FW
Turkish textile company Birlesik Tekstil is planning to open a factory in Belgrade, Serbia by the end of this year. This was announced by Belgrade Mayor Sinisa Mali. The proposed factory will come up in the city’s Lazarevac municipality. Birlesik Tekstil has acquired a factory of insolvent local textile company Beko and is looking to appoint 600 employees by the end of 2017 and another 600 at a later stage to do business.
Serbia imports $180 million worth of textile from Turkey annually which is the reason why Serbia should attract Turkish investors here says Ljajic. Serbia plans to promote a model that involves the reconstruction of old and abandoned halls where interested investors could install machinery and immediately start production. The country’s exports to Turkey rose by 10.8 per cent to 30 billion dinars in 2016, while imports from Turkey increased 18.1 per cent to 74.3 billion dinars, according to data from Serbia’s statistical office.
Turkey’s exports to Russia declined to $1.4 billion in the first three months of 2014 from $1.7 billion in the same period of the previous year. They fell to $912 million in the first quarter of 2015 and to $353 million in the first quarter of 2016. Exports reached $498.1 million in the first quarter of this year, soaring by 40.9 per cent compared to the same period last year.
Imports from Russia to Turkey neared $6.2 billion in the first quarter of 2013 and rose to $6.7 billion in the same period of 2014. They dropped to $3.9 billion in the first quarter last year from nearly $6 billion in the same period of 2015. Imports from Russia neared $4.4 billion in the first quarter of this year with an 11.5 per cent increase compared to the same period last year.
There was also a significant increase in the amount of Turkey’s exports to Russia in apparel, boilers and machines, electric machines and motor land vehicles.
During the last financial year, sales of khadi products went up 33 per cent. Sales of village industries produce grew 24 per cent. There has been a huge demand for products such as honey, soaps, cosmetics, furniture and organic foods, which are produced by village industries and many of which are run by women. Domestic and international fashion designers prefer to work with sustainable and natural fabrics like khadi. Millennial shoppers are concerned about the clothes they wear or whether the products they use create jobs. Since khadi cloth is handspun, and its products are mainly created by artisans in rural areas, the brand invokes good vibes in consumers. The target is to double khadi sales by 2018-19.
A survey in 21 overseas markets revealed, khadi was the most recalled Indian brand, along with yoga. So the Khadi & Village Industries Commission (KVIC) is now looking at exports and aiming to make khadi an international brand. KVIC has an unique model, selling through government-owned stores as well as other retail outlets. In fact, KVIC is one of the most underrated companies in India and has IPO potential. While low production growth was a drag on sales in recent years, during the last fiscal khadi output grew by 31 per cent.
The textile industry wants an uniform levy of five per cent on all textile and clothing products under GST (Goods and Services Tax). The assumption is such a levy would ensure smooth migration of the entire textile value chain to the GST tax structure with full compliance, create a win-win strategy for all stakeholders and bring substantial revenue to the exchequer when compared to existing revenues.
The Indian textile industry feels net revenue will double if the GST rate is fixed at the lowest slab of five per cent without any exemption across the value chain. The industry wants existing export benefits, including duty drawback rates, to be continued for some time after the implementation of GST as the industry has just begun taking advantage of these schemes and grabbing global export opportunities.
Sectors like handlooms could be given benefits from tax refunds under the direct benefit transfer system. Free trade agreements with potential importing countries, especially the European Union and Britain, would help as the strong rupee and high import tariffs of up to 20 per cent on various textile products in almost all major importing countries have made the Indian textile and clothing industry uncompetitive.
Indonesia wants a bilateral trade deal with the US. Trade between the countries was around $25 billion in 2016, the lowest since 2010. The US deficit in trade stood at more than $13 billion. The US wants Indonesia to further open up its $900 billion economy to businesses. The US is seeking to cut trade and investment barriers to create a truly level playing field. This forms the background to the collapse of the Trans-Pacific Partnership, a sweeping, 12-nation trade-and-investment pact. Indonesia wasn’t one of the dozen nations but had expressed interest in joining the partnership at a future date.
Indonesia has been seeking to draw new foreign investment to help build railways and ports. US investors are among the biggest investors in Indonesia but face problems with rule of law and cumbersome policies such as local-content requirements. Indonesia’s priority is to boost economic growth. The rate has been hovering around five per cent due to global weakness and a mixed-investment climate. The target is to deliver seven per cent growth by the end of 2019. Indonesia is Southeast Asia’s largest economy. In dollar terms, foreign direct investment slipped in 2016. But Chinese investors have evinced interest.
India’s cotton area is forecast to increase by seven per cent in 2017-18. Assuming yield is similar to the five-year average, production could increase by three per cent. Similarly, China’s cotton area may expand by three per cent due to the stable cotton policy and high cotton prices. Production in China is expected to rise by one per cent. Harvested cotton area in the US is expected to grow by 12 per cent and production could grow by eight per cent.
