At the beginning of 2021, when S&P Global Ratings forecast Indian gross domestic product growth at 11% for the coming nancial year, the number looked eminently achievable. Last month, the Goods and Services Tax — a good barometer of economy activity — hit 1.41 trillion rupees ($19.1 billion), its highest ever monthly collection. Indeed, it’s been higher than the benchmark Rs. 1 trillion for seven consecutive months and higher than the same month for the last year for eight consecutive months. India’s international merchandise trade reached $34 billion in March, the highest ever, and stayed over $30 billion in April. Many short term economic indicators — auto sales, electricity consumption, highway toll collection — were also pointing to a strong recovery after a crushing 2020. But that’s when the second wave of the pandemic hit with a vengeance. The daily case count went up from 81,000 on April 1 to more than 402,000 thousand on April 30. India’s healthcare system came under severe stress the same month. As the outbreak grew worse, state governments applied restrictive lockdown measures that halted the nascent economic recovery in its tracks. According to the Centre for Monitoring Indian Economy — a think tank — the unemployment rate grew from 6% in March to 8% in April. Studies show that more than 200 million Indians are expected to fall into poverty as a result of shutdowns and healthcare costs. The S&P has now downgraded Indian GDP growth to 9.8%. Most experts predict the second wave to recede by June. But the government has to start now to rebuild the economy. There are three parts to this. The most immediate involves vaccinations: choosing which sectors of the population get inoculated rst will mitigate the negative impact on GDP. A government spending boost will then help backstop the downslide. Finally, structural changes must be initiated to ensure that India’s prowess in technology and manufacturing is leveraged to its highest potential. Right now, the focus must be placed on vaccinations in the 53 cities with populations of a million-plus each. They are hubs of economic activity and need to be de-risked from a third wave. Second, workers in customer-facing businesses— hospitality, restaurants, aviation, storefront retail, local transportation, commercial real estate — should have priority. The Government spending must then follow. At the end of 2019, the government released a National Infrastructure Pipeline, outlining capital expenditures of Rs. 120 trillion over ve years. The announcement ran into the onset of the pandemic but this program should be expedited. With a gradual glide path to 3% scale deficit signaled in the union budget and buoyant direct and indirect tax collections, the government has scale headroom for this expansionary spend. The aggressive spending plan is likely to face political opposition. A project to revamp New Delhi’s central vista is currently facing criticism. But there is no better way than infrastructure to rekindle animal spirits. Infrastructure is a job multipliers and that will help India’s unorganized labor market. These projects also catalyze growth in core sectors – construction, cement, roads, railways and real estate. One specific area of investment should be healthcare: Build modern hospitals in each of the 700 districts, upgrade all the 150,000 primary health centers and bring domestic vaccine production to 2 billion doses a year. The government should continue to push for structural market reforms. A recent Credit Suisse study talked about how 100 unicorns – rms with more than $1 billion valuation – have sprung up in India in just a few years. Political opposition, however, has delayed the tough reforms that would encourage even more enterprise. Easier and cheaper access to capital, faster land acquisition for marquee projects and new business investments, bureaucratic agility, administrative transparency and a nimbler judiciary will go a long way. Encouraging more digitization of retail through simpler rules can further open the national market to small businesses. The government can further boost business condence with the full privatization of companies like Bharat Petroleum Corporation and IDBI Bank and Shipping Corporation this year. There isn’t much time. The ruling Bharatiya Janata Party faces huge tests in early 2022, when elections in Mumbai, the business capital, and Uttar Pradesh, the largest state, will drive the political narrative in the run up to the next national vote. An economic rebound would influence the two elections positively for the government. The scars of the second wave of the pandemic will run deep but well-executed policy measures will help meet the challenge — and decide how far India’s rebound will go. Sectors have all taken a hard knock, as in every other country; inoculations there will help build confidence for consumers to patronize them and move about again.
