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In terms of acreage, India is ranked fourth after the US, Brazil and Argentina in adopting of GM crops. While the top three grow more than one GM crop, India grows only cotton. Bt cotton was introduced in India in 2002 amid a raging controversy. This is a genetically modified seed. Many activists were alarmed at the decision to permit GM crops in India, and there were widespread agitations. Bt cotton continues to be the only genetically modified crop permitted in India and has captured about 95 per cent of the crop area under cotton. However, the increase in productivity has not been commensurate. The average yield was 472 kg per hectare in 2005-06 (when only about 15 per cent of the cotton crop was covered by Bt cotton.) The yield rose marginally to 484 kg per hectare in 2015-16. A dispute arose between several seed companies and Monsanto regarding Bt cotton trait fee payments.
Initially, the dispute between Monsanto and seed companies was the quantum of royalties or trait value to be paid by the latter. In 2010, some state governments fixed the maximum retail prices of cotton seeds, which included the trait values as a component. The governments did this so as to ensure that seeds were available to the farmers at reasonable prices. However, Monsanto put pressure on the seed companies to pay the trait values as determined by them on the ground that they had a patent on Bt cotton seeds. The seed companies had no alternative but to pay under protest.
The Chinese are contemplating investing in sick textile units of Pakistan. More than 115 textile mills have closed for good and many have disposed off their machines at junk rates. Their deserted sites are ideal for establishing modern textile units. They closed because they were operating on obsolete technology and lacked resources to bring in the new one.
But apart from that the basic infrastructure to operate a modern unit exists. There are sheds and storage space and gas, power, and water connections. So the Chinese may enter into joint ventures with sponsors of the closed mills. The mills could be started within six months of investment and would be viable from day one. This is because modern spindles consume 40 per cent less power and require only one-third of the workforce that works in most existing spinning mills in Pakistan.
It makes business sense for the Chinese to start spinning yarn in Pakistan. The basic textile sector of Pakistan is the fourth largest cotton producer and home to low-cost skilled labor. And many Pakistani basic textile entrepreneurs including the closed mills have shown keenness to enter into joint ventures with the scores of Chinese entrepreneurs that have been visiting Pakistan for this purpose.
Bangladesh’s apparel exports to India increased 111 per cent point-to-point in the last nine months. Knitwear exports to India increased 104 per cent, and woven exports increased by 113 per cent. Bangladesh’s total exports to India increased by 15 per cent during the period.
The main reason for the increase in apparel exports is the appreciation of the rupee against the dollar. Also, there is an advantage of lead time to export to India which is a neighboring country. Bangladesh is keen to collaborate with India on various fronts such as supply chain, technology and textile education. Bangladesh is the world’s second largest readymade garment exporter and India is the second largest producer of manmade fiber and textile fabrics. Bangladesh feels it can work with India for creating a supply chain, where it can source the raw material like cotton and manmade fiber, yarn and textiles and convert them into fashion apparels.
Equal emphasis on physical and institutional connectivity between India and Bangladesh will facilitate the exploration of more opportunities through trade and investment. Connectivity offers a game-changing opportunity for India and Bangladesh. This is pivotal to India’s connectivity with its north-eastern region and with countries of Asean.
As textile firm Alok Industries heads into liquidation, about 12,000 permanent employees of the company are set to lose their jobs.The Ahmedabad bench of the NCLT admitted insolvency proceedings against the textile firm last July. A consortium of lenders, led by the State Bank of India (SBI), is claiming dues of over INR 23,000 crore from Alok Industries.
The 270-day deadline before which lenders had to finalize a resolution plan ended April 14 this month. Plans to recover the distressed firm failed as lenders were unwilling to accept an offer that involved a substantial cut. Earlier last week, lenders to Alok Industries did not approve an offer by Reliance Industries and JM Financial ARC to acquire the bankrupt company.
Only 70 per cent of the lenders endorsed the revised all-cash offer of Rs 5,050 crore, which was just about Rs 100 crore higher than the previous one. For a resolution plan to be passed, at least 75 per cent of the lenders must vote in its favor. Tthe firm is headed for liquidation and could be one of the biggest labor casualties since the implementation of the bankruptcy code.
There were 11,759 full-time employees as on March 31, 2017, with the total staff strength around 18,000. Meanwhile, staff costs amounted to Rs 283.31 crore during that financial year. The insolvency proceedings are also expected to impact hundreds of small vendors and service providers to the company. Almost 2.05 lakh equity shareholders, including public financial institutions and retail investors, are also looking in the face of losses as the company heads into liquidation.
