IBTEX No. 005 of 2014 January 07, 2014

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NEWS CLIPPINGS

INTERNATIONAL NEWS No Topics 1 Cotton Yarn Prices in Pakistan 2 Cotton Prices on International and Domestic Markets 3 Pakistan: PCGA asks govt to import cotton seeds from China 4 Maker’s Row to help promote US-made cotton 5 PTEA seeks govt support to fully benefit from GSP Plus NATIONAL NEWS 1 Rs 35 cr handloom institute to be set up in Machilipatnam 2 R 35 guarantees excellent piecing for high acceptance in downstream processing 3 Reforms and measures undertaken by Central Board of Excise and Customs to facilitate trade 4 Indian weavers unite against mechanization of handlooms 5 Cotton gains on limited arrivals

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INTERNATIONAL NEWS

Cotton Yarn Prices in Pakistan

The yarn market is bottoming out in Pakistan, amid renewed optimism over 2014 prospects, our Correspondent reports. Our monthly review covers the cotton and polyester-cotton yarn markets in Karachi and Faisalabad, with a long series of tables, charts and historical data back to 2007.

Cotton yarn prices have started increasing on Pakistan's domestic market, following a surge of cotton fiber prices and a rebound in yarn demand from domestic and foreign customers. Larger orders being received Large quantities were last week sold for 8s, 10s, 12s, 16s, 20s, 21s, 24s, 30s carded and 30s, 40s combed yarns. Price offers rose by Rs.3-5 per lb as a result. Processors were ordering to meet their immediate needs and also to build stocks for future use. A few buyers however limited their demand levels, as yarn prices were being raised. Suppliers were interested in selling, in order to reduce their stocks which had been increased by a previously low level in sales. Demand for blends also recovered On the blended yarn market, there was good demand for 10s, 12s, 20s, 24s, 30s, 31s, 38s, and 40s carded PC yarns. The Faisalabad market was also active and good demand was reported in the past week for 24s, 31s, 38s and 40s carded PC yarns. Yarn imports from India have again bottomed out, after remaining slow in the previous weeks. A few more processors are now working on the import options, mainly due to the cost factors. Expanding textile capacities

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About 21 million kilos of yarns were imported during the fiscal year 2012- 13 (July-June), out of which 16.7million kgs were imported from India, according for more than 80% of total shipments. Textile producers in Pakistan are now in enthusiastic mood, as they foresee many opportunities in 2014 including the preferential trade regime GSP-+ on EU's market, a stronger demand for yarns from China, and lower cotton prices. 12,000 more spindles are being installed at Blessed Textile Mills which will increase production capacity of this facility to 360 tons yarns per month. Another expansion at Faisal Spinning Mills with 6,000 more spindles has increased its production capacity to 270 tons per month. In addition, the Sapphire group has recently expanded its dyed fabric production capacity to 4 million meters per month, before eventually reaching a total of 5 million meters per month by next March. A few problems, however There are a few challenges for the textile producers in the country, that include a rise of power and financial costs, energy shortages and double digit inflation. Cotton fiber prices last week rose to more than Rs.7,000 per maund of 37.32 kilos on Pakistan's domestic market, as major processors were trying to grab maximum available qualities. HOME

Source: Emerging Textiles - 06 Jan 2014 *****************

Cotton Prices on International and Domestic Markets

Cotton prices slided in the last week in New York, however remaining very firm over the past 4-week period. Our weekly cotton report covers the latest price trends of international spot and futures markets through a large number of tables and charts, with also domestic markets in China, India and Pakistan being reviewed. Daily dataof the past 12-month period are available for download.

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Cotton prices last week slided in New York, reflecting a relatively poor demand level in this holiday period.

Prices however stayed firm if considering the last four weeks, with the nearby contract actually rising 2.53 cents per lb or 3.15%.

Lower availability in first quarter

Demand for US cotton slowed down at the end of December with Turkey however buying large quantities.

Cotton prices will get some support from the lower supplies in the first quarter of the new year, after new crops of the Northern Hemisphere will have been digested by the market. Surging prices in Pakistan In Pakistan, prices already surged back to historical highs, with the benchmark indicator reaching the symbolic level of 7,000 rupees per maund of 37.38 kilos. Prices also rose in India, although less dramatically, as arrivals are still relatively large from the new crop. India is increasingly optimistic about its cotton fiber and yarn exports, still benefiting from a lower rupee.

