Modi govt 3.0: Textiles awaits transformation
The sector critical to economic growth and employment needs robust government support to navigate global headwinds. India’s textile industry weaves a vital thread into the nation’s economic tapestry, contributing 2.3 per cent to the GDP, 13 per cent to industrial production and 12 per cent to exports. The textiles and apparel sector—the country’s second-largest employer, directly engaging 45 million workers and indirectly supporting 100 million more in allied industries—is especially significant as India grapples with an unemployment crisis. With a 4 per cent stake in global trade, exports are projected to surge at a 10 per cent CAGR from 2019-20, reaching $190 billion (Rs 15.9 lakh crore) by 2025-26. That said, the industry’s heavy reliance on exports exposes it to challenges. The slowdown in western markets and ongoing conflicts disrupting trade routes have reduced India’s export volumes. “The government should prioritise the textile sector not only for its significant annual revenue contribution but also for its critical role in employment-generation,” asserts Animesh Saxena, general secretary of the Garment Exporters & Manufacturers Association.
WHAT NEEDS TO BE DONE
Central policy
Currently, most schemes for the sector are state-led, resulting in regional disparities in benefits. What’s needed is a central textile policy focused on scaling up, subsidies for capital investment and capacity-building.
Reskilling
The Sector Skill Council for textile workers primarily focuses on training the new entrants. With rapid technological advancements, the workforce needs programmes for reskilling.
Import duties
Man-made fibres dominate 65 per cent of the global market, but due to uncompetitive duty structures for the import of raw materials, India struggles to compete in this lucrative segment.
Incentives for small industries
The PLI scheme for textile industry currently targets manufacturers with a turnover of over Rs 100 crore. Small-scale manufacturers also need incentives to grow.
Source: India Today
In an interview with CNBC-TV18, Sivaramakrishnan Ganapathi, Vice Chairman and Managing Director of Gokaldas Exports, and P Sundararajan, Chairman and Managing Director of SP Apparels, discussed whether the textile export market is getting better. The exports for the month of May grew by the fastest pace in 18 months. In an interview with CNBC-TV18, Sivaramakrishnan Ganapathi, Vice Chairman and Managing Director of Gokaldas Exports, and P Sundararajan, Chairman and Managing Director of SP Apparels, discussed whether the textile export market is getting better or not Gokaldas Exports, incidentally, also announced a strategic stake of ₹350 crore in BRFL Textiles Private Limited (BTPL) which is a separate entity of Bombay Rayon Fashions Limited (BFRL).
Source: CNBC
Surat Textile Market Faces Potential Lease Cancellation Over Unpaid Dues
Even after receiving 13 notices from the Surat Municipal Corporation (SMC), the STM management has still not paid the outstanding lease amount of ₹81 crore
Surat : The Surat Textile Market (STM), which has been a prominent hub for textiles in Surat for many years, is facing the possibility of losing its lease because of substantial unpaid dues. Even after receiving 13 notices from the Surat Municipal Corporation (SMC), the STM management has still not paid the outstanding lease amount of ₹81 crore.The lease agreement for STM expired in 2018, and the SMC decided to renew it for a 100-year term at a total cost of ₹127 crore. Unfortunately, the market has failed to meet its financial obligations under this renewed agreement.
According to official sources, if STM does not settle the remaining dues, the SMC has the option to terminate the lease agreement. The textile traders operating within STM are facing a dire situation, with many of them experiencing financial difficulties or choosing to disregard the SMC’s ultimatum.
According to the lease agreement, market traders are given a lease for 100 years once they have paid ₹15 lakh over a period of ten years. This amounts to ₹1.50 lakh per year or ₹12,050 per month. Traders are only required to pay ₹1,250 per month for the lease over the course of 100 years. In spite of these apparently advantageous conditions, the market management has failed to fulfill their payment obligations.
The SMC has been consistently sending notices to the STM management, however, there has been a lack of significant action taken to recover the ₹81 crore that is owed. Some critics claim that the SMC’s approach has been ineffective, comparing it to a “notice-notice game” instead of taking decisive actions to ensure payment.
