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

16-07-2019 74.95 (+1.30)

17-07-2018 97.70

17-07-2017 82.45

New York Cotton Futures (Cents/lb) As on 18.07.2019 (Change from

previous day)

Oct 2019 63.02 (+0.13)

Dec 2019 63.11 (-0.71)

Mar 2020 64.23 (-0.83)

18th July

2019

First Natural Fiber center of India to be opened in Almora

Global slump crimps cotton yarn exports

GST Cell, ni-msme to conduct 3 day training program on GST

Value addition can further boost apparel export to US: ITF

India and US bilateral trade at crossroads: Report

IMF issues fresh warning, says trade war risks weighing on global economy

MIT and Fashion Institute of Technology join forces to create innovative textiles

Cotton and Yarn Futures

ZCE - Daily Data (Change from previous day)

MCX (Change from previous day)

July 2019 21770 (+180)

Cotton 13680 (-40) Aug 2019 21040 (+110)

Yarn 21295 (-10) Oct 2019 20260 (-50)

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2 CITI-NEWS LETTER

-------------------------------------------------------------------------------------- First Natural Fiber center of India to be opened in Almora

Global slump crimps cotton yarn exports

GST Cell, ni-msme to conduct 3 day training program on GST

Value addition can further boost apparel export to US: ITF

India and US bilateral trade at crossroads: Report

Skill India celebrates fourth anniversary

India’s bilateral relations not influenced by other countries: Hardeep Singh Puri

India, eight others, caution WTO against reforms that worsen imbalances

Slow Growth in Manufacturing Sector

Export Promotion Scheme

Indian CFOs keen to ride on economic expansion in 2019: Amex Global Survey

Odisha mulls new industrial policy to sweeten sops, take on rival states

Preferential trade status under GSP for India should continue: IACC

Making life easy, Pratibha Syntex distributed home appliances to over 4,000 associates

Demand for digitally skilled manpower to rise to 2.7 mn in FY23: NASSCOM

Japan's Uniqlo to foray into India in October, open 3 stores in Delhi-NCR

Toda embroidery duplicates threaten local artisans’ livelihood

When it's not waste

------------------------------------------------------------------------------ IMF issues fresh warning, says trade war risks weighing on global economy

MIT and Fashion Institute of Technology join forces to create innovative textiles

Zara owner promises 100 per cent sustainable fabrics by 2025

One small step for Saurer, one giant leap for mankind

TSG expands DEFEND DWR into nonwovens

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

NATIONAL

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

GLOBAL

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3 CITI-NEWS LETTER

NATIONAL:

First Natural Fiber center of India to be opened in Almora

(Source: Uttarakhand News, July 18, 2019)

The country’s first Center of Excellence will be opened in Almora for the preparation

and research of natural fiber by the plants found in Himalayan regions. For this, the

Ministry of Textiles has released a sum of Rs. 20 crores. This center will be set up

through the Northern India Textile Research Association (NITRA). The state

government has transferred one acre land for the center to the Textile Ministry.

For the preparation of research and filament on Himalayan Natal (Kandali), Bhang,

Bhimal, Rambans, Bhabar grass in Uttarakhand, Center of Excellence based on Natural

Fiber will be established in Almora. It will be the first center of the country to promote

Himalayan Natural Fiber. Ministry of Textiles has released a sum of Rs 20 crore as the

first installment for the construction of the center.

In the last few days, Textile Minister Smriti Irani held a meeting with the

representatives of tourism, agriculture, culture and state government. She has asked this

center to be developed in terms of tourism and culture.

So that tourists coming from outside can be attracted to the products made from natural

fiber. With the promotion of natural fiber, resources for livelihood will be available to

people in mountainous areas.

Demand for fabrics made from natural fiber in the international market

In Uttarakhand there is a lot of demand in the international market of clothes fabrics

made from Kandali, Bhang, Bhimbal, Rambans and Bhabar grass. In Uttarakhand, more

than 95 percent of the vegetation have fiber. In Uttar Pradesh, Uttarakhand Bamboo

and Fiber Development Council has professionally identified some species.

Home

Global slump crimps cotton yarn exports

(Source: Prashant Krar, Economic Times, July 17, 2019)

Cotton yarn exports from India have come down by 22 per cent in the first quarter as a

global slump in demand and higher prevailing domestic cotton prices loom over the

trade.

