NEWS [ TEXTILES ]

Indian cotton needs to restore its lost glory

  • The Indian Society for Cotton Improvement (ISCI) in collaboration with the International Cotton Advisory Committee (ICAC), the Central Institute for Cotton Research (CICR) and the Central Institute for Research in Cotton Technology (CIRCOT) organized a three day Asian Cotton Research and Development Network (ACRDN) meeting.
  • Kavita Gupta, the textile commissioner of India speaking at the valedictory function said that the second technology mission on cotton in the offing all this seems possible as time has come to restore the lost glory of Indian cotton.
  • India just doesn't need to increase its productivity and improve the quality of the cotton but it also needs to double the income of both cotton farmers and non-farmers associated with the cotton industry by 2022.
  • The commissioner sees a lot of hope in the young scientists who have excellent ideas and believe in innovation. These scientists should ensure the traceability of cotton, evolve suitable bale tagging process, develop agro-climatic zone specific varieties and develop synergy between all various factors impacting cotton which will give the required momentum to the whole process. Cotton was one commodity which generated a lot of employment from the farmers to the industry.
  • Stressing on bringing cotton to premier quality Gupta said that India needs to brand its cotton. She expressed her concern over the declining quality of cotton. Contamination and adulteration were two major problems that need to be addressed immediately to bring cotton to international standards and be competitive.
  • Although India had the highest area (36%) under cotton and was the biggest cotton producer the productivity was almost half (25%) of that of the major cotton growing countries. The average productivity in India was 500-570 kg/lint per ha as compared to world average of 900 plus kg/ha. Australia with highest productivity has an average of about 2619/lint kg /ha. India exports one third of the produce. In Punjab there are farmers who produce 2500kg/ha. Gupta said that Why this can't be replicated elsewhere.
  • Earlier C D Mayee, former chairman of the national Agriculture Scientists Recruitment Board (ASRB) in his valedictory talk stressed on the need for regulations to control the seed, fertilizer and pesticide market. He said cotton in India was victim of democracy. He demanded a board at national level to control the lacunae in the system.
  • Also the value addition activities should be encouraged. These activities can fetch 30% income to the farmers. There has been a good period for cotton with developments in technologies but despite this there has been a yield stagnation. Hence there is need to educate the farmers and the policymakers equally about changing the cotton production scenario in country. The high density plantation system (HDPS) was a perfect technology that has answer to increasing production. They need to select the best cultivars for HDPS.

Welspun earns Oeko-Tex Made in Green label

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  • New York – Welspun has become the first manufacturer in India to earn the Made in Green certification from Oeko-Tex for both bedding and bath products.
  • The traceable consumer sustainability label indicates that textiles have been tested for harmful substances and manufactured in environmentally and socially responsible facilities.
  • Products carrying the Oeko-Tex Made in Green label are tested by an independent, third-party laboratory. Manufacturing facilities are first evaluated to confirm they are using the best available processing technologies that protect the environment and for efficient resource management. In addition, the facilities must be certified for their fair working conditions. This includes measures to ensure occupational health and safety as well as social aspects such as the exclusion of child labor or discrimination.
  • “Our Made in Green label is the result of our long-standing commitment to sustainability,” said Dipali Goenka, ceo joint managing director of Welspun India Limited. “Made in Green also supports our retailers in their efforts to offer more sustainable products to their consumers. The label clearly and quickly communicates to shoppers that our products have been tested for harmful substances and made with respect for our employees, communities, and planet.”
  • The consumer-facing label allows shoppers to confirm a product’s certification through a unique ID code. Customers can enter the code on www.MadeInGreen.com or scan the label’s QR code with their smart phones. The links authenticate the certification and provide visibility into every component of the production stream.
  • “We applaud the sustainability commitment that Welspun has made with Made in Green,” said George Dieners, Oeko-Tex general secretary. “Improving sustainability within the textile industry requires major manufacturers like Welspun to head the effort.”

