Cotlook A Index - Cents/lb (Change from previous day)

13-02-2019 79.40 (-0.50)

13-02-2018 87.35

13-02-2017 85.65

New York Cotton Futures (Cents/lb) As on 15.02.2019 (Change from

previous day)

Mar 2019 70.00 (-0.13)

May 2019 71.69 (-0.02)

July 2019 72.93 (+0.19)

15th February

2019

Cabinet approves continuation of Credit Linked Capital Subsidy and

Technology Up-gradation Scheme (CLCS-TUS) beyond 12th Plan for three

years from 2017-18 to 2019-20

Cabinet to soon consider relaxing local sourcing norms for single brand

retailers

European Parliament endorses free trade agreement with Singapore

Indonesia, Australia to sign trade deal in March: trade minister

Cotton and Yarn Futures

ZCE - Daily Data (Change from previous day)

MCX (Change from previous day)

Feb 2019 20130 (-20)

Cotton 15735 (-90) Mar 2019 20430 (0)

Yarn 24855 (0) Apr 2019 20720 (0)

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2 CITI-NEWS LETTER

-------------------------------------------------------------------------------------- Cabinet approves continuation of Credit Linked Capital Subsidy and

Technology Up-gradation Scheme (CLCS-TUS) beyond 12th Plan for

three years from 2017-18 to 2019-20

Cabinet to soon consider relaxing local sourcing norms for single brand

retailers

Measures soon to boost textiles exports: Official

Indo-US talks: Jobs, tech transfer top agenda; ecommerce, tariffs

skipped

Scope for Indian companies to increase supplies to UN

Farmers hold on to stock but cotton rates dip

Institute of Directors’ MSME meet in Chennai tomorrow

WB govt calls for tripartite meet to resolve jute industry

WPI inflation for apparel up 1.3% in January 2019

Min of Textiles honours 12 weavers and artisans for their outstanding

work in handloom and handicrafts sector

Banks step up lending to corporates

Strata Celebrates Grand Opening of New Manufacturing Facility in

India

------------------------------------------------------------------------------------------------

European Parliament endorses free trade agreement with Singapore

Indonesia, Australia to sign trade deal in March: trade minister

Cambodia will not die if EU withdraws EBA trade preferences: PM

Egyptian Cotton pilots BCI cotton project

Collection, sorting imp for fibre2fibre market: WRAP

----------------------------------------------------------------------------------

NATIONAL

---------------------

GLOBAL

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3 CITI-NEWS LETTER

NATIONAL:

Cabinet approves continuation of Credit Linked Capital Subsidy and

Technology Up-gradation Scheme (CLCS-TUS) beyond 12th Plan for three

years from 2017-18 to 2019-20

(Source: PIB, February 13, 2019)

The Cabinet Committee on Economic Affairs, chaired by the Prime Minister Shri

Narendra Modi, has approved the Credit Linked Capital Subsidy and Technology Up-

gradation Scheme (CLCS-TUS) with a total outlay of Rs.2900 crore. This scheme aims at

improving the competitiveness of MSMEs by integrating various ongoing schematic

interventions aimed at up-grading technology through Credit Linked Capital Subsidy

(CLCS), hand holding for zero defect zero effect manufacturing (ZED), increasing

productivity through waste reduction (Lean), design intervention (Design), cloud

computing (Digital MSMEs), facilitation of intellectual property (IPR) and nurturing new

ideas (Incubation).

Special provisions have been made in this scheme to promote entrepreneurship for

SC/STs, women NER, Hill States (Jammu & Kashmir, Himachal Pradesh & Uttarakhand)

Island Territories (Andaman & Nicobar and Lakshadweep) and the Aspirational

Districts/ LWE Districts, as in these cases the subsidy shall be admissible also for

investment in acquisition /replacement of plant & machinery / equipment & technology

up-gradation of any kind. The scheme would be demand driven. But its coverage has been

made more inclusive.

In addition, the scheme through Zero Defect & Zero Effect, component will promote

reduction in emission level of green house gases and improve the competitiveness

through reduction in defect / wastage during the manufacturing process of the products.

It will also promote the innovation, digital empowerment of MSMEs, design interventions

and support the protection of intellectual property of MSMEs.

The scheme will facilitate technology up-gradation to MSEs, improvement in Quality of

products by MSMEs, enhancement in productivity, reduction in waste and shall promote

a culture of continuous improvement.

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4 CITI-NEWS LETTER

Cabinet to soon consider relaxing local sourcing norms for single brand

retailers

(Source: Economic Times, February 13, 2019)

The Cabinet is expected to soon consider a proposal of FDI-linked relaxation for

mandatory 30 per cent local sourcing norms for foreign single brand retailers by allowing

them more time to comply with regulations, sources said. The commerce and industry

ministry has already circulated a draft cabinet note seeking views of different ministries

including the department of economic affairs on the proposal, one of the sources said,

adding that "after receiving the comments, the ministry would soon approach the cabinet

for its consideration".

With a view to attract big players such as iPhone maker Apple, as per the proposal, single-

brand retail firms may be permitted to open online stores before setting up brickand-

mortar shops if they bring in over USD 200 million foreign direct investment (FDI).

But such firms would have to set up brick-and-mortar shops within two years of starting

online sales.

Currently, online sale by a single-brand retail player is allowed only after opening of

physical outlet.