Source: Economic Times
Exporters' body FIEO on Wednesday urged the government to immediately release all eport benefits under duty drawback, tax refund scheme RoDTEP, and goods and services ta as that would help in making shipments protable. The Federation of Indian Export Organisations (FIEO) President S K Saraf also expressed concerns over the rising prices of domestic inputs and suggested reduction in import tari to soften the prices. He urged shipping companies to rationally increase freight as all stakeholders are facing the same problem and with recovery in sight, all will sail together. "Liquidity should be addressed by encouraging banks to lend to the export sector and more importantly instantly releasing all export benets including drawback, MEIS (Merchandise Exports from India Scheme), GST and RoDTEP (Remission of Duties and Taxes on Export Products) to name a few. This will help in making exports protable else with delay in refund, exporters protability is wiped out with increasing interest burden," he said in a statement. Saraf said although order book position of exporters is encouraging, increase in the prices of many inputs have resulted in re-negotiation of orders with some price escalation, which may also support exports in value terms by 10-15 per cent. Further, he said that to achieve USD 400 billion exports target for 2021-22, a concerted strategy would be required, treating exports a national priority by all wings and ministries. Are You Buying or selling Bitcoin? Ad iForex VISIT SITE Sponsored by In a separate statement, the Engineering Eport Promotion Council (EEPC) said that value-added steel products exported from India are becoming uncompetitive in the international market due to rising prices of primary steel locally and hence both tari and non-tari measures could be considered to rein in the steel prices. Accordingly, it suggested that quantitative restrictions could be imposed on export of primary steel which is used as a key raw material by local manufacturers. Export duty could also be raised to make steel available in the domestic market at reasonable and competitive prices, it said. "There has been a substantial jump in export of primary steel in recent months while many value-added steel products shipped from the country have seen a 15-35 per cent decline. "We have therefore suggested the government to take non-tari and tari measures as part of the raw material export policy," it said adding that otherwise, many MSME exporters will be out of business and it will lead to unemployment of skilled people.
Source: Economic Times
The textile trading shops in Surat will continue to remain shut between May 13 and 17, the Federation of Surat Textile Traders Association said Wednesday. A delegation of FOSTTA, led by President Manoj Agrawal, general secretary Champalal Bothra, and treasurer Rajesh Agrawal, met Surat Municipal Commissioner B N Pani and Police Commissioner Ajay Kumar Tomar to decide a decision whether to allow shops to reopen from Thursday. “We urged Surat Police Commissioner to allow us to keep the textile trading market to open for three hours in the morning. He has asked us to wait till May 17. So, we have informed traders that the shutdown will continue till May 17,” the treasurer said.
Source: Indian Express
West Bengal finance minister Amit Mitra has written to finance minister Nirmala Sitharaman seeking an urgent meeting of the Goods and Services Tax Council to discuss the critical issue of increasing the compensation of Rs 1.56 lakh crore earmarked for states in FY22. With states imposing lockdowns due to the second Covid-19 wave, their compensation could be much higher than what the government estimated earlier, Mitra said in a letter to Sitharaman on Wednesday, which ET reviewed.
Source: Economic Times
The high positive annual growth in the index of industrial production (IIP) in March 2021 came on back of a contraction of (-)0.9% and (-)3.4% in January and February 2021 respectively, according to the data released by the National Statistical Office on Wednesday. This turnaround was led by recovery in the mining, manufacturing and electricity sectors. India’s factory output climbed 22.4 per cent in March, benefiting from the base effect of the lockdown-marred month a year back as well as a turnaround in the manufacturing sector, while retail inflation slipped to a three-month low of 4.29 per cent in April.The high positive annual growth in the index of industrial production (IIP) in March 2021 came on back of a contraction of (-)0.9 per cent and (-)3.4 per cent in January and February 2021 respectively, according to the data released by the National Statistical Office (NSO) on Wednesday. This turnaround was led by recovery in the mining, manufacturing and electricity sectors. Also, it benefited from the base effect as most parts of the country were under lockdown in March 2020 and the IIP gauge had recorded a massive contraction of (-)18.7 per cent. The CPI inflation moderated from 5.52 per cent in March 2021 to 4.29 per cent in April 2021, driven particularly by deflation in vegetable prices