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CityVIBES

Vol. 19 Issue 42 RNI No. 69862/98 WEEKLY 6 Pages May 20-26, 2018 Publisher: C. M. Sharma M: 98154-29998 Email: cityvibesldh@gmail.com

HOSIERY EDITION - APRIL

www.cityvibesindia.com APPAREL EXPORTS FALL DESPITE DEPRECIATION IN RUPEE - PAGE 2

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ITME Society a r e g l o ba l l y acknow ledged in the t o p rank by n o t only the textile & t e xtile engineering industry but also has become landmark Exhibition & prestige for India. A non-profit organization, India ITME Society strives hard to provide quality service to the exhi bitors in generating business, bringing together investors & entrepreneurs, mo bilizing joint ventu res, facilitating one to one interaction bet ween the officials & the industry, disseminating knowledge to the academician, thus touching lives and prosperity in all aspects for the industry & business. The Society offers key B2B exhibitions i.e. GTTES 2019 th th (18 – 20 January 2019), ITME 2020, IIN Zone (Online Networking Portal) creating maximum opportunities for exhibitors & the Industry. India ITME Society has proved to be the best catalyst for Growth & Techno logical Excellence today, weaving success story one after another for Textiles & Textile Engineering Industry not only in India but across the globe.

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City VIBES

INDUSTRY VIBES

May 20-26, 2018

Depreciating Rupee Fails To Cheer Apparel Exporters The apparel exporters have failed to cheer the depreciating rupee against the US dollar for a change. There are good reasons for it. Even though the rupee fell to INR 68 per dollar by a steep six percent quantum, apparel exports to US have not picked up or benefited from this trend. In fact the fall in apparel exports value for the seventh consecutive month in April stood at 22.76%. A year earlier, in April 2017, the ready-made garment (RMG) sector had a total export value worth of USD 1.747 billion. In the current year, the number has declined to USD 1.349 billion. The trend continuing for seven months since October 2017 comes as an after-

math of the Goods and Services Tax (GST) implementation. In the post GST regime Indian exports have been rendered uncompetitive as the system is not conducive for exports. The new regime has resulted in the rise of cost of working capital for the exporters. In addition, they face an acute cash crunch due to delays in the refund of taxes paid. However, the manufacturers are not all glum about the depreciating rupee. “If Rupee remains at 68/69 levels for the next few months, it can offset the loss of Duty Drawback to some extent and may see a growth of threeto-five per cent,” said Rahul Mehta, Presi dent, Clothing Manufac turers Association of India.

According to a spokesman from the e x p o r t e r s ’ b o d y, “While consumption in the international market is growing at around one to two per cent, competition is increasing too, as the business sees new entrants like Myanmar and Ethiopia. Competitors’ currencies are also depreciating, but they don’t have problems that Indian exporters do.” The Apparel Export Promotion Council also sounded the cautionary note, stating, “Fall in apparel exports has led to a decline in production. According to the latest IIP figures, India's apparel production fell 18.6 per cent in the month of March and saw a decline of 11 per cent for the period 2017-18.”

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Smriti Irani Elicits Feedback On Textile Ministry Agrees To Upgrade Infra Demand Samarth Textile Skilling Scheme The Samarth scheme extends from 2017From Exporters that was launched by 2 0 , a t h r e e - y e a r

In a recent development, it was learnt that the ministry of textiles has given the nod to appeals from exporters’ bodies to effect upgr ades of over 200 apparel training and design centers ( AT D C s ) . T h i s upgrade is expected to get carried out pan India and will include centers in Chandigarh, Pun jab, Haryana and Himachal Pradesh. The major functions the upgrade comprises are setting up of state-of-the-art machinery and induction of new training courses. According to highly placed sources in the ministry that wished not to be named, “Members of the industry

told the textile ministry officials that the machinery at these centers was obsolete. Consi dering the competitiveness of exports, the industry needs highly skilled professionals. For this, these training centers should be upgraded and equi pped with the latest machinery so that workforce can be trained on the mode r n m a c h i n e r y. Acting on the requ est of the exporters, the ministry officials has asked the Apparel Export Promotion Council (AEPC) to make project report for the upgrade. The ministry also agreed to add knitwear section in these training centers.”

the centre aims to provide training to 10 lakh persons in the text i l e s e c t o r. T h e breakup provided was 9 lakh in the organized sector and 1 lakh in the traditional sector. The scheme

period with a total outlay of INR 1300 crores. The target audience is the youth. The youth will be skilled to get gainful and sustainable employment in the textile sector.