Retail traders may also be allowed to adjust the incremental sourcing of goods from India

for global operations during the initial 6-10 years, from the current five years (beginning

April 1 of the year of the opening of first store), against the mandatory sourcing

requirement of 30 per cent of purchases from India. These relaxations too would be

subject to quantum of FDI one brings in India.

While six years' time would be given to a retailer that invests USD 100 million in the

sector, 8 years and 10 years time would be given to those who bring in USD 200 million

and USD 300 million foreign inflows in the sector, respectively. In January 2018, the

government allowed 100 per cent FDI in the sector, permitting foreign players in single-

brand retail trade to set up own shops in India without government approval.

That time, the government also relaxed mandatory local sourcing requirement of 30 per

cent by stating that a foreign retailer would be able to get credit from incremental rise in

sourcing for its global operations from India towards the mandatory 30 per cent local

sourcing requirement for its business in the country. In 2016, Apple India had sought

relaxation in the local sourcing norms to set up single brand retail stores in India.

During April-September 2018-19, FDI in India declined by 11 per cent to USD 22.66

billion.

Home

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5 CITI-NEWS LETTER

Measures soon to boost textiles exports: Official

(Source: The Hindu BusinessLine, February 13, 2019)

The Centre will soon announce measures to boost exports of apparels and textiles which

will be compliant with the World Trade Organization norms and help exporters meet

competition from countries such as Bangladesh and Vietnam.

“Our exporters of apparels and made-ups have been finding it difficult to compete with

countries such as Bangladesh and Vietnam, which get zero-duty access to markets such

as the EU. Over the last few months, we have held discussions with the Departments of

Commerce and Revenue and we will shortly come up with some measures for the sector

which would also be WTO-compliant,” Raghvendra Singh, Secretary, Ministry of Textiles,

said at a press conference on Wednesday.

Singh said ensuring that export schemes were WTO-compliant was an important issue

now and the Ministry was working on the recommendations of the committees set up to

examine WTO compatibility of schemes.

The Textiles Secretary, however, did not clarify on how long the popular Merchandise

Export from India Scheme (MEIS), which is one of the five schemes challenged by the US

at the WTO, will continue. The US wants India to do away with the scheme as the country

had crossed the average per capita income level of $1,000 some time back and was no

longer eligible to give export sops.

Singh also indicated that the Rebate of State Levies (RoSL) scheme could be expanded to

increase the level of benefits to exporters. The RoSL does not flout global trade rules as it

involves refund of taxes and levies paid by exporters and is not a subsidy.

Home

Indo-US talks: Jobs, tech transfer top agenda; ecommerce, tariffs skipped

(Source: Economic Times, February 14, 2019)

Both sides to set up groups on financial services, healthcare & defence to boost trade.

Job creation and technology transfer dominated the India-US talks on Thursday while the

contentious issues related to data localisation, ecommerce and US’ likely withdrawal of

benefits to Indian exports were not discussed.

The two sides will set up groups on financial services, healthcare and defence to accelerate

bilateral trade and investments.

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6 CITI-NEWS LETTER

The three working groups will be in addition to four such groups which were established

to deal with issues concerning energy, water and environment; ICT, emerging

technologies and digital infrastructure; entrepreneurship, inclusive growth and

promoting small business; and infrastructure and manufacturing.

“Suresh Prabhu and Wilbur Ross had one to one bilateral telephone conversation and

discussed various aspects of India-US trade and commerce relations,” the commerce and

industry ministry said in a statement.

However, in the absence of US secretary of commerce Wilbur Ross, who cancelled his visit

due to inclement weather and technical problems, there was no joint statement. He

participated in most of the sessions remotely via teleconference.

Officials who attended the India-US Commercial Dialogue and the CEO Forum said there

was no discussion over the contentious trade issues.

India recently tightened foreign direct investment policy for ecommerce firms and the US

is likely to withdraw preferential benefits to Indian exports. “They could have come up if

Ross was here,” said one official.

Another official said the issue of trade deficit, that the US is concerned about, was also

not discussed but both sides emphasised on employment opportunities in their countries.

The two countries have been embroiled in a series of trade spats including the eligibility

of Indian products for preferential or duty-free access to its market under the Generalized

System of Preferences (GSP), US’ demand for unconditional approval to its dairy exports

and lower tariffs on ICT products.

These issues are being negotiated with the United States Trade Representative as part of

a trade package.

Separately, India also has put on hold its plan to impose retaliatory tariffs on certain

American imports in response to heavy duties on imported steel and aluminium items by

the US.

SME Focus

“India’s MSME ministry was made part of the process for the first time,” the second

official said.

Appreciating the pivotal role of small businesses, including small and medium enterprises

(SMEs) in the areas of manufacturing and services, the sides expressed interest in

facilitating partnerships among businesses and institutions with a view to encourage best

practices, conducive policies, and collaboration for SMEs in both countries.

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7 CITI-NEWS LETTER

“The US Department of Commerce has taken the initiative to organise Trade Winds event,

which will bring in a lot of SMEs having interest in India in May, 2019,” the government

said in the statement. Both sides agreed to constitute a private sector-led SME initiative

on the sidelines of this event.

Home

Scope for Indian companies to increase supplies to UN

(Source: The Hindu Business Line, February 15, 2019)

India’s share as a supplier is over $900 million

Indian companies stood to benefit in more ways than one by becoming suppliers, of both

products and services, to the United Nations and its agencies.

