FW
Micro-finance companies, taking advantage of the demonetisation of high value currency, are slowly re-entering Sircilla textile town in AP and lending small loans to power loom weavers. Demonetisation has cast its shadow on the powerloom industry which is already reeling under crisis due to no-takers for its grey fabric.
Two micro-finance companies started providing loans ranging from Rs 2,000 to Rs 5,000 after collecting bonds and sureties. They collect a whopping interest rate of 36 per cent and burden the weavers. Usually, months of November and December are lean seasons for the movement of fabric. Demonetisation has come as a rude shock to main purchasers of the fabric - traders, powerloom owners and power loom workers. As fabric production and sales are done only through cash, the ban and restrictions on withdrawal of cash from banks has become a cause of concern for everyone involved in the industry.
People in Sircilla still remember the harassment by micro-financers who operated till 2008. There were incidents of weavers resorting to suicide unable to bear the mental agony and torture by agents of micro-finance companies.
The then chief minister of united Andhra Pradesh removed micro-finance companies by making nationalised banks provide loans to weavers.
In a bid to register their strong protest over discrimination against the Punjab textile industry over gas prices, a key input, a lot of associations of textile manufacturers in Pakistan have said they will observe December 6 as ‘Black Day’. The disparity in gas prices had shattered the entire industrial chain in Punjab, the associations say.
All trade bodies including the Pakistan Textile Exporters Association (PTEA), Faisalabad Chamber of Commerce and Industry (FCCI) and All Pakistan Textile Mills Association (APTMA) have lashed out at what they say was the government’s discrimination against the Punjab-based textile industry as it was bearing the brunt of gas shortage.
PTEA Chairman Ajmal Farooq said that industries in Sindh were consuming low-priced gas to meet their needs while Punjab industries, which generated the highest revenue, were compelled to use the expensive re-gasified liquefied natural gas (RLNG) in their production process. With the recent reduction in the industrial gas tariff, the price for Sindh industries has become Rs400 per million British thermal units (mmbtu) whereas Punjab industries are paying over Rs900 per mmbtu.
Expressing disappointment over the indifference and lack of cooperation from government institutions, Farooq said they were repeatedly voicing their concern over the situation but all of the hue and cry was falling on deaf ears of policymakers. He urged the PM to take notice and ensure gas supply to Punjab at the same price.
He also urged the PM to immediately announce a package for the ailing textile industry and warned if the government did not fulfill their demands, they would hold a massive protest.
Pakistan’s textile exports have moved down by 12.11 per cent. Despite being the largest forex earning sector this year, exports declined to $8363 billion. Although the country is reaping the benefits of GSP, it has shown bleak performance in the export sector and the Islamabad Chamber of Small Traders (ICST) has expressed deep concern and termed it unacceptable.
The decline is being attributed to the shortage of electricity and delays in disbursement of export refund claims. Despite achieving preferential market access to the European Union, exports have been declining for the last two years. The country is facing tough challenges in the international market. Many have urged the government to take over the textile industry since many textile owners are winding up businesses and moving to other countries. The government should provide safe environment for the industry to thrive and guarantee better incentives and friendly policies.
ICST has urged the government to take immediate steps to arrest the trend as rival countries are snatching Pakistan's share in the international market which will have a negative impact on the economy. The government should make plans to provide affordable energy to Punjab's value added sector which rely on the supply of LNG, says Shahid Rasheed Butt, Patron of ICST. He says Punjab's textile sector is already buying costly LNG while the value added sector in Sindh gets uninterrupted supply of natural gas throughout the year.
The Delhi High Court on Friday adjourned Monsanto's challenge to proceedings initiated against the company and its officials by the Competition Commission of India (CCI) earlier this year, as government co-counsel senior advocate, A S Chandhiok, was unavailable to present his arguments.
His absence though, did not stop either party from continuing their on-going tussle before the single judge. On hearing Chandhiok's unavailability, counsel for Monsanto, Ajit Warrier, highlighted CCI's continuing attempts at delaying proceedings and pressed for the matter to be heard nonetheless in order to avoid any coercive steps being taken against the company.
Co-counsel for the government, additional solicitor general Sanjay Jain responded to this by informing the court of Monsanto's non-cooperative attitude and failure to respond to notices on the ground that the matter was sub-judice before the court, even though no stay order was granted against the probe. After hearing the submissions, Justice Sanjeev Sachdeva agreed with Jain that the investigation was to continue as usual, while also consoling the Monsantocounsel that any coercive action could be undone if necessary, at a later stage. The court then adjourned the matter till December 7.
The CCI had in February, ordered a detailed probe into the activities of the genetically modified seed manufacturer after finding prima-facie evidence of violations of Indian competition laws. After the commencement of the initial probe, the regulator clubbed three additional complaints against Monsanto later in June. The CCI has also included Monsanto officials into the ambit of the probe, which the company contends is beyond the scope of the regulator's powers at this stage. Monsantohas challenged both the investigation and the inclusion of its officials by the CCIin the Delhi High Court.
Though the leather industry of neighbouring countries are growing but in Pakistan, the leather garment industry is declining as far as exports are concerned. As result the industry is near to closure. Moreover the government is not paying attention to issues facing the industry, says chairman of Pakistan Leather Garments Manufacturers & Exporters Association (PLGMEA), Atif Ashraf.
He further observed the leather garment industry of Pakistan is already in distress and would collapse if the Federal government does not come forward to bail it out by giving incentives and pay extra attention to address issues. The decline in quantity of leather garments exported is around 12.35 per cent during 2015-16 from 2014-15 as per Pakistan Bureau of Statistics which is very alarming.
