INDIA. Gujarat government notifies textile policy 2012

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1 DOMINICAN REPUBLIC Online shopping affects Dominican textiles trade The Dominican Association of Textile Industries (ADITEX) has announced that the preferential treatment granted by the Dominican Republic government to couriers and companies engaged in express mail for online shopping is harming the local textile trade. ADITEX President David Cortes requested the urgent intervention of the Directorate General of Customs to standardize and control imports of more than 50,000 daily shipments of goods without the payment of ITEBIS (tax on transfer of industrialized goods and services) or tariffs that are required to be paid on such kind of imports. Mr. Cortes said that the exemption of duties and taxes on such goods is distorting the balance of payments which in turn is hurting the economy as well as creating an unfair competition in textile trade. According to the ADITEX President s estimates nearly US$ 700 million worth of goods enter the Dominican Republic evading taxes through courier companies. He said that the ADITEX is not opposed to online shopping or modernization but the couriers evade duties and taxes, and the shipments are also not fully verified, and hence it is unfair to the domestic textile traders. If the online shopping completely disappears, the domestic textile companies, which currently employ over 100,000 Dominicans, would be able to create 30,000 more jobs in the country. ECUADOR Government proposes new textile labelling regulation The Ecuadorian Ministry of Industry and Productivity (MIPRO) has recently delegated the Quality Undersecretary Faculty to approve and formalize the proposed standards of mandatory requirements on the Technical Regulation of the Ecuadorian Standardization Institute (RTE INEN) No. 013 Labelling of Apparel, Home Textiles and Clothing Accessories. This technical regulation establishes requirements for the labelling of apparel, home textiles and clothing accessories marketed in Ecuador, whether locally manufactured or imported, in order to prevent deceptive practices. Imports of certain textile and apparel products (e.g. clothing, sportswear, swimwear, pyjamas, gloves, scarves, belts, socks and other hosiery, curtains and bedding items, etc.) must be accompanied by a certificate indicating compliance with the requirements of the Ecuadorian Technical Regulation. The certificate of conformity must be issued at the origin or destination by a certification body whose accreditation is recognized by the Ecuadorian Accreditation Organization (OAE). INDIA Gujarat government notifies textile policy 2012 More than a year after the announcement of the Textile Industry Promotion Policy 2012, the government of the western Indian state of Gujarat has notified the same, enabling textile units to receive government assistance under the policy. The objective of the policy is to have an integrated approach to strengthen the value chain - Farm to Fibre to Fabric to Fashion to Foreign (5 Fs), which will enhance sustainable growth of farmers and industry. Over the next five years, the new policy aims to attract Rs. 200 billion investments in the state s textile sector, resulting in creation of employment opportunities for 2.5 million people, with half of them being rural women. The new policy provides interest subsidy of 5% without an upper cap on the amount, for the period of five years on new plant and machinery for ginning and processing sectors. It also provides 7% interest subsidy on new plant and machinery for cotton spinning and for second-hand imported cotton spinning machinery with certain conditions for five years. Moreover, one rupee per unit power tariff concession would be provided on new investment for cotton spinning for five years and value-added tax (VAT) paid by the unit on the purchase of raw material would be refunded. The new textile policy, which aims to promote ginning, processing, yarn production, spinning, fabric manufacturing and readymade garment making, will help the farmers get better value for their cotton. Ahmedabad was considered as Manchester of the country due to presence of hundreds of textile mills. Gujarat is now lagging behind many other states, including Tamil Nadu in textile industry. 16