The multi-million dollar annual business opportunity that existed apart, what would

benefit them eventually would be fine-tuning their operations to conform to the norms

mandated by the UN for the suppliers.

This was a message speakers sought to underscore at a seminar on ‘Business

opportunities with the United Nations’ here on Thursday while pointing out that India’s

share as a supplier was a little over $900 million of the over $18 billion total procurement

by the UN and the agencies in 2017.

Addressing the programme, organised by trade and industry body FTAPCCI, Senior

Procurement Officer of the UN Procurement Division Bruno Maboja said the $900

million is the value of the products and services provided by the Indian companies.

“Lot of Indian goods are supplied to the UN but not by companies from India. You have

middlemen who come all the way from Europe, China, they come to India -- get the goods

-- and supply to the UN,” he said. The reason we are here, he told the gathering comprising

representatives of various companies, “is because you are capable of supplying goods to

the UN directly for the benefit of the country. Why should somebody else come and get

them from India and pay you very little and supply to the UN at a higher price? We are

interested in getting them at a cheaper price from you directly… it is a fair deal to you also

if we come to you directly,” Mr. Maboja said. Of the over $18 billion total procurement,

the value of supplies made by UN Procurement Division was a little over $3 billion.

Industries and IT Secretary Jayesh Ranjan urged the companies to educate themselves

about the procedures involved in becoming suppliers to the UN and its agencies. “You

need to be very ethical in your dealings,” he added.

The Federation of Telangana and Andhra Pradesh Chambers of Commerce and Industry,

he said, should set up a help desk or a cell to keep track of the UN tenders and

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8 CITI-NEWS LETTER

procurement requirements and inform the prospective exporters. He suggested that the

UN consider Hyderabad for setting up a regional procurement centre.

Regional Passport Officer and Head of MEA Branch Secretariat in Hyderabad E.Vishnu

Vardhan Reddy said India is the one the leading suppliers to UN and the major exports

from the country are pharmaceuticals, contraceptives and vaccines.

Home

Farmers hold on to stock but cotton rates dip

(Source: Shishir Arya, Times of India, February 14, 2019)

Prime Minister Narendra Modi’s visit to Pandharkawda, which is a major hub for cotton

trade, coincides with a steep fall in price of the commodity, the main crop of the region.

Hoping to get a higher rate, farmers were sitting on a major part of their produce even

though the harvest was over in November. The rates have come down to the level of

minimum support price (MSP) or even lower in some places.

The cultivators were banking on global trends hoping for a bumper price in the days to

come. Cotton growers of Vidarbha had hopes on the US-China trade war which was

expected to have a favourable tide for Indian farmers.

Both US and China had imposed tariff barriers on each other which led to the scope of

demand for cotton from India in both the countries. Aware of the developments, the

farmers hoped that the rates would ultimately cross over Rs 6,000 a quintal in local

markets.

However, the calculations have failed. An overall slump in the economy has hit the

demand for cotton too. There are signs of the conflict easing with a series of negotiations

taken up recently. In the last 20 days, the rates have slipped below the minimum support

price (MSP) level of Rs5450 a quintal or are just at par in some of the pockets.

“A major dip of Rs500 was seen in the last fortnight,” said sources. The MSP was Rs4,500

earlier and it was raised to Rs5,450 recently by the central government last year.

The season began on a bullish note, followed by a dip. Last month the rates had again

touched Rs5800-5900 a quintal and farmers were hoping for a further jump beyond

Rs6000 level. However, the trend reversed instead.

In Pandharkawda market cotton has touched Rs5450 to Rs5300, said Suresh Bolenwar a

farm activist and a cotton grower himself. A little ahead in Telangana the rates are further

down at Rs5115-5120 a quintal.

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9 CITI-NEWS LETTER

Sudhir Kothari, a member of agriculture produce marketing committee (APMC) at

Hinganghat in Wardha district, said a large number of farmers had been waiting for the

rates to improve. “Now as the rates have touched the MSP, government procurement

through cotton corporation of India (CCI) has also started,” he said.

Lorena Ruiz, an economist at International Cotton Advisory Committee (ICAC) in New

York, said other cotton-growing countries too are expecting to benefit from the US-China

trade war. “But there needs to be an overall situation which can create a demand for the

commodity,” she said.

The IMF has cut its growth forecast for China to 3.7% from 3.8%. The consumption

estimates for China, from where buying was expected, has also been lowered.

Brazil is also hoping to gain from the trade war and has increased its area under cotton.

It is expected to sell its carry forward stock to China, apart from the forthcoming harvest,

on getting a good rate.

Keshav Kranti, who heads the technical coordination section of ICAC, said that the rates

had touched 100 cents a pound in July — a 10-year high. “However, the rates have come

down to 80 cents now. At this level, experts see little chance of rates further going down.

Rather, the bearish trend can increase the demand eventually,” he said.

Home

Institute of Directors’ MSME meet in Chennai tomorrow

(Source: The Hindu Business Line, February 14, 2019)

Institute of Directors (IOD), the apex body of corporate directors in the country, will

organise the first edition of its Micro, Small and Medium Enterprises (MSME) Summit

2019 in the city on February 16.

The theme for the summit, ‘Roadmap towards Excellence’, will bring together trade

associations and delegates from the MSME sector to gain insights into emerging

opportunities and prospects for the segment.