of 14.2 per cent on a yearly basis which pulled down the food inflation significantly. While cereal prices fell in line with real time data unlike in some of the previous months, some categories in the food basket such as meat and fish, edible oil, fruits and pulses continue to show high inflation both on a year-on-year and sequential basis, reflecting structural supply bottlenecks that might have got further aggravated by the fresh disruption brought in by the second COVID-19 wave. Besides, core inflation continues to be firm due to the cost push factor triggered by higher retail fuel prices. “There is clearly a risk of a further increase in retail prices due to the re-emergence of supply constraints from COVID 2.0 lockdowns but the base effect may help to moderate the inflation print even if there is a sequential uptick,” said Suman Chowdhury, Chief Analytical Officer, Acuite Ratings & Research. Rumki Majumdar, Economist, Deloitte India, said upside risks to inflation are significant because of rising global commodity prices, including crude oil prices. At the same time, rising transportation expenses due to intermittent lockdowns and shipping rates will also add to input costs. “Inflation is expected to sharply increase once the economy returns to the recovery path. Uncertainties have resulted in the postponement of capital spending and investment, which will translate into supply constraints in the near term.“Post recovery, pent-up demand is expected to rise sharply and result in demand-push inflation, thereby, limiting RBI’s ability to maneuver monetary policy,” she said. On IIP, Chowdhury said the gross generation of electricity in FY21 almost reached the levels in FY20 despite the lockdown driven disruption, implying that higher residential power demand largely offset the drop in demand from industrial and commercial activity. “While there is a broad based uptick in manufacturing on a year-on-year basis due to the base effect, there has been a heightened activity in the export driven sectors and particularly refined petroleum products in March 2021. “However, the sustainability of an uptrend in manufacturing is clearly in question due to the expected disruption caused by COVID 2.0 in April and May 2021. The YoY figures may not be meaningful to analyse at this point and we need to look closely at the sequential data,” he said. The manufacturing sector — which constitutes 77.63 per cent of IIP — grew by 25.8 per cent in March 2021, NSO data showed. The mining sector output too grew 6.1 per cent in March, while power generation increased by 22.5 per cent. The Consumer Price Index (CPI) based retail inflate on stood at 5.52 per cent in March. Food price inflation eased to 2.02 per cent in April from 4.87 per cent in the preceding month. According to the data released by the Ministry of Statistics and Programme Implementation, the rate of price rise in the vegetables basket was (-) 14.18 per cent on an annual basis, sugar and confectionery (-) 5.99 per cent and cereals (-) 2.96 per cent. CPI inflation had edged up to 5.5 per cent in March 2021 from 5 per cent a month ago on the back of a pick-up in food as well as fuel inflation, while core inflation too remained elevated. Aditi Nayar, Chief Economist, ICRA Limited, said given the high base related to the supply disruptions seen during the nationwide lockdown in April 2020, the CPI inflation dipped to a three month low in April 2021, while printing somewhat higher than the expectations. Overall, the prevailing localised restrictions appear to have had a limited impact on prices in April 2021.“As the lockdown base fades away, we expect the CPI inflation to bounce back to an average of 5 per cent in the remainder of the first half of fiscal year 2021-22, ruling out the possibility of further rate cuts to support economic activity and sentiment. “However, with the economic outlook remaining uncertain in light of the continuing pandemic, we expect the monetary policy stance to remain accommodative for much of 2021,” she said. The government had refrained from releasing the comprehensive retail inflation data for April 2020 as the nationwide lockdown prevented officials from collecting price data at various centres. A lockdown was imposed in the latter part of March 2020 as the COVID-19 pandemic started spreading. RBI, which mainly factors in the retail inflation while arriving at its monetary policy, had left the key lending rate (repo) unchanged last month on inflation concerns. Earlier this month, RBI Governor Shaktikanta Das had said that going forward, a normal south-west monsoon, as forecast by the IMD, should help to contain food price pressures, especially in cereals and pulses. The build-up in input price pressures across sectors, driven in part by elevated global commodity prices, remains a concern, he said. The inflation trajectory over the rest of the year will be shaped by the COVID-19 infections and the impact of localised containment measures on supply chains and logistics, Das had said on May 5 while announcing measures to help the economy amid the second wave of the pandemic.