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4 CITI-NEWS LETTER

Cotton spinning mills in India are resorting to partial shutdown as a squeeze in demand

from China and Bangladesh has accumulated yarn stocks, a potential risk for millers in a

dwindling cotton market. “The global cotton yarn demand is under stress as GDP

growth in China has fallen and there are recessionary trends in major cotton markets

including Bangladesh,” Dr Siddhartha Rajagopal, executive director, Cotton Textiles

Export Promotion Council, told ET.

He said that the slide in export of cotton yarn is worsened by low margins in Indian

cotton market due to higher domestic prices. Rajagopal pointed that Indian cotton yarn

manufacturers are also losing the global trade due to China’s access to duty-free market

in Pakistan and Vietnam.

India is the worlds’ largest exporter of cotton yarn and has major markets in China,

Bangladesh, Pakistan, Vietnam and South Korea. Yarn export to China had gone up in

2018-19 as the largest importer of the natural fibre bought a third of total yarn export

from India. The export has increased by 72 per cent to Vietnam in the last year.

This year, yarn exports are down to China, Bangladesh, Pakistan and European markets.

The millers who are turning to domestic market are again feeling the heat due to a spike

in dutyfree garment imports from Bangladesh. The import of garments from Bangladesh

has jumped by 82 per cent in 2018-19 to $365 million — much of it made from dutyfree

fabric coming from China.

Home

GST Cell, ni-msme to conduct 3 day training program on GST

(Source: KNN India, July 18, 2019)

To impart the knowledge about Goods and Service Tax (GST) and procedures for

implementation, GST cell in association with ni-msme has proposed to conduct training

program on GST to have a better understanding about the new tax regime.

The three days certification program will start from July 29 here, and will end on July

31, 2019.

The objective of the program is to impart the knowledge about Model GST law and to

provide valuable insights on impact of GST on Industry/Trade/ Services.

In addition, it will give practical knowledge of the different procedures required under

GST Act and Rules such as Registration, tax invoices, Filing of Returns, availing Input

Tax Credit, compliance, Refunds and other documentation requirements.

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5 CITI-NEWS LETTER

The target participants for the program are Entrepreneurs of Industry and trade, Key

managerial personnel, Professionals, Tax consultants, Academicians and students.

On the successful completion of program, the participant will be able to understand the

transitional issues relating to migration from Current indirect tax structure to GST

regime.

GST is a game changing reform for the Indian economy by creating a common Indian

market and reducing the cascading effect of tax on the cost of goods and services. GST

has a large ramification on business processes and there is a grave necessity for the

industry members, entrepreneurs of Industry/Trade, Managerial personnel, Finance

managers and professionals to ensure compliance with the Act, and for benefitting from

the seamless pass through of Tax to the final consumer.

Home

Value addition can further boost apparel export to US: ITF

(Source: Fibre2Fashion, July 15, 2019)

India witnessed a double-digit growth in

apparel export to the US and can grow further

with more focus on blended and value-added

products, the Indian Texpreneurs Federation

(ITF) recently said. Apparel exports to the US

were worth $1.764 billion in January-May last

year and saw a 10.83 per cent growth to reach

$1,955 billion in the same period this year, it

said.

In a tweet marked to textiles minister Smriti Irani, ITF said an eco-system needs to be

created to nurture manufacturing of high value-added apparel as 43 per cent of the top

30 export items in this sector are fetching a revenue of below $6 per piece.

Few Indian players are demonstrating their capability in value-added product exports

by earning more than $9 per apparel. An alternative is to motivate small and medium

enterprises to set up large scale units to compete in low-value apparel, it said.

Exporting clusters like the one in Tiruppur should focus more on the US market to grow

further, it said.

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6 CITI-NEWS LETTER

A few ITF member companies are trying to brand their products as sustainable fashion

items to command better preference in global markets, ITF said.

Whatever space China is vacating in the home textile space will be shared by several

countries, but India continues to maintain the second-largest supplier status in this sub-

sector, according to ITF.