88Spares.com to support Indonesian textile and garment industry

  • INDONESIA’s textile and garment industry is one of its oldest. The government aims to increase the value of exported textiles and garments to US$75 billion by the year 2030, implying that this industry would contribute around 5% to global exports.
  • 88Spares.com chief executive officer and co-founder Hartmut Molzahn (pic) was therefore inspired to launch a business to business (B2B) multi-vendor marketplace to assist the sector.
  • “Textile companies in Indonesia are very old school. They do not talk about online shops. Digital technology can help them to increase their value chain, enabling everyone to save and make more money,” he tells Digital News Asia (DNA).
  • To Molzahn, Indonesia is strategically placed and the country accounts for nearly 2% of global textiles and related products.
  • 88Spares.com facilitates B2B transactions between buyers and sellers in the textile and garment manufacturing industry and specifically deals in industrial machine spare parts and consumables.
  • “Vendors can cut their costs and efforts on sales and marketing easily by selling textile machine spare parts for weaving and spinning machines as well as various textile machinery spare parts through our web-based platform,” he adds.
  • After it was soft launched at the international garment exhibition, Indo Intertex 2017 in April, Molzahn says that Spares88.com will be officially launched in Q1 2018.
  • “Now we are still bootstrapping the market. We are focusing on attracting more vendors in the textile and garment industry in Indonesia,” he says.
  • Molzahn also says that his company will serve a niche market and enhance the chances small and medium enterprises (SME) and family businesses of entering the sector.
  • The startup will generate revenue from every successful transaction and will take a percentage depending on the value of a transaction.
  • 88Spares.com chief marketing officer and co-founder Rosari Soendjoto says that they aim to make positive contributions to the local textile and garments industry. She also hopes to become a catalyst of change in the domestic economy.
  • “Even we are still doing business by bootstrapping, to develop our business, we are also planning on fundraising,” she said.
  • 88Spares.com also has a presence in China by enabling China-based manufactures to become vendors on the platform.
  • Digitalisation in the textile industry
  • The Hong Kong Research Institute of Textiles and Apparel (HKRITA) chief executive officer Edwin Keh said at the International Textile Manufactures Federation Annual conference 2017 (ITMF 2017) in Bali recently that the textile industry is still left behind in utilising technology.
  • In order to transform, key players in the industry have to participate in this new economic era.
  • “We have three options -- to become victim, bystanders, or participants in this digital era. I hope everyone can be a participant,” he explains.
  • At the same event, Alvanon president Edward Gribbin said that that millennials are coming into the market and they think differently. Alvanon is a US apparel product development consultant.
  • “We are in the age of digital disruption. Rather than going to shop at an offline store, consumers choose to shop online. In the fashion industry nowadays, consumers are in control,” he said.
  • He added that Amazon in 2016 saw the most demand for its apparel category and for players in this sector had to “transform or die”.
  • Molzahn offered three main components for a company to move into the digital realm.
  • First, a company need the right human resources. Having someone from the C-level to take on digitalisation process will help change mindsets across the company.
  • The next thing is to have the right organisation. Molzahn says the role of an IT department has to change and be integrated into the company’s key strategy.
  • The company then has to cultivate an entrepreneurial mindset in all employees. Innovation might take some time and it can be helped by setting up infrastructure for corporate entrepreneurship to develop business innovation.
  • “In the future, software will become a driver in the industry and I believe that every industrial company will become a software-driven company,” he says.