2 INDIA Government plans to raise outlay by Rs 700 crore for Technical Textile sector To promote technical textile sector, the government plans to increase fund outlay for various schemes to over Rs 700-crore during the 12 th Five-Year Plan. The market size of technical textiles in India is estimated to have grown to Rs 91,236 crore in from about Rs 42,000 crore in , with an annual growth rate of 11% said Minister of State for Textiles Panabaka Lakshmi. In order to continue building on this success, we are looking to increase the fund outlay for various schemes for the promotion of technical textiles to over Rs 700 crore during the 12 th Five Year Plan period. With proper policy support, promotional efforts and standardisation and regulation, the sector has the potential to reach Rs 1.58 lakh crore by Based on the projected growth of this sector, employment in the technical textiles industry is estimated to grow at 13% annually to 26 lakh by This sector provides great potential for growth as the global textile market has estimated to have reached Rs 7.48 lakh crore in FY13, at an annual growth rate of 3.5%. She said India needs to tap the potential in the global market and look to harness new opportunities. The export target set for the technical textile is US 550 billion this fiscal and now the sector is exploring new markets like South America and Japan. Under the 12 th Five Year Plan, Rs 11,952 crore has been sanctioned for the overall development of the textile sector, of which Rs 2,400 will be given this financial year. To develop technical textile in the North-eastern States, the government has sanctioned government support of Rs 55 crore for geo textile and another Rs 500 crore and under process. Government okays continuation of SITP in 12 th Plan period The government of India has approved continuation of the Scheme for Integrated Textile Parks (SITP) during the 12 th Five-Year Plan period ( ) and an additional grant for apparel manufacturing units. The Cabinet Committee on Economic Affairs (CCEA) has approved continuation of the scheme for Integrated Textile Parks (SITP) in the 12 th Five Year Plan and sanction of new projects for utilizing Rs billion the balance left in the 12 th Five Year Plan allocation, after meeting committed liabilities of the sanctioned 61 parks. The CCEA also approved additional grant of Rs. 100 million to be given to existing parks under SITP for setting up apparel manufacturing units, out of the Rs. 500 million allocated for this purpose. The overall impact and progress of the SITP had been positive and the scheme had been successful in terms of leveraging private sector investment, employment generation and creation of need-based, product based world class infrastructure for the industry. Some 40 textiles park projects were sanctioned under the scheme in 10 th and 11 th Five-Year Plans. Subsequently, 21 new parks were sanctioned in October 2011 with project cost of Rs billion. Ministry for linking textiles sector with MNREGA The Indian Textiles Ministry is seeking the sector s linkage with the Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA) to attract workers in view of the shortage in skilled manpower being faced by the industry. The Ministry said that linking the employment scheme with the textiles sector will help train about 1.5 million workers over the next three years. Textiles Minister K Sambasiva Rao said he had recently written to the Prime Minister proposing to link MNREGA with the textiles sector to increase the availability of skilled labour. The main aim of MNREGA scheme is to provide employment to the people during the off-season periods and linking it to the textiles sector would give them training and employment. 17

3 To make the Indian textiles sector globally competitive, the Textiles Ministry wants to impart training to around 1.5 million people over the next three years. The Indian government has already allocated a sum of Rs.19 billion towards skill development in the textiles sector and some funds from the MNREGA would help in providing training to the people. For fiscal year , the Indian government has set an export target of US$ 43 billion, compared to last fiscal s exports of US$ 34 billion. The textiles sector in India employs about 45 million people. KAZAKHSTAN Government plans to diversify cotton acreage The government of the Central Asian country of Kazakhstan would be developing an action plan to diversify the acreage of cotton in the years , said Bakytzhan Sagintayeva, the Minister of Regional Development. He said the region is faced with the problems associated with predominance of cotton monoculture, water shortage during the harvest period and deterioration of irrigated lands, and to solve these problems the Ministry would develop a detailed action plan to diversify the acreage of cotton for the years On behalf of the local administration of Maktaaral region, the Ministry of Regional Development along with other concerned ministries would be presenting the draft of the plan to the government. Collection of raw cotton begun in the South Kazakhstan from September and as of now 40,000 tonnes of raw cotton has already been collected, and by the end of October 2013, farmers plan to harvest around 370,000 tonnes of cotton, according to Department of Agriculture of South Kazakhstan. Cotton was sown on 140 million hectares in the region for the current harvest period which is 4 million hectares less compared to the area harvested in In 2012 harvest period, around 257,000 tonnes of raw cotton was collected from the region. South Kazakhstan is the only raw cotton growing region in the country, contributing around 40% of the region s overall agricultural output. RUSSIA Russian entrepreneurs suggest investing in man-made fibre Russian entrepreneurs of textile and light industry have suggested that the Ministry of Trade and Industry of Russia should instead of reviving the domestic cotton industry aim at manufacturing of man-made fibre, used in the making of polyester and other synthetic fabrics. The Russian government has created a technical textiles branch around 15 years ago, which focuses on raw materials derived from petrochemical products, and the branch has become the driving force of the country s light industry, said Russian Union of Entrepreneurs of Textile and Light Industry. He said global demand for synthetic materials continues to rise due to the increasing developments in the field of fabrics made from petroleum derivate have found new applications especially in the construction of roads (geo textiles), in the aviation and automotive industries (automobile textiles). The technology of producing fabric from petroleum has already been successfully engaged in Germany. The entrepreneurs are of the opinion that the quality of domestic cotton may be significantly lower compared to the imported cotton and hence propose a parallel program for production of textiles from petroleum derivatives. However, the entrepreneurs Union said the program would require a lot of money as the production of textiles from petroleum is expensive, estimated at about 15 billion rubbles a year. Earlier, the Russian Ministry of Trade and Industry announced its plans to revive the domestic cotton production to reduce dependence of its textile industry on imported cotton. Last year, Russia imported 90,000 tonnes of cotton. Astrakhan to raise cotton sowing area to 100,000 hectares The Astrakhan region located in Southern European Russia will be increasing cotton sowing acreage to 100,000 hectares, in order to produce 200,000 tonnes of cotton annually, said Governor of the region Alexander Zhilkin. He said that during the summer harvest period of region, the cotton growers used special cultivation technology, which increased the cotton yield by 20 tonnes to 30 tonnes per hectare. Negotiations are also underway with companies from Russia and Belarus, who are interested to take up the industrial processing of raw materials from the region s light industry. Mr. Zhilkin said as of now, around 75,000 acres of area is harvested for cotton in the region and the local government intends to increase the cotton sowing area to 100,000 hectares to produce more cotton, as the quality of cotton grown in the region is superior to cotton obtained from Central Asia. According to the Governor, a new impetus to the development of the region s agricultural sector could give the cotton industry the boost it needs. On his part, the Russian Prime Minister said he would give instructions to the relevant ministries and agencies to examine in detail various issues, including cotton cultivation in the region. 18