Sectoral issues

The summit will deliberate on the key challenges faced by the sector, such as ease of doing

business, easy access to credit, impact of major policy reforms despite various initiatives

taken by the Central and State governments to promote the MSME sector.

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10 CITI-NEWS LETTER

Currently, MSME sector contributes about 7 per cent of India’s Gross Domestic Product

(GDP), 45 per cent of total manufacturing output, and 40 per cent of Indian exports and

employs over 117 million people.

Growth prospects

“MSMEs are in a unique position to become global players attracting partners with

technology and funds. These enterprises impart the resilience to withstand economic

upheavals and maintain a reasonable growth rate since being indigenous is the key to

sustainability and self-sufficiency,” said MS Sundara Rajan, Chairman, IOD - Chennai

region, and former CMD of Indian Bank.

Event partners

The event is supported by MSME Development Institute and the Union Ministry of Micro,

Small and Medium Enterprises. BusinessLine is the media partner.

Home

WB govt calls for tripartite meet to resolve jute industry

(Source: Business Standard, February 14, 2019)

The West Bengal government has called for a tripartite meeting to resolve the impasse

between the jute mill owners and the workers' trade unions, which have threatened to go

on an indefinite strike from March 1 over their unfulfilled demands.

A notice issued by the state labour department earlier this week invited the jute unions

on February 18 to discuss their charter of demands with the mill owners.

Earlier the meeting was scheduled to be held Thursday.

All trade unions in the jute sector, barring Indian National Trinamool Trade

Union Congress, have agreed to join the strike from March 1 to press for their demands,

including wage revision and implementation of Minimum Wages Act.

The jute sector employs over two lakh workers in more than 60 mills in the state.

The strike, if not prevented, may have an impact on the vote bank of political parties

across the jute belts of Howrah, North 24 Parganas and Hooghly districts.

The general election is due this summer.

The jute industry has not seen any major wage revision after 2011. The state government,

in the last tripartite meeting held on January 17, had decided to give an interim relief of

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11 CITI-NEWS LETTER

Rs 70, raising the workers' wage to Rs 327 per day till the new wage agreement was

finalised.

The unions, however, contended that the interim benefit was a unilateral decision of

the state government.

A former chairman of Indian Jute Mills Association, a body of mill owners, said paying

anything more than Rs 327 would not be possible as "margins are already under pressure

in the jute business".

"The government should take steps to ensure that there are no disruptions. Strikes will

only help the central government to dilute mandatory packaging order in favour of the

plastic industry," he said.

Home

WPI inflation for apparel up 1.3% in January 2019

(Source: Fibre2Fashion, February 14, 2019)

India’s annual rate of inflation, based on monthly wholesale price index (WPI), eased to

ten-month low of 2.76 per cent for the month of January 2019. The index for apparel rose

by 1.3 per cent to 140.2 in January, according to the provisional data released by the Office

of the Economic Adviser, ministry of commerce and industry.

The official WPI for all commodities (Base: 2011-12 = 100) for the month of January 2019

declined by 0.7 per cent to 119.2 from the previous month’s level of 120.1, the data showed.

The index for manufactured products (weight 64.23 per cent) for January 2019 declined

by 0.3 per cent to 117.9 from the previous month’s level of 118.3. The index for

‘Manufacture of Wearing Apparel’ sub-group rose by 1.3 per cent to 140.2 from 138.4 for

the previous month due to higher price of woven apparel except fur apparel (2 per cent).

The index for ‘Manufacture of Textiles’ sub-group, on the other hand, declined by 0.3 per

cent to 118.8 from 119.2 for the previous month due to higher price of lower price of

synthetic yarn, knitted and crocheted fabrics, cordage, rope, twine and netting, other

textiles, texturised and twisted yarn, and weaving and finishing of textiles (1 per cent

each). However, the price of viscose yarn (2 per cent) and woollen yarn (1 per cent) moved

up.

The index for primary articles (weight 22.62 per cent) declined by 0.1 per cent to 134.5

from 134.7 for the previous month. The index for fuel and power (weight 13.15 per cent)

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12 CITI-NEWS LETTER

declined by 4.1 per cent to 99.3 from 103.5 for the previous month due to lower price

of ATF, furnace oil, bitumen, LPG, naphtha, kerosene, petrol and HSD.

Meanwhile, the all-India consumer price index (CPI) on base 2012=100 stood at 2.05

(provisional) in January 2019 compared to 2.11 (final) in December, 2018 and 5.07 in

December, 2018, according to the Central Statistics Office, ministry of statistics and

programme implementation.

Home

Min of Textiles honours 12 weavers and artisans for their outstanding work

in handloom and handicrafts sector

(Source: KNN India, February 14, 2019)

Ministry of Textiles honoured 12 weavers and artisans from different parts of the country

for their outstanding work in handloom and handicrafts sector at the event titled

‘National Conclave on Creating Synergy for MSMEs in Textiles Sector’.

An exhibition showcasing achievements of the MSMEs in textiles sector was also held

during the conclave. A booklet on Ease of Doing business was also released, which is

available in ten languages-Hindi, Manipuri, Assamese, Bengali, Odia, Gujarati, Marathi,

Tamil, Telugu and Kannada.

Fifteen MoUs were signed at the event to facilitate foreign trade of textiles and handicrafts

items and a short film on the outreach support programme of the textiles ministry was

also screened.