Home

India and US bilateral trade at crossroads: Report

(Source: Economic Times, July 17, 2019)

The reports provides an expert analysis of the current state of the relationship, including

recent negotiations and recommendations for the path forward in the short, medium,

and long-term

India and the US need to "prioritise efforts" to manage current trade tensions and

initiate cooperative projects in areas like intellectual property rights and digital trade,

according to a report by a former trade official from the Trump administration.

The report, 'Trade at a Crossroads: A Vision for the US-India Trade Relationship', said it

was clear that the first priorities for the future should be to manage current challenges

and address those that were likely immediately ahead. Authored by Mark Linscott,

former assistant, US Trade Representative for South and Central Asian Affairs, the

report is produced jointly by the Atlantic Council and the US India Strategic and

Partnership Forum (USISPF).

It provides an expert analysis of the current state of the relationship, including recent

negotiations and recommendations for the path forward in the short, medium, and

longterm. There is no easy way to sugarcoat the present state of the relationship -- it is

one in which the only common denominator is a fundamental misunderstanding of

priority objectives on the other side, which has led to misalignment of expectations in

recent negotiations, the report said. A strong commitment to improve the bilateral trade

relationship and build a sound foundation for future successes can start now it said

adding that the current state of play suggests that the two countries were now at a

crossroads, with one direction leading to an initial bilateral agreement, and the other to

outright conflict.

"While conflict in which the two sides engage in retaliatory measures, such as GSP

suspension and tit-for-tat tariff increases, can create new leverage and focus minds to

eventually achieve an agreement, it can also significantly set back the relationship at a

moment when there is an urgent need to cultivate trust and achieve some

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7 CITI-NEWS LETTER

confidencebuilding outcomes," said the report. The publication of the report on Tuesday

comes days after a US delegation of trade officials returned from New Delhi after

holding first talks with their Indian counterparts on resolving their trade differences.

The talks have started at the direction of Prime Minister Narendra Modi and President

Donald Trump who met in Japan last month on sidelines of the G-20 Summit. The

report counsels that India and the United States redouble their efforts to go down a path

of constructive engagement that can lead, in the short term, to a first ever bilateral trade

agreement. In parallel, it said, the two can explore new areas for bilateral engagement,

with the objectives of continually building new confidence, gradually aligning their

visions for opportunities to open their markets to each other, and growing trade and

investment at an accelerated pace. The report recommends that the two governments

should manage current conflicts and reach an initial agreement; review and improve

institutional underpinnings; recommit to the TPF and pursue institutional reform;

replicate recent cooperative success; explore opportunities for significant market

opening agreements; and chart a map toward an FTA. Observing that the United States–

India trade relationship is rapidly approaching a point of crisis, the report says that

institutional arrangements are unable to address evolving and growing trade irritants,

while protectionist instincts in both governments are exacerbating tensions. "Recent

failures to reach even a small agreement, and subsequent tit-for-tat escalations, now

place the relationship at a tipping point," it said. Noting that the United States-India

relationship will be one of the most consequential of the 21st century, the report said

commerce would play a vital role in determining whether it is constructive or

adversarial. Issues, including standards and conformity assessment testing, digital

trade, healthcare, and agricultural trade, present areas of emerging conflict or

opportunities for cooperation, the report said. "While the history of bilateral trade

negotiations has often been contentious, it also includes examples of constructive

cooperation. These examples should serve as inspiration in addressing today's

challenges," it said. The United States was the second-largest trading partner for India

in goods in 2018, and the single largest export destination for Indian exporters. Bilateral

trade in goods and services grew at an average annual rate of 7.59 per cent from 2008-

2018, double in value from USD 68.4 billion to USD 142.1 billion.

Home

Skill India celebrates fourth anniversary

(Source: The Daily Pioneer, July 18, 2019)

On the World Youth Skills Day, the Ministry of Skill Development and Entrepreneurship

(MSDE) celebrated the fourth anniversary of the Skill India Mission on Tuesday.

A clutch of big-ticket announcements and signing of MoU’s to empower the youth with

appropriate skill-training marked the celebrations. The event saw several ministers and

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8 CITI-NEWS LETTER

government officials who came together to show their commitment to the avowed

mission.

Dr KP Krishnan, secretary, Ministry of Skill Development and Entrepreneurship,

opened the ceremony by welcoming all delegates and guest. He said, “The Ministry

would focus its efforts on the informal and unorganised sector especially the small and

medium enterprises.”