Waiting for Chinese import quotas

In China, the official buying system is still very active, supporting prices on the domestic market and boosting front month contract on futures market in Zhengzhou.

However, the cotton buying policy will end later this year and the November contract already reflects an expected fall of cotton prices, as clearly shown by our below chart.

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In the meantime, the level of import quotas will be decisive for predicting how cotton prices will move on the international market. Prices could stay stable around 85 cents per lb, until the end of the Chinese buying policy will possibly trigger a radical change in market trends.

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Source: Emerging Textiles - 06 Jan 2014 ***************** Pakistan: PCGA asks govt to import cotton seeds from China

The Pakistan Cotton Ginners Association (PCGA) has asked the Government to import cotton seeds from China, reports The News.

PCGA chairman Mukhtar Baloch said the unavailability of germinated seeds at right time is affecting the cotton crop.

He warned that the future of cotton in Pakistan might be bleak if the farmers do not virus-resistant and certified seed supply at the right time.

He said cotton growers in Punjab and Sindh provinces have incurred huge monetary losses due to spurious and substandard seeds.

By January 1, 2014, about 12.67 million bales of cotton reached ginneries across the country, surpassing the 12.336 million bales estimated for the current crop season by the Cotton Crop Assessment Committee (CCAC), according to the PCGA.

In 2012-13 cotton season, Pakistan’s cotton output fell by 12.81 percent year-on-year to 12.915 million bales, compared to the previous season’s production of 14.813 million bales, mainly because of less sowing of the crop.

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PCGA is a representative body of over 1200 ginning factories all over Pakistan.

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Source: cottonyarnmarket - 06 Jan 2014 *****************

Maker’s Row to help promote US-made cotton

Maker's Row and Cotton Incorporated have announced their partnership that aims to further educate and connect textile brands with U.S. cotton suppliers and manufacturers. Through the efforts of their partnership, Maker's Row, an online platform providing product-based businesses direct access to domestic manufacturers, and Cotton Incorporated, the research and marketing company representing America's cotton producers and importers, will be able to reach and inform a far larger, more diverse audience on the cotton production process and associated benefits with domestic sourcing. "The partnership with Cotton Incorporated was a natural choice. This partnership provides brands with a deeper understanding of one of the principal materials used in apparel today. With that understanding, brands have a greater opportunity to push the boundaries of their own products with our manufacturers on Maker's Row." said Matthew Burnett, CEO, Maker's Row. To steward their efforts, Maker's Row and Cotton Incorporated have created a video titled, American Cotton Part 1, designed to assist businesses in the understanding of cotton production as it moves through the supply chain. By revealing the production process, businesses--from first-time entrepreneurs to big brands--are now able to make more informed decisions which will ultimately curate a better product. "There are more than 70 cotton producing countries in the world and the United States is the third largest. And in the United States, we have more than 10,000 cotton farmers committed to high standards of cotton

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News Clippings production. That starts at the farm and continues all the way through the grading and classing systems that exists for every pound and every bale of US cotton." - Mark Messura, Senior Vice President, Cotton Incorporated. "This is such a great collaboration and we are very excited to finally launch the campaign. What we loved about the Maker's Row team is their passion and enthusiasm for American manufacturing coupled with the fact that they are great storytellers through their video documentaries. “We have a great story to tell about U.S. cotton and you will see from American Cotton Part 1 how passionate the cotton farmers are about their crop and the many things the U.S. cotton industry is doing to produce the most responsible and traceable cotton in the world. Everyone who sees this campaign should feel good about using American cotton as an ingredient in the products they create or source." – David Earley, Sr. Director, Supply Chain Marketing, Cotton Incorporated. Maker's Row has also launched a page which features over twenty domestic cotton mills and suppliers of cotton-based materials that all comply with Cotton Incorporated's stringent quality and responsibly-produced cotton requirements. The added platform will generate a larger community for businesses to discover and communicate with cotton-based suppliers and manufacturers across the United States. Maker's Row Maker's Row is an online marketplace that connects American manufacturers with product-based businesses. Their mission is to make U.S. manufacturers universally accessible, and the production process simple to understand. Maker's Row has created a community of makers, entrepreneurs, designers and businesses that are collectively coming together to bring back American manufacturing.

