An Indian think tank has advised New Delhi to ‘exercise caution and closely monitor’ the progress of the Bangladesh-Japan economic partnership agreement (EPA) negotiations as the pact can affect India’s exports to Bangladesh if the latter offers zero duty on all products to Japan under the pact. "Several products in sectors such as automobiles, metals, electricals and textiles may be largely impacted by the Bangladesh-Japan FTA [free trade agreement]," according to a report by CUTS International (Consumer Unity & Trust Society). India may need to strengthen its existing trade ties with Bangladesh, diversify its export markets, enhance its competitiveness and explore partnership opportunities to navigate the changing trade dynamics effectively, the report, a quarterly analysis, noted. While India has a preferential trade agreement (PTA) with Bangladesh and there is the Agreement on South Asian Free Trade Area (SAFTA), addressing these concerns is crucial to maintaining India's export performance in this market and neutralising the shocks posed by future FTAs that Bangladesh may engage in, the report said. The report called for a comprehensive economic cooperation agreement between India and Bangladesh, according to media outlets in Bangladesh. India should assess the possible impact of Bangladesh's fast-growing textile-apparel and footwear sector, which is gaining a comparative advantage over time, it noted. Though the CUTS International analysis suggests that India is unlikely to experience significant market share loss for textile and apparel products in Japan, it will be better to take some precautionary measures, the report cautions.
Source: Fibre2fashion
Surat, the textile hub of India, is poised for a significant growth spurt with a projected investment of over Rs 600 crore in digital printing and advanced embroidery machines. This surge in investment follows the resounding success of the Surat International Textile and Machinery Exhibition (SITME) 2024, organized by the Southern Gujarat Chamber of Commerce and Industry (SGCCI) and the Surat Embroidery Association (SEA). “The upcoming investment in textile machinery will propel Surat’s garment industry to new heights,” remarked Ramesh Vaghasia, President of SGCCI. The recently concluded SITME exhibition witnessed a phenomenal response, attracting over 20,000 visitors from across the nation. The exhibition showcased a diverse range of machinery, priced from Rs 13 lakh to Rs 1 crore. Exhibitors reported a positive outlook, with many anticipating orders for four to five machines in the coming month. One exhibitor, who displayed four state-of-the-art embroidery machines valued between Rs 10 lakh and Rs 50 lakh, shared his experience. “Participation in SITME allowed me to connect directly with buyers from various Indian cities,” he stated. “Based on the genuine inquiries received, I expect to secure a total of 26 machine orders within the next month.” He further elaborated, “There’s a strong possibility of receiving orders for 20 advanced embroidery machines, each valued at Rs 40 lakh. In total, I anticipate securing orders exceeding Rs 10 crore within the next month due to my participation in SITME.” The SGCCI is actively pursuing the establishment of Surat as a hub for textile machinery manufacturing, aligning with the government’s Make in India initiative. “While Juki Company is setting up a garment machinery plant in Ahmedabad, Surat is also striving to manufacture readymade garment-making machinery,” explained Vaghasia. “The SGCCI’s efforts aim to benefit the entire garment industry.” This surge in investment and the SGCCI’s commitment to domestic manufacturing bode well for the future of Surat’s textile industry. The city is well on its way to solidifying its position as a leading center for textile production and innovation.