Under the Prime Minister’s support and outreach 100 days programme, 100 districts were

identified in various sectors, and among these, 39 districts were identified for the textiles

sector.

Out of these 39 districts, 12 were identified for handlooms, 19 for handicrafts, and eight

for powerloom.

Also, various activities were undertaken in identified districts for creating synergy for

MSMEs in textile sector like holding camps for Mudra loan in collaboration with local

bank, enrolment of beneficiaries on e-dhaga, distribution of tool kits to beneficiaries,

registration and distribution of Pehchan cards to artisans and weavers, popularization of

24x7 help line, quality certification and social security.

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13 CITI-NEWS LETTER

Speaking on the occasion, Minister of Textiles, Smriti Zubin Irani, said that during the

outreach programme the Government has ensured that the relevant information related

to the Central Government schemes reaches beneficiaries.

She said that Rs. 6500 crore Mudra loan was sanctioned to Textiles sector MSMEs.

She further stated that as many as 2.6 lakh weavers and craft persons were brought under

the social security network during the 100 days outreach programme.

Textiles Minister informed about the Pradhan Mantri Shram Yogi Mandhan Yojana for

providing pension of Rs. 3000 per month to people working in unorganized sector on

payment of small premium.

Addressing the gathering, Minister of Social Justice and Empowerment, Dr. Thawar

Chand Gehlot said that 70% of people working in MSMEs of Textile Ministry belong to

SC/ ST and OBC categories and urged the weavers and handicraft persons to avail the

benefit of the schemes of his Ministry.

Secretary Textiles, Raghvendra Singh said that in view of the crucial role played by

MSMEs in the creation of jobs and promoting inclusive economic growth, the textiles

Ministry is implementing various schemes and programmes for small business in textiles

and handicrafts sectors.

He said during the outreach programme Textiles Ministry officials worked in

coordination with state and district administration. Textiles Secretary said exhibitions

were held in targeted districts to promote sales of their products, MUDRA loans were

mobilized by involving public sector banks.

Twenty thousand new applications were received from craft persons for credit under

MUDRA scheme. Technology upgradation assistance was provided to 12,776 craft

persons in 31 districts, he added.

He stated “Over 1.30 lakh Pehchan ID cards have been issued to weavers and artisans to

facilitate them to claim the benefits and services they are entitled to. Other services such

as yarn passbooks marketing support, social security coverage were also extended to

the handloom weavers through outreach camps.”

Home

Banks step up lending to corporates

(Source: G Naga Sridhar, The Hindu Business Line, February 14, 2019)

Power, roads and ports, as well as services sectors get a fillip

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14 CITI-NEWS LETTER

India’s business environment appears to be turning positive with an increase in corporate

loans being extended by major banks.

The growth in corporate lending, which started from the beginning of the current

financial year and has been described as ‘green shoots’ by experts, now appears to have

gained ground, going by the third quarter numbers of major lenders.

State Bank of India reported a 20.67 per cent growth in total corporate lending at ₹7.74

lakh crore as of December 31, 2018, against ₹6.42 lakh crore in the same period last year.

In the third quarter of last fiscal, SBI’s corporate credit was muted compared to the

previous fiscal. But this year, the scenario has improved.

For the last couple of years, corporate loan growth has been almost flat for many banks.

“The drivers for corporate growth are power, roads and ports, as well as services,” said a

senior SBI executive. There was higher traction in government undertakings, he added.

Corporate slippages for banks continued to decline, and slippages from the watch list are

not significance any longer.

Other banks also witnessed a similar increase in various segments of corporate advances.

Punjab National Bank saw a 28 per cent growth in medium enterprise loans, while ICICI

Bank witnessed “continued growth” at 10 per cent in domestic corporate lending,

excluding restructured loans, among others. Canara Bank, too, posted over 7 per cent

increase in corporate portfolio.

The RBI’s data on sectoral deployment of bank credit, as of December 2018, also point to

an increase in credit to industry. Credit to industry rose by 4.4 per cent in December 2018,

compared to an increase of 2.1 per cent in December 2017.

“Credit growth to infrastructure, chemical and chemical products, all engineering,

vehicles and petroleum, coal products and nuclear fuels accelerated,” the RBI said in its

report. However, credit growth to basic metal and metal products, textiles, food

processing, and gem and jewellery saw deceleration.

Non-food credit

On a year-on-year basis, non-food bank credit increased by 12.8 per cent in December

2018, against an increase of 10.0 per cent in December 2017.

The stabilisation of Goods and Services Tax (GST), waning of adverse impact of

demonetisation, among others, have been positive for gross capital formation in the

economy, and there is more propensity to investments in some sectors, say experts.

Home

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Strata Celebrates Grand Opening of New Manufacturing Facility in India

(Source: Business Standard, February 14, 2019)

Strata Geosystems, a global leader in the soil reinforcement industry, opened doors to its

newest state-of-the-art manufacturing facility on February 11th, 2019 aimed at meeting

the growing demand for geotechnical products in India and around the globe.

"We are indeed a truly unique company," said Ashok Bhawnani, Founding Director of

Strata Geosystems, during the grand opening ceremony of the company's

new manufacturing facility located in Daheli, Gujarat. "As the largest reinforced soil wall

builder in India, we differentiate ourselves by using re-engineered yarn to build high-

performance structures for highways."