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Source: fibre2fashion - 07 Jan 2014 *****************

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PTEA seeks govt support to fully benefit from GSP Plus

Pakistan Textile Exporters Association (PTEA), an apex body of textile exporters in the country, has sought government support to help textile exporters fully benefit from the Generalized System of Preference (GSP) Plus facility extended to the country by the European Union.

The Association has urged the Government to initiate steps to ensure early release of huge sums of textile exporters of the country, which are blocked in refund regime.

During a media briefing, PTEA Chairman Sheikh Ilyas Mahmood and Vice Chairman Adil Tahir noted that liquidity crisis is a major roadblock which over the years has proved detrimental to the country‟s textile industry and has negatively impacted its production and productivity.

Duty waiver benefit under the Generalized System of Preference (GSP) Plus facility is expected to significantly boost textile exports from the country, however, the industry would not be able to fully exploit the opportunity with insufficient funds, they added.

While levy of two percent sales tax on supplies are impacting business activities, zero rating is a key for remaining globally competitive, the PTEA officials said adding that hardly 15 percent of textile items produced in Pakistan are consumed domestically, with the rest being exported.

Mr. Mahmood assured that the industry would deploy all efforts to reap the benefits of the GSP facility, but added that it would depend to a large extent on the Government ensuring release of refund claims, continuous gas and power supply and duty waivers.

Calling on the Government to reinstate duty waiver facility for the textile industry, he said finance is the key to keep the business running and it

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News Clippings would not be possible for the industry or the economy to benefit from the GSP Plus facility without this.

GSP would also help in re-attracting the investments that Pakistani textile industry has lost to other nations already availing the facility, he added.

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Source: fibre2fashion - 07 Jan 2014 *****************

NATIONAL NEWS

Rs 35 cr handloom institute to be set up in Machilipatnam

The state government has decided to set up a handloom in Krishna district headquarters of Machilipatnam, Union Minister for Textiles Kavuri Sambasiva Rao said. The All India Handloom Technology Institute would be set up with a project cost of Rs 35 crore, Rao said last night, after inaugurating a training programme of Jamdani saree weaving under integrated skill development scheme in Kappaladoddi village of Guduru Mandal in Krishna district. At present, only four handloom technology institutions are functioning in the country, he said. Rao said the central government has decided to abolish the outstandings of handloom weavers‟ loans, including interest. “We have sanctioned Rs 45 crore subsidy for Siricilla constituency handloom weavers,” the minister said, adding that the amount under Rajiv Arogya Yojna has also been increased. Later, Rao inaugurated a handloom exhibition in Pedana town and also laid the foundation stone of a Common Production Centre costing Rs 3 crore.

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He also distributed cheques of Rs 6 crore of bank linkage amount to Pedana and Gudur SHGs (Self help groups). All India Handicrafts Commissioner S Gupta and Krishna District Collector M Raghunandana Rao were also present on the occasion. (PTI)

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Source: Tecoya Trend - 07 Jan 2014 ***************** R 35 guarantees excellent piecing for high acceptance in downstream processing

In today‟s yarn markets, an inadequate piecing quality alone can cause an otherwise high-quality yarn not being accepted in downstream processing. For the new Rieter R 35 semi-automated rotor spinning machine the renowned AMIspin piecing process has been optimized and is more operator-independent. The new R 35 semi-automated rotor spinning machine has been designed exactly to meet following needs:  Higher productivity  Better yarn quality  Minimized piecing quality variation  Effective yarn quality monitoring  Reduced energy consumption per kilogram of produced yarn  Ergonomic and operator-friendly handling.