“The money is not exchanged through the market system, and the SMC appears content with solely sending notices.” An official source stated that if the dues are not paid on time, the lease will be cancelled. Nevertheless, the ongoing failure of the market management to make payments raises significant concerns regarding the implementation of the SMC’s policies.
Source: The blunttimes
Chief Minister Dr. Mohan Yadav has said that the processes related to the Rs 500 crore project approved by the Textile Ministry for Integrated Textile and Apparel Park in Dhar district should be completed expeditiously. To fulfill the target of employing more than 25 thousand people by 21 units in PM Mega Textile Park, the concerned agencies should discharge their role promptly. Chief Minister Dr. Yadav reviewed the Industrial Policy and Investment Promotion Department activities in Mantralaya on Monday. Chief Minister Dr. Yadav gave instructions to prepare an integrated plan for the development of industries. The proposed industrial policy was also discussed in the meeting. Chief Minister Dr. Yadav said that various ministries of the Central Government have received approvals for the establishment of different industrial units in Madhya Pradesh. Work has to be done expeditiously for the implementation of these projects. The proposed investment of a total of Rs 35 thousand crore in mega projects in Pithampur, Ratlam will employ more than one lakh people. The development of the Indore-Pithampur Economic Corridor is proposed in an area of3200 acres. This project is worth Rs 2125 crore and will employ about one lakh people. Indore’s Multimodal Logistics Park will also employ more than 5 thousand people. Its cost is Rs 20 thousand crores. The Government of India has approved an amount of Rs 100 crore for the Medical Device Park in the Vikrampuri Industrial Area of Ujjain. Here, infrastructure works are being done in a total area of 360 acres for Rs 225 crore. In the last six months, 71.83 acres of land have been allotted to 28 units. About 4500 people will get employment here. The process of purchasing medical equipment is also currently underway. Similarly, in the last six months, 459.24 acres of land have been provided to 58 other industrial units in the Vikrampuri Industrial Area ofUjjain. A total investment of Rs 5407.59 crore has been approved in this industrial area. About 15 thousand needy people will get employment.
Emphasis is being laid on setting up employment-oriented industries in the state. The coming year 2025 will be celebrated as the Year of Industry. Investors Summit is also proposed in January 2025. Regional industrial summits will be held at various places in the state. Chief Minister Dr. Yadav will hold meetings with industrialists in major cities of India for new industrial investment in the state. A national conference on space technology will also be organized in the state. It was told in the meeting that activities useful for the youth will be held in the field of industries and business with the cooperation of MAPCOST and other organizations like ISRO.
Chief Minister Dr. Yadav said that the Industry Department should initiate efforts in the field of old age home operation and religious tourism. Housing facilities for the elderly should be developed in Datia, Orchha, and other religious tourism-related destinations of the state. For this, arrangements for multi-storied buildings can also be made, and tax-related concessions should be given to the institutions which cooperate in this field. The was told in the meeting that very soon inauguration and bhoomi pujan of 78 industrial units in the state is going to take place. The progress of the Industry Summit held last year besides, the progress of the Regional Industry Conclave-2024 held on March 1 and 2 in Ujjain was also reviewed in the meeting. Chief Secretary Smt. Veera Rana, Additional Chief Secretary to the Chief Minister’s Office Shri Rajesh Rajoura, Principal Secretary to the Chief Minister’s Office Shri Sanjay Kumar Shukla, Principal Secretary to the Chief Minister and Industrial Policy and Investment Promotion Department Shri Raghavendra Kumar Singh and other senior officers were present in the meeting.
