cited concerns over growth as it lowered the GDP forecast to 7.2% for the current
financial year from 7.4% projected in the February policy.
The central bank said the output gap remained negative and the domestic economy was
facing headwinds, especially on the global front. (Output gap refers to the difference
between the actual output of the economy and its maximum potential.) “The need is to
strengthen domestic growth impulses by spurring private investment that has remained
sluggish,” it said. Four members of the committee voted for a rate cut, while RBI Deputy
Governor Viral Acharya and Chetan Ghate voted for status quo. The committee
maintained the neutral policy stance, which means interest rates can move in either
direction. “With the inflation outlook remaining benign, the RBI will address the
challenges to sustained growth of the economy while ensuring price stability on an
enduring basis,” Governor Shaktikanta Das said.
The RBI lowered its inflation forecast to 2.9%-3% from 3.2%-3.4% for the first half of the
current financial year and 3.5-3.8% in the second half, assuming a normal monsoon.
“Domestic GDP growth is also estimated to slow in 2018-19, with high frequency
indicators suggesting slackening of urban and rural demand as well as investment
activity,” he said.
Bond traders, however, were not impressed with the 25 bps rate cut as they were expecting
a higher quantum to address growth headwinds and deficit liquidity. The yield on the 10
year benchmark bond hardened from 7.27% to 7.35%.
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11 CITI-NEWS LETTER
“Markets were perhaps anticipating a relatively high degree of dovishness from the policy
statement which hasn’t materialised,” HDFC Bank said in a note to its clients.
Hoping for more
Economists said there is still scope for further rate reduction. “We expect another rate
cut, with June as our base case. An argument for the cut to be delayed to August is equally
strong if the RBI sees reason in factoring in the full-year budget due in July and awaits a
clearer picture on monsoon developments,” said Radhika Rao, Economist, DBS Bank. The
Governor expressed concern over monetary transmission, while noting banks have only
reduced lending rate by 10 bps after RBI reduced the policy rate by 25 bps in February.
“More needs to be done.”
The State Bank of India, the country’s largest lender, said the marginal cost of fund-based
lending rate (MCLR), which is the benchmark rate, can go down by 7-10 bps. “We have
already announced a framework that we will link some products with the policy rate. So
that transmission will happen through the linking that we have already announced,” P.K.
Gupta, managing director, SBI told The Hindu. “As we said whereever there is direct
linking (with repo rate) the full pass through will happen. And wherever the linking is
through MCLR, we believe 7-10 bps MCLR will go down. Our ALCO (asset-liability
committee) will meet and take a call,” Mr. Gupta said.
SBI had linked savings bank rate (for over ₹1 lakh deposit) and some short term loans
with repo rate, with effect from May 1. The current savings bank rate of 3.5% was linked
to a repo rate of 6.25%, so now with 25 reduction in the repo rate, savings bank rate (for
₹1 lakh) will become 3.25% from May 1.
Highlights
* Short-term lending rate (repo) reduced by 25 basis points to 6 per cent
* This is second back-to-back rate cut
* RBI maintains Neutral stance on the monetary policy
* Four out of six MPC members voted in favour of rate cut
* GDP growth projection lowered to 7.2 per cent for 2019-20
* RBI revises downward retail inflation estimate to 2.4 per cent in Q4 FY19.
* MPC notes output gap remains negative and domestic economy facing headwinds
Home
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12 CITI-NEWS LETTER
Workshop on e-Sanchit portal
(Source: The Hindu Business Line, April 04, 2019)
The Apparel Export Promotion Council, in its bid at educating the trade about the e-
Sanchit portal, organised a workshop in Tirupur recently. The speakers highlighted the
changes in procedures for import certificate from April 1. A Sakthivel, Vice-Chairman,
AEPC. said exporters would now be able to overcome unnecessary time delay as the
import certificate can be uploaded on the customs portal directly. With all customs related
works made completely online, exporters will be able to get it from anywhere in the
country. The Council plans to organise such workshops in all its offices.
Home
Government tightens check against Chinese e-comm players escaping taxes
(Source: Sachin Dave, Economic Times, April 05, 2019)
The government is now asking the post office and courier companies to
monitor shipments from China.