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City VIBES May 20-26, 2018

FUTURE VIBES

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Join the Denim Revolution at Gartex

Denim Zone Brings Togetherthe whole Denim Fraternity Under One Roof to Share Their Dedication for Denim, Talk About Innovation, Education and Sustainability New Delhi, May 2018 (CITY VIBES): The comprehensive trade show on garmenting and textile manufacturing solutions and technologies, Gartex has joined hands with Denim Manufacturers' Association (DMA) of India to facilitate a platform for denim fraternity to showcase denim fabrics, various applications possible using Denim Fabrics and as well as showcasing upcoming trends in the Denim Fashion Industry . The show is expected to add value to the entire valuechain of Denim industry encompassing the accessories like zipper and buttons, besides highlighting latest on finishing and washing technologies.Itwill be a great opportunity to Denim Fabricators, Garment Manufactur-

ers, Apparel Brands, Buying houses, Merchandisers and other industry players to interact with India's leading Denim Mills to witness the latest range and innovations in the Denim Sector. Companies like Aarvee Denims & Export Ltd., Anubha Industries Private Limited, Bhaskar Industries Pvt. Ltd., Ginni International Ltd., Mahak Creations Pvt. Ltd., Jindal Worldwide Ltd., LNJ Denim (Unit RSWM Ltd.), Ultra Denim Pvt. Ltd., Modern Denim Ltd., PartapSpintex Pvt. Ltd., Vinod Denim Ltd., Mafatlal Industries Ltd., Oswal Denims (Prop. Oswal Woolen Mills Ltd.), Nandan Denim Ltd., Suryalakshmi Cotton Mills Ltd. and many

more are showcasing their product range in the Denim Zone. G o i n g f o rward, the organisers have created an Applications Zone within the periphery of the Denim Zone to highlight rapidly increasing applications of denim fabric. As we all know, the applica-

tio n s o f denim as fabric is not limited only to the clothing especially jeans and jacket, but has gone far beyond to include ladies apparel, wed-

ding dresses, bags, rugs, bikers' helmets, decorative items, home furnishings, shoes, toys,car seat covers, face-masks, phone covers, upholstery, insulations, etc. to bring forth a wholesome idea that where denim can be used. Interestingly, there would be a Trends Zone to display the latest technologies and advancements taking place in the industry and the moves that DenimIndustr y must make to achieve a sustainable g r o w t h . To p Brands like Arvind Mills & Raymondwho are also the sponsors of the Zone, have confirmed to present the future forecaston the trends of denim industry under this specific Zone.

Most importantly, aKnowledge Forum will be staged on denim sector to exchange ideas on the development front. The forum will focus o n s u s t a i n a b i l i t y, design inspiration, trends emerging in d e n i m i n d u s t r y, improvement in washing & finishing techniques, apart from other relevant industry topics. Broad exhibit categories at Gartex 2018 include embroidery machines, cutting and sewing machines, fabrics & accessories, needles & threads, laundry & washing equipment, finishing equipment, laser cutting machines, digital textile printing machines, automation and software. MEX Exhibitions Pvt. Ltd. is an international exhibi-

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City VIBES

INDIA VIBES

May 20-26, 2018

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Centre Injects Fresh Life Into Textile SIMA Pleads With Centre To Relax Cabotage Laws Sector In The Form Of ATUF Scheme

