FW
Textiles Minister Smriti Irani has confirmed that an incentive package for the knitwear sector in less than two months to help the industry cope with the “challenging times”, The much-awaited National Textile Policy may, however, take longer as it will be announced only after incorporating the inputs given by experts in the round tables planned at the Textile India 2017 event. Textile India 2017, which is positioned as the first global B2B textile and handicrafts event in India, will be held in Gandhinagar from June 30 to July 2.
Irani further commented that the hallmark is that is continuous consultations with people and the industry. Over the last 10 months the textile secretary, held consultations across sectors including knitwear, powerloom, handloom, handicraft, wool, jute and cotton and the company will come up with a package for the knitwear sector.Although the National Textile Policy had not yet been announced, the Ministry was not sitting idle and “in instalments we are already doing it, says minister.
The Centre announced a 6,000 crore special package for the textile and apparel sector in June 2016 to help create one crore jobs, mostly for women, over three years.On the new National Textile Policy, which seeks to introduce flexible labour laws, create integrated textile parks, attract higher investments and generate more jobs, the Minister indicated that one needed to wait a bit longer.
Additionally to this she commented that in the Textile India event, there would be about 20 round tables involving experts from the country and world over in diverse sectors, including man-made fibre, jute diversification and technical textile. When the experts give their opinion on the important sectors, they would come out with a plausible policy. Before finalising it they would display it in public domain.
A new cross-industry initiative aims to make sustainable cotton a clothing industry staple. The coalition, called Cotton 2040, brings together existing sustainable cotton initiatives, industry stakeholders and clothing brands to encourage the use of sustainably sourced cotton in the apparel sector.
Cotton is the world’s most commonly used natural fiber and is one of the world’s oldest sources of textiles. Accounting for a mere 2.3 per cent of agricultural land worldwide, cotton growing accounts for 6.2 per cent of global pesticide sales and 14.1 per cent of total insecticide sales.
The initiative is aiming to push production of sustainable cotton from 13 per cent to more than 30 per cent of total cotton production by 2040. Thirty per cent is typically considered to be the tipping point at which solutions to challenges, such as sustainable cotton in this case, begin to rapidly scale and enter the mainstream.
Sustainable cotton now represents less than 20 per cent of the more than 20 million tons of cotton produced annually.
Brands and retailers are often confused by the broad range of sustainable cotton sourcing options on the market. The coalition functions as a one-stop guide for companies to learn about the various standards of sustainable cotton.
The Pakistan Readymade Garments Manufacturers and Exporters Association (PRGMEA) has urged the government to allocate at least Rs60 billion for the export-oriented industry in the upcoming budget 2017-18 under the prime minister’s Rs180 billion package. They have also asked for the release of stuck tax refund claims of exporters, including the drawback of local taxes and levies scheme, customs and sales tax rebate and more.
Appreciating the prime minister for announcing the Rs180 billion package for enhancing exports, PRGMEA Central Chairman Ijaz Khokhar says that the decision is starting to show results as exports of the value-added textile industry are now showing an upward trend at a time when shipments of all other sectors continue to decline.
He further added that the package had given some boost to the country’s exports and if it was implemented properly and issues of liquidity crunch were addressed, the exports could be enhanced further also the Incentives will not be effective until the prime minister takes ownership of exports as policy implementation is not seen anywhere.
The chairman suggested appointing a full-time minister for textile industry as early as possible so that he could play a proactive role.The government was told to introduce a liberal import policy for raw material of export goods like duty-free import of fabrics and accessories, which were not being manufactured in Pakistan.
Khokhar appealed to the government to take steps to discourage exports of raw material for the sake of finished clothing products in domestic and export markets. According to him emphasis must be put on job creation and value-added segments like apparel exports. At the same time, raw material exports must be disincentivised as they take jobs away from our country and create them in competing countries where the raw material is exported.
PRGMEA Vice Chairman Jawwad Chaudhry commented on this saying that they would continue to lose export share in the global market and textile sector may face closure in the absence of consistency of policies and proper policy implementation.
Fespa was held May 8 to 12, Germany.
Printers and sign makers from over 139 countries attended the event. Over 39,224 visitors attended. Visitors from Asia represented ten per cent of the total attendance.
With almost 100 first-time exhibitors on the show floor, visitors had access to a comprehensive line-up of suppliers of technology, materials for printing and sign-making, consumables and accessories.
The largest visitor groups were from Germany, the UK, Italy, the Netherlands, Spain, Denmark and Poland.
The profile of Fespa as the leading European exhibition for textile printing continues to increase. Vendors offered new textile printing solutions. Printed interior décor applications were also prevalent throughout the event.
This response underlines the success of the expo as a forum for meeting customers face-to-face, making concrete sales and developing business pipelines.