India has started a major crackdown on online purchases of goods from Chinese
ecommerce platforms that were escaping customs duty and goods and services tax, two
people with direct knowledge of the matter said. After shooting letters to the tax officers
and customs officers, the government is now asking the post office and courier companies
to monitor shipments from China.
“Up until now, customs department was asked to undertake strict action, now even post
office would be asked to scrutinise such purchases,” said a person aware of the
development. The Department for Promotion of Industry and Internal Trade (DPIIT)
through a written communication had directed that all ports across India to see if the
shipments were genuine gifts.
The government had stopped import of goods through Mumbai and is now looking to
start similar crackdown across India and other ports including Chennai and Kolkata, said
people aware of the development.
According to the people in the know, many Chinese e-commerce platforms were shipping
goods ordered by Indians to various cities claiming these were “gifts”. As per the domestic
laws, any gifts received by Indians up to Rs 5,000 don’t attract any taxes.
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13 CITI-NEWS LETTER
People in the know say that the Chinese retailers such as Club Factory, AliExpress and
Shein were allegedly taking undue advantage of the exemption from customs duties on
gifts of up to Rs 5,000.
“It is often brought to the notice that authorised registered couriers are outsourcing
activities without prior permission from or intimation to customs.. and without exercising
necessary due diligence and checks,” an official communication by customs department
reads.
“Investigations revealed that at its peak anywhere around 2,00,000 orders were placed
every day through Chinese e-commerce platforms in India which escaped any form of
taxes, which are otherwise applicable on imports. After a major crackdown, this has now
come down to around 1,20,000 orders per day but that too is high and the government
wants that all major ports across India intensify their checks to stop such practices,” said
a person with direct knowledge of the matter.
Compared to orders delivered by the Chinese e-commerce players, companies like
Flipkart and Amazon record an average of around 1 million shipments every day.
According to the government investigations most Chinese ecommerce platforms were
circumventing Indian taxes by claiming these purchases were “gifts” which are not taxable
as per domestic laws.
Recently, the government made it mandatory for all the Chinese e-commerce platforms
to register domestically. This could help bring them under the domestic laws, said both
the people quoted above.
Home
Why textile cluster near Surat incurring heavy losses daily
(Source: Nayan Dave, Financial Express, April 04, 2019)
Surat is the biggest manufacturer of mandap cloths in the country with more than 250
units manufacturing only mandap cloths. According to Sancheti, there are nearly 1,000
other units which are manufacturing mandap cloths as well as other fabrics.
One of the biggest textile clusters of India which had been developed near Surat is
incurring daily production loss of nearly 30% due to labour shortage. This is happening
when textile units are flooded with orders due to peak summer season. Annual turnover
of Surat-based textile units is pegged at `40,000 crore. All these units are heavily depend
on migrant labourers. Nearly half of the labour force have gone on a prolonged vacation
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14 CITI-NEWS LETTER
since Holi. Most of these labourers have not returned to work, citing reasons of marriage
season and Lok Sabha elections.
“Majority of migrant labourers are coming from Uttar Pradesh, Bihar, Odisha and
Rajasthan. Every year, they go to their natives during Holi and returned to work in 15-20
days. However, this year most of the labourers preferred to take a prolonged vacation in
wake of Lok Sabha elections and marriage season,” said Dev Kisan Mangani, chairman,
textile committee of South Gujarat Chamber of Commerce and Industry (SGCCI).
Textile units in Surat are flooded with orders of fabric, dress materials, sarees and home
furnishing due to peak marriage season and vacations, said Mangani, adding, “Most of
the textile units are short of 30% production due to labour shortfall. On an average, daily
minimum dispatch of textile from Surat to other cities is around `125 crore, but the
traders are hardly supplying `90 crore worth of textile goods.”
The industry is often plagued with labour absenteeism in case of natural calamities or
man-made disasters in the states from where migrant labourers are hailing, said
Mangani, adding that the permanent solution was to provide affordable housing to these
labourers in the vicinity of Surat instead of their respective villages under schemes like
Pradhan Mantri Aawas Yojana. “Such measues would ensure the labourers wouldn’t lose
their wages and at the same time textile industry would thrive.”
Mandap cloth manufacturers in Surat and its neigbouring places are also facing the
similar issue. Labourers have not returned to work and are on extended leave in wake of
polling in their respective areas, said Devkumar Sancheti, president of Surat Mandap
Cloth Association.