To achieve the vision of the Government for generation of employment and promotion of exports through “Makein India” and of Zero effect and Zero defect manufacturing, Central Government has introduced a new scheme “Amended Technology Upgradation Fund Scheme (ATUFS)” which provide one time capital subsidy for eligible investments in plant & machinery. The Scheme is credit linked and the project is covered by term loans sanctioned by the lending agencies which will only be eligible under the scheme. Sector eligible under the scheme Garment / Apparel / Made ups (wearable or non wearable of stitched fabrics), Technical Textile ( i.e Mobitech, Meditech, Geotextiles, Agrotextiles,

P r o t e c t , P a c k Te c h , Buildtech and Hometech ) Duration of the scheme This scheme is effective from 13.01.2016 to 31.03.2022. Cut-off date:The date of Term Loans shall be the date of the letter of the lending agency vides which the sanction ofterm loan is communicated to the entrepreneur. Different Segments covered under Textile Sector are as follows: ATUFS benefits are available for ATUFS bench marked machinery covering the following segments:Weaving, weaving Prepa ratory and knitting Processing of fibres, yarns, fabrics, garments and made –ups Technical Textiles Garment / Made up manufacturing Handlooms Silk

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Jute Subsidy for garment and technical textiles is 15%; subsidy for weaving for brand new shuttleless looms, processing, jute, silk aned handloom is 10%; Subsidy for composite unit/multiple segments is 15% in event capital for garmenting and technical textiles is more than 50%; and 10% subsidy if capital is less than 50% for the same criteria. EDITORIAL BOARD Publisher & Editor C. M. Sharma 98154 29998 Administration Aakash 94632 62033 RNI NO. : 69862/98 Published by C.M. Sharma from P-11, Basant Vihar, Noorwala road, Ludhiana and Printed at Swastik Printers Ludhiana.

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Shippi ng of cotton by fore i g n c a r r ie r s within t h e Indian shorelines from Gujarat to the southern port lines are facing major constraints due to the existing Cabotage laws, which the Southern India Mills’ Association is seeking to be relaxed. SIMA advocates that the government relax the cabotage laws for the movement of cotton from Gujarat to Tamil Nadu by the sea route. To bring down cost of transporting cotton, this demand from SIMA has been long pending with the government. The Southern India Mills Association made a representation to the centre, stating, “The

Ministry of Shipping had taken several steps to enable coastal movement of cotton from Gujarat to Tamil Nadu. Textile processing facilities are spread across clusters in d i ff e r e n t S t a t e s a n d hence, transport cost is the key to determining the cost competitiveness of the industry.” “Against this background, we request you to kindly relax the cabotage rule in respect of cotton transport from either Mundra or Pipav Ports to Thoothukudi, Kochi, Chennai and Krishnapatnam Ports,” the association mentioned. Nearly, 60% of the spinning capacity in the country comes from the southern states. The cause for relaxation of cabotage laws is further augmented by the cat that a substantial volume of the raw cotton comes

from Gujarat and Maharashtra. SIMA expressed the sentiment that there is scope for 50% reduction in cost if cotton is moved by ship instead of lorries as is done currently. SIMA chairman P Nataraj said, “Every year, mills in Tamil Nadu buy 60 lakh to 70 lakh bales of cotton from Gujarat. This cotton comprising mainly Shankar 6 Variety is popular for use in hosiery items.” For the past two years, Indian flag vessels have been moving a miniscule portion of 70 lakh bales, nearly 10 lakh bales by ship from one domestic port to another. Industry sources disclosed that “Once these cabotage rules are relaxed, foreign flag vessels will be in a position to move cotton from one Indian port to another at very competitive prices.”

Jammu Cloth Merchant Body Demands Revoke Of Toll Booths The Jammu cloth wholesalers are up in arms against the levy of toll tax by the J&K state government. In a representation to the state deputy chief minister Kavinder Gupta, a delegation from the Wholesale Cloth Merch ant’s association put forth their set of demands for effectuating ease of doing business in the state. Kavinder Gupta was presiding as Chief Guest over the annual general meeting of the association when the merchants chose to put forth their demand in a formal tone.