With a semi-automated machine, ergonomic and operatorfriendly design and ease of the piecing operation are necessary for better machine performance and to secure highest quality and productivity. Optimal machine working height for any operation Optimal working conditions are decisive in order to reduce operator errors when cleaning

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News Clippings the rotor, doing the piecing preparation or removing yarn faults from the package. For this reason, the R 35 rotor spinning machine has optimal low working height combined with excellent accessibility. This secures the machine efficiency and the yarn quality. AMIspin - the most reliable and easy semi-automated piecing system AMIspin is uinique for its simplicity and reliability. The handling of AMIspin has been improved by using an individual feed drive for the sliver, applying piecing technology known from other Rieter rotor spinning machines. After preparing the yarn end and cleaning the rotor, the piecing process is launched automatically as soon as the box is closed. As a result the quality, speed and success rate of AMIspin piecings have been improved. Optimized yarn entry for fast and easy piecing With the R 35 the insertion of the prepared yarn end into the exit tube has been simplified., because the yarn entry is now from the front (Fig. 1). This accelerates the piecing operation and allows reduction of the operator time. It guarantees excellent piecing quality with high value for the yarn users. For the spinner it helps to maintain higher machine efficiency even with a high ends down rate and fewer operators. Individual sliver feeding drive for better piecing quality Immediately after each yarn break, the single feed drive pulls back the sliver into a protected position, thus ensuring that the piecing always is formed from undamaged fibers. During piecing the individual drive allows more exact sliver feeding to further optimize the appearance and strength of the piecings. AMIspin quality more operator-independent With optimized yarn entry, individual drive for sliver feeding and loop compensator on the R 35 rotor spinning machine, piecing quality becomes more operator-independent even with a semiautomatic machines.

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Source: Tecoya Trend - 07 Jan 2014 *****************

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Reforms and measures undertaken by Central Board of Excise and Customs to facilitate trade

Central Board of Excise and Customs (CBEC) has been an early starter in introducing reforms and substantial reforms have already been carried out in the Central Excise laws and procedures since 1994. The object of these reforms was to repose a greater trust in the tax-payers and bring about a substantial improvement in the delivery system and compliance through automation and trade facilitation measures. CBEC has also undertaken a number of e-governance initiatives with the objective of improving tax-payer services, transparency, accountability and efficiency in the indirect tax administration in India. These applications have automated all major processes in Customs, Central Excise and Service Tax through web-based and workflow-based systems, reducing the physical interface between the tax payers and the departmental officers, thereby reducing discretion and opportunity for corrupt practices. Details of the important trade facilitation measures undertaken by CBEC are as below:

CUSTOMS Customs has initiated meaningful and effective trade facilitation that reduces transaction costs through the following measures for tax payers: AUTOMATION IN CUSTOMS CBEC had modified the Indian Customs EDI System (ICES) in 2009, which has been launched in 109 Customs locations in the country. The Indian Customs EDI Gateway (ICEGATE), the gateway portal hosts a number of services for the EDI partners and provides facilities for e-filing of documents from anywhere at any time (24/7). ICEGATE and ICES 1.5 are serving about 6.7 lakhs importers/exporters and handling nearly 98% of India‟s International trade. CBEC is among the first departments that has adopted Information Technology Infrastructure Library (ITIL) framework to provide IT services to end users in a consistent manner. The following taxpayer services have been provided to the importers and exporters:

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 E-filing of Bills of Entry, Shipping Bills, IGM/EGM with electronic acknowledgements  An Accredited Clients Programme (ACP) whereby trusted importers are extended the facility of fast track custom clearance.  Connectivity with 17 types of Stakeholders such Custodian, Port Authorities, Shipping Lines. Airlines, Custom Brokers, DGFT, Banks and other Government Agencies, through electronic messages. This eliminates the need for paper movement across agencies and across locations.  Facility of electronic payment of duties  Selective appraisement and examination through the Risk Management System  Facility of filing of Bills of Entry and Shipping Bills through Service Centers  Documents processed on a First-Come- First-served basis and status can be tracked.  Drawback is directly credited to exporters‟ bank accounts.  Electronic Refund of Service Tax paid on exports  Uniform applicability of duty rates and trade policy across the country  Centralized Bond Management and elimination of Release Advices has enabled traders to file bond at any location and effect clearance from any other location.  Electronic transmission of Shipping Bills to DGFT and online receipt of licences has reduced physical interface with the departments and has also reduced time and cost of transaction  Round the clock Helpdesk with toll-free number Automated Recording and Targeting System (ARTS)  provides protection of Intellectual Property Rights (IPR)

SELF ASSESSMENT Self Assessment of Customs duty by importers or exporters was introduced vide Finance Act, 2011. This is paradigm shift away from assessment by