Source: The Blunt Times
Units operating within special economic zones (SEZs) could potentially be exempt from paying the integrated goods and services tax (IGST) on specified services taken from the domestic tariff area (DTA) through the reverse charge mechanism, if a ruling by the Gujarat-based Authority for Advance Rulings (AAR) sets a precedent. To qualify for this exemption, these units will need to provide a letter of undertaking (LUT) or furnish a bond. These services include services from goods transport agencies, legal services from advocates, security services, and hiring buses for employees. Normally, providers of services have to pay Goods and Services Tax (GST) to the government, but it is the recipient of services who pays tax to the government on the reverse charge mechanism. The AAR issued the ruling in a case involving the procurement of services by Surat-based SEZ unit —Waaree Energies Ltd — which is engaged in the manufacture of solar modules. Frequently asked questions (FAQs) issued by the government in 2018 state that while the supplier of services in these cases is not liable to pay GST as the supply is under a reverse charge mechanism, SEZ has to pay IGST since the recipient is considered a deemed supplier. The issue becomes complicated since the Tax Research Unit (TRU) at the Central Board of Indirect Taxes and Customs (CBIC) clarified that a unit in SEZ can procure such services where they are required to pay GST under the reverse charge mechanism without payment of integrated tax (IGST) provided the unit in SEZ furnishes a letter of undertaking. The clarification by CBIC was given in a case relating to legal services, sponsorship services received by an SEZ unit in International Financial Services Centre (IFSC) in Gandhinagar from a unit in DTA. The AAR observed that this clarification was given to a specific SEZ unit and is not a circular but there is no bar in borrowing the rationale of the clarification. Hence, the authority ruled that Waaree Energies Ltd can procure the services without payment of IGST provided it furnishes LUT or bond as specified by the government. Sandeep Sehgal, partner at tax and consulting firm AKM Global said this is a pivotal decision for businesses operating within SEZs. “It aligns with the zero-rated intent of the GST Act as clarified by the TRU, allowing SEZ units to source services without the burden of Reverse Charge Mechanism (RCM). This ruling not only eases compliance for SEZ-based businesses but also fosters a more conducive environment for growth and investment in SEZs,” he said.
Source: Business Standard
Synopsis the Reserve Bank of India (RBI) has emphasized that the Indian economy needs to grow at a rate of 8-10 per cent per annum over the next decade to reap the demographic dividend. The RBI believes that India's favourable demographics will help it break the low middle-income barrier and harness its young and rising labor force. The working-age population is expected to grow at a rate of 9.7 million in 2021-2031 and 4.2 million in 2031-2041 per year, making a focus on labour quality essential for the growth strategy.The Indian economy needs to grow at a rate of 8-10 per cent per annum over the next decade to reap the demographic dividend, the Reserve Bank of India said in its monthly bulletin released on Tuesday. "In order to achieve its developmental aspirations over the next three decades, the Indian economy must grow at a rate of 8-10 per annum over the next decade to reap the demographic dividend that started accruing from 2018 and as calculations show will last till 2055 "
Source: The Economic Times
Indian conglomerate Reliance Industries Limited (RIL) has reported a record-breaking gross revenue of ₹10.00122 trillion (approximately $119.9 billion) in fiscal 2024 (FY24), a 2.6 per cent increase year-over-year (YoY). This surge was supported by continued growth in its consumer and upstream businesses. The conglomerate's EBITDA saw a substantial rise of 16.1 per cent YoY, reaching ₹178.67 billion ($21.4 billion), with positive contributions from all key operating segments. Profit after tax also rose by 7.3 per cent YoY to ₹790.2 billion (approximately $9.5 billion). The fourth quarter (Q4) showed significant growth, with gross revenue up by 10.8 per cent YoY to ₹2,648.34 billion (approximately $31.8 billion), driven by double-digit increase in the consumer business sector. EBITDA for the quarter increased by 14.3 per cent to ₹471.5 billion (approximately $5.7 billion), and profit after tax saw a marginal YoY improvement to ₹212.43 billion (approximately $2.5 billion), the company said in a press release. The annual performance in the polyester sector faced challenges, with the polyester chain delta declining by six per cent due to weaker PTA and polyester product deltas, though there were improvements in PX and MEG deltas. The polyester chain margin stood at $518 per MT during FY24, down from $550 per MT in FY23. However, PX margins over Naphtha improved YoY amidst a higher decline in Naphtha prices compared to product prices. The MEG-Naphtha margins also saw a rise, bolstered by an increase in Asian MEG prices due to the Red Sea crisis and Panama Canal restrictions in the second half of FY24. On a quarterly basis, the polyester chain delta saw a similar six per cent decline YoY in Q4 FY24, with the margin standing at $486 per MT. Domestic polyester demand