Textile industry needs attention to boost local manufacturing

  • The Finance and Administrative Manager of Akosombo Textiles Limited (ATL), Justice Boateng, has come out to say that the annual consumption of textiles in the country is about 130 million yards, yet the three largest local manufacturers-ATL, GTP and Printex only produces 30 million yards; explaining why the remaining 100 million-yard deficit is being filled by cheap, counterfeit, pirated and smuggled Asian products.
  • This startling revelation was made when the Parliamentary Select Committee on Trade and Industry visited the Akosombo factory recently and the true state of affairs were laid bare.
  • Like Mr.Boateng outlined, the local industry faces high-interest rates, high electricity tariffs, fluctuating exchange rates, smuggling, piracy and counterfeiting which renders them less competitive than their Asian counterparts who in most instances, receive some assistance from their governments.
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  • The interesting thing about the whole debate is the fact that the textile industry sources a lot of materials locally such as salt, shea butter, and cassava which means the industry has a ripple effect on economic development and job creation in the country and thus, must not be ignored or even allowed to die a natural and premature death.
  • No doubt, these facts were laid bare to our legislators and they will be minded to enact legislation that will ensure the survival of the textile industry which holds a lot of promise, in terms of job creation and boost the manufacturing sector of the economy.
  • In the view of Mr. Boateng, if getting alternative sources of funding for the industry proves difficult, there are other measures that government can take to improve their competitiveness such as the reduction of electricity tariffs, and other related tariffs.
  • The local industry is not against competition per se, and asking for an outright ban. What is seeks is a conducive environment to operate competitively, and this should not be too much to ask. As for counterfeiting, we believe it is against intellectual property rights as well as the copyright laws, therefore the companies can initiate legal processes to get justice. Copying brands and designs have legal implications and we wonder why after so much evidence of putting local brand names on textiles produced outside our borders, we have not persecuted any offender as a precedence.  
  • We are confident of the assurances given by the Trade and Industry Select Committee of Parliament that it will liaise with the sector Minister to devise means to address the multiple problems faced by the textile industry. We are all anticipating a positive outcome.
  • Compliance of MFIs to new guidelines will restore confidence…
  • Banking regulator had adopted certain measures to ensure that what happened in the microfinance sector in the recent past does not occur again.
  • The BoG has conceded that its previous regime was not punitive enough and as a consequence, has introduced stiffer sanctions for the sector and is pleased with the level of compliance.
  • For one, the capital requirement has been revised and grouped into four categories. A Finance Committee of Parliament report on measures put in place by the BoG to improve activities of microfinance companies and check the operations of sham companies has given all MFIs in the country up till the end of April 2018 to comply with the new guidelines.
  • According to the guidelines, MFIs are to focus on providing financial services to people in the lower income bracket as well as small and medium scale enterprises.  Therefore, persons with larger funds or financial requirements need to resort to the traditional banks.
  • What transpired last year in which a number of microfinance companies were forced to fold up due to poor supervision leading to a number of companies to over-step their limits and begun offering ridiculous loans on questionable terms led a number of them to insolvency.
  • A lot of depositors lost large sums of money in the process without any hope of retrieval, and this sent a chill of anxiety among many depositors. Panic was visible and this led the BoG to introduce some stiffer sanctions for companies that fail to comply with regulations.
  • Some depositors are still counting their losses and it is, therefore, relieving that a second look is being looked into to ensure better compliance. If we are to encourage greater financial inclusion from the informal economy, then it is prudent to insulate depositors from the sort of challenges that confronted the microfinance sector by reviewing the rules to ensure compliance.
  • Therefore, it is welcome that the BoG has asked all players in the microfinance sector to comply with the new regulations by next year. It brings a modicum of relief to potential depositors, knowing that their savings are intact.
  • When the system is regulated better, confidence will be restored in the microfinance sector and more people will be encouraged to save with these institutions.

Group Of Ministers Identifies 25 Glitches In GST Portal

  • A high-powered group of ministers will meet every fortnight to resolve over two dozen technical glitches identified in the GST tax portal GSTN, the panel's head and Bihar Deputy Chief Minister Sushil Modi has said.
  • Over 25-odd glitches, which had led to the GST-Network portal crashing on at least two occasions in the very first month of filing, relate largely to payments and registration, he told PTI after the five-member GoM held its first meeting in Bengaluru on Saturday.
  • The grouping had extensive interaction with executives of Infosys, which is providing the IT support for the portal, and businesses will notice a "lot of difference" on the GSTN portal in the next 7-10 days, Modi said.
  • The GSTN website had faced glitches last month as taxpayers flogged to the portal on the last day of the deadline of filing returns for July.
  • "Over 25 issues have been identified which needs to be resolved and timelines have been set for each of them. Overall, we are satisfied with the performance of GSTN and Infosys is doing its best to make it error free," said Modi.
  • The GSTN, the information technology backbone and portal for real-time taxpayer registration, migration, and tax return filing under the GST, had developed a snag last month when the first deadline for filing of returns approached, forcing the government to extend the last date. A five-member GoM was constituted on September 12 after the GST Council decided to sort out technical glitches. The first meeting of the GoM was held in Bengaluru on September 16.
  • Besides Modi, Kerala Finance Minister Thomas Isaac, Chhattisgarh Minister of Commercial Taxes Amar Agrawal, Karnataka Agriculture Minister Krishna Byre Gowda and Telangana Finance Minister Etela Rajender are part of the GoM.
  • Modi said the GoM noted that the tendency of taxpayers is to file returns on the last day, which is evident from the fact that only 3.5 lakh taxpayers have so far filed GSTR-3B for the month of August. The last date for filing is September 20.
  • Over 47 lakh returns in GSTR-3B was filed in July and the GST to the tune of Rs 95,000 crore was collected in the maiden month of roll-out.
  • On September 15, GSTN officials and state commercial tax officers also held meetings with bankers, large taxpayers and tax experts to decipher the procedural issues being faced by them on the portal.
  • "The GoM will meet every 15 days to review the functioning of GSTN. The GSTN system is robust and load is not an issue. We are considering the procedural issues," Modi said.
  • So far, over 22 crore invoices have been uploaded on the GSTN portal, which has a capacity of handling over 3 billion invoices.
  • GSTR-3B is only a simple return which will ease compliance burden of businesses. Businesses will have to upload invoices and file final returns in form GSTR-1, 2 and 3 on a stipulated date.
  • The GST Council, chaired by Finance Minister Arun Jaitley and comprising state counterparts, had last week decided to extend the last date for filing final returns for July by a month to October 10. GSTR-2 for July will have to be filed by October 31 and GSTR-3 by November 10.
  • Currently, there are over 85 lakh registered taxpayers under the Goods and Services Tax regime. This include 62 lakh assessees who have migrated from the excise, service tax and VAT system and another 23.18 lakh new registration.
  • Among this, 10.96 lakh businesses have opted for composition scheme, under which they have to file returns quarterly.