Surat is the biggest manufacturer of mandap cloths in the country with more than 250
units manufacturing only mandap cloths. According to Sancheti, there are nearly 1,000
other units which are manufacturing mandap cloths as well as other fabrics.
Surat’s textile cluster consist more than 6.50 lakh power looms, nearly 4.50 lakh process
houses and about 70,000 traders who adds value in terms of making dress material,
sareers and ready-made garments.
Home
MP has potential to double its share in country's exports: FIEO
(Source: SME Times, April 04, 2019)
Exporters' association FIEO has said that Madhya Pradesh has potential to double its
share in country's exports in next 5 years.
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15 CITI-NEWS LETTER
FIEO president Ganesh Kumar Gupta, President, FIEO along with DG & CEO and
Regional Chairman (WR) met Mr Kamal Nath, Chief Minister of Madhya Pradesh to
discuss about exports potential of the State and attract exports centric FDI in pharma,
auto components, machineries, textiles, processed agriculture products etc.
FIEO offered its assistance to help the State to increase its share from about 1.6% in
India's exports to over 3% in next 5 years.
Looking into the possibilities of augmenting exports to China and Iran of soyabean and
soyameal, non basmati rice, pharmaceuticals, technical textiles, FIEO Chief urged the
Chief Minister to lead a business delegation to China and Iran, which have huge demand
for such products.
Gupta also emphasised the need for identification of more products under GI and
marketing of such products through exclusive shops in the departure area of international
airports to start with Mumbai and Delhi.
FIEO also requested for inland freight subsidy for all products as the cost of carrying cargo
from MP to JNPT, in many cases works out to be more than overseas freight.
The Chief Minister asked FIEO to work more closely with the State to help it to
exponentially increase its exports.
Kamal Nath also assured that he will pro-actively look into the issue of freight subsidy
and GI products exclusive show rooms at international airports in India.
Home
Once ignored India’s handloom becoming latest trend among millennials
(Source: Udaipur Kiran, April 04, 2019)
Handloom weaving is largely decentralized, and weaving families are mainly from the
vulnerable and weaker sections of society, who weave for their household needs and also
contribute to the production in the textile sector. These weaving families are keeping alive
the legacy of traditional Indian craft of different regions. The level of artistry and intricacy
achieved in handloom fabrics is unparalleled and certain weaves/designs are still beyond
the scope of modern machines.
The handloom sector can meet every consumer need ranging from exquisite fabrics,
which take months to weave, to popular items for daily use. As per the 3rd Handloom
report carried out in 2009-10, more than 43 lakh people are engaged in weaving and allied
activities. Remarkably around 77 percent of adult weavers are women and only 23 percent
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16 CITI-NEWS LETTER
are men. Around 23.77 Lakhs looms of varied designs and construction are used by these
weavers. A total of 7200 million sq.mtrs of handloom textiles were produced in India
during 2014-15 and 2246 Crores of handlooms were exported.
In addition to being the 2nd largest employment provider in the unorganized sector (after
agriculture), the Indian handloom industry is also unique as a sector which employs over
75% women. In today’s India when young people from rural/semi-rural areas are
constantly tempted to desert their traditional vocations and migrate to urban areas for
employment, the handloom sector provides these weavers/artisans, the opportunity to
earn decent wages and at the same time preserve India’s beautiful weaving heritage.
Despite being such a large industry and more importantly where 75% of the artisans are
women, this section has not received the recognition which they deserve. There are few
E-Commerce platforms that are touching lives of more than 1000 weavers every month
in a mission to democratize access to fine Indian handlooms sourced from a plethora of
weaving clusters across the country.
Ethicus is one such company which is being widely appreciated for their contribution in
this sector. It is an online platform which only deals in organic garments. Ethicus is a
Farm to Fashion initiative of the husband and wife duo of Mani Chinnaswamy and
Vijayalakshmi Nachiar. It also has the distinction of being India’s first Organic &
Sustainable fashion brand. Established in 2009, it was launched with the aim to revive
the rich local hand weaving traditions of the area through Product Development & Design
Intervention.