The event was graced by Nirmala Sitharaman, Minister of Finance and Corporate Affairs

as the chief guest. Sitharaman pointed towards how the Skill India Mission has offered

new avenues of livelihood to the youth of the country by urging young people to follow

their heart in pursuing their ambitions. She said, “If you want to acquire a particular

skill and you are comfortable with it, you should utilise it to the fullest. Do not settle for

something just because it is easy. Strive for what you want and put in your heart to

achieve it. Earlier, it was not easy to look for opportunities but today, through the help

of the Ministry, the government has created an ecosystem for training. I would urge

each one of you to utilise whatever is given to you by the government.

Dr Mahendra Nath Pandey, Minister for Skill Development and Entrepreneurship, said,

“I want to congratulate all those who have been associated with Skill India in its four-

year journey. An idea that germinated with our Prime Minister’s vision of a Skilled India

has now reached its next phase. The foundation has already been laid. It is essential that

there is seamless convergence across skill development programs, for which we seek

support of all ministries, states and industries.”

He added that a number of initiatives have also been announced, “which will engage the

youth in various skills designed to cater to new avenues of employment. We have placed

emphasis on promoting apprenticeship and have rationalised the stipends to increase

participation in this program.”

The highlight of the event was Kaushal Yuva Samwaad, an open dialogue with the youth

to discuss potential issues and solutions from the candidates’ perspective. The two-week

consulting programme was organised on a nation-wide scale to engage young job-

seekers and understand their views and ideas, identify opportunities to help the

Ministry in building on existing programmes and improving overall efficiency of its

projects. The future recommendations would be compiled and referred for further

program implementations.

The MSDE also announced the launch of Kaushal Pakhwada, a 15-day campaign, which

began from July 16, where sessions and workshops will be conducted across the country

to aspire young trainees under the Skill India Mission and promote the initiative among

them.

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9 CITI-NEWS LETTER

The event also witnessed an introduction of the 48-member contingent, which will be

representing India at World Skills International Competition, which will be held from

August 22 to 28 in Kazan, Russia. These young skill trainees, below 23 years, will be

competing in 44-skills against their peers from 66 other countries.

MoUs signed

- Between Retailers Association’s Skill Council of India, Ness Wadia College of

Commerce and McDonald’s for degree apprenticeship in the retail sector.

-Between the Media and Entertainment Skills Council, Shri Shankarlal Sundarbai

Shasun Jain College for Women, Bot VFX Limited and Vikatan Group for degree

apprenticeship in the media sector.

-Between the National Skill Development Corporation (NSDC) and the State Bank of

India (SBI) and another with HDFC bank to promote apprenticeship training in the

financial sector.

- In another MoU, Urban Clap collaborates with NSDC to ensure that it has a workforce,

which is 100 per cent Skill India-certified through recognition of prior learning’s (RPL)

programme under Pradhan Mantri Kaushal Vikas Yojana (PMKVY).

-Between RDSDE (Regional Directorate of Skill Development and Entrepreneurship)

Punjab and Trident group for women empowerment.

- Between the Directorate General of Training (DGT) and Dassault Aviation for the

launch of Aerostructure Fitter and Welder program at ITI, Nagpur

Other highlights

- Designed by the MSDE and the Ministry of Human Resource and Development

(MHRD), a degree apprenticeship programme in collaboration with industry and

academia has been launched. The dual vocational education program shall have

apprenticeship or on-the-job training embedded in a three or four year university degree

programme.

-The SBI shall be engaging 5,000 apprentices as banking front office executive and tele-

caller in FY19-20.

-The HDFC bank will be hiring 10,000 trained professionals under the ‘job ready’

programme, designed and created in association with NSDC, over the next three years.

-In collaboration between NSDCC, BFSI Sector Skill Council and India Post Payments

Bank, 170,000 grameen dak sewaks will be certified as banking correspondents under

RPL program of PMKVY.

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10 CITI-NEWS LETTER

Additionally, the directorate general of training also announced the establishment of a

new Japan India Institute for Manufacturing (JIIM) in Haryana and new courses in ITIs

around training on Electric Vehicles (EVs), in line with an avowed intention of the

government to work for greener energy sources.