remained flat during this period, with notable shifts in PFY and PSF demand. “Initiatives across RIL’s businesses have made a remarkable contribution towards fostering growth of various sectors of the Indian economy. It is heartening to note that alongside strengthening the national economy, all segments have posted a robust financial and operating performance. This has helped the Company achieve multiple milestones. I am happy to share that this year, Reliance became the first Indian company to cross the ₹ 1,000-billion threshold in pre-tax profits,” said Mukesh D Ambani, chairman and managing director, Reliance Industries Limited. Reliance Retail Ventures Limited (RRVL) continued its trajectory of robust growth, recording a 17.8 per cent increase in gross revenue to ₹3,067.86 billion for FY24. The EBITDA rose impressively by 28.5 per cent YoY to ₹230.4 billion, with an EBITDA margin on net sales improvement of 0.6 percentage points to 8.4 per cent. The quarterly performance also reflected strong growth, with a 10.6 per cent increase in revenue to ₹766.27 billion. EBITDA for the quarter rose by 18.5 per cent YoY to ₹58.23 billion, driven by significant contribution fashion and lifestyle sectors, the release added. RRVL also expanded its footprint in the fashion sector, developing new formats and strengthening its own brands, with three brands achieving over ₹20 billion in annual sales. Ajio’s ‘All Star Sales’ event attracted customer interest, demonstrating growth in the premium and luxury segments.
Source: Fibre2fashion
Mumbai: While India’s recent growth performance has surprised many, triggering a flurry of upgrades from financial institutions such as the IMF, the RBI bulletin released on Tuesday cites six factors that will propel the country to become the world’s third-largest economy. In purchasing power parity (PPP) terms, the Indian economy is already the third largest in the world. According to the OECD’s December 2023 update, India will overtake the US by 2045 in PPP terms to become the world’s second-largest economy, the RBI bulletin points out. According to the bulletin, the “tailwinds likely to power India’s take-off” are as follows: * The demographics favour the rising profile of growth. Currently, India has the world’s largest and youngest population. The median age is around 28 years; not until the mid2050s will aging set in. Thus, India will enjoy a demographic dividend window of more than three decades, driven by rising working-age population rates and labour force participation rate. This is a striking contrast to a world widely confronted with the challenge of aging. * India’s growth performance has been historically anchored by domestic resources, with foreign savings playing a minor and supplementary role. This is also reflected in the current account deficit (CAD), which remains within a sustainable threshold of about 2.5 per cent of the GDP. Currently, the CAD averages about 1 per cent, and this is associated with various indicators of external sector resilience – illustratively, external debt is below 20 per cent of the GDP and net international investment liabilities are below 12 per cent. * The gradualistic path of fiscal consolidation adopted after the Covid pandemic has brought the general government deficit to 8.6 per cent of the GDP and public debt to 81.6 per cent of the GDP by March 2024. Employing a dynamic stochastic general equilibrium (DSGE) model, it is estimated that reprioritising fiscal spending by targeting productive employment-generating sectors, embracing transition, and investing in digitalisation could lead to a decline in general government debt to 73.4 per cent of the GDP by 2030-31. In contrast, the debt-GDP ratio is projected by the IMF to rise to 116.3 per cent in 2028 for advanced economies and to 75.4 per cent for emerging and middle-income countries. * India’s financial sector is predominantly bank-based. In 2015-2016, the overhang of asset impairment in the wake of the global financial crisis was addressed through an asset quality review (AQR). A massive recapitalisation was undertaken during 2017-2022. The beneficial effects started to show up from 2018 — gross and net non-performing assets ratios declined to 3.9 per cent and 1 per cent, respectively, by March 2023, with large capital buffers and liquidity coverage ratios well above 100 per cent. The Insolvency and Bankruptcy Code (IBC) has created the institutional environment for addressing stress in banks’ balance sheets. Macroeconomic and financial stability are providing the foundation for medium-term growth prospects. * India is undergoing a transformative change leveraged on technology. The trinity of JAM – Jan Dhan (basic no-frills accounts); Aadhaar (universal unique identification); and Mobile phone connections — is expanding the ambit of formal finance, boosting tech startups, and enabling the targeting of direct benefit transfers. India’s Unified Payments’ Interface (UPI), an open-ended system that powers multiple bank accounts into a single mobile application of any participating bank, is propelling inter-bank, peer-topeer, and person-tomerchant transactions seamlessly. * inflation in India is moderating after surging on multiple and overlapping supply shocks from the pandemic, weather-induced food price spikes, supply chain disruptions and global commodity price pressures following the Russia-Ukraine conflict.