Unlike other top cotton producers, area in Uzbekistan is expected to dip four per cent in accordance with plans to reduce areas where yields are low and use them for other agricultural products. However, plentiful soil moisture may improve the average yield by one per cent, which will limit the loss in output. Uzbekistan’s cotton production is projected to decline by two per cent.
Cotton area in Brazil and Australia is forecast to increase by two per cent and three per cent. World cotton trade is projected to rise five per cent. Imports by Bangladesh are forecast to rise by three per cent, while imports by Vietnam may increase by 16 per cent. Imports by China are expected to increase by three per cent. Exports from the United States are projected to increase by 53 per cent. India’s exports are projected to decrease by 30 per cent.
Jaipur-based India Today Fashions is an apparel exporter. The quarter century old company manufactures women’s wear and children’s wear. It works with buying houses in the US, Sweden, Dubai, Australia and Japan. The exporter is also upgrading its CAD system and foraying into the domestic market.
Though Jaipur is a cost-effective garment manufacturing hub, especially when compared to Delhi-NCR, labor shortage is an issue which has forced India Today Fashions to start a new unit in Haryana. Since already some of its job work is being done in Haryana, the company thought of setting up its own factory there. Skilled labor is easily available in Haryana. The new factory will be operational very soon.
Despite initiatives for skill development and training in apparel manufacturing, and the presence of Apparel Training Development Centers, Jaipur has been facing a labor shortage for many years. A big chunk of migratory workers who belong to Uttar Pradesh or Bihar prefer to work in Delhi-NCR rather than Jaipur. Rajasthan has been associated with the production of color fabrics in the Maru-Gurjar tradition since ancient times. A sense of color-aesthetics has led to the use of colors and motifs intended for different occasions.
Dhyana van der Pols, a sourcing consultant for a group of European garment buyers recently said there are no back-up nation to Bangladesh for the global garment business at this moment and hence, business will continue to grow in Bangladesh. However, Bangladesh needs to shift production to value-added items from basic garment goods, she further added.
Bangladesh is the most attractive destination for European retailers among the six nations due to its competence in the supply of quality products at competitive prices, says a study. Garment exports accounted for nearly 85 per cent of Bangladesh's total products sold overseas in 2016. The country's share in the global apparel market is about 6 per cent.
Kurt Salmon, a leading global strategy consulting firm focused on the retail industry, conducted a survey on the basis of Production Cost Indices (PCI) among six garment producing nations: Bangladesh, China, India, Morocco, Myanmar and Turkey. Import data of apparel items from six countries between 2005 and 2015 were analysed. Among the six nations, China is in second because of higher costs of production and dearth of skilled workers.
Siddiqur Rahman, President, Bangladesh Garment Manufacturers and Exporters Association opines the country is passing through a dull season now, the future outlook is very positive. However, the study states in global comparison of Kurt Salmon, Bangladesh is the second most attractive destination after Cambodia. Globally, Cambodia is ahead of Bangladesh only because it uses more technology in production,
With dipping business abroad, Indian apparel exporters are thinking of focusing on the domestic market now. The European Union and the United States are traditional and core markets for India, but they are not doing too well. Many fashion retailers in the US have closed stores or have filed for bankruptcy. In the past few months over 18 fashion brands have shown negative results.
Struggling Indian exporters are creating an alternate client base. Fabric suppliers especially are focusing more on the domestic business and less on the export-oriented business, which requires certain compliance standards to be met. Other alternatives are China, the Middle East and African countries.
Exporters have different opinions on exploring emerging markets. For example, the Latin American market was seen as an alternative but that is also in trouble as their currencies are becoming weaker against the dollar. Exporters are wary of entering unknown territories and taking risks. They insist on analysing buyers before doing business as most insurance covers only post shipment and not the work in progress production. They want export associations to come up with a proposal of hiring financial experts, who can forecast any market and give proper guidance to members. In any case, the entire ecosystem of the supply chain will get affected.
Swiss companies Schoeller and Textil color have collaborated to create a new auxiliary concept used in polyester dyeing called ‘Ecodye’ technology. It is supposed to accelerate the dyeing process and, in turn, cut costs and preserve environment.
The new eco dye auxiliary concept allows eco-friendly and cost-saving dyeing processes for polyester yarns and piece goods. It shortens the heating phase, thus accelerating process time by more than 30 per cent. At the same time, it reduces energy consumption by 20 per cent and the water requirement by 2per cent as the goods can be cleaned in the cooling dye bath. In addition, eco dye improves the dyeing levelness in polyester textiles.
The companies’ goals were to provide textile customers with a technology that yields good dyeing levelness; avoids spots and dye agglomeration; avoids precipitation on the goods that arise as a result of polyester oligomers; and provides shade stability for reliable reproduction, batch to batch.
The technology is being used by polyester processing customers in categories including outdoor, sportswear and technical knitted fabrics, primarily in Europe, South and Central America, Turkey, Bangladesh and China. Water Molecule and less density , absence of dye sites are some of the factors , along with it the thickness of the polyester products are high compared to other products.