Appachi Eco-Logic Cotton (P) Limited is the company behind the brand ‘Ethicus’ based
in Pollachi Tamil Nadu, India. It was established in 1946. The company has pioneered
India’s first Cotton Contract farming model and grows the finest Eco-logic Cotton in the
Country. The best thing about this company is that along with its products it also
promotes the artisan who has prepared the product. On every product, there is a label
which mentions the name of the artisan along with the pic of the person and how much
did it take to complete the product. Today, Ethicus weavers have gained a social status
where they are no longer considered as paid labourers but ‘’ARTISANS”. All the products
by this company are made from their own home grown cotton.
Now, Ethicus is coming to Delhi this week where they will be showcasing their beautiful
products in an exhibition. They have named the exhibition as ‘Crossroad’. They have
named it cross road because this season they took inspiration from the lines, angles &
blocks of the iconic ‘Madras Checks’ & the colours of the ‘Birds of the Anamalais &
Coimbatore’ to create a line of fresh colourful sarees with unique weaves and textures.
The exhibition is taking place on 5th and 6th April at Indi College, Hauz Khas. It is a
golden opportunity for Delhites to enjoy the top class products made from pure cotton
and colours.
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Digital platforms have the potential to innovate and scale up volumes of Indian handloom
products, both in the domestic and international markets. This has huge potential for the
Indian economy as it holds the key to providing large scale employment to over 4 million
weavers spread all over the country in rural & semi-rural areas. There are few E-
Commerce platforms that are touching lives of more than 1000 weavers every month in a
mission to democratize access to fine Indian handlooms sourced from a plethora of
weaving clusters across the country.
In the new Digital economy, top class digital platforms could be the ‘x-factor’ that will
catalyze the widespread usage and growth of traditional handlooms. And thus help in
weaving an alternate story for the Indian weaver.
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How handloom sarees are weaving a storm in Bengaluru
(Source: Apoorva Puranik, Economic Times, April 04, 2019)
The three-floor exhibition centre is draped in hues of yellow, red and white
A sea of indigo greets visitors walking into the Bangalore International Centre at Domlur.
Hanging loftily from the ceiling are beautiful blue handwoven sarees, a tribute to the art
of handloom. The three-floor exhibition centre is draped in hues of yellow, red and white,
with intricate threadwork like the Bengali jamdani and three shuttle weaves. The Registry
of Sarees — a citybased organisation enabling design and curatorial projects of handmade
textiles — in collaboration with textile curator Mayank Mansingh Kaul, has put on display
52 sarees from a collection of 108 designs, all part of a 2003 exhibition titled ‘Khadi – The
Fabric of Freedom.’ This time around, however, Kaul says, they wanted to refrain from
using the term khadi. “There’s a lot of difference in Gandhi’s idea of khadi and the khadi
we see today. It’s now become a government institution. It has become a high-end luxury
fabric and the art and history behind it seems to have faded into the background.”
The exhibition, open till April 6 in Bengaluru, recently travelled to Chirala, a small town
in Andhra Pradesh, famous for its handloom industry producing ikat weaves. It was
primarily for the weaving community. They set it up in a government school where more
than 80 weavers came together to study the fabric and techniques. It was more like a
workshop, Kaul says. “The weavers told us that the way we displayed the fabrics, it made
them feel like artists, not labourers.”
The second leg was at Coimbatore’s iconic Lakshmi Mills. “There, too, we got a good
response, but, interestingly, a lot of people who visited were upset that none of the fabric
was available to purchase,” Kaul says.
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18 CITI-NEWS LETTER
Efforts like these, Kaul says, are meant to facilitate the study of design and quality of
textiles, to reflect on their relevance today and for the future. Ask about region-specific
weaves and the efforts for their revival, Ally Matthan, the co-founder of the Registry of
Sarees, says reducing textiles to regions is detrimental, an opinion echoed by Kaul.
And why not, when the world of textiles is so fluid, like for example Kanchipuram designs
are being done on Benaras sarees, the Kota Doriya from Rajasthan has a GI tag from
Mysuru, Chanderi, a traditional weave from Madhya Pradesh, is being used on Benarasi
sarees.
“Why do you want to regionalise the art? We often get caught up with the personal
sentiment when it comes to sarees handed down from generations. But rarely do we think
about the product, the effort and skill put into it,” says Mathhan, whose #100saree pact a
few years ago created quite a wave on social media. A resource and study centre in Domlur
has been set up for this purpose. Apart from curatorial departments, the centre also
provides the environmental conditions necessary for the long-term preservation of these
fragile works of art and a research facility for the public. A library, too, is in the works.