Major instructions of Chief Minister Dr. Yadav in the meeting of Industrial Policy and Investment Promotion Department
Source: MP Info
Century Textiles and Industries advanced 4.50% to Rs 2,314.90 after Birla Estates announced to acquire land parcel of 16.5 acres in Manjri, Pune. Birla Estates is a wholly owned subsidiary of Century Textiles and Industries and the real estate venture of the Aditya Birla Group. The land parcel spans 16.5 acres with a development potential of approximately 32 lakh square feet, with an estimated revenue potential of Rs 2,500 crore. The project is situated on the Pune-Solapur Highway offering seamless connectivity to several IT hubs including Kharadi, Magarpatta and Phursungi as well as the Hadapsar MIDC. Located in the rapidly emerging micro-market of Manjri, Pune, the project is situated on the Pune-Solapur Highway offering seamless connectivity to several IT hubs, including Kharadi, Magarpatta, and Phursungi, as well as the Hadapsar MIDC. Furthermore, the project is conveniently connected to educational institutions, healthcare facilities, and shopping centers, making it a lucrative investment opportunity. The area is poised for substantial growth due to its excellent connectivity to the Pune ring road. K T Jithendran, MD & CEO at Birla Estates said, Pune is a strategic market for us and this acquisition is a step towards our ambitious growth plans. The Pune Sholapur corridor is transforming at a rapid pace and we intend to enhance living standards in Manjri by delivering meticulously designed homes that seamlessly integrate contemporary architecture with thoughtfully chosen amenities. Century Textiles & Industries has presence in cotton textiles, pulp & paper and real estate sectors. The Aditya Birla Group company reported a 4.40% fall in consolidated net profit to Rs 160.28 crore despite of 59.84% jump in sales to Rs 1,542.11 crore in Q4 FY24 over Q4 FY23.
Source: Business Standard
Para 4.30 of HBP prescribes the procedure for obtaining advance authorisation (AA) for intermediate supplies. This is somewhat inconvenient for us because we have a number of customers to whom we have to supply our goods that they will use as inputs in their manufacture of the export products. We have to enter into tie-up agreements with each one of them and we have to wait for the invalidation letters issued against their AA every time and then apply for our AA for intermediate supplies. We are considering obtaining AA for physical imports, import our raw materials under notification 21/2023-Cus dated April 1, 2023, manufacture the intermediates and then supply against invalidation letters as and when they are issued. Are we likely to encounter any difficulties under this type of arrangement?
The DGFT Policy Circular no.1/2024 dated April 12, 2024 says that AA holder holding an AA issued on or after 01.04.2015, under customs notification no. 18/2015-Customs, dated 01.04.2015 has option to fulfill the export obligation either by physical exports or by making domestic supplies under Para 7.02(A) (a) of FTP 2015-2020 i.e. supply of goods against AA/AA for annual requirement/DFIA. In my opinion, this circular lays down a principle that is equally applicable for AA issued during the current Foreign Trade Policy 2023 under notification no.21/2023-Cus dated April 1, 2023 also. However, it is better if you get this point clarified by the DGFT.
We are an EOU. We had made certain purchases under high seas sales arrangements where we made payment in INR. Our consultant says that according to the DC, Kandla SEZ, we are required to show such payments in INR also in our NFE calculation. Is this correct?
Yes. Para 6.10 of HBP is quite clear that payments made in INR towards high seas sales will also enter into NFE calculations.
We import our inputs under advance authorisations without payment of any customs duties or IGST. We export under LUT without payment of IGST and claim refund of unutilised ITC. In this process, our ITC keeps accumulating. We want to liquidate the accumulated ITC by exporting on payment of IGST under refund claim. Our consultant says that this cannot be done due to the bar under Rule 96(10) of the CGST Rules, 2017. Is this correct?
Rule 96(10) of the CGST Rules, 2017 bars you from exporting on payment of IGST if you have imported any of your inputs without IGST payment under notification 79/2017-Cus dated October 13, 2017, which actually amends the basic notification 18/2015-Cus dated April 1, 2015. So, if you imported your inputs under the said notification 18/2015-Cus, you cannot export on payment of IGST. However, if you have imported your inputs under the notification 21/2023-Cus dated April 1, 2023, the bar against exporting on payment of IGST under a refund claim does not operate. So, after exhausting the inputs imported under the said notification 18/2015-Cus., you can start exporting on payment of IGST under refund claim.
Source: Business Standard
GST Department Raids Textile Companies In Surat Over Tax Discrepancies
The GST department had previously investigated two Surat textile traders before the elections and has now raided three more
Surat : The Goods and Services Tax (GST) department raided multiple textile companies in Surat, targeting those using sublimation printing paper in digital machinery. The investigation revealed that the owners were paying 12% GST on their final products. However, the department contends that an 18% tax is applicable, leading to a levy of an additional 6% tax on these products.