Source: Sarkaritel.com
The Reserve Bank of India (RBI) abstained from selling any US dollars throughout February, for the first time in nine months. The decision comes amid increasing pressure on the rupee, as expectations of rate cuts by the US Federal Reserve keep pushing back. The last time the RBI did not sell dollar over a month was in May 2023. The RBI had sold $8.5 billion in the spot market in January 2024. The central bank purchased $8.5 billion over the month in February to build the foreign exchange reserves and to protect the rupee from further depreciation as the US CPI data for January was higher than expected, said market participants. India’s foreign exchange reserves have been hitting new peaks for the past seven consecutive weeks. It reached a new peak of $648.56 billion in the week ended April 5, latest data by the Reserve Bank of India showed. The reserves surged by $2.98 billion in the week. “RBI was intervening in the foreign exchange market both through spot and forwards to contain volatility in the rupee,” said a treasury head at a private sector bank. “Dollar was getting stronger as the data was unsupportive and rate cut was pushed back to June,” he said. The rupee depreciated by 0.6 per cent in February. Before the release of the US inflation data for January, the first rate cut by the US Fed was expected in March, later it was pushed to June. Currently, after a slew of unfavourable data, the market expects the US Fed to start cutting rates in the second half of the current calendar year. A segment of the market expects only one rate cut in December. “The intervention was more to do with keeping the rupee in a range than building reserves,” said a treasury head at another private bank. “The rupee blew up only in April, it was fairly in a range during February and March,” he added.
Source: Business Standard
Indore: Ginning units of have cut down on operations to 2 to 3 days in a week amid a decline in cotton arrivals in the fag end of the season. While most units have reduced the number of working days, the ones in operation are working at 5-10 per cent capacity, said industry players. They said, steady demand from textile mills have kept spinning and ginning units running towards the fag end Kailash Agrawal, a cotton farmer and owner of ginning units in Khargone said, “Textile mills are mostly utilizing their stocks. The ginning industry is expected to wind up operations by mid-May this season as availability of cotton has reduced sharply and ginning units are running on just 5-10 per cent capacity.” Cotton, technical textile and garments is a leading export product from Madhya Pradesh. In the last fiscal 2022-23, technical textile and garment worth Rs 4,052 crore and cotton exports were at Rs 4,397 crore. In Khargone, a leading spot market of cotton in Madhya Pradesh, cotton is traded at Rs 6,700 per quintal. New season cotton harvest starts from October and peaks in November-December. Cotton arrivals continue until April-May. The Cotton Corporation of India (CCI), a nodal agency set up under the ministry of textile for trade and procurement of cotton, has procured around 6.35 lakh quintal of cotton from the markets of the state in the current season.