"Using geogrids to reinforce soil is analogous to using steel for concrete reinforcement,

and this technology is being used for a wide range of applications including ramp

construction, landfills, mining dykes, and other engineered structures," said Narendra

Dalmia, CEO & Director. Strata began as a manufacturer of geogrids in 2004 and has

evolved to become both a manufacturer and India's largest developer for reinforced soil

structures. Today, Strata has built over 400 bridge ramps on national highways across the

country and is a leader in the technical textiles industry. Reinforced soil technology has

been adapted across the country, which led the company to expand its capacity and more

effectively cater to the growing infrastructure needs in India.

Strata had the honour of hosting its joint-venture partners from Glen Raven, Inc. a global

performance-textile company headquartered in the USA. Among Glen Raven's attendees

were Leib Oehmig, CEO and Harold Hill, President of the Technical Fabrics

division. "This is a tremendous milestone for the entire Strata global organization,"

said Harold Hill. "It's an occasion that has been many years in the making, and it's only

been possible through the hard work and steadfast dedication of our team here

in India. We, at Glen Raven, could not be more proud of our partners in India - they are

top-notch professionals, and even better people. We couldn't ask for better partners,"

said Leib Oehmig.

The plant was constructed using Strata's own technical textiles for flooring, internal

roads, water-proofing, slopes and embankments, and loading aprons, providing a

testament to the products' benefits.

Further reiterating its commitment to India and Prime Minister Modi's ' Make in India'

vision, this new facility is the largest geogrid plant and will provide sufficient capacity to

cater to India's demand while continuing to strengthen existing export markets. The plant

enables the production of the widest geogrid, (made on 245" knitting machines), high-

strength uniaxial and biaxial geogrids, and improved technical parameters like enhanced

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16 CITI-NEWS LETTER

stress strain values. Additionally, the facility, located over 10 acres, houses an exclusive,

custom-built coating machine, efficient material handling capabilities, and an advanced

laboratory which will be accredited with global standards.

The inauguration of this plant is a milestone for the country's technical textile sector and

a symbol of Strata's continued global expansion. This new facility also aligns with the

efforts of The Ministry of Textiles towards the promotion of technical textiles in

critical infrastructure applications.

About Strata Geosystems:

Strata Geosystems is a global leader in geotechnical product and engineering solutions.

With fully integrated design, supply and construction capabilities, Strata provides

solutions to complex soil reinforcement and stabilization challenges. Strata's line

of geosynthetic products are matched by world-class engineering support and

geotechnical expertise.

Strata's products, including the industry-leading StrataGrid (geogrid) and StrataWeb

(geocell) lines, are ISO certified, hold CE markings, and are tested in GAI-LAP accredited

labs across the US, UK, and India. As a member of the International Geotechnical

Society (IGS), Strata proudly promotes the advancement of geosynthetics.

Home

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17 CITI-NEWS LETTER

GLOBAL:

European Parliament endorses free trade agreement with Singapore

(Source: Amanda Lee, Euractiv, February 14, 2019)

The European Parliament approved on Wednesday (13 February) the EU-Singapore Free

Trade Agreement (EUSTFA), the bloc’s first bilateral trade agreement with a southeast

Asian country.

The trade deal removes all existing tariffs on goods from the EU, removes trade barriers

by recognizing EU safety tests and will make the business environment more predictable,

according to the European Commission.

The trade agreement provides new opportunities for Europeans in sectors such as

telecommunications, environmental services, engineering, computing and maritime

transport. It will also make the business environment more predictable.

Singapore also agreed to remove obstacles to trade besides tariffs in key sectors, for

instance by recognising the EU’s safety tests for cars and many electronic appliances or

accepting labels that EU companies use for textiles.

In addition, the investment protection agreement will include an Investment Court

System for resolving investment disputes.

There are more than 10,000 European companies in Singapore with total bilateral trade

in goods of over €53 billion and €51 billion-worth of trade in services. Singapore is the

number one location for European investment in Asia, according to the Commission.

Besides the Free Trade agreement, there is the EU-Singapore Investment Protection

agreement, which replaces already standing treaties, and the EU-Singapore Partnership

and Cooperation agreement which is designed to reinforce the existing relationship

between the two governments.

The Investment treaties will be replaced by a modern common investment protection

framework and the Partnership agreement sets sustainability and trade standards.

“This is yet another win-win trade agreement negotiated by the European Union, an

agreement that will create new opportunities for European producers, workers, farmers

and consumers, while at the same time promoting cooperation and multilateralism,”

Commission President Jean-Claude Juncker said in a press release.

This new agreement was praised by EuroCommerce which noted the quick evolution and

development of Singapore resulting from free trade.

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18 CITI-NEWS LETTER

“The European Parliament’s approval today opens a further avenue for mutual benefit

through open and free markets, and confirms the EU as a promoter of the world trading

system where important partners seem to be turning away from it,” said Director-General

of EuroCommerce, ChristianVerschueren.

The Greens/EFA party was less enthusiastic, saying that the Commission was putting

profit over people.

“The EU is relying on old mistakes around investment protection and prioritising large

foreign investors, while small and medium-sized enterprises are left behind in

Singapore,” said Heidi Hautala, Vice-President of the Greens/EFA Group. “It’s very

regrettable that the European Commission has pushed through privileged investor

protection.”