This move has far-reaching implications for the industry, as manufacturers of such printing papers may now face a 6% tax difference. The GST department’s actions stem from a long-standing classification issue dating back to the introduction of GST in 2017. The discrepancy arises from the absence of an appropriate Harmonized System of Nomenclature (HSN) code in the GST tariff for the products sold.
Raids and Investigations Before Elections
The GST department had previously investigated two Surat textile traders before the elections and has now raided three more. These actions are part of an effort to address the misclassification and ensure compliance with the appropriate tax rates. The department’s scrutiny has intensified, focusing on paper and coated printing paper manufacturers involved in sublimation printing.
Classification Issues and Financial Implications
The core of the problem lies in the classification of these products. In the industry, the final products have been subjected to a 12% GST. However, the department’s stance is that they fall under an 18% tax bracket. This reclassification has prompted the department to start calculating additional tax, interest, and penalties for the affected traders.
Expert Opinions and Recommendations
Tax experts have weighed in on the issue, highlighting the need for clarity in the classification of new or mixed products. CA Sunay Jariwala, a renowned chartered accountant, emphasized the importance of obtaining professional opinions in writing for HSN codes before launching any new products. He noted, “It is necessary to take proper opinion, in writing, from a professional for HSN code before launching any mix or new product.”
Additionally, the recent GST Council meeting has recommended the introduction of a new Section 11-A. This section would grant the government the power to provide relief by addressing issues of lesser or no GST levy under common trade practices. CA Jariwala added, “Under this 11-A, the government will have the power to grant relief by accepting the issue of less or no GST levy under Common Trade Practice. How it is implemented and with what financial means will be an important issue.”
Source: The Blunt Time
Egypt has expressed a keen interest in importing rawhides from Bangladesh and leveraging the country's expertise to enhance its own jute industry. This interest was conveyed by Egyptian ambassador to Bangladesh, Omar Mohie Eldin Ahmed Fahmy, during a meeting with Bangladesh’s state minister for commerce, Ahasanul Islam Titu, at the Secretariat. Ambassador Fahmy highlighted Egypt's desire to collaborate with Bangladesh, utilising its historical experience in the jute industry to foster similar development in Egypt. State Minister Titu mentioned that the commerce ministry is currently negotiating commercial agreements with 26 countries globally. He noted that once investments are made, Bangladesh could leverage market advantages in Southeast Asia and ASEAN countries. Titu expressed optimism that future visits by Egyptian business delegations to Bangladesh would further enhance investment opportunities, according to Bangladeshi media reports.
Source: Fibre2fashion
For the period of January-May 2024, Uzbekistan exported textile products worth $1.29bn, representing 11.8% of the total export volume. This figure marks a 0.5% increase compared to the same period in 2023. The increase in textile exports is a direct result of reforms aimed at shifting from raw cotton production to finished goods, thereby adding more value, Statistics Agency disclosed.
A closer look at the export structure reveals that yarn constitutes the largest share at 46.8%, followed by finished textile products at 37.6%. In this period, Uzbekistan exported 496 types of textile products to 55 countries.
The export values for specific categories for January-May 2024 are as follows:
This growth in exports is attributed to the adoption of new production technologies, modern equipment, and the implementation of quality management systems. In 4M24, extile exports exceeded $1bn, marking a 1.4% increase compared to the same period in 2023. From January to May 2024, Uzbekistan's textile exports totaled $1.29bn. Therefore, the textile exports increased by 29% from January-April 2024 to January-May 2024.
Source: Daryo.UZ
Tens of thousands of textile and textile product (TPT) workers in Indonesia have been laid off in the first half of this year, President of the Confederation of Indonesian Trade Unions (KSPN) Ristadi said on June 23, describing the sector’s situation as an emergency. Jakarta (VNA) – Tens of thousands of textile and textile product (TPT) workers in Indonesia have been laid off in the first half of this year, President of the Confederation of Indonesian Trade Unions (KSPN) Ristadi said on June 23, describing the sector’s situation as an emergency. Ristadi said the condition of the TPT industry sector is critical, especially for locally oriented factories, as the domestic market is increasingly flooded with imported goods. Clothing, textiles, and footwear from abroad continue to inundate Indonesia’s domestic market. According to KSPN, since the beginning of 2024, 13,800 workers in Indonesia's textile industry have been laid off due to plummeting orders, with some companies even experiencing a complete halt in operations. Currently, only export-oriented textile firms are managing to survive.