Source: Times of India
ISLAMABAD: The bustling city of Frankfurt am Main has become the global epicenter for textile innovation as Techtextile and Texprocess 2024 kick off on Tuesday. The prestigious international trade fairs, renowned for showcasing the latest in technical textiles, nonwovens, and garment manufacturing machinery, have attracted over 1,600 exhibitors from nearly 50 countries. Among these exhibitors, ten companies from Pakistan have unveiled their cutting-edge innovations. From Lucky Textile to Sapphire Finishing Mills, these Pakistani representatives are demonstrating the nation’s dedication to advancing its textile industry through technology and global partnerships. Techtextil features a lineup of Pakistani exhibitors such as Lucky Textile, Master Textile Mills, Midas Safety, Nishat Fabrics, and Sapphire Finishing Mills, each presenting their unique contributions to the textile landscape. Meanwhile, Triple Tree Solution is making waves at Texprocess, showcasing its innovative garment manufacturing solutions.
Source: Pakistan Today
Primary textile millers urged the government on Tuesday to revert the gas tariff to its pre-hike level, saying the sector is facing a severe gas shortage despite the price hike. They said the government increased the gas price in January last year promising uninterrupted supply of the energy. They also demanded that the concerned authorities address the crisis related to US dollar and take required measures so that businesses do not face any harassment by Customs officials. The observations were made at a view exchange meeting organised by Bangladesh Textile Mills Association (BTMA) at its Gulshan office in the city. Presided over by BTMA President Mohammad Ali Khokon, the meeting was attended by leaders and representatives from Bangladesh Cement Manufacturers Association (BCMA) and Bangladesh Steel Manufacturers Association (BSMA), apart from the textile millers, according to meeting sources. "We are in severe crisis due to poor supply of gas. We discussed the issue with our member mills and other sectors including cement and steel manufacturing sectors," he told the FE after the meeting. The meeting also discussed the dollar crisis issue as their working capital had shrunken due to the gap between the rates at which US dollar was being bought and sold, he said adding that as a result they could not buy raw materials. "All are affecting the business negatively," he said and demanded an immediate solution to the problems. Besides, they were facing a number of difficulties related to customs, the meeting was informed. Meeting sources said due to the severe gas shortage, the machinery of textile mills was getting damaged and they were not being able to supply the required yarn and fabrics to the export-oriented garment industry, while fabric processing plants were closed as they could not run boilers. Though Petrobangla had assured them of an uninterrupted gas supply after the price hike, more than a year had passed since then but there was no improvement in the gas supply situation, they noted. Mr Khokon said they would sit with the leaders of FBCCI today (Wednesday) to find a way out and decide their next course of action.
Source: The Financial Express
Ghana’s textile industry, renowned for its rich history and cultural significance, is currently facing challenges due to a surge in counterfeit products flooding the market, particularly those originating from China. The influx of these counterfeit imports has led to a decline in sales and a threat to the viability of local manufacturers. For decades, Ghana’s textiles have been celebrated for their unique designs, vibrant colours, and cultural significance. The industry has played a vital role in the country’s economy, contributing to exports and job creation. However, in recent years, local manufacturers have been struggling to compete with the low-priced counterfeit fabrics that are flooding the market. Perpetual Agyemang, who has been in the textile business for almost 20 years, reflects on the drastic changes she has witnessed and expresses her disappointment with the current state of affairs. She stated that sales and purchasing have dropped significantly, affecting the overall performance of the industry. “For production, I would say the standard is still the same even a bit better than before but the sales and purchasing, if I’m rated from one to 100, formerly it would have been 80 per cent but now 20 per cent, very low. For me now, if there’s something I could exchange this with what I’m doing, I’ll close down.” Stakeholders in the industry have reported producing fewer quantities due to the challenges, leading to job losses and financial strain. The proliferation of counterfeit textiles is one of the major factors posing a significant threat to Ghana’s textile industry. Retailers within the industry are calling for urgent action to address the issue of counterfeits, emphasizing the need for stricter enforcement of intellectual property laws and regulations. Emmanuel Kissi Debrah, the Sales Manager of Textiles Ghana Limited, highlighted the significant drop in sales within the last five years, mainly due to the rise of counterfeit imports. “If I look at the last five years, in 2019 we sold about 18. 8 million yards and last year we did about 8.8 million yards so you can see the difference, shortfall of about 10 million yards already gone just within five years. And this year we are not expecting to do anything more than that and it’s mainly because of the copies and imports. “So in Ghana, currently we have about three textile companies that have TSG, we produce GTP, wooden and import Lisco. We also have Printex, we have ATL. We more or less estimated at least around 100 million yards but because the market size is shrinking, we have about 85 million yards currently. Importation is about 70 per cent of it so all the three companies put together we’re doing just 30 per cent.” Philip Ofori, Head of the Engraving and Innovation Department at Textiles Ghana Limited, pointed out the factors contributing to the high cost of production, including imported materials and the challenges local suppliers face. The situation has led to a shrinking market size, with local companies struggling to compete with the influx of cheap, counterfeit products. “Some are imported, some are also taken from Ghana, we used to take it from ATL, there used to be Juapong textiles but it was changed to Volta style but now they are having some challenges in the company so we import some from Benin and Volta star which is from Ghana.”