"Amid clouds of uncertainty, companies across the globe are facing challenges while operating businesses out of their own countries. Given this scenario, India is emerging a preferred destination for sourcing. Alessandro Lenzi, Administrator, Lebiz srl, recently came to India to explore factories for intimate apparels. He pointed out despite the economic crisis in Italy, his company is optimistic about further growth. This is the best time to explore new growth opportunities and to come back strongly post crisis, as early as possible."
Amid clouds of uncertainty, companies across the globe are facing challenges while operating businesses out of their own countries. Given this scenario, India is emerging a preferred destination for sourcing. Alessandro Lenzi, Administrator, Lebiz srl, recently came to India to explore factories for intimate apparels. He pointed out despite the economic crisis in Italy, his company is optimistic about further growth. This is the best time to explore new growth opportunities and to come back strongly post crisis, as early as possible.
The company has 26 stores in Bologna and they realised Italian consumers prefer Indian productsm hence, India is a hub they can’t ignore anymore. Initially the plan is to source 20,000 pieces per collection annually and with 4 to 5 collections a year. Some manufacturers are in touch with them. As of now, they are exploring prints. Other sourcing companies too are increasingly looking at India as their sourcing partner. Saudi Arabia’s Nama Arabia Apparels, (‘Blooming’ label) was working primarily out of China but now they are impressed with Indian manufacturers and rethinking options. Fawzi Alnahdi, CEO, Nama Arabia Apparels says around 95 per cent of their products, including underwear and outerwear, are out of China but now they would like to start working with casual womenswear that would appeal to women in Saudi Arabia.
Some buyers say they are working hard to ensure timely delivery from Indian exporters and insisting on focusing more on product development. Rayes Gimenez, Manager, Kuini Creation, Spain and Jaime Barba of 360 Streetwear, are upbeat about their sourcing tie-up. As Ada Kamara, Mykonos, Greece says, India is their biggest sourcing destination. They are looking for fresh collections and hope to make new contacts with exporters that will support their growth plans as they plan to become wholesalers and spread their wings.
For Sarabjit Singh E.E., Manager, Siba International, Denmark, any exporter who can offer innovative patterns will have an upper hand in winning contracts. Twinset S.P.A., from Italy has been sourcing from India for the last 15 years and their journey have been impressive. The company is represented by Preeti Walia in India. Around 70 per cent of products are sourced from India, while the remaining 30 per cent of basic/core lines are sourced from China. Hand embroidery is at the core of most of the products sourced from India.
Opening new horizons
Russia is a potential market for Indian exporters. As Valery Sidorenkov, Chief production officer and quality assurance, Modis, Moscow says he is working with six exporters in India. They are sourcing good volume of womenswear, menswear and kids wear from India. He says, garment exporters should have proper data and start analysing where they exactly are. Some key areas like good quality can make a company profitable. Strong quality management system and data assessment system will help reduce issues like extra procurement of material, amount of manpower invested on check, rechecks, reworks, so proper data would be the starting point.
Gurgaon-based Rania Trading, Gurgaon is as an authorised agency for UK companies Poundstretcher, the Pet Hut, Pound Store. It is mainly into home furnishing products and is now exploring garment also. Udit Gupta, Assistant Merchandiser, Rania Trading says they are planning to start with kids wear and will proceed accordingly. With such an expansive list of clients, it is challenging for the company to find good quality products with reasonable price but they are managing with their experience and expertise in the field.
For Q1 of 2018, Vietnam’s revenue from the export of textile and garment products increased 13.35 per cent over the same period last year. Export of garment products alone was up 12.49 per cent compared to the first quarter of 2017. Besides traditional garment and textile products, goods with a high value-addition such as fabrics, fiber, geo textiles, and textile and garment accessories have also grown well.
T-shirts, jackets, and shirts were among the top export products in the first two months of this year. Many companies have received orders until the end of the third quarter of 2018. Vietnam’s key export markets are: the US, member countries of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the EU, the Republic of Korea, China, and Asean.
In the first quarter of this year Vietnam’s textile and garment exports to the US were up 13.2 per cent over the corresponding period in 2017, the highest pace of growth in the last three years. Textile and garment exports to CPTPP member countries grew at an average rate of eight per cent a year in the 2013-2017 period, accounting for about 15 per cent of Vietnam's total textile and garment export revenue.
ITMA, which takes place every four years since 1951, has strengthened its reputation as the world’s leading textile and garment technology exhibition. Exhibition space for its 18th edition to be held in Barcelona has been fully booked before deadline of April 6, 2018. As per CEMATEX, the European Committee of Textile Machinery Manufacturers, owner of the ITMA exhibition, over 1,500 companies from 45 countries have applied for ITMA 2019. The space booked already totals more than 110,000 sq. mt.