The actual number of laid off worker is almost 50,000 workers. However, many companies do not want their names to be exposed to maintain trust from banks and buyers. Ristadi noted that most of the layoffs occurred in West Java and Central Java, which are home to the TPT production hubs. He said that the wave of closures is primarily triggered by Trade Minister Regulation (Permendag) No. 8 of 2024, which relaxes import restrictions on ready-made garments, flooding the domestic market with imported clothes. As a result, domestic textile production has been facing many difficulties.
Source: vietnamplus.vn
Texworld and Apparel Sourcing return to Paris from July 1-3
Just ahead of the Paris Olympics, international textile and apparel manufacturers will converge in Paris from July 1 to 3. The Texworld and Apparel Sourcing fairs will bring together 1,154 companies at the Porte de Versailles. Apparel Sourcing, with nearly 530 exhibitors, will closely match the approximately 570 exhibitors of Texworld, the textile and materials fair. Additionally, around 30 exhibitors will feature in the Denim zone, and 20 leather specialists will come together in the Leatherworld zone, which will also host a Leather Trend forum co-produced with Edizioni AF. A highlight of this year’s event is the introduction of Yarn Expo, a space dedicated to yarns and fibers, echoing the biannual fair organized by Messe Frankfurt alongside Intertextile Shanghai. Yarn Expo will feature productions from China and India, as well as Pakistan and Taiwan. “This year, Apparel Sourcing welcomes 30 Chinese manufacturers, showcasing their own brands or producing white-label goods for European distributors. These exhibitors will be identified by a Chinese Brands Gallery logo,” the organizer noted. The accessories sector will also expand to include a range of jewelry and bags. The Avantex space, dedicated to innovation, will introduce a Designer Hub for meetings between designers and buyers, and a ReSources zone focused on sustainable innovation. The Near Sourcing Hub will offer proximity production solutions, featuring around 20 companies from Portugal, Turkey, and Serbia. This edition will also host a series of thematic conferences. The Bali Chair will present the challenges and opportunities of digital product passports for textile items. Other topics will include developing European regulations, the rise of African fashion, and the revaluation of textile products.
Source: US fashion network
Gala ‘Sourced Sri Lanka’ Fashion and Textile Trade Show held in London
The Sri Lankan High Commission in London, in collaboration with the Export Development Board (EDB), Sri Lanka Apparel Sourcing Association (SLASA), and Joint Apparel Association Forum (JAAF), presented the ‘Sourced Sri Lanka’ Fashion and Textile Trade Show on June 17-18, 2024, at the Royal Horticultural Hall in London. This event, the first of its kind in the UK, showcased the pinnacle of Sri Lankan fashion and textiles with 80 exhibiting stalls. It provided a unique platform for UK buyers and fashion enthusiasts to engage directly with Sri Lankan manufacturers and designers. Highlights of the event included a captivating fashion show, the launch of “Your Vital Island” by High Commissioner Rohitha Bogollagama, and a panel discussion, on June 17, led by industry leaders and experts, focusing on the values and sustainability of Sri Lanka’s apparel industry. In his address, the High Commissioner emphasized Sri Lanka’s rich history of more than 3,000 years in weaving and the country’s leading role in the global apparel industry, with the UK being its second-largest market. The ‘Sourced Sri Lanka’ Road Show underscored Sri Lanka’s commitment to excellence, sustainability, and innovation in the global fashion industry.