Source: Citi News Room
"Techtextil and Texprocess 2024 have commenced on Tuesday in Frankfurt. Techtextil, renowned as the leading international trade fair for technical textiles and nonwovens, is being held alongside Texprocess, which exhibits the latest in garment and textile manufacturing machinery and services, all at the same venue. With over 1,600 exhibitors representing approximately 50 countries, these premier international trade fairs provide a platform for showcasing the latest advancements and innovations. The Export Promotion Bureau (EPB) is leading Bangladesh's presence at Techtextil 2024, gathering over 5 companies, including Akij Jute Mills, M & A Sourcing, Nex Zen Apparels, Smee Apparels, and Team Manufacturing BD, to showcase the nation's excellence in technical textiles and highlight Bangladesh's strong dedication to the event. Bangladeshi exhibitors aim to establish connections with a global audience, extending beyond European buyers, and seek engagement with individuals from various sectors and sub sectors within the international textile industry. Bangladeshi exhibitors at Techtextil and Texprocess highlight the nation's commitment to advancing its textile industry through technology and global partnerships.
Source: Bangladesh Post
Gita Gopinath, the first deputy managing director of the International Monetary Fund (IMF), emphasised the challenging road ahead for Sri Lanka, stressing the critical need to maintain reform momentum. Following discussions with minister of state for finance Shehan Semasinghe, central bank governor Nandalal Weerasinghe, and treasury secretary Mahinda Siriwardena during the IMF/World Bank Spring Meetings in Washington, Gopinath underscored the significance of sustaining economic reforms. Acknowledging Sri Lanka’s hard-won economic gains in the past year, Gopinath expressed her concerns about the formidable challenges ahead even as she highlighted the importance of continuous reform efforts to navigate through these challenges effectively. Emphasising the criticality of reform momentum, Gopinath’s remarks underscored the ongoing commitment required from Sri Lanka to drive economic progress. Under President Ranil Wickremesinghe’s leadership, Sri Lanka has undertaken significant reforms, including measures such as tax increases, as part of its IMF programme. The decision to engage with the IMF came after Sri Lanka faced a sovereign debt default in April 2022, necessitating urgent economic stabilisation measures. State minister for finance, Semasinghe expressed gratitude to Gopinath for recognising Sri Lanka’s economic progress and described the discussions as insightful and productive. He reiterated Sri Lanka's steadfast commitment to its reform agenda and expressed eagerness for continued collaboration with the IMF to achieve shared objectives. Sri Lanka’s engagement with the IMF stems from a period of economic and political turmoil, including an unprecedented economic crisis followed by political upheaval. The IMF programme encompasses reforms in various sectors, including state-owned enterprises, the fiscal sector, and financial sectors, aimed at ensuring long-term debt sustainability. Furthermore, the IMF has pledged support to expedite Sri Lanka’s debt restructuring process with private creditors, including sovereign bond holders, indicating the global lender’s commitment to facilitating the island nation’s economic recovery and stability.
Source: Fibre2fashion