4 SPAIN Spanish govt launches National Fashion Awards The Spanish Ministry of Industry, Energy and Tourism (MINETUR) has announced the launch of the very first edition of National Fashion Awards, which would be held annually in order to recognize the work of firms operating in the fashion sector of the country as well as promote the industry. According to a statement issued by the MINETUR, the Ministry, through the Directorate General of Industry and Small and Medium Enterprises, and the Bureau of Spanish Fashion, established the awards for supporting the sector, which is of great importance for the Spanish economy and the Brand Spain. The call for the first edition of the awards was also published in the official state gazette of Spain (BOE). According to the Ministry, the awards would recognize those individuals, institutions, organizations and industries, which have made significant efforts to achieve excellence in the field of fashion. The awards would be convened annually and would endorse the prestige of the fashion industry in Spain, contributing in turn to support the state policy of Brand Spain. The fashion awards would support creation, development and strengthening of the fashion industry as part of the strategy to promote initiatives that create more trade in the sector, in times when the economic activity of the country needs revival. The five categories under which various organizations and firms would be recognized are: the National Award for SMEs in fashion industry; National Award for large company in fashion sector; National Award for entrepreneurship; National Award for fashion designer, which has two sub-categories, lifetime achievement and new designer honor; and National Award for professional communication and outstanding work in enhancement of Spanish fashion.

5 USA CAC forecasts lowest cotton output in four years During the seasons, world cotton production is projected at 25.5 million tonnes, the lowest in four seasons, but world cotton mill use is expected to remain around 23.5 million tonnes with consumption shifting from China to other countries, notably India, Pakistan and Turkey. Production in both the United States and China are significantly less than last season due to unfavorable weather conditions and a decrease in planted area. Cotton plantings in the southern hemisphere start in large scale this month with approximately 2.7 million hectares projected to be planted with cotton this season, similar to However, higher yields are expected to result in an increase in South American production. World cotton trade is projected at 8.5 million tonnes during , approximately 1 million tonnes less than last season, largely accounted for by a decrease in imports by China. World cotton ending stocks for are forecast at 20.4 million tonnes, an increase of 2.0 million tonnes from the previous season. In September, the Chinese government started buying cotton for its national reserve, amounting to just over 100,000 tonnes at the end of September. In , China s reserves are expected to increase to 11.4 million tonnes, up by almost 2 million tonnes from last season. However, world ending stocks outside China will increase by less than 200,000 tonnes, so that at the end of the current season, China will hold nearly 60% of world stocks. US Textile industry grows with more technology with fewer workers After decades of decline, the U.S. textile and apparel industry is growing again and many factories are competing with low-wage operations in countries like China. In North Carolina, where the textile industry was once dominant, the industry has reinvented itself using technology but also employing far fewer people than in the past. Robots do most of the heavy lifting at the National Spinning Company plant in Burlington, North Carolina. This factory dyes over 110,000 kilograms (250,000 pounds) of yarn per week in a variety of colors. The yarn is sent to clothing and upholstery makers both in the U.S. and around the world. Michael Hankensen who is one of only two technicians who service the dye producing machines explains that most of this work is extremely heavy and cumbersome, and therefore trying to move it around manually would take an army of men to accomplish what these robots do everyday. Technology is helping bridge the wage gap between labor-intensive factories overseas that pay workers only a few dollars a day and this North Carolina plant where about 100 employees make between $10 and $20 an hour. Plant manager Ed Atkins says it is important to limit labor costs, but the company must also provide higher quality and better customer service to compete in the global market place. We have diversified, looked new for markets that depended on the quick response, which we can provide from American-made products, as well as little niche markets. I mean we don t try to compete in the generic cotton business, because it s not where our strengths are based," said Atkins. The collapse earlier this year of one garment factory in Bangladesh that killed more than 1,000 workers illustrated the tragic consequences of relying on partners that bring down costs by sacrificing health and safety. Deborah Wince-Smith, president of the non-profit Council on Competitiveness, says the future of the textile industry lies in innovation, not low wages. Companies and enterprises are really bringing their core activities to where they have a skilled workforce, where they have innovation talent and where they re actually able to develop the next generation of innovation that drives manufacturing," said Wince-Smith. With 23 U.S. plants built in the last three years, and exports up over 30 percent, the textile industry is making a comeback in America. Source: Voice of America. 20