FW
Bangladesh has revised the cash incentive scheme for the fiscal year 2015-2016, raising the rate of incentive for textile products exported to the Eurozone area and leather goods.
The rate of cast incentive for export of textile products to the Eurozone area has been increased to six per cent from the current four per cent. The sector gets cash incentive as an alternative to the duty bonds and duty drawback facility. The rate of cash incentive for export of leather goods has also been increased to 15 per cent from the current 12.5 per cent.
Exporters who have already received the cash incentive at the existing rate will also be allowed for the additional benefit.
Exporters would receive cash subsidy for the products against net repatriation of the FOB (freight on board) prices. Bangladesh will shore up and offer incentives for export-oriented industries. Six export products alone account for nearly 90 per cent of the country’s yearly export earnings.
Bangladesh’s exporters have been passing through a torrid time in recent times because of the euro zone crises, higher production costs and infrastructure deficiencies.
The country offers export incentives for agro products such as vegetables and fruits, leather goods, home-made textiles and jute goods.
The National Fire Protection Association (NFPA) has released the Bangladesh ready-made garment (RMG) industry high level assessment report. It presents an appraisal and gap analysis of Bangladesh’s fire and building safety standards, inspection procedures and training programs.
The final report includes short-term and long-term recommendations that provide a road map for sustainable electrical, fire and life safety in RMG manufacturing facilities in Bangladesh.
NFPA and the University of Maryland were invited by the Alliance for Bangladesh Worker safety (the Alliance) to provide an independent review of their factory upgrade program designed to improve worker safety.
The Alliance identified a sample of 14 factories currently undergoing remediation in the Dhaka region of Bangladesh. The project team to visit the sites, observe building operations and interview key stakeholders in the building industry.
Based on these activities, NFPA made recommendations for the government officials and other stakeholders to undertake efforts to institutionalize sustainable worker safety enforcement programs.
“The Alliance has been working hard to meet its goal to create a safe environment for workers in Bangladesh’s factories, and its results-oriented process has helped make progress within the industry, said Don Bliss, NFPA’s vice president of Field Operations.”
The success of the suggested methods for improvement after the Alliance timeframe expires will depend on the concerted efforts of all stakeholders in Bangladesh RMG fire and life safety.
Australia is ready to eliminate import duties on all items from India. About 90 per cent immediately and the rest over the next five years. As part of the proposed free trade agreement (FTA), the country’s special envoy for trade Andrew Robb said the free trade pact officially known as the Comprehensive Economic Cooperation Agreement (CECA) is likely to be freezed in about 6-8 weeks.
According to Robb, this would translate into import duties on more than 9,000 items out of about 11,000 exported to Australia coming down to near zero as soon as the pact gets implemented and benefit sectors like auto parts, textiles, leather and pharmaceuticals.
The country has also agreed to ease visa norms for Indian workers as part of the pact, especially for intra-corporate transfers (ICT), the trade envoy said. In both goods and services, we have offered India the best of what we have extended to our other FTA partners.
Lower duties
Australia, on its part, wants India to lower duties in wines and high-end dairy products collaborate in the services sector and provide stability on investment policies. “We understand the sensitivities that India has in the goods sector. But, there are certain items such as high-end dairy products and wine where there is no domestic competition and duties can be lowered,” Robb said.
The proposed India-Australia Comprehensive Economic Cooperation Agreement (CECA) seeks to lower barriers in market access for goods, services as well as investments and bring about alignment in customs procedures and standards. Australia has signed FTAs with China, South Korea and Japan in the last two years and is also part of the US-led Trans Pacific Partnership (TPP).
Robb said that while Australia could provide expertise to India in a host of services such as construction, engineering, water management, health and education, it wanted the CECA to provide an assurance that India’s policies related to investments in a particular sector would not change in the middle of project-execution.
Currently, India-Australia bilateral trade was about $14 billion in 2014-15, with Australian exports at $11 billion and Indian exports just at $3.2 billion. The two countries hope to increase two-way trade to at least $40 billion by 2020, which would still be much lower than Australia-China’s $160 billion worth of annual trade.
‘UKP Brand Protection’ provides brands with a covert anti-counterfeit measure integrated into garment labels and trims. U.K.P. Accessories has introduced revolutionary anti-counterfeit technology that allows a covert material to be integrated into various garment labels and trimming products. The technology will allow brands to produce garments and accessories carrying labels and trims that can be quickly and easily authenticated to ensure they are genuine.