“It’s all about democratisation of the handloom and building awareness. There is a lot of
misinformation about textiles out there. This needs to change,” Matthan says.
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19 CITI-NEWS LETTER
GLOBAL:
Chinese companies ink agreement to invest in textile sector
(Source: The Nation, April 04, 2019)
Recognising Pakistan’s potential as the world’s 4th largest cotton producer, Chinese
investors have signed a cooperation framework agreement with government of Punjab.
Chinese investors appreciated Pakistan’s textile and textile value addition sector and
shown interest in investing in the Punjab.
In this regard, a four party cooperation framework agreement was signed between China
Railway 20 Co. Pakistan (pvt) Limited, Shanghai Yuanyi Industry Company Limited, Pak-
China Investment Company Limited and Punjab Board of Investment and Trade (PBIT).
Representatives from China Railway 20 Co. Pakistan (Pvt) Limited, Shanghai Yuanyi
Industry Company Limited and Pak-China Investment Company Limited held a joint
meeting at the Punjab Board of Investment and Trade. The Minister for Industries,
Commerce and Investment, Mian Muhammad Aslam Iqbal, Chinese Consulate General
Long Dingbin and CEO PBIT, Jahanzeb Burana also participated in the joint meeting.
All participants in the meeting were briefed about the core functions of PBIT as an
investment promotion agency. Aslam Iqbal stated that the government resolves to
strengthen the economic bond between both countries in light of China Pakistan
Economic Corridor and Belt &Road Initiative. Participants of the meeting expressed a
mutual resolve to work together and take things forward in a positive manner.
Home
Experts urge Kenya to diversify export to help cut trade deficit
(Source: Mu Xuequan, Xinhua, April 05, 2019)
Kenyan experts on Thursday urged the government to diversify the country's export base
to help curb rising trade deficits which they said grew 1.2 percent in 2019.
The experts, from the Institute of Economic Affairs (IEA) and the Kenya Association of
Manufacturers (KAM), said the government could enhance its ability to widen sources of
revenue by increasing investment in a broad range of sectors.
"We remain constrained by the current export structure that relies on a few export
products and markets," said KAM research and fiscal policy manager Simon Githuku. "It
is time we diversified if we are to address the ballooning trade deficits."
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20 CITI-NEWS LETTER
Githuku told a forum in Nairobi that having a new export structure will mitigate adverse
effects of trade fluctuations.
According to latest World Bank statistics, the gap between imports and exports climbed
to 1.15 trillion shillings (10.15 billion U.S. dollars) in 2018, up from the previous year's
10.13 billion dollars.
"We... require a clear regulatory framework and workable incentive packages to condense
the trade deficits," Githuku said.
The trade deficit is denying the country an opportunity to create more jobs with local firms
losing out to foreign manufacturers in the long run, he said.
Joram Gicheru, an IEA associate, called on the government to give subsidies to local
producers of agricultural products to reduce the cost of production and improve volumes
and quality of the products.
"One of the ways out from this mess is by striving to double volumes of our three top
exports -- tea, coffee and horticulture -- and to do that it means we need to improve our
productivity," he said.
The answers to the deficits also depend on how the government positions its
manufacturing sector with a sharp focus on alternative products such as textile,
chemicals, machines, agro-processing, blue economy and leather, Gicheru said.
He called on policymakers to take advantage of the Africa Continental Free Trade Area
(AfCFTA) initiative, which offers African countries a great long-term opportunity to
address technical barriers to trade.
The agreement will increase intra-Africa trade as well as enabling Kenya and other African
countries to attract investment, he said, noting that the AfCFTA provides new export
opportunities for African products.
Once in place, the AfCFTA will cover a market of 1.2 billion people and a combined gross
domestic product (GDP) of some 3 trillion dollars.
"We must position ourselves strategically to reap from the regional pact, which aims to
establish a single market that will spur industrialization, infrastructural development,
economic diversification and trade," Gicheru said.
Fred Simiyu, who is in charge of international trade at the Ministry of Trade, said the
government will implement initiatives to add value to the free trade agreement.