Source: island.lk
Despite various challenges faced by industries, such as dollar shortages for importing raw materials and capital machinery, and a lack of uninterrupted gas and electricity supply, Ananta Group is set to invest $70 million to establish a synthetic knit fabric manufacturing facility. The new unit, named Ananta Knitwear Limited and located in Narsingdi, will serve as the first backward linkage industry for one of the country's leading apparel exporters, aiming to capture a significant share of the export market for activewear, sportswear, and intimate apparel based on manmade fibre. Through this investment, the group has set a target to achieve about $700 million in export turnover over the next five years, according to the entrepreneurs. They mentioned that despite the ongoing dollar shortage, the apparel manufacturer has undertaken this initiative with $40 million in low-cost long-term financing support from the Asian Development Bank (ADB) for importing capital machinery. Sharif Zahir, managing director of Ananta Group, told The Business Standard, "The remaining amount will be managed through our own financing to procure land and complete construction work." Sources at the company said the group has already purchased 100 bighas of land to establish the factory. The foreign financing comprises $20 million from ADB and a syndicated B-loan of $20 million from the ILX Fund, an Amsterdam-based emerging market asset manager focused on the Sustainable Development Goals, with ADB as the lender of record. As the mandated lead arranger, ADB arranged and syndicated the financing package.The managing director mentioned that construction work will start next month, and the factory will go into production by the end of 2025.
Sharif Zahir added that it will create about 2,000 new jobs in two phases, with a daily production capacity of 60 tonnes and an initial capacity of 30 tonnes. He hoped that it would help attract some leading sportswear brands like Nike, Adidas, and Puma to import MMF-based sportswear from Bangladesh. The new factory is expected to receive platinum certification under Leadership in Energy and Environmental Design, the global standard in green building rating systems. The factory will use advanced automated, energy-efficient machinery and equipment based on the latest technology. Sharif Zahir said the new unit would be able to produce 2MW of solar energy from its rooftops. "Bangladesh's textile industry is a major contributor to the economy, but the breadth of its impact is much broader. It is also about livelihoods and national resilience," said ADB Director General for Private Sector Operations Suzanne Gaboury in a statement on Monday. "The textile industry employs millions, drives exports, and sustains families. ADB's support will help attract much-needed financing to this strategically crucial part of the national economy."
Asif Zahir, deputy managing director of Ananta Group, expects that Ananta Knitwear's annual turnover will be about $100 million, noting that it will serve as a deemed exporter for the group's intimates and activewear manufacturing unit as well as other factories in the country. He further mentioned that this initiative would help increase the turnover of its intimate apparel manufacturing unit to $200 million from the current $50 million. In addition to the new project and ongoing expansion plans for existing units, Asif Zahir hopes that the group's annual exports will reach about $700 million by 2029. Ananta Group manufactures products including jeans, suits, sweaters, intimates, activewear, and outerwear, generating total revenue of about $400 million. With over 30 years in business, the group employs over 30,000 people across seven factories.
Source: tbsnews.net
Govt to provide compensation to flood-hit farmers in Sylhet: Textile & Jute Minister
Textiles and Jute Minister Jahangir Kabir Nanak on Monday said the government will provide compensation to the flood-hit farmers for the damage caused in the agriculture sector during the recent floods in Sylhet. Nanak came up with the assurance while distributing relief materials among the flood-hit victims at No 42 ward in Sylhet city on Monday.The Prime Minister has directed to protect the Sylhet residents from flood through dredging the Surma-Kushiara Rivers and she has sent the State Minister for Relief and Disaster Management and State Minister for Water Resources to Sylhet to take all necessary steps to protect the people of Sylhet from floods next year, he said. The minister also provided relief materials to the flood-hit victims in Dakkhin Surma upazila. Prior to that, Nanak performed ziarat at the shrines of Hazrat Shahjalal (RA) in the morning. He will distribute relief materials among the flood-hit victims in Sunamganj on Tuesday.
Source: unb.com.bd
In Vanguard’s Nigerian Newspapers review programme, today in the News, Vanguard reports that Nigeria’s textile industry is now gasping for breath following the failure of revival measures, a sustained upsurge in the importation of textile products and a series of adverse monetary policy regimes. Financial Vanguard findings indicated that decline had set in around 2005 and it had struggled since then despite the growing market size due to the rising population. It reported that only about five textile mills are still operational today while the cotton production value chain has vanished. The labour force is also down to less than 2,000, both direct and indirect.
Source: vanguardngr