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Departmental officers to a trust based system of self- assessment. The objective is to expedite release of imported / export goods. The interest of revenue in terms of ensuring correct declarations and duty payment is ensured by an electronic Risk Management System (RMS) that identifies risky consignments for assessment or examination or both. The shift to Self Assessment is aimed at increasing the facilitation level of consignments imported through Air, Sea and Inland Container Depots (ICDs) from the present 60%, 50% and 40% to 80%, 70% and 60%, respectively. ON SITE POST CLEARANCE AUDIT (OSPCA) SCHEME In accordance with the legal provisions introduced vide the Finance Act, 2011; a scheme of „On Site Post Clearance Audit‟ (OSPCA) has been implemented w.e.f. 1.10.2011 in case of the importers registered under the Customs Accredited Client Programme (ACP). This scheme is aimed at facilitating Customs clearance of goods and reducing dwell time. At the same time, interest of revenue is safeguarded by a comprehensive verification of records and documents at the premises of the importer / exporter on annual basis. Other categories of importers/ exporters shall be considered for inclusion later. AUTHORIZED ECONOMIC OPERATOR PROGRAMME Indian Customs Authorized Economic Operator (AEO) Programme has been developed pursuant to World Customs Organization adoption of SAFE Framework of Standards. The programme aims to provide businesses in international supply chain with an internationally recognized quality work highlighting a business role in a secured supply chain and compliance to laws. The full fledged Indian AEO programme was rolled out by the CBEC with issue of the Circular No. 28/2012-Customs, dated 16.11.2012. Currently 16 applications are being processed at AEO centers at Regional Units as well as at headquarters. For wide publicity of AEO programme, pamphlet, poster and advertisement have been approved by the Board and these materials have been circulated among the field formations and local newspapers through DPPR. Trade sensitization programmes in zones is currently underway. 24X7 CUSTOMS CLEARANCE

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 In order to facilitate importers and exporters, CBEC began 24X7 Customs clearance with effect from September 1st, 2012 at identified Air Cargo Complexes, viz., Bangalore, Chennai, Delhi and Mumbai; and sea ports viz. Nhava Sheva, Kandla, Chennai and Kolkata in respect of certain categories of imports and exports. This facility has now been extended and presently covers 17 Air Cargo Complexes and 4 Sea Ports.  Clearance of indigenously manufactured goods has been allowed to Duty Free Shops located in the arrival and departure halls of the international airports. The permissible allowance including the restrictions and prohibitions, if any applicable to passengers and members of crew for purchase of the indigenous goods is governed by the same Baggage Rules that govern the imported goods.  Risk Management System (RMS) has began with effect from 15.07.3013 at ICDs Patparganj and Mulund. This is a prelude to extending RMS in exports to expedite the flow of export goods, reduce dwell time port congestion by limiting examination to the risky consignments on the basis of risk parameters. Interactive Website Indian Customs has developed a user friendly interactive website to enable importers / exporters to know tariff classification, applicable rate of Customs duty and other regulatory requirements for clearance of goods. Interactive website is an effective tool to help educate traders for making correct assessment of duty after introduction of self assessment in Customs. MANDATORY E-PAYMENT OF CUSTOMS DUTY E-payment of Customs duty has been made mandatory for importers registered under Accredited Clients Programme and importers paying customs duty of one lakh rupees or more per Bill of Entry with effect from 17.09.2012. Besides expediting the process of payment of duty and clearance of imported goods, the facility of epayment has resulted in reduction of transaction costs. CENTRAL EXCISE AND SERVICE TAX AUTOMATION OF CENTRAL EXCISE AND SERVICE TAX (ACES) CBEC has implemented the Automation of Central Excise and Service Tax (ACES) project, a Mission Mode Project (MMP) of the Govt. of India under the National e-Governance Plan. ACES have transformed the way about 20

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News Clippings lakh indirect taxpayers conduct their business with the department. The application has been rolled-out nationally in 2009 in all 104 Commissionerates.