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21 CITI-NEWS LETTER
Richard Kariuki, regional head of Governance Beta Healthcare International, urged the
government to offer favorable policies that make it easier for pharmaceutical and health
industries to operate smoothly.
"The government needs to give subsidies and come up with favorable tax policies on
medical equipment, capital expenditure and raw materials as well as honoring obligations
for health sector such as tax refunds, improved management as well as partnership with
private entities to foster a coherent framework for UHC," he said, referring to universal
health care.
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Epic Group to enter India; revolutionise garment manufacturing industry
(Source: Charu Lamba, Indian Retailing, April 04, 2019)
Hong Kong-based garment manufacturing company, Epic Group is planning to enter
India and set up its first manufacturing unit in Ranchi spread across the minimum built-
up area of around 20,000 sq. mt. to start with. The manufacturing unit in Ranchi is
equivalent to the smallest factory of the company in Bangladesh, the biggest
manufacturing hub for the Epic Group.
“We will start with a target unit of about 4,000 people which is a gradual ramp-up to be
achieved within the time frame of 24 months. Initially, we will start with an outlay of US$
20 million in the form of capex,” says Ranjan Mahtani, Chairman and Owner, Epic Group.
The brand is planning to source 90 percent of its raw material from India, with Mahtani
saying that they are already buying huge amounts of raw material from four – five
different suppliers in India.
How India Has an Edge
The brand is confident about establishing its business in India as it believes the country
has an edge over other nations.
“Compared to most of the countries we are in, India is more vertical as far as textiles are
concerned, so that should add more speed into our business. We still need to decide on
things like where fabric could be coming from – Ahmedabad or down South – and should
we manufacture in India itself versus how it’s being done right now – transported to these
foreign countries which are quiet far away,” says Mahtani.
Another reason, says Mahtani, that the company has decided to venture into India is the
value addition the country has to offer first in terms of embellishment and embroidery
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22 CITI-NEWS LETTER
abilities. “Aside from this, one very important reason for venturing into India is its
booming economy, which has There is a lot of government support and a lot of maturity
as far as financial institutions and services are concerned. This is the positive environment
that we are looking forward to working in,” he adds.
Also, with the way trends are changing and fashion is evolving, the brand is looking
forward to working with different skill-sets and believes that India will add to these skill-
sets and create a more versatile supply chain model.
HR Solutions
Epic Group believes that it is its moral and fundamental responsibility to provide workers,
staff and associates with a safe working place irrespective of where they are.
Mahtani says, “We provide day-care and medical facilities and we do not think that we
are doing anything extra for the employees. These are part and parcel of the facilities in
any part of the world. The kind of lighting and chairs that we provide, safety facilities –
electrical or within the building – we have brought in a certain standard of comfort for
our employees and we will continue improving on this. Our first priority is to provide a
safe place to our workers to work in.”
“Aside from this, the brand has a lot of incentive schemes where the worker is part of their
profitability. As workers get more efficient and start learning how to work on the
machines, they start getting more than their minimum cut and that is what has worked
for the brand so far,” he explains.
The brand usually employees more women than men. Explaining the reason behind this,
Mahtani says, “We do not recruit more women as a matter of choice. We do not
distinguish between male and female workers, but we have found that in a large number
of countries – for instance China, Vietnam, Bangladesh or Ethiopia – women are more
talented as far as tailoring is concerned. We believe in hiring the right people to do the
right job.”
Epic Group is also planning on changing the impression of high attrition rates in India.
“We will do what we have done in other countries. Some of our factories in Bangladesh
the attrition rate is 1 percent whereas other factories have 5-6 percent. Our employees feel
more secure, they feel that they are the part of the company, they know what the
leadership is and what is their ultimate goal. There is nothing fancy about bringing
attrition down, it is all about getting the basics right,” says Mahtani.
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23 CITI-NEWS LETTER
Innovation – The Key to Success
The manufacturing facilities of the brand are designed to combine traditional skills and
modern technology to serve a new era and evolving consumers. The brand is planning to
replicate the same here in India.
“We are going to put a lot of emphasis on innovation and automation into the factory.
Over the years, we have learnt that everything is evolving. We are going to implement
Japanese Lean Kaizen technology. Lean is a methodology that eliminates waste and
boosts efficiency. Kaizen means continuous improvement. This course merges both
philosophies. Lean Kaizen helps you get rid of waste and continuously implement best
practices. Our aim is to keep up with evolving technology,” he states.