Unless the government announces and implements relief package for this industry, exporters will be forced to close down units causing unemployment to workers. Governments of India and China have offered high duty drawback rates to their exporters as incentive for boosting exports. While China offers 8.5 per cent duty drawback rate on export of leather garments, India offers 9.5 per cent duty drawback. The duty drawback rate in Pakistani is only 4.26 per cent for leather jackets. Ashraf strongly urged the PM and commerce minister to activate TDAP and commercial consulars in Pakistani missions abroad.
Amid a strong demand for lint from domestic mills and its potential to supply manufacturers exporting clothing and textiles to the US under a preferential trade deal, Kenya plans to revive its cotton industry, a major foreign-exchange earner until the 1980s. The government is planning to train and offer credit facilities for farmers as part of a bid to restore production that peaked at 38,000 metric tons of seed cotton in 1984-85. Currently, the country produces 15,700 tons of seed cotton creating about 5,240 tons of lint. Demand is about 37,000 tons with the shortfall imported from neighbouring countries, says Fanuel Lubanga, a development manager at the state-run Agriculture and Food Authority, Kenya.
The initiative comes as manufacturers in East Africa’s biggest economy are counting on apparel exports to the U.S. growing 5 per cent this year after the US extended its African Growth and Opportunity Act, or AGOA, by a decade. East Africa could potentially export garments worth $3 billion annually by 2025, says a 2015 McKinsey report. Affordable electricity and cheap labour with monthly salaries as low as $60 make producers such as Kenya and Ethiopia attractive to investors, the study indicated. Kenya exported clothing worth $380 million in 2015, with companies including Puma SE, Walmart, JC Penny and H&M among those sourcing garments from Kenyan Export Processing Zones that employ more than 66,000 people.
The global cellulose acetate market is expected to grow at a CAGR of around 3.6 per cent between 2016 and 2021. Cellulose acetate is a non-flammable thermoplastic polymer produced by acetylation of cellulose with acetic acid by using sulfuric acid. Cellulose acetate is available in various forms such as granules of fiber, powder, and granules. It is also obtained from wood pulp.
Cellulose acetate is widely used in the photography industry as a film base and is also used in the manufacturing of eyeglasses as a frame material. Cigarette filters, textile and apparel, photographic films, tapes and labels, and extrusion and molding are the application areas in which cellulose acetate is used.
Increase in disposable income and changes in the lifestyle of consumers in developing countries such as China, Brazil and India are predicted to boost demand for cellulose acetate in cigarettes, textiles and plastics.
Cigarette filter was the largest application segment in 2015 and it accounted for over 80 per cent of the market share in the same year. It is estimated to increase its market share over the next few years. Moreover textiles and apparel accounted for the second largest share of the global cellulose acetate market in 2015.
Following the adoption of a law that granted experimentation rights both in labs and fields and conduct of confined field trials of BT cotton, Ethiopia is gearing up to begin commercial sale of BT cotton in two years.
Endale Gebre, Director of agricultural bio technology sector at the Ethiopian Agricultural Research Institute, says they will sell the BT cotton seed varieties to the market in coming one or two years. He further added the confined field trail stage of the BT cotton has now entered final stages which will allow the cotton to be commercialised. The trials have been conducted for four years on four different varieties sourced from India and Sudan.
The field trial has been conducted in selected cotton growing areas of the country. Most activities have been undertaken in the North, South and Eastern parts of the country. Based on field results, Endale has confirmed Ethiopia will have a BT cotton variety in the plantations sometime soon.
Business for the textile and apparel industry in India has fallen by 30 to 40 per cent since demonetization. Since consumers at first had to make do with Rs 2,000 notes they deferred purchases. There was an abrupt decline in domestic sales which hit bottomlines. There was an immediate and total disruption. Sales were down completely. Retail counters wore a deserted look. Such headwinds are expected to persist for at least a quarter. Apparel sales are expected to recover gradually with the availability of new currency notes especially in lower denominations.
Many handloom, power loom and cottage fabric manufacturers continue to operate largely in cash. In the garment business, a large section of retailers at the bottom of the pyramid deals largely in cash.
The wedding season is on but consumers are in no rush to buy. People are opting for sober marriages and cutting down on wedding gear. The apparel sector, however, has hailed the overall scheme as good for the long term, on expectations of transparency in the entire value chain.
The Indian textile and apparel industry is estimated to be worth a $100 billion. It anticipates new measures which would inject liquidity into the system.
With the US President-elect Donald Trump’s saying he would reject TPP on his very first day in office, it has had a cascading effect. Business houses in South Korea who were looking forward to Vietnam’s ratification of the Trans-Pacific Partnership (TPP) are dejected and deeply disappointed.
The country is Vietnam’s largest provider of foreign direct investment (FDI) and the latter was poised to be one of the biggest gainers from the US-led trade deal involving 12 Pacific Rim nations. Though South Korea was not among the 12, the deal’s failure has hit the country’s industry and companies that have been struggling to maintain growth amid declining entrepreneurship and innovation.
South Korea’s largest business conglomerates, its famous chaebol, are long-term investors in Vietnam. They are attracted by low wages and the possibility of free trade with Asean members and TPP countries. However, the government of Vietnam has announced it will delay ratification of TPP, taking a wait-and-watch approach.
Indeed, Vietnam’s decisions first to join the deal and then delay ratification gave South Korean business houses a roller-coaster ride and a lot of companies rescheduled their investments, says Kim Bu-heung, leader of the international cooperation team at the Korea Federation of Textile Industries (KOFOTI) in Hanoi said.