“With counterfeiting, an issue of high concern for clothing brands worldwide, ‘UKP Brand Protection’ provides a cost-effective solution that can be easily implemented,” explains Steve Starkey, Managing Director of U.K.P. Accessories. “We work with brands to find a solution that fits into their anti-counterfeit procedure which is enabled by the flexibility of application of the technology.”
The covert material is integrated into products during the production process and is a permanent part of the label or trim. Swing tickets and other printed items can have the material combined with printing inks, while with woven labels, the material is mixed with the polyester yarns. A simple detector is then used, providing the user with a light and sound notification to authenticate the presence of the anti-counterfeit material.
Another feature of the technology is that it is entirely covert, not only being invisible to the naked eye, but also not visible under any special lighting such as UV and infrared. This ensures it cannot be copied and only verified using the specific detection device. “We are excited to be able to offer our innovative solution to brand owners and managers and help bring some peace of mind to counterfeit struggles.” added Steve Starkey.
U.K.P. Accessories provides garment branding solutions to clothing brands worldwide, with offices in the UK, Hong Kong, India and China. The company produces a wide range of garment labels, trims and packaging products, created to customer’s bespoke requirements.
Bangladesh may overtake China as the world’s biggest cotton importer in the current crop season thanks to strong demand from apparel makers. In the year ending July 31, 2016, Bangladesh may import a record 5.75 million bales of the fiber, up 6.5 per cent from a year earlier.
Bangladesh’s share of the global cotton export market doubled from 1995 to 2012, mostly because of the strong performance of the garment sector. The country imports 50 per cent of the cotton from India. It was 22 per cent six years earlier. Due to the higher quality, lower prices and shorter lead time, India has become the largest cotton sourcing country for Bangladesh. Much of Bangladesh’s apparel export is fuelled by cotton sourced from India.
About 14 per cent of cotton imports into Bangladesh come from Africa. The main African countries are Zimbabwe, Mali, Ivory Coast, Uganda and Zambia. Bangladesh is almost entirely dependent on raw cotton imports for the export market. More than 40 per cent of the imported raw cotton and 80 per cent of the imported yarn and fabrics are used by spinning mills and the readymade garment sector to meet the export demand.
The ITUC (International Trade Union Confederation), which represents 180 million workers in 162 countries, has protested against the approval of a new Trade Union Law by the National Assembly of Cambodia this week. The law was pushed through despite repeated objections by trade unions, the International Labour Organization and several global garment brands.
The law, backed by Prime Minister Hun Sen's ruling party, would among other things impose new limits on the right to strike, facilitate government intervention in internal union affairs and permit third parties to seek the dissolution of trade unions .It would impose only miniscule penalties on employers for unfair labour practices. Trade unionists who peacefully protested at the time of the vote on the new law were bludgeoned by the government .
According to Sharan Burrow, ITUC General Secretary, "Cambodia, with the backing of a retrograde local garment industry federation, has pushed back against decent working conditions at every opportunity. If it does not reverse this course soon, the country will find itself at the margins of the global garment industry at tremendous cost to the economy, which is heavily reliant on this sector.”
Major companies know the risks, of doing business on the back of worker repression, and consumers everywhere are increasingly alert to the kind of inhuman treatment in global supply chains that this legislation means. Many feel the the violence and judicial harassment perpetrated by the government against those who stand up for fundamental rights guaranteed under international law must end.
The ITUC represents 180 million workers in 162 countries and territories and has 333 national affiliates.
"Russia is the one of the largest market for Turkish exports. The main item of exports to Russia is textiles, which has decreased due to this political turmoil. Although textiles were not formally included in the list, shipments of Turkish textiles have been blocked at the Russian border since November. A few shipments that manage to make it past the Federal Customs Service of Russia undergo long inspections that result in significant delivery delays."
The unhealthy relationship between Turkey and Russia may have a deep impact on Turkish economy. Recent reports indicate that Russia had mounted sanctions against a number of Turkish industries mainly agriculture and tourism, but the Russian distributors and national suppliers expect this sanction to place a ban on textile and apparels as well, which is one of the major sectors for the Turkish economy (World Textile Information Network-WTIN).
Border controls tough for Turkish exports
Russia is the one of the largest market for Turkish exports. The main item of exports to Russia is textiles, which has decreased due to this political turmoil. Although textiles were not formally included in the list, shipments of Turkish textiles have been blocked at the Russian border since November. A few shipments that manage to make it past the Federal Customs Service of Russia undergo long inspections that result in significant delivery delays.