After the vote today, the EU member states need to ratify the agreement and is also

waiting for Singapore’s procedures to conclude for the deal to go into force.

The Singapore Embassy in Brussels was not immediately available for comment.

The EU had signed trade agreements with South Korea, Canada, Mexico and Vietnam,

and is currently negotiating with Australia, New Zealand and Mercosur countries.

Home

Indonesia, Australia to sign trade deal in March: trade minister

(Source: Business Standard, February 14, 2019)

Indonesia is to sign a trade and investment partnership deal with Australia in March,

Indonesia's trade minister said on Thursday, three months later than expected and

following diplomatic friction between them over Middle East policy.

Trade Minister Enggartiasto Lukita told reporters that the Indonesia-

Australia Comprehensive Economic Partnership Agreement would be signed at an

Indonesia-Australia business conference.

Negotiations on the deal were concluded last August and it had been due to be signed by

the end of 2018.

But Australia's recognition of West Jerusalem as Israel's capital strained relations with

Indonesia, which is the world's biggest Muslim-majority country and supports a two-state

solution to the Middle East dispute.

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19 CITI-NEWS LETTER

Australia's trade minister, Simon Birmingham, had played down the issue and cited

translation glitches as cause of the delay in signing the deal.

The neighbours have been in talks on trade since early in the decade, with diplomatic

tension occasionally stalling the process.

Though neighbours, the two are not top trade partners.

Australia valued trade between them at A$11.2 billion ($7.96 billion) in 2017-2018,

with Indonesia being its eighth largest source of imports, while Australia is Indonesia's

14th largest export destination.

($1 = 1.4075 Australian dollars)

(Reporting by Bernadette Christina Munthe; Writing by Fransiska Nangoy; Editing by

Ed Davies and Robert Birsel)

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Cambodia will not die if EU withdraws EBA trade preferences: PM

(Source: Xinhua, February 14, 2019)

Cambodian Prime Minister Samdech Techo Hun Sen said on Thursday that the country

will not die if the European Union suspends the Everything But Arms (EBA) trade

preferences for the kingdom.

"No matter whether it is suspended or not, the suspension of the EBA trade preferences,

that will be known in 18 months, will not lead us to die," he said during the closing

ceremony of the Interior Ministry's annual conference.

"We must not exchange our sovereignty for any aid," the Cambodian prime minister said.

Meanwhile, Hun Sen unveiled a series of "sharp and deep" reforms to strengthen

economic independence and support businesses in case the EU withdrew the EBA from

the country.

He said the measures included cancellation of certificates of origin (CO), pullout of

Cambodia Import Export Inspection and Fraud Repression (CamControl) unit from all

border checkpoints, removal of the Kampuchea Shipping Agency and Brokers (Kamsab)

officers from all ports, reduction of fees on inspection of cargo containers by scanning

machines, and cut of the fees for getting customs papers stamped.

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20 CITI-NEWS LETTER

He added that the government will also provide fiscal incentives for small- and medium-

sized enterprises.

"With our ongoing sharp and deep reforms, we believe that investment environment in

Cambodia will be better and more attractive to local and foreign investors and business

people," Hun Sen said.

He added he will meet with business leaders in March during a government-private sector

forum to discuss these issues.

According to Hun Sen, Cambodia's economic growth was 7.5 percent in 2018, the highest

rate in the last decade.

His remarks came after the EU began on Tuesday the 18-month process that could lead

to the temporary suspension of Cambodia's duty-free trading access to the EU market

under the EBA scheme due to concerns over human rights and labor rights.

EU is a major trading partner for Cambodia, especially for textiles and footwear sector.

As a Least Developed Country, Cambodia has enjoyed exports of all products, except arms

and ammunition, to the EU market with zero percent tariff since 2001.

According to an EU data, the Southeast Asian nation exported products to the bloc worth

about 4.9 billion euros in 2018.

The Garment Manufacturers Association in Cambodia (GMAC) said on Monday that a

suspension of EBA would increase tariffs by 12 percent in the garment sector and by 8 to

17 percent for footwear.

Home

Egyptian Cotton pilots BCI cotton project

(Source: Home Textiles Today, February 14, 2019)

UNIDO partnership part of sustainability drive

The Cotton Egypt Association is partnering with the United Nations Industrial

Development Organisation (UNIDO) to boost sustainability.

Under a new pilot project called The Egyptian Cotton Project, the partners are launching

the country’s first Better Cotton Initiative (BCI) program. BCI connects people and

organizations across the cotton sector – from field to store – to make global cotton

production better for the people who produce it and the environment it grows in.

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21 CITI-NEWS LETTER

“The partnership with UNIDO to support the BCI pilot project is one of several initiatives

we will be exploring in 2019, as we continue to bring the brand and the values of the

world’s finest cotton to meet the expectations of a modern consumer,” said Khaled

Schuman, executive director of the Cotton Egypt Association.

The BCI is the largest cotton sustainability program in the world, educating farmers and

granting the BCI standard to those who meet rigorous levels of sustainable production

and employee welfare. Currently the organization licenses 1.3million farms in 21

countries and aims to bring 30% of global production up to BCI standard by 2020.

A UNIDO spokesman said: “The pilot project’s vision is to pilot the BCI standard system

in Egypt, through a multi stakeholder program jointly coordinated by UNIDO, relevant

governmental entities, farmers’ cooperatives, cotton-textile associations and

local/international private sector stakeholders.”