Government Won't Extend Deadline For Filing Returns Under GST

  • The government on Saturday ruled out giving more time after December for filing tax returns by businesses under the Goods and Services Tax.
  • "We have already extended the period for GSTR-3B...People have to file their own self-assessed summary return till December, and there will not be any extension of time as far as GSTR-3B is concerned," Revenue Secretary Hasmukh Adhia said.
  • GSTR-3B is a simple return form introduced by the Central Board of Excise and Customs for the month of July and August, following the roll out of the new tax regime from July 1.
  • Adhia was speaking to reporters in Bengaluru after the first meeting of the group of ministers formed to tackle technology-related glitches in GST network. Earlier, the hiccups had prompted the government to extend the time limit.
  • "It decided to extend the timeline of filing GSTR-1, from September 10 to October 10. The last dates of filing returns for GSTR-2 and GSTR-3 are October 31 and November 10, respectively," Adhia said.
  • Bihar Deputy Chief Minister Sushil Kumar Modi, who heads the group of ministers, said it would be only by October 30 that the government would be able to iron out 70-80 percent of the technical issues being faced by stakeholders in filing returns.
  • He said only 3.3 lakh people filed their GSTR-3B in August, while there are 85 lakh dealers registered under the one-nation tax regime. "Further, even for the previous month of July, only 46 lakh taxpayers have filed their 3B returns so far."
  • India's GST network is the biggest in the world and 22 crore invoices have been filed so far, he said. As many 23.18 lakh new dealers have been registered, and another 11 lakh dealers were under 'composition scheme', the GoM chief said.
  • Appealing taxpayers not to wait for the last date to file returns, he said the GoM would meet once in every 15 days.
  • Asked if software major Infosys, the service provider, will be penalised for the glitches the stakeholders are facing, Adhia said the company has not failed. "There are always initial hiccups and issues, but there haven't been large-scale failures."
  • Kerala Finance minister Thomas Isaac, Chhattisgarh minister of Commercial Taxes Amar Agrawal, Karnataka Agriculture minister Krishna Byre Gowda and Telangana Finance minister Etela Rajender are other members of the GoM.

Oritain diversifies into ‘cotton transparency’

  • Supply chain specialist Oritain Global plans to implement its ‘fingerprint’ identification technology, currently used in the food industry, to improve transparency and traceability in the cotton industry.
  • The company, which analyses and then compares crops with the composition of the soils in which they are grown, has announced new partnerships with American supima cotton grower, J.G. Boswell, Australian upland cotton producer, Auscott and home textiles firm, Welspun India.
  • The move comes as the provenence of Indian organic cotton is once again being brought into question.