As per data, at the end of Q3 of 2015, Turkey's share in Russian imports was 11 per cent for fabrics made from chemical fibers and threads; more than 40 per cent for warp-knit fabrics; and about 25 per cent for yarns made from synthetic and artificial fibers. Finished products make up the majority of Turkish textile imports to Russia, while raw materials amount to roughly 30 per cent of the total import volume.
Experts say that Russian textile manufacturers still don't have the capacities to substitute for Turkish imports. Though, Russia will be the main short term loser on account of its ban on imports of some Turkish items. In the longer term, Turkey will lose a valuable export market in Russia, a leading destination for Turkish products.
Opportunities for Southeast Asian countries
The ongoing crisis in Russian clothing sector has created opportunities for Southeast Asian exporters. Man-Made Fiber Textiles has been witnessing a negative growth in the four segments namely – Yarn, Fabrics, Made-ups and Fiber. Some feel this is a good opportunity for many to enhance their exports to Russia. The Synthetic and Rayon Textiles Export Promotion (SRTEP) council in India is thinking of mounting a joint textile delegation to Russia.
Executive Director, Vanil Kumar reveals, “We may also explore the possibility of mounting a Joint Business Delegation to enhance MMF Textile Trade with Russia in the wake of the emerging situation. As a prelude, members who are interested to join may contact the council to help advance preparation for contacting the embassy. Already, hundred companies have registered.”
Bombay Dyeing’s standalone net loss totalled Rs 78.15 crores for the third quarter ended December 31, 2015, as against a standalone net loss of Rs 65.93 crores for the same period last fiscal.
The company’s net sales on a standalone basis plunged by 35.12 per cent during the period compared with the corresponding quarter last year. Its revenue from the textile segment totaled at Rs 48.69 crores during the period under review versus Rs 145.84 crores in the same period last fiscal. The revenue from the polyester segment dived to Rs 241.64 crores during the third quarter of the current fiscal as against Rs 330.63 crores in the year-ago period.
Established in 1879, Bombay Dyeing is the flagship company of the Wadia Group, involved primarily in the business of textiles. It is one of India’s largest producers of textiles.
Bombay Dyeing was established in 1879 as a small operation of Indian spun cotton yarn dip dyed by hand. It offers bed, bath, linen and lifestyle home furnishings. It is in 350 EBOs and 2,000 MBOs across India.
In textiles the company manufactures cotton suitings, polyester cotton suitings, shoe lining and duck fabrics, satin furnishings, yarn dyed fabrics, towels, table tops and napkins, satin bed sets.
Wool production is at a 70-year low globally but is still out-performing most other commodities. Global demand will drive what happens to prices in the next 12 months. Retail sales around the world are seeing slower growth rates.
The particular downturn in super fine-wool prices is because supply is increasing more than demand is. Once there is a bit of a pull back in production of super-fine wool, there will be a more sustainable balance and more sustainable prices.
China buys 70 per cent of Australia's wool clip, but there is increased demand in Europe. The rising European interest is acting as a counter to Chinese dominance in the market. A shift in the global, China-dominated demand for raw wool will push up wool prices everywhere.
The number of China's wool processing plants has dropped from 2,500 to 2,000 in five years. Sportswear has traditionally been dominated by synthetic fibers. However natural fibers like wool provide better advantages. Wool keeps a person cool when it's hot and warm when it's cold, something synthetic fibers have never succeeded in doing. Another problem synthetics haven’t solved is smell. Wool happens to be anti-microbial and anti-odor by nature. That gives it a huge head start over synthetics.
The Trans Pacific Partnership can pose problems for India’s textile and clothing business. For one, exporters from TPP member countries (of which India is not a member) will get preferential access to the US market. India’s apparel exports to the US have been sliding since 2010-11. To avail of duty preference, India will have to source yarn, fabrics and other inputs from TPP member countries.
So the option before Indian businesses would be to consider relocating to Vietnam (a TPP partner) and avail of the TPP duty advantage. But this proposition may not be feasible considering that labor is highly expensive in Vietnam compared to India.
To tide over the situation, India needs to explore export markets in emerging regions of Africa, South Asia, CIS and Latin America. The country will need to address the issue of inverted duties (a situation of higher duties on fiber and lower duties on apparel), expedite the free trade agreement with the Russian customs unions (it can be a big market in the coming years), make it mandatory for all least developed countries to use fabrics made in India if they want to export their apparels to India duty free and request the US to include apparel items in its GSP program.