The sustainability drive is the latest move from Cotton Egypt Association to modernize

and cement the Egyptian Cotton brand. It follows initiatives such as the introduction of a

new accreditation process in partnership with Bureau Veritas, which uses DNA

technology to root out counterfeit goods.

Home

Collection, sorting imp for fibre2fibre market: WRAP

(Source: Fibre2Fashion, February 14, 2019)

Collection and sorting are important for developing a post-consumer fibre2fibre

marketplace. In addition, demand from brands and retailers is essential, as is positive

consumer perceptions of the use of post-consumer textiles, says a report by sustainability

experts WRAP which is the first to examine the economic factors influencing fibre2fibre

recycling.

WRAP examines the economics of closed loop (fibre2fibre) recycling using UK post-

consumer clothes and textiles. Using data from established and emerging business and

academic trials, WRAP’s report (Fibre to fibre recycling: An economic and financial

sustainability assessment) is the first detailed appraisal of the financial viability of using

post-consumer clothing and textiles as feedstock for chemical and mechanical fibre2fibre

recycling operations.

The focus on end-of-life clothing is an attempt to unlock alternative sources to virgin

fibres for manufacturing clothes and supports WRAP’s work to reduce the environmental

impact of clothing under the Sustainable Clothing Action Plan 2020. Peter Maddox,

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22 CITI-NEWS LETTER

WRAP director explains, “We know that only housing, transport and food have greater

environmental impacts than clothing, and with rising global demand we urgently need to

secure new sources of materials and find new markets for used clothing. Fibre2fibre

recycling offers a potential solution - but one that has not been properly investigated.

“Our report is the first to explain the economics of fibre2fibre recycling and will help

investors, business-developers and the recycling sector navigate this relatively young,

uncharted field. New processes and entrants onto the market should be monitored to

inform the business case for future investment, but we already see potential for post-

consumer textiles to become part of the UK’s fashion scene.”

The research was undertaken ahead of the anticipated global shortfall in virgin textiles.

This predicts limitations in future cotton supplies, the UK’s most used fibre, with

projections suggesting a five-million-tonnes global cotton deficit by 2020.

WRAP’s study models the finances for both chemical and mechanical fibre2fibre recycling

processes for recovering polycotton and cotton respectively. It highlights the pressure

points, and potential returns, and outlines the barriers to developing post-consumer

fibre2fibre recycling, with recommendations for overcoming these.

Modelling shows high sensitivities in both fibre2fibre recycling processes to the quality

and cost of sorted and prepared feedstocks, and to output prices. Feedstocks (in terms of

both quantity and quality) may not be economically met using manual sorting alone,

particularly for chemical fibre2fibre recycling. Automated sorting using near-infrared

spectroscopy may be critical to wider development, the study says.

Chemical recycling processes are commercially farther off than mechanical but may offer

higher economic potential in the long run, it says. The development of technical processes

and more supply chain integration need prioritising to enable scale-up to a commercial

size.

Collection and sorting are particularly important in the development of a post-consumer

fibre2fibre marketplace. Demand from brands and retailers is essential, as is positive

consumer perceptions of the use of post-consumer textiles, it says.

In terms of fibres providing the greatest potential for fibre2fibre recycling, cotton and

polyester (found in mono-fibre fabrics and polycotton blends) are the leading materials.

These are most commonly used in clothing and household textiles, with as much as three-

quarters of post-consumer recycling grades containing polycotton blends. Growing

demand for cotton and the potential for recycled cellulosic material to replace cotton

make this material likely to sustain viable income levels for recyclers. Limiting the use of

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23 CITI-NEWS LETTER

problematic dyes and trims would also help increase the potential for greater recyclability

of more clothes.

Further improvements in consumer messaging, and collection infrastructure, could

positively influence the proportion of discarded clothing available for recycling.

Consumer behaviour also affects the quality of garments received, with excessive washing

and tumble drying at high temperature causing damage to clothing and effecting the

quality of the fibres recovered in mechanical reprocessing.

The costs associated with feedstock are highly dependent on factors like transport and

distances travelled and, as a result, the location from which they are sourced has a major

impact on costs. Recent ECAP (European Clothing Action Plan) fibre2fibre recovery trials

including the Dutch companies Tricorp, Schijvens and Havep show how innovative

approaches to supply chain costs can overcome such barriers.

Alan Wheeler, director Textile Recycling Association, said, “The Textile Recycling

Association is very supportive of this important research by WRAP. The fragility of

existing fibre recycling markets is presenting a significant barrier to improving the overall

sustainability of the fashion industry, which as we know has a huge environmental

impact. “The current markets for mechanically recycled fibres are limited, and to be able

to collect more clothing that is currently being disposed of we must find new markets for

recycled fibres or risk flooding these markets and potentially having to dispose of low

value recycling grade textiles. Clearly this cannot happen. This research will help us to

obtain a greater understanding of the market sensitivities, particularly of the fledgling

chemical recycling processes, and how used textile collectors and processors may have to

adapt their practices going forward to maximise value and recyclability of used textiles.”

Currently, an estimated £140 million-worth of clothing is sent to landfill every year in the

UK and WRAP’s research will help inform SCAP 2020 re-use and recycling activities. As

more data becomes available, further work would help enlarge upon these findings and

WRAP believes this modelling exercise could be expanded to reflect a wider range of

techniques and systems.

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