Home
Italian textile machinery to come together in Frankfurt
(Source: Innovation in Textiles, April 04, 2019)
A significant contingent of Italian textile machinery companies will be on hand at the
upcoming edition of Techtextil, the most important global event for technical fabrics and
nonwovens that takes place from 14-17 May in Frankfurt.
The technical/innovative textiles sector has developed at a very high pace in recent years.
In 2010, global production of textiles for technical applications and nonwovens amounted
to EUR 37 billion, rising to EUR 60 billion in 2018. In Europe, over 30% of the textiles
sector revenues currently derive from the production of textiles designed for technical or
innovative uses. Germany is the sector’s primary European producer, at around EUR 6
billion.
“Growth in the industry has resulted in a substantial increase in demand for specialised
ad hoc machinery, with the product ranges of Italy’s textile machinery companies
broadening to the new needs of customers operating in this specific sector. ACIMIT
estimates that over 100 of its associated members are working for the sector,” the trade
association reports.
The whole of the world’s textile machinery industry will come together in Frankfurt at
Techtextil, the primary event for technical fabrics. Around 30 Italian textile machinery
companies are slated to exhibit in Germany.
Of these, 15 will be on hand at the special exhibition area organised by the Italian Trade
Agency and ACIMIT. These companies are all ACIMIT associated members and include
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24 CITI-NEWS LETTER
4M Plants, Bematic, Bianco, Color Service, Corino, Fadis, Ferraro, Gualchieri e
Gualchieri, Loptex, Mesdan, Sicam, Stalam, Textape, Unitech, and Zappa.
“Still, Italy’s machinery companies present in Germany represent just a part, albeit a
significant one, of the total number of Italian producers of machinery for the technical
textiles and non-woven fabrics sector,” the association comments.
ACIMIT represents an industrial sector comprising around 300 manufacturers,
employing close to 12,000 people and producing machinery for an overall value of about
EUR 2.5 billion, with exports amounting to more than 85% of total sales.
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A.T.E. launches automation division for textile mills
(Source: Fibre2Fashion, April 04, 2019)
A.T.E., an engineering group offering solutions in manufacturing, industrial sales,
distribution, and services, has launched an automation division under its TEG
(Textile Engineering Group) business unit. The division has been launched as a direct
response to customer’s requests that A.T.E. help them improve the performance of their
installed machines.
Textile mills continuously seek to automate their processes and upgrade their machine
and process controls so as to produce with better quality and lower costs. In some cases,
they accomplish their goals through the purchase of new equipment, or through
machinery overhauls with new parts. In other cases, the path to improvement requires a
tailor-made approach – as the mills have machines that are in generally good mechanical
condition, but need new kinds of control, or add-on systems for automation. Such
customised projects in textile mills require to be executed by reliable partners with in-
depth textile knowledge.
A.T.E., endowed with deep domain knowledge in textile engineering and textile processes,
has built-up a team of experts to undertake automation and upgrade projects. Machines
are upgraded using modern retrofits and the latest software, resulting in significant
improvement in the performance of these machines, both in terms of productivity and
quality, the company said in a media statement.
A.T.E. can undertake machine upgrade/automation of textile machines like weaving
preparatory like sizing and warping machines; processing like Stenter/merceriser/dyeing
ranges/pad dry/pad steam; denim processing lines, and POY/FDY winders, extruders,
PSF lines, bale press, chip conveying, and drying for synthetics.
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25 CITI-NEWS LETTER
Apart from custom machine upgrade/automation, the automation division has also in its
portfolio some productised solutions, such as a fancy yarn system, Fancy Spin, to add
value to yarn, which would help mills realise higher value for their yarn. Another such
productised system is the pre-reduced indigo dosing systems for denim manufacturing
(bulk as well as portable). These dosing systems help in maintaining consistent quality
without any shade variation along millions of meters of denim produced and also help in
reducing the load on the wastewater treatment plant.
“We have a team of experts with long experience in executing such projects smoothly.
Customers can count on us for excellent support at all times of the project execution, and
also post execution,” Vikas Banduke, vice president – automation, who is responsible for
this new business at A.T.E. said.
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