The following Taxpayer Services are provided under ACES:  Online PAN-based Registration of Central Excise & Service Tax Assesses and online amendment. ACES provides for online validation of PAN with the Income Tax database so that when any taxpayer enters a wrong PAN, the system will indicate the same.  Electronic filing of Claims, Permissions, Intimations and processing thereof  Instant e-acknowledgement of documents with Document Identification Number  Viewing, filing and tracking the status of documents online  Facility of e-Payment and checking status online  Online Revenue Reconciliation  Online Messages/ Alerts to users on business related matters  Online information to assesses about issuance of Show Cause Notice, Personal Hearing and Orders passed by Adjudicating Authorities  Online filing of replies to Show cause Notices  Online filing of application for Provisional Assessment  Online filing and processing of Refund Claims  Online filing of selected Export related documents  Simplified Service Tax Refund Procedure A simplified electronic Service Tax Refund mechanism which is beneficial to the exporting community, especially merchant exporters was introduced in December, 2011. This export promotion scheme i.e. tax refund process, which is dealt with by the designated Central Excise and Service Tax officers, is electronically enabled under the Customs application (ICES 1.5). SEVOTTAM As a part of the Central Government initiative to improve the quality of public services, the Central Board of Excise & Customs (CBEC) has been

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News Clippings identified as one of the 10 organizations with large citizen interface to implement the quality management system for public services. This is based on Indian Standard IS 15700:2005, prepared by the Bureau of Indian Standards (BIS), under the name of “SEVOTTAM”. As such at present we have 13 offices Sevottam Certified and 8 more Sevottam ready for certification Audit. The department has also selected 47 Commissionerates for Phase-III roll out. E-HELPLINE CBEC has launched an e-helpline facility w.e.f. 1st October, 2012 at the Zonal levels for clarifying the doubts of trade and industry in an administration friendly manner without the assessee having to come to offices of the department. The main objective of the e-helpline is to provide help to the taxpayers in resolving procedural delays and in addressing system related problems including ACES and ICES. (PIB Features.)

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Source: Tecoya Trend - 07 Jan 2014 ***************** Indian weavers unite against mechanization of handlooms

Handloom weavers in India, under the banner of the All-India Federation of Handloom Organizations, will hold „Banashankari yatra‟ against the mechanization of handlooms in the country.

Speaking at a press conference, P Prasanna, convenor of Desi, a non- governmental organization into production and sales of products made by khadi and village industries, said the yatra will begin on January 15, 2014 from Gajendraghad in Gadag district and will conclude on January 27 at Badami in Bagalkot district, both in southern Indian state of Karnataka.

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The purpose of the 200-km long yatra was to go to the villages with high concentration of weavers and organize them.

Subsequently, weavers would launch an indefinite hunger strike at Heggodu village in Sagar taluk of Shimoga district from January 30, Mr. Prasanna informed.

He said the handloom sector in the country has been neglected by successive governments, which have lured handloom weavers to use powerlooms.

He said a survey undertaken in Andhra Pradesh and other regions found that nearly 70 percent of the products sold as handloom products were actually powerloom products. He alleged that powerloom operators have been duping customers by falsely branding their products as handloom- made.

Handlooms (Reservation of Articles for Production) Act, 1985, reserves certain products for the handloom sector, but the Central Government was not taking measures for strict enforcement of the law, enabling powerloom operators to manufacture the reserved products, Mr. Prasanna said.

India has over 4 million handloom units, the highest in the world, which together employ more than 2.25 million people, about 78 percent of whom are women.

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Source: Fibre2fashion - 07 Jan 2014 *****************

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Cotton gains on limited arrivals As cotton arrivals decreased, the natural fibre’s prices increased by Rs 200 for a candy of 356 kg. Kapas or raw cotton prices also gained.

According to brokers, demand emerged from domestic mills and exporters also began to buy to meet their immediate needs.

Gujarat Sankar-6 cotton traded higher by Rs 200 at Rs 40,800-41,000 for a candy of 356 kg in Saurashtra region of Gujarat. Kapas gained Rs 7-10 to Rs 970-995 for a maund of 20 kg. Gin delivery kapas traded at Rs 1,000- 1,020 .

About 50,000 bales (of 170 kg) arrived in Gujarat and 1.75 lakh bales arrived across the country.

Traders said that during the past few days arrivals have decreased from 65,000 bales to 50,000 bales.

According to a Rajkot-based ginner, farmers are holding back kapas and they are not willing to sell at lower price.

Cotton brokers feel that in the current conditions, the fibre may gain as mills are likely to continue buying for some more time.

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Source: cottonyarnmarket - 07 Jan 2014 *****************

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