President, Whol esale Cloth Merchants’ Association, Vinay Gupta conveyed the message to the members in his welcome speech and put forth the demands of the association to the deputy chief minister. The demands included abolition of toll tax and construction of wholesale textile market to boost the textile trade and economy of the state. Kavinder Gupta, the deputy chief minister in turn gave an assurance to the merchants that their genuine demands will be

considered on a priority basis by the state assembly. Also touched upon was the topic of changing business scenario opportunities and challenges in a symposium that was held at the venue. The merchant body honored all the participants in the symposium with trophies. . The annual report of the association was presented by Ashwani Arora, the general secretary. Laxmi Narayan, vice president, presented the vote of thanks.

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City VIBES May 20-26, 2018

GLOBAL VIBES

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US Is Indeed Widening Its Apparel Sourcing Base The latest US textile and apparel import statistics are indicative of a changing supply chain, and of US buyers noticeably diversifying their sourcing base. U S a n d European buyers have been following the China + 1 or China + many sourcing strategy for some years now. And in this part of the world, it was believed that the +1 or +many would be Asian countries - viz. Bangladesh, Vietnam, India, Sri Lanka. The latest OTEXA statistics reveal that US imports from these countries remain the highest, but have not clocked the highest growth rates. Imports have surged from Turkey, Myanmar, Cambodia, AGOA countries for mass apparel. And imports have clocked impressive growth from the fashion capitals of the world - Italy, France, Spain. Consumer spending on low end commodity apparel and footwear has been more or less stagnant for some time now, with shoppers preferring high value items. The current import figures point to this trend. China still rules the roost US imports of apparel from China during January-March 2018, at US$ 5802.021 million, were 0.87% higher than in the same period of 2017. In volume terms, Chinese exports to the US amounted to 2482.089 million SME, an increase of 3.74% during the period under review. In 2017, China's apparel exports to the US fell 3.17% to US$ 27030.289 million,

which was still 33.67% of total apparel imports of the US in terms of value, and 42% in volume. I n th e fi r s t three months of 2018, China's share remains the highest, but is dwindling. In value, China's share in US apparel imports was 30.17%, and in volume, 38%. Imports from China will fall further in the midst of tariff and trade wars. Will a 25% US tariff on Chinese apparel significantly bring down China's exports to this market? Once again, the answer is not in the near future. A rough aggregation of China's per unit price of apparel for US buyers shows that it is still one of the most competitively priced destinations to source from, coupled with the fact that it has the capacities needed to service the huge US market, among others. An overall 25% tariff by the US on imports of Chinese apparel will make the apparel costlier by well, 25%. But this will still keep China far more competitive than some of its rivals. Vietnam will remain pricier than China. As also Indonesia and India. Bangladesh will become the lowest cost destination for US to buy from. A direct boost to Bangladesh. All this is assuming that the Chinese government will offer no incentives or tax rebates to its industry to counter the US tariff. Imports from other sourcing destinations in Asia Vietnam is the second largest apparel supplier to USA. US imports of apparel from Vietnam during January-March 2018

were valued at US$ 2858.357 million, an increase of 3.32% compared to the same period in 2017. US imported 914.263 million SME apparel during the period, which was 1.73% higher than in the corresponding period of last year (CPLY). In 2017, Vietnam's apparel exports to the US had clocked a 7% growth. Bangladesh's noncompliance issues spoil the game In the last two benchmarking reports by the United States Fashion Industry Association (USFIA), many buyers had hinted at reducing sourcing from Bangladesh, while others had pledged to work closely with the Bangladesh industry. The non-compliance issues faced by the country's garment factories, coupled with lower US consumer spending on apparel, has resulted in a drop in exports to this market. T h e U S imported garments worth US$ 1356.166 million from Bangladesh during January-March 2018, a drop of 0.92%. In volume terms, imports were at a slightly lower level of 511.892 SME million, a drop of 0.06%. In 2017, imports from Bangladesh were down by 4.46%. The fourth largest supplier to the US market Indonesia, has seen a more noticeable fall. US apparel imports from Indonesia fell 5.78% to US$ 1149.891 million. In 2017, imports was Indonesia were down 3%. India's presence in the US market remains stable. During JanuaryMarch 2018, US imports of apparel