Source: Financial Express
Official figures show that the British economy contracted by 1.5 per cent in the first quarter of 2021, a relatively modest contraction given that the country was in the midst of a strict lockdown to combat a second wave of the coronavirus. Official figures show that the British economy contracted by 1.5 per cent in the first quarter of 2021, a relatively modest contraction given that the country was in the midst of a strict lockdown to combat a second wave of the coronavirus. The Office for National Statistics also said Wednesday that the economy even managed to grow by 2.1 per cent in March when the country began easing some of the restrictions.The overall first quarter figures provide further evidence that businesses and consumers have adapted to the constraints of lockdown by increasing their online activities. In the second quarter of 2020, when the first lockdown was in place, the British economy contracted by a fifth. The agency said the strong recovery seen in March was led by the retail sector and the return of schools. The construction and manufacturing sectors also did well as businesses continued to adapt to the pandemic. Treasury chief Rishi Sunak said the March performance is “a promising sign of things to come.” The statistics agency also said that exports of goods to the European Union increased in March and are now almost back to where they were in December, the last month that Britain was part of the European single market and customs union. The new free trade deal between a post-Brexit Britain and the EU came into force at the start of 2021, leading to disruption in trade which the British government said represented some early teething problems. Still imports from Europe remained sluggish in the first three months of the year, outstripped by non-EU imports for the first time on record.
Source: Financial Express
The United Nations on Tuesday responded to the rebounding Chinese and US economies by revising its global economic forecast upward to 5.4 per cent growth for 2021. The United Nations on Tuesday responded to the rebounding Chinese and US economies by revising its global economic forecast upward to 5.4 per cent growth for 2021, but it warned that surging COVID-19 cases and inadequate availability of vaccines in many countries threaten a broad-based recovery. In raising its projection from January of 4.7 per cent growth, the U.N.’s mid-2021 World Economic Situation and Prospects report pointed to the rapid vaccine rollout in a few large economies led by the U.S. and China and an increase in global trade in merchandise and manufactured goods that has already reached its pre-pandemic level. But the U.N. cautioned that “this will unlikely be sufficient to lift the rest of the world’s economies,” and “the economic outlook for the countries in South Asia, sub-Saharan Africa and Latin America and the Caribbean remains fragile and uncertain.” Lead author Hamid Rashid, chief of the Global Economic Monitoring Branch in the U.N. Department of Economic and Social Affairs, told a news conference that “Europe’s outlook is not as bright as we expected” because of signs of second and third waves of COVID-19 infections.“The key challenge we face in the world right now is that infections are still rising in many parts of the world, and we are seeing new variants and new mutations affecting large populations in South Asia, also in Latin America,” he said. “That poses a significant challenge in terms of the recovery and world economic growth.” Rashid said: “Vaccination is probably right now the number one issue to put the world economy on a steady path of recovery.” He noted, however, that “vaccine inequity is a serious challenge.” In normal times, he said, 5.4 per cent would be considered a very high economic growth rate, but this year it is barely offsetting last year’s losses and growth is “very uneven and also very uncertain.” He said the U.N. expects the U.S. economy, which is very strong, to grow about 6.2 per cent this year, “the fastest growth of the U.S. economy since 1966,” and it expects the Chinese economy to grow by about 8.2 per cent. But he called India, Brazil, South Africa and many other developing countries “weak spots.” Rashid said that in the past the growth rate of developing countries would be higher than the global average, but this year the average growth rate of many developing countries and regions is lower because of the pandemic. One of the key drivers of economic recovery has been investment, he said, with some countries like the U.S. seeing only a 1.7 per cent drop in investment last year while some developed countries saw investment drop by 4 per cent of GDP or even more. The USD 16 trillion in stimulus to counter the economic impact of the coronavirus pandemic “was much needed to avoid a complete meltdown of the global economy,” Rashid said, “but that has not led to massive increase in investment.” He warned that the “massive surges in stock market prices globally” are creating “something of a financial stability risk worldwide, and we have to be vigilant about that risk as that could also derail the recovery efforts going forward.” Rashid said the U.N.’s forecast of 5.4 per cent growth this year is far more cautious than other international organizations, including the International Monetary Fund, which last month revised its 2021 projection upward to 6 per cent. “We’re still optimistic about the global economy,” Rashid said, but there are a lot of uncertainties that we underscored in our report, especially the spread of vaccination and coverage that needs to happen in the next six months to achieve that kind of growth rate that we project here.For 2022, the U.N. forecast that the global economy will grow by about 4.7 per cent is higher than the IMF’s projection of 4.4 per cent.