This was a commercial show which welcomed a great many printers from all parts of the world but particularly from Europe and the Middle East. It brought together a buoyant specialty printing community, with many exhibitors reporting record sales, and an audience of senior decision-makers coming with an immediate intention to invest.
Germany will host Fespa, May 15 to 18, 2018. The aim is to move the Fespa global print expo to an annual cycle and make every event a comprehensive showcase of all processes and products.
The textile industry in Ghana is facing serious difficulties.Workers are being laid-off because of the pace of smuggling of cheap and fake prints from China. The market is flooded with counterfeit textiles.
Togo and Ivory Coast are often the entry point for smugglers, with some Ghanaian market traders even travelling to China to collect designs.
The borders are very porous with only a few of them manned by security people, making it very easy for these counterfeiters to pass through.
Employment figures in the industry reduced from a high of 25,000 in 1975 to 5,000 in the year 2000, before sliding further down to 3,000 in 2003 and 1,500 at the close of 2016.
Similarly, production level of fabrics was 130 million meters in 1975, 46 million meters in 1995, 65 million meters in 2000 and 39 million meters in 2003. Today, production is below the 30 million meter mark.
Workers are calling for the re-activation of the textiles piracy task force that was set up in 2010 to deal with traders in counterfeit textiles.
While locally produced cotton is used by firms, many of the dyes, chemicals and machines are imported from abroad at significant prices.
For the first quarter of the year, Cambodia’s exports to the United States increased by almost two per cent on the same period last year.Garment, textile and footwear products made up the bulk of exports.
The increase marked a significant turnaround after a big drop in exports at the end of last year.The market has bounded back after quite a significant drop last year. However, it’s still lower than it was in 2015.
The percentage share of Cambodia’s exports to the US among total exports has reduced from about 75 per cent in the past to just over 25 per cent last year, due to increasing exports to other markets.
Cambodia’s exports to the US have been affected by the way the markets operate. The industry is moving toward fast fashion and small quantity orders. Both buyers and investors are under huge pressure from shorter lead-times and demands for quick responses. The previous 12 to 18 week lead-times have been reduced to only seven to eight weeks.
Cambodia has been granted duty-free benefits for exports of travel goods such as luggage, backpacks, handbags and wallets to the US.
But the unavailability of raw materials, especially fabrics, poses a big threat to Cambodia.
Bangladesh is keen to boost bilateral trade with the UAE.
UAE-Bangladesh trade has a very high potential for growth as the level of bilateral trade is still quite low. The United States and European Union are Bangladesh’s largest export markets dominated by readymade garments because of the high demand there. Bangladeshi exporters have decided to focus on the Middle East and start using the UAE as a gateway.
The balance of trade is hugely tilted in favor of the UAE. Major exports of Bangladesh to the UAE are readymade garments, woven and knitwear, vegetables, frozen fish, jute yarn and twine, home textiles and textile fabrics, fruit juices, tea in packets, spices, stainless steel ware, melamine tableware, electronics, cables and jute products, among others.
Some vegetable products, plastic articles, cotton and cotton yarn, fabrics, iron, steel and its products, electrical machinery and equipment are also re-exported from the UAE to Bangladesh.
Bangladeshi companies have regularly been participating in expos such as Gitex, Gulfood and the Dubai Shopping Festival, among others. Bangladesh is planning to host a single country exhibition in the UAE to promote its products in the region. Major Bangladeshi firms are expected to be participating in this single country exhibition, which is expected later this year.
Local garment makers are gearing up with fresh investment to enter the global sportswear markets, as demand for the items is on the rise with changes in taste and fashion. Although Bangladesh is the second largest garment exporter worldwide after China, it has little presence in the global sportswear market worth $270 billion. China and Vietnam are currently dominating the market.
Bangladesh exports a few million jerseys during different occasions, although the country has greater potential in the sportswear segment, for both fashion and sports functional wear.
Abdus Salam Murshedy, managing director of Envoy Group, a leading garment exporter says that they are setting up a big factory in Gazipur on 50 bighas of land to produce specialised garment items, including sportswear, wind jackets, denim items and swimwear.
KM Rezaul Hasanat, chairman of Viyellatex, stated that sportswear has two segments – fashion and functional. The fashion segment includes garments that are used like any other apparel item, while the functional items are used for performance during sports.Local manufacturers export fashion sportswear items on a limited scale, but they are yet to explore functional wear.
Momin Mondol, managing director of Mondol, another leading garment exporter, says that they had shipped a few million pieces of jerseys during the last football world cup in Brazil in 2014. Bakhtiar Uddin Ahmed, general manager at Fakir Apparels a Narayanganj-based garment maker, stated that his company produces sports t-shirts and trousers on a limited scale.
Mohammad Hatem, former vice-president of Bangladesh Knitwear Manufacturers and Exporters Association, says he supplied eight lakh pieces of jerseys to 10 football playing nations, including Brazil, Germany, France, Portugal and Argentina, during the last football world cup.