Ravi Shankar Prasad, Minister for Law and Justice, Communications, Electronics and

Information Technology, said skilling has been the backbone for all initiatives and the

driving force behind this are the youth of India.

“The concept of Skill India has a unique interplay with other visionary schemes,

including Make in India, Start-Up India, Stand-Up India, and Digital India. All of these

will have to work in tandem for them to succeed. The Indian economy has grown

manifold to become the third largest in the world now. Today, our country’s youth

aspire to be job-givers and not job-seekers and this has given rise to the number of start-

ups in the country. India has a unique demographic dividend and I urge the Minister of

Skill Development, Dr Pandey, to match the aspiration of the youth with the global

demand.”

Narendra Singh Tomar, Minister of Agriculture and Farmers’ Welfare and Minister of

Rural Development, added, “Skill training has always been an integral part of the

country’s culture and traditional education system. Our ITI ecosystem has been one of

the most credible and long-standing network but it is only now, that these institutes are

being modernised through improvised curriculum, state of the art infrastructure and

enhanced pedagogy to the meet the aspirations of youth, turning into preferred choices

for skill training.”

Ramesh Pokhriyal, Minister of HRD, said that India is set to become the hub of skill

development in the world in the next few years. “In the coming 25 years, India will be

the only country that will remain young, allowing us more opportunities for economic

development. Apprenticeship is one of the most sustainable modules through which our

youth can learn and earn at the same time. The recent reforms towards initiating

apprenticeships are commendable.” RK Singh, MoS, Ministry of Power and Ministry of

New and Renewable Energy, Ministry of Skill Development and Entrepreneurship, said

that the day marked an important occasion to pause and reflect on the efforts towards

promoting skill training in the country. He said, “It is important to celebrate milestones.

This is an opportunity for us to pause and reflect on the need gaps and the roadmap

ahead for Skill India. In a fast-moving economy riddled with disruptions, many have

questioned whether India will be able to address the needs of a vast population by

providing them skills that will make them employable in the future. The answer is

definitely yes and can be seen in the eyes of our youth who aspire to live a better life.”

Home

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11 CITI-NEWS LETTER

India’s bilateral relations not influenced by other countries: Hardeep Singh

Puri

(Source: Kritika Suneja, Economic Times, July 17, 2019)

“India's bilateral relations with Iran, and the US stand on their own merit and are not

influenced by relations between other countries,”Puri said.

Amid rising global trade tensions, India has reiterated that its bilateral relations with

Iran and the United States are not influenced by relations between other countries.

“India's bilateral relations with Iran, and the United States stand on their own merit and

are not influenced by relations between other countries,” Minister of State in the

Ministry of Commerce and Industry, Hardeep Singh Puri said in Parliament on

Wednesday.

In a written reply to the Lok Sabha, he said that the government “consistently monitors

all developments with a bearing on its national interest and takes necessary measures to

safeguard and protect the same”. US Secretary of State Mike Pompeo branded Iran as a

“state sponsor of terror” during his Delhi visit late last month. The US imposed

additional tariff of 25% and 10% on steel and aluminum respectively under section 232

of Trade Expansion Act, 1962 in March last year on a global basis. While India’s steel

export in the affected lines to US declined by 35% during the FY 2018- 19 compared to

FY 2017-18, aluminum export in the affected lines have increased by 14% during the

same period.

“India has been engaged with the US on this issue, as part of the ongoing bilateral trade

dialogue. The US did not accede to India’s request for withdrawal of these duties,” Puri

said.

In response, India imposed retaliatory tariffs on 28 products originating or exported

from the US with effect from June 16, which have already been disputed by Washington

at the World Trade Organization.

India’s trade surplus with the US reduced to $16.8 billion in 2018-19 from $21.2 billion

in FY18 on higher purchases of oil and gas and civilian aircraft.

Home

India, eight others, caution WTO against reforms that worsen imbalances

(Source: Amiti Sen, The Hindu Business Line, July 17, 2019)

Say special and differential treatment for all developing countries is non-negotiable

In response to growing protectionism and questioning of the special dispensation for

developing countries at the World Trade Organisation by rich nations, India, and some

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12 CITI-NEWS LETTER

others such as Cuba, South Africa, Bolivia and Zimbabwe, have submitted a concept

paper pointing out necessary areas of reform for strengthening of the multilateral

organisation and the need to continue with special and differential treatment (S&D) for

all developing members.

