India and the UK have agreed to start negotiations later this year on a bilateral Free Trade Agreement besides kicking off a series of trade working groups from September. Piyush Goyal, Minister of Commerce and Industry and Liz Truss, UK’s International Trade Secretary have decided to enhance India-UK trade partnership and take forward negotiations for a bilateral Free Trade Agreement. Truss spoke with Goyal to discuss the scope and ambition for a UK-India free trade agreement following the close of the Department for International Trade’s public consultation last month.

These discussions will help both sides better understand each other’s position on potential chapter areas in any trade deal, including tariffs, standards, IP and data regulation. They also discussed the newly-established Enhanced Trade Partnership, and confirmed their commitment to timely implementation of the market access package.

Truss reaffirmed her ambition to negotiate a trade agreement that delivers results for the British people and businesses, including those in digital and data, tech and food and drink. Both ministers agreed that continuing to engage with the business community was vital throughout the forthcoming negotiations.

Japanese fast fashion brand Uniqlo has become the latest to join the Bangladesh Accord on Fire Building Safety. As per a Women’s Wear Daily report, the landmark agreement on garment worker safety was signed in 2013 following the Rana Plaza factory collapse that killed over 1,100 garment workers.

The Accord was originally scheduled to expire in May, but public pressure from activists, brands and organizations led to three-month extension to the agreement Several brands like Asos, G-Star, Espirit, S Oliver have committed to renew or expand the Accord beyond the three-month period, indicates Remake’s live tracker.

These brands including Zara and its parent company Inditex, have communicated email statements of intent. However, Ayesha Barenblat, Chief Executive Officer and Founder, Remake, has also urged American brands especially PVH and American Eagle Outfitters to join the agreement.

The Union Textile Ministry utilized 98 per cent of grants under the National Handloom Development Program (NHDP) in the last three years, informed Piyush Goyal, Union Minister of Textiles. The ministry was granted Rs 353.05 crore as revised estimate under grant-in-aid, against which it incurred an expenditure of Rs 347.65 crore, he added. The ministry provided financial assistance to eligible handloom agencies and weavers for purchase of upgraded looms and accessories, design innovation and product diversification, infrastructure development, marketing of handloom products in domestic as well as overseas markets under various components of NHDP.

Micro Units Development and Refinance Agency (MUDRA) loans were provided at concessional rates as well. Banks also sanctioned MUDRA loans on the basis of their internal credit appraisal parameters. There was a dip in the number of viable proposals from the state governments. The conditions emanating from the novel coronavirus disease (COVID-19) pandemic led to disruptions in economic activities, leading to demand and supply shifts in the off take of raw-materials and finished goods.

The ministry also set up design resource centers in weavers’ service centres in Delhi, Mumbai, Varanasi, Ahmadabad, Jaipur, Bhubaneswar and Guwahati to build and create design-oriented excellence to facilitate weavers, exporters, manufacturers and designers access design repositories for sample / product improvisation and development.

The Handloom Export Promotion Council organized international fairs to promote marketing of handloom products in 2020-21. Besides, the ministry provided financial assistance for raw material, infrastructure projects such as dyeing / printing, reeling / spinning, marketing complex, design studies, value addition etc.

Jeffery Hogue, Sustainability Chief, Levi’s Strauss’ has exited the board of the Better Cotton Initiative, cutting short a four-year term that was scheduled to end next year. As per Sourcing Journal, Hogue is currently focused on building the denim giant‘s sustainability team and preparing the release of its first sustainability report and ESG disclosure.

Levi‘s maintains its status as a member of the cotton sustainability program, which features boldface names such as Adidas, Burberry, H&M, Ralph Lauren and Ikea on its roster, the spokesperson added. Kenneth Roth, Executive Director, Human Rights Watch, alleged Levi’s was vacating its spot because BCI has softened its stance on Chinese government’s use of Uyghur Muslims forced labor to produce cotton in Xinjiang.

BCI’s engagement on the issue has continued to confound industry watchers. On one hand, the organization has pulled out of all field level activities in Xinjiang while on the other hand, it has scrubbed all public references to why it was doing so; thus becoming a target of opprobrium from both China, and anti-slavery campaigners.

From January to May this year, India’s textile exports to the US increased by 66.69 per cent to $2.28 billion, reports OTEXA, a trade body of the US Department of Commerce. As per Textile Focus, US’ textile imports, during the same period, increased by 39 per cent to $12.47 billion. India’s share in these imports remained at 18.32 per cent. On the other hand, China’s share increased to 34.65 per cent to value $4.32 billion.

The share of India’s textile exports increased over 3 per cent. Made-ups accounted for a larger portion of total shipment from India to the US, valued at $1.92 billion and increasing by 64.54 percent year on year. Yarn exports increased by 88.37 per cent to $55.16 million, while fabric exports totaled $302.92 million.

A collective of 33 unions and labor rights groups from Cambodia have demanded the world’s biggest brands -- including Adidas, H&M, Levis, Nike, Puma, Target, Gap, C&A and VF Corp -- help recover wages worth millions of dollars, lost amid the pandemic. A study of 114 factories by the Clean Clothes Campaign shows, Cambodia lost $117 million in wages during the lockdown in April and May. More than 700,000 garment workers were owed $393 million in outstanding wages and severance since the start of the pandemic.

