Chairmans Desk

Dear Friends,

The month of November started with the news that India’s overall exports contracted for the first time in 13 months in October. Textile & clothing exports declined by (-) 20.30% with Garments showing a sharp drop of (-) 40 percent. Export of cotton textiles provided the only silver lining recording a positive growth of 4.83 percent. The prediction made by the World Trade Organization (WTO) that world trade would grow by a robust 3.6 percent in 2017 after a lacklustre 1.3 percent in 2016 does not seem to be reflected by the ground realities.

During the last fortnight, the Council undertook a diverse range of activities which included attending a meeting on Indian Standard of Organic Textiles (ISOT) on 10th November 2017 at Noida city of NCR, participating in the South Asia’s largest sourcing event – Intex South Asia 2017 at Colombo, Sri Lanka during 15-17 November 2017 and “Farm to Finish” exhibition organized by SIMA held during 17-20 November, 2017 at Coimbatore. In the meantime the Government also took a series of steps with regard to implementation of GST in order to simplify the procedures.

Meeting on Indian Standard of Organic Textiles (ISOT)

A consultative meeting on “Fiber to Garment – Traceability in Organic Textiles” was held on 10th November 2017 at Noida, under the auspices of Nation Accreditation Board (NAB), Agricultural and Processed Food Products Export Development Authority (APEDA) in collaboration with C&A Foundation. Representatives from C&A, Carrefour, H&M, Cotton suppliers, Ginners, representatives from TEA, TEXPROCIL, GOTS, COS, Organic textile buyers from NZ, Canada, Netherlands, etc. were present.

APEDA stated that owing to frequent complaints received from importers / Chain Stores around the world regarding the poor monitoring system for traceability of organic components in the textile value chain and to ensure that only authentic organic textile products are shipped out from India, APEDA is keen to implement Indian Standard of Organic Textiles (ISOT).

Most of the attendees were directly or indirectly opposing the move by APEDA and C&A Foundation in implementing ISOT. We made the point that an additional cost will be incurred by the exporters as the present system of traceability and certification by GOTS and COS is already fool proof and widely accepted by the importers worldwide. APEDA’s role in traceability should be up to cotton fibre stage and thereafter it needs to be seamlessly integrated with existing system of GOTS and similar certifying agencies. We also pointed out that unless seed related issues are addressed ISOT initiative is meaningless.

Intex South Asia 2017 trade fair

An occasion to reflect on the lack of integration in South Asia presented itself at the Intex South Asia 2017 trade fair held at Colombo, Sri Lanka during 15-17 November 2017. The exhibition was inaugurated by H.E. Mr. Ranil Wickremesinghe, Prime Minister of Sri Lanka at the Sri Lanka Exhibition & Convention Centre (SLECC) on 15th November 2017 in presence of Mr. Baithiudeen, Minister of Industry and Commerce of Sri Lanka.

We took this opportunity to meet leading trade bodies present at the fair including the local associations – Joint Apparel Association Forum (JAAF), Sri Lanka Apparel Brands Association (SLABA), Sri Lanka Ports Authority and the international associations such as Taiwan Textile Federation.

The Executive Director of the Council made a presentation on the subject ‘Increasing Intra-regional Trade through Enhanced Regional Cooperation in South Asia’ at the Interactive Business Forum organised during the fair, which was well received.

Over 200 exhibitors from 15 countries participated in the exhibition which included highest participation of 60 companies from India. Buyers from over 16 countries were present for this grand event.    

GST implementation

I am glad the Government has taken many steps to alleviate the problems faced by the exporters under GST. Refund of IGST on exports effected in July 2017 has started. However, majority of the exporters have not received the refunds till date. In this regard, the Government has issued some guidelines to the exporters to ensure that refunds are smooth and timely. I urge all our members to please go through these guidelines and take the necessary steps as suggested so that IGST refunds are not delayed. The Government has also put in place a mechanism for the exporters to file their applications for refund of Input Tax Credit manually till further instructions which is a welcome step.  I would urge the Government to ensure that exporters do not face problems at the field formation of GST Commissionerate who will be processing the refund applications.    

It is a matter of concern that overall textiles exports is declining. One of the factors, in my view, that has led to the decline in exports is the steep reduction in the Drawback rates in the GST regime. To alleviate the problems faced by the exporters, like many other EPCs, the Council has also represented to the Government to extend the Drawback rates (Pre-GST rates) till June 30, 2018 so that exports gets stabilized.

“Farm to Finish” exhibition organized by SIMA

The Council participated in the exhibition “Farm to Finish” organized by SIMA from November 17 to 20, 2017.  The Council’s booth was visited by many textiles units located in South India seeking guidance regarding the steps to be taken to become exporters. Also there were many members who had visited the Council’s booth to seek clarifications on the different aspects of GST, Duty Drawback, ROSL etc. All these Companies were suitably guided. I extend my congratulations to SIMA for organizing such an event successfully.

TEXPROCIL Awards function

The Council’s Export Awards function, rewarding excellence in Export Performance in 2016-2017, is scheduled for 14 December 2017 at Hotel Sahara Star in Mumbai. The Hon’ble Minister of Textiles Smt Smriti Zubin Irani has kindly consented to be the Chief Guest at the event. We congratulate all the award winners for their sterling performance which has earned them the richly deserved awards and invite you all to join us at the function in applauding for these meritorious performances.

Friends, as the journey of trade continues relentlessly, there is a need to systemically and critically evaluate the present regulations and understand the “pain points” with regard to interface with Government. The government should also engage with businesses on a regular basis and understand their concerns and resolve to modify regulations to address the issues. The trying times appear here to stay, however, the real dynamism has to come from within us – the stake holders on the ground and all of us should be prepared for the long haul.

 Ujwal Lahoti