GST: Textile industry expects rise in cost amid input credit refund delay

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  • Continuing to press its demands for relief under the Goods and Services Tax (GST) regime, the textile industry has now sought refund of the accumulated input tax credit at the fabric stage, citing cost escalation of the value chain.
  • Industry representatives have stated that delay in refund of accumulated input tax credit could lead to increased import of fabrics, resulting in job losses in the highly vulnerable sectors like powerloom, handloom, and processing.
  • The textile industry fears costs could escalate by anywhere between three per cent and five per cent which could further impact capacity utilisation. According to the newly elected chairman of the Southern India Mills' Association (SIMA) and managing director of KPR Group, P Nataraj, this percentage share in cost escalation is proportionate to the range of accumulation of input tax credit on the sales value, especially for sectors like powerloom, handloom and processing.
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  • In its recent representation, SIMA cautioned that there were few major problems and ill-effects due to certain GST anomalies that need to be addressed on a war footing to bring all the stakeholders of the textile industry under GST net and enable the products to remain globally competitive.
  • "The Indian textiles and clothing industry had been passing through continuous recession during the last three years mainly due to poor off-take in the global market, the FTA/PTA competitive advantage gained by the competing nations like Vietnam, Bangladesh, high tariff rates imposed on Indian textiles and clothing products in the major textile makers such as EU, US, Canada, and China. The total textiles and clothing exports had stagnated at around US$ 40 billion during the last three years," Nataraj pointed out.
  • SIMA and other textile bodies have appealed to the centre to refund the accumulated input tax credit at fabric stage that had been singled out to avoid cost escalation. As per the industry, apart from avoiding cost escalation, a timely refund could also avert high imports of fabrics and fall in capacity utilisation which could result in job losses. For instance, the weaving industry in Surat which houses 650,000 such powerlooms, saw over 40 per cent shut since a month, thereby incurring a loss of over Rs 1,200 crore so far.
  • As per SIMA, the dyes and chemicals account for over 30 per cent of the processing charge that attract 18 per cent GST, while the fabric or job work is levied with 5 per cent GST.
  • Ashish Gujarati, president of Pandesara Weavers' Association, which alone has 200,000 powerlooms, told Business Standard that the only difference has been a slight reduction in accumulated input tax credit from Rs 1.25 per metre to 80 paise per metre under a five per cent GST on twisting job work.
  • The industry is now continuing to press for reduction of GST rate on man-made fibre (MMF) spun yarn, including sewing thread filament yarns from 18 per cent to 12 per cent.
  • The powerloom sector and independent weaving units that produce over 95 per cent of the woven fabric is burdened with 18 per cent GST on yarn, while the vertically integrated units do not have such a problem as they need to pay 18 per cent GST for fibres and only 5 per cent GST on fabrics and the cost difference works out to 5 to 7 per cent.
  • The industry has appealed to the GST Council to sort out both the anomalies of refunding the accumulated ITC at any stage of manufacturing, especially processed fabrics and also reduce the GST on MMF spun yarn, including filament sewing threads from 18 per cent to 12 per cent.

Cotton Council International Organize seminar in India on September 23

  • CCI is all set to host its 3rd seminar in India on September 23.
  • -Coimbatore

RESOLVE GST ISSUES IN TEXTILE INDUSTRY TO FOSTER GROWTH: SIMA

  • The Southern India Mills' Association (SIMA) today said there were some ill-effects due to certain GST anomalies that need to be addressed on a war footing inorder to bring all the stakeholders of the textile industry under the ambit of GST.
  • Talking to reporters here, SIMA Chairman Nataraj appreciated the strenuous efforts taken up by the Centre while implementing the GST, by classifying the entire cotton textile value chain and also all the textile job work under the lowest and seamless GST slab of 5 per cent.
  • The lowest rate has protected the livelihoods of over 40 million people involved in cotton farming and trading community, Nataraj said.
  • Stating that for processed cotton fabrics, the accumulation of input tax credit (ITC) would range between 3 to 5 per cent of the sale value, he said the dyes and chemicals account over 30 percent of the processing charge that attract 18 per cent GST while the fabric or job work is levied with 5 per cent.
  • Yet another genuine demand of the synthetic sector was the reduction of GST rate on Man Made Fibre (MMF) spun yarn including sewing thread filament yarns from 18 to 12 per cent, he said.
  • The power loom sector and independent weaving units that produced over 95 per cent of the woven fabric was burdened with 18 per cent on yarn while the vertically integrated units did not have such a problem as they need to pay 18 per cent GST for fibres and only 5 per cent GST on fabrics and the cost difference works out to five to seven percent, he pointed out.
  • Considering this, Nataraj appealed to the GST Council to sort out both the anomalies of refunding the accumulated ITC at any stage of manufacturing especially processed fabrics and also reduce the GST on MMF spun yarn including filament sewing threads from 18 per cent to 12 per cent.
  • Appeciating the bold and proactive initiatives taken by Prime Minister Narendra Modi and Union Textile Minister Smriti Zubin Irani, Nataraj said demonetisation and GST (one tax-one nation) were the two revolutionary policies implemented by the NDA government within a year to create a healthy business environment, curb tax evasion and corruption, enhance global cost competitiveness, and facilitate ease of doing business.

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