from India at US$ 1036.066 million, were marginally lower by 0.79%, compared to CPLY. In 2017, India's apparel exports to the US registered an increase of 1.17%. Even so, US buyers will become more aggressive in adopting the strategy of China + many. And Vietnam and Bangladesh will become more important suppliers to the US. Vietnam already enjoys a 13-14% share of total US apparel imports, and Bangladesh, 7-8%. Emerging sourcing destinations for US apparel needs Cambodia could emerge as an important apparel sourcing destination. At present, it offers the lowest prices. But does not have the capacities to match the demand of US buyers. Moreover, Cambodian factories have been in the news for non-compliance many times, and buyers may hesitate to increase sourcing from here. US imports from Cambodia, during the period under review, went up 12.52% to US$ 587.715 million. In volume terms too, imports registered a similar increase of 12.75% to 262.845 million SME. US imports from Myanmar are quite negligible, but growing at a fast pace. During January-March 2018, US apparel imports from Myanmar amounted to US$ 33.785 million, up 36.70% compared to CPLY. In 2017, apparel imports worth US$ 132.517 million, were 80% higher than in 2016. Myanmar is working

to strengthen its textile industry. Chinese investors could set up factories in Myanmar, as they have done in Vietnam. As we know, for textile and apparel commodities, China is losing its competitiveness, and is setting up production facilities in other countries and regions. So, while direct sourcing from China may attract a 25% US tariff, a Chinese company will be able to work around this tariff if it relocates. And maybe even enjoy preferential treatment in the US market. We are hinting at Chinese textile investors' aggressive move into African countries, most of them enjoy preferential trade access under AGOA. US buyers have increased their sourcing from Turkey over the years. During January-March, US apparel imports from Turkey at US$ 147.996 million were 21.75% higher than in the CPLY. In 2017, the US imported apparel worth US$ 526.546 million from Turkey, which were 11.51% higher than in 2016. A rough aggregation reveals that Turkey is more competitive than Vietnam and Bangladesh. Egypt looks to be another emerging sourcing destination for US buyers. During January-Marcy 2018, imports from Egypt were up 15.78%, to US$ 203.355. In 2017, imports from Egypt at US$ 726.547 climbed 5.13% compared to 2016. Prices of Egyptian apparel are quite competitive. Imports from Italy

rose 20.52% during the first three months of 2018. Imports from France recorded a growth of 11.24%, to US$ 41.756 million. These are high value fashion apparel, revealing a preference for high value over commodity. Apparel imports from AGOA countries are up Apparel imports from AGOA countries are on the rise too, especially in 2018. In the first three months of the year, apparel imports from these African countries reached US$ 274.55 million, up by 17% compared to CPLY. Volumes grew 20% to 74.726 million SME. Top exporting countries from AGOA include Kenya, Lesotho, Madagascar, Mauritania, Morocco, Ethiopia and Tanzania. While most of these countries registered double-digit export growth to the US this year, Ethiopia's apparel exports grew 101.58% during January-March 2018. US buyers imported apparel worth US$ 21.955 million from Ethiopia. Volume was up 123.43% to 10.480 million SME. These import trends, the looming trade war between US and China are a wake-up call for America's traditional apparel suppliers to act quickly to make their supply chains efficient. And to diversify their markets to hedge risks.

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City VIBES May 20-26, 2018

EXPO VIBES

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City VIBES presents FIRST TIME EVER

SOURCING GUIDE For LUDHIANA’S APPAREL INDUSTRY Available online at

www.cityvibesindia.com A Comprehensive Directory of Hosiery & Textile Suppliers in Yarn Fibre Fabric Thread Machinery & Equipment Accessories Dyeing Printing Dyes & Chemicals Job Workers Allied Industries To Help in Sourcing Requirements of GARMENT MANUFACTURERS & Other finished Goods Manufacturers For Booking your Space, Contact:

Aakarshan MEDIA +91 98154 29998; +91 94632 62033 Email: cityvibesldh@gmail.com

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