Hatemfurther says a lot of factories in Bangladesh supply jerseys to different football clubs in Europe, like Barcelona, Real Madrid, Manchester United and FC Bayern Munich.Some factories inside the export processing zones export high-end functional sportswear items to renowned retailers and brands like Adidas and Puma.
"The just concluded bilateral trade meet between India & Bangladesh seemes to have benefitted both countries. Bangladesh PM Sheikh Hasina raised the issue of growing trade deficit and PM Modi assured her of his government's concrete steps to address it. She believes she has secured firm promise from her India that Delhi will take concrete actions to redress the balance. Incidentally, PM Hasina reportedly raised the issue of Indian imposition of anti-dumping duties on jute imports from Bangladesh seeking to resolve the issue."
The just concluded bilateral trade meet between India & Bangladesh seemes to have benefitted both countries. Bangladesh PM Sheikh Hasina raised the issue of growing trade deficit and PM Modi assured her of his government's concrete steps to address it. She believes she has secured firm promise from her India that Delhi will take concrete actions to redress the balance. Incidentally, PM Hasina reportedly raised the issue of Indian imposition of anti-dumping duties on jute imports from Bangladesh seeking to resolve the issue.
Anti-Dumping Duty on Jute
India accounts for about 30 per cent of Bangladesh's total export of jute. In January this year, India imposed an anti-dumping duty on import of jute and jute goods from Bangladesh and Nepal ranging between $19 and $351.72 per tonne. It means the importing country believes that foreign imported goods, and in this case, jute and jute goods from Bangladesh and Nepal, are priced below fair market value. This duty has been imposed for five years. Bangladesh is in strict opposition of this. As a result, jute/jute goods exports to India have impacted adversely. During July-March period of FY2016-17, it decreased by over 17 per cent to $105.25 million as against $171.41 million in the corresponding period last year. The anti-dumping duties became effective from January 05, so the first six-month of this period, the trade was not affected.
Exports to India during July-March (FY2016-17) rose by 7.28 per cent to $522.83 million, but earnings from apparel exports decreased by 7.85 per cent to $99.99 million. According to MAKS Attire director Farkhunda Jabeen Khan, India's total apparel market is worth $40 billion and there is no threat to India from Bangladesh.
Promising sectors getting impacted
Packaged food production has recently gained prominence in Bangladesh and the country is looking at global avenues to expand reach. Despite a number of agreements signed by both Bangladesh and Indian governments in facilitating mutual efforts to enter each others' market, Bangladeshi producers are facing problems. The Indian customs authorities don't accept certification by the Bangladesh Standards and Testing Institution (BSTI) and the exporters are required to testing their products in Indian labs there. It costs time, money and ultimately customers' discontentment.
This scenario remains unchanged despite agreement between BSTI and India's NABL (National Accreditation and Calibration Laboratories) in which BSTI received accreditation for 161 parameters of 27 different products such as fruit juice, fruit drinks, jam jelly, biscuits, noodles, carbonated beverages, soap, cement, MS rod and GI pipes. On the contrary, Indian products are not facing any difficulties in entering the Bangladesh market. Industry experts are of the view that the recognition of certificates issued by BSTI by the concerned Indian agencies could aid in reducing the huge trade gap existing between the two countries.
The commerce ministry fears that a higher than expected goods and services tax (GST) rate on gems and jewellery and textiles products may make such exports uncompetitive and exporters may have to be compensated. These two items are among six on which GST rates could not be finalized in the 14th GST council meeting in Srinagar that was last week and a decision was delayed until the next meeting on 3 June.
A commerce ministry official stated that after GST rates are imposed, if the tax rates increases on textiles and gems and jewellery sectors, then there will be need to evaluate how much more support they may require, because the margins in the international market are fixed and higher taxes may make them uncompetitive. Also, there won’t be uniform rates for textiles and gems and jewellery items as the products vary widely. At present, taxes on textile products vary from 4 per cent to as high as 60 per cent.
Rahul Mehta, president of the Clothing Manufacturers Association of India in a note posted on its website wrote that from all the informal feedback the association has received, government is likely to impose 12 per cent GST rate on the sector and the government has not considered the industry fit to be taxed at the lowest slab of 5 per cent, which would have given a tremendous boost to the industry.
The Gem and Jewellery Export Promotion Council has demanded to fix GST rate at 1.25 per cent for the sector with continuing exemptions for diamonds. Revenue secretary Hasmukh Adhia in an interaction with a news channel pointed out that the GST rate for all branded products including textiles will be decided on 3 June. He further stated that a final decision is yet to be taken on whether branded products should be treated differently from non-branded products, he also suggested that manufacturers of branded products will benefit if a GST rate is imposed since they will be able to claim input credit.