One reason for such a large amount of unpaid wages includes failure of factories to pay severance as stipulated in the country's labor law. The Labor Ministry last year advised factories closing because of economic hardship that they do not have to pay damages or make prior notice payments. Global brands, many of whom have seen their earnings sharply improve this year, say they have attempted to limit the impact of pandemic on garment workers. Adidas has committed to fair wages and has helped key suppliers secure bank finance to weather the pandemic.

Puma has sought to avoid order cancellations as much as possible. The brand cancelled only 0.2 per cent of its orders in Cambodia. The number of factories it works with did not decrease during the pandemic.

A Sakthivel, Chairman, Apparel Export Promotion Council believes, exports can help India boost farmers and artisans’ incomes. Appreciating the Prime Minister’s decision to support exports, Sakthivel said, this will encourage the exporters to achieve the target of $400 billion merchandise exports this fiscal. He informed that the Prime Minister has identified logistics constraints and costs as the key challenges to export growth and assured of adequate policy and infrastructural support for the same.

Sakthivel said, exporters will encourage startups, artisans and farmers to enter into the field of exports for a mutually beneficial relationship. AEPC will also engage with Indian diaspora to facilitate India’s exports to help lift the economy. This can help it achieve inclusive growth by becoming a bridge between farmers and artisans in India and the Indian diaspora abroad, Sakthivel added.

KBR will be the technology partner for TreeToTextile’s new sustainable textile fibers demonstration plant to be built in Nymölla, Sweden. The company will provide technology license, engineering, proprietary equipment, and commissioning services for the chemicals recovery unit of the project. This will enable TreeToTextile to efficiently and sustainably reuse valuable chemicals through KBR eco-planning innovative solutions.

Based in the US, KBR delivers science, technology, and engineering solutions to governments and companies. It employs approximately 29,000 people worldwide with customers in more than 80 countries and operations in 40 countries. The company has over 50 years of experience in state-of-the-art design and supply of evaporation and crystallization technologies and has supplied over 200 plants globally across diverse applications and industry segments, including fertilizers, metallurgical, pulp and paper, chemicals, food, etc.

The TreeToTextile technology is a new innovative chemical process using renewable forest raw material and regenerating the cellulose into a textile fiber by spinning the dissolving pulp. The process uses less chemicals, allowing for a more sustainable and cost-efficient process compared to conventional technologies and fibers.

China’s cotton yarn imports increased by 66.24 per cent year on year in May’21 to 168,700 ton, estimates GACC. As per Textile Focus, from January-May 2021, China’s Cotton yarn imports increased by 35.82 percent totaling 975,200 ton. A report in Apparel Resources attributes this increase in cotton yarn imports to the revival of cotton textile and garment production and sales in China.

According to cotton yarn traders in customs clearance zones at Guangdong, Jiangsu, and Zhejiang markets, quotations for cotton yarn sourced from India, Pakistan, and Vietnam are comparable to domestic cotton yarn prices of the same count and quality. The per ton yarn prices are falling. Light textile market quotations in coastal areas are concentrated at $3,937-3,984/ton, while the price of C32 package bleached yarn in India and Pakistan reaches $4,020-4,051/ton.

The pandemic and resultant lockdowns have pressured the global apparel index with prices rising almost 4.9 per cent in June 2021 compared to corresponding month last year. As per a report by retail intelligence company Edited, prices of children’s clothes have seen a steeper rise with boys’ apparels surging 5.5 per cent and girls’ rising 5.6 per cent. Prices of kids’ shoes have also increased 5.7 per cent.

The greatest hike has been in the prices of men’s pants, women’s dresses and outerwear, says a Forbes report. Prices of men’s pants have risen 11.1 per cent while those of women’s dresses have jumped 15.8 per cent. Prices of winter coats have gone up 8.4 per cent. In terms of styles, demand for casual wear and athleisure wear has surged while formal and office wear have seen a fall, says Kayla Marc, Market Analyst, Edited. In athleisure, there is growing demand for men’s hoodies, sweaters, sweatshirts, sweatpants and T-shirts while in the women’s category, demand for loungewear including cardigans, sweaters and sweatpants has surged. In footwear, prices of both men’s and women’s boots have risen.

Compared to 2019, fashion retailers’ sales grew 7.4 per cent to reach $130.9 billion from January through June 2021. However, retailers are not too concerned over this hike as it would have minimal effect on demand, says Terry Lundgren, Former Executive Chairman, Macy’s

Retailers struggle with tariff, supply chain issues

Steve Lamar, President and CEO, American Apparel and Footwear Association believes, the current shipping crisis on top of oppressive tariffs on apparel, footwear and fashion could prove to be a double whammy for the fashion industry. His association is urging the Biden government to remove tariffs and help maritime industry overcome the shipping crisis.

Retailers have also been struggling with supply chain issues for some time now, says Natalie Kotlyar, National Practice Leader-Retail and Consumer Products, BDO. They need a reliable and resilient supply chain to provide the right product to consumers, she adds. Another issue that plagues retailers is absorbing rising production costs into their supply chains. They are also struggling to meet customers’ demands.

Price adjustments can boost margins

Fashion retailers need to consider the impact of price rise on consumers’ already burdened with escalating costs of other items like food, opines Kotlyar. Luxury brands need to adjust their prices as per need. Fast fashion retailers with lower price points will benefit from the tightening market situation. However, the price-rise may not translate into higher profit margins as product costs are expected to remain higher, warns Kotlyar. This will keep the fashion market challenged.