Fritz P Mayer, President CEMATEX says ITMA is the launch pad of choice for the latest technologies from around the world. Interest in ITMA 2019 is strong, and compared with previous editions it has received more applications at an earlier date. It will continue to welcome manufacturers who are launching new products, as they will help to make ITMA 2019 an even more vibrant sourcing platform for our visitors.
The exhibition will showcase an integrated textile and garment manufacturing value chain. Close to 65 per cent of the space has been booked. Besides machinery, exhibits will also include yarns, fibres and fabrics, and solutions for technical textiles and nonwovens, and garment making. Countries exhibiting at ITMA include Italy, Germany and Spain. Highlighting the positive market sentiments of textile machinery manufacturers from the rest of the world, applicants from Turkey, India and China take the top spots in terms of space applied.
With the participation of some 1,600 exhibitors ITMA 2019 is expected to feature a showcase of more than 115,000 sq. mt. ITMA 2019 will be held from June 20 to 26 at Fira de Barcelona, Gran Via venue. The exhibition, themed ‘Innovating the World of Textiles’, will showcase latest technologies and sustainable solutions for the entire textile and garment manufacturing value chain, as well as fibres, yarns and fabrics.
India’s garment exports for March have contracted by 0.7 per cent compared to a year ago. This slowdown is across all sectors, led by the gems and jewelry sector, whose exports fell sharply by 16.6 per cent from a year ago. Garment exports have now fallen behind Bangladesh’s and Vietnam’s in absolute dollar terms.
Vietnam’s garment export grew 10 per cent last year and is expected to continue at the same pace this year. Notably, Vietnam has now tapped newer markets like Russia and China, in addition to the US and the European Union.
India’s garment sector was affected first due to demonetisation. Due to last year’s cash disruption, orders were lost, and these can’t be regained easily from competitor countries. Second the delay in getting GST refunds and the burden of cost in locked capital. The delayed refund does not include the interest cost. Exports need to be urgently zero-rated. The overvalued exchange rate makes India’s exports relatively expensive. Then there is the continued unreliability of electricity and other infrastructure facilities. Small and medium enterprises need a common plug and play, seamless hard and soft infrastructure—whether it’s effluent treatment or inspection or logistics.
The combination of three integral segments of handicrafts sector home-textiles, houseware and furniture concluded at India Expo Centre & Mart, Greater Noida. The premium expo, saw 720 overseas buyers and their representatives and buying agents and retail buyers sourcing for their focused requirements from a diverse range of international products under one-roof showcased by more than 650 exhibitors.
A highly dedicated and product-segmented triple show Home Expo India was the culmination of Indian Houseware and Decoratives Show (IHDS), Indian furnishings, floorings and textiles show (IFFTEX) and Indian Furniture and Accessories Shows (IFAS) offered opportunities to the visitors to source their requirements under one roof.
One of the distinct features of the show was display of products from Northeastern region made out of cane and bamboo. Rakesh Kumar, Executive Director, EPCH stated the push is now on product-segmented specialized trade shows rather than trade shows covering all product categories after the development taking place in the international markets. So Home Expo India was initiated by EPCH in 2012 and this year it has entered its 7th edition.
EPCH is the nodal export promotion body for handicrafts in India and plays an important role as a catalyst between exporters, buyers and the government with the main objective of boosting handicrafts exports from the country and also projects India’s image in the global markets as a reliable supplier of handcrafted exquisite and quality products.
Guess has partnered Better Cotton Initiative (BCI). Since Guess uses cotton in many of its products, it is taking proper steps to source sustainable cotton in the supply chain, hence the need to joine The Better Cotton Initiative. The brand will source Better Cotton to help address its water use. Guess will make public its official goals for sustainable cotton sourcing later this year.
Global lifestyle brand Guess is famous for its iconic ad campaigns and trend setting denim. Better Cotton Initiative works with cotton farmers, helping them to use water efficiently and care for the environment, as well as promote higher standards of work, during cotton production.
By becoming a BCI retailer and brand member, Guess can commit to a more sustainable future for cotton production by investing in the initiative which, last year, reached and trained 1.6 million cotton farmers on more sustainable agricultural practices, such as efficient use of inputs (water, pesticides), increasing yields, and addressing gender equality and child labor issues.
About 64 per cent of water use occurs during raw material production, namely cotton. In 2017-18 financial year, Guess’ total operating income improved 37 per cent. In the same period, its operating margin grew from 2.9 per cent to 3.6 per cent.