Source: Financial Express
The German Agency for International Cooperation GIZ recently issued a call for tenders to recruit a regional office that will carry out a study to identify the job opportunities existing in the cotton and textile industry in Cameroon. According to the tender document, this project aims to identify the various job opportunities existing in the cotton production and processing segments, highlight the skills needed by employers, and develop courses to bridge the skill gap in the cotton and textile industry's labor market. The bids are expected to reach the GIZ by June 17, 2021. As for the project, its duration is 140 days maximum, between June 24 and August 30, 2021. The German cooperation agency explains that this study is important because, for several years now, the competitiveness of Cameroon’s cotton and textile industry is being affected by several problems. These include the rising input costs, the overvaluation of the Euro against the US dollar, and the dropping of cotton prices in international markets. Meanwhile, the sector is full of potentials. According to the Ministry of Agriculture, cotton is the fourth most important export product in the country's foreign trade. Also, it currently provides subsistence means to nearly 27,000 farmers.In the framework of its 2020-2030 National Development Strategy, Cameroon plans to boost its yearly cotton production to 600,000 tons by 2025 (against 310,000 tons currently). Also, the country plans to increase the volume of the national production which is processed yearly to at least 50% by 2030 and develop a national wear production industry to meet at least 50% of the demand in sports and military wear. Each of those wears must be 60% cotton, the plan outlines.
Source: Business in Cameroon
Vietnamese garment producers are struggling to recover monies owed by U.S. companies that have gone under. May Song Hong saw its dues outstanding from American companies rise by 19.5 percent in the first quarter to VND654 billion ($24.2 million).It has had to increase its provision for bad debt to over VND224 billion, especially after getting only 17 cents on the dollar from fashion firm New York & Company, whose parent filed for bankruptcy last July amid the Covid-19 pandemic. It also meant May Song Hong’s revenues increased by a mere 1 percent year-on-year in the first quarter to VND945 billion. Thanh Cong Textile Garment Investment Trading recorded dues outstanding of VND405 billion as of March, a 43 percent increase since the beginning of the year. A quarter of that amount was owed by two subsidiaries of U.S. retailer Sears, which filed for bankruptcy in 2018. TCM’s revenues rose by nearly 20 percent in the first quarter to VND946 billion. In the first four months textile and garment exports rose 9 percent year-on-year to $9.5 billion, according to the General Statistics Office.
Source: VNexpress
Huntsman Textile Effects, a Singapore-based global leader in innovative solutions and environmentally sustainable products, has announced that the company will highlight its extensive end-to-end suite of protection effects and high-performance solutions for performance apparel at Performance Days Digital Fair Week to be held digitally from May 17-21, 2021. Huntsman will also deliver a presentation on sustainability, showcasing the top megatrends impacting the textile industry. “With increasing adoption of active lifestyles and outdoor activities, consumers are demanding high-performance, yet comfortable and sustainably-produced sportswear. Consumers are looking for brands that incorporate sustainable processes and principles in their operations,” the company said in a press release. “The upward trend in the performance apparel segment is spurred on by the demands and evolving needs of consumers; sustainability also remains the top of mind amongst these consumers. At Huntsman, we are delighted to be able showcase our suite of solutions that are high-performing and sustainable, so that mills and brands are better able to meet the fast-changing market needs,” Dhirendra Gautam, senior director – global market strategy and innovation at Huntsman Textile Effects said. Huntsman’s featured solutions include: complete end-to-end systems for protection effects, from pre-treatment to coloration and finishing; revolutionary antimicrobial and odour-control solutions from Sciessent - The Agion, Lava X2 and Active X2 products will be featured at the upcoming show; and, High IQ intelligent effects is a set of brand assurance programmes that support accelerated evaporation, water and stain repellence, lasting colour and cool comfort, ensuring garments dry quickly for long-lasting comfort. Huntsman will also deliver a presentation on May 18, 2021, at the expert talk session. Titled “Sustainability & Textiles: Being the Change That We Want to See”, the presentation will showcase the megatrends that will define the next five years, and the textile and apparel industries’ quest for more sustainable design, product development, production methods and garment care.
Source: Fibre2fashion