“In recent months, some members have suggested a broad range of reforms at the WTO

including a slate of new rules, even though existing mandates from the Doha

Development Agenda (DDA) remain unaddressed. WTO reform does not mean

accepting either inherited inequities or new proposals that would worsen imbalances.

Reforms must be premised on the principles of inclusivity and development and

respond to the underlying causes of the current backlash against trade and the

difficulties that developing members continue to face vis-à-vis their industrialisation

challenges,” the paper said.

The concept paper, co-sponsored by India, South Africa, Cuba, Bolivia, Zimbabwe,

Ecuador, Tunisia, Uganda and Malawi, has been circulated to the WTO General Council

and will be later taken up for discussion while brainstorming on necessary WTO reforms

by all members.

The immediate priorities for reform at the WTO must include resolving the crisis in the

Appellate Body and addressing the unilateral actions taken by some members, the paper

said.

“As per Articles 17.1 and 17.2 of the Dispute Settlement Undertaking, all WTO members

have a collective duty to ensure the maintenance of a standing Appellate Body

comprising seven members. It would be disingenuous to use the pretext of the Appellate

Body’s alleged digression from the clear mandate of the DSU to justify wilful non-

compliance with the same by the membership,” the paper said.

Judges for Appellate Body

With the US stalling the appointment of judges at the Appellate Body, it will become

non-functional in December when the minimum number of judges required to run the

body will not be met because of judges retiring.

“Attempts at addressing the crisis in the dispute settlement system must preserve its

essential features namely an independent, two-tier dispute settlement system,

automaticity in the launch of proceedings and decision-making by the Dispute

Settlement Body by negative consensus, ” the paper said.

In response to arguments by some WTO members that many developing countries such

as China, India and South Africa do not need special treatment any more, the paper said

that available data indicated that the gap in the standards of living between developing

and developed countries has not narrowed to any significant extent since the

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13 CITI-NEWS LETTER

establishment of WTO. “This necessitates the preservation and strengthening of the

S&D provisions in both current and future WTO agreements, with priority to

outstanding LDC issues,” it said.

Reform must reaffirm the principle of S&D, which is a treaty-embedded, non-negotiable

right for all developing countries in the WTO, it added.

Home

Slow Growth in Manufacturing Sector

(Source: Press Information Bureau, July 17, 2019)

As per the latest available estimates of Gross Domestic Product (GDP) by National

Statistical Office, the Gross Value Added (GVA), at constant prices (2011-12), for the

manufacturing sector registered a growth of 6.9 per cent in the year 2018-19 as

compared to a growth of 5.9 per cent in the year 2017-18. As per the 73rd Round of

National Sample Survey (NSS), conducted by National Sample Survey Office, Ministry

of Statistics & Programme Implementation during the period 2015-16, the estimated

number of workers in unincorporated non-agriculture MSMEs in the country engaged

in different economic activities excluding the MSMEs registered under (a) Sections

2m(i) and 2m(ii) of the Factories Act, 1948, (b) Companies Act, 1956 and (c)

Construction activities falling under Section F of National Industrial Classification

(NIC), 2008, were 11.10 crore. Out of 11.10 crore, 3.60 crore persons were employed in

manufacturing.

The Government has taken several steps to promote and stimulate the growth of MSME

sector in the country. These include simplification of the registration process through a

one page Udyog Aadhar Memorandum (UAM), introduction of the ‘MSME

SAMBANDH’ portal for monitoring the implementation of public procurement policy

for the MSEs and launching of the ‘MSME SAMADHAN’ portal for enabling MSMEs to

directly register their cases relating to delayed payments. Further,

schemes/programmes including Prime Minister’s Employment Generation Programme

(PMEGP), Credit Guarantee Scheme, Credit Linked Capital Subsidy-Technological Up-

gradation Scheme (CLCS-TUS) to support MSMEs in their technology up-gradation,

Cluster Development Programme, Marketing Development Assistance and

Skill/Entrepreneurship Development Programme etc. are also implemented to boost the

MSME sector. This information was given by the Minister of State in the Commerce and

Industry, Som Parkash, in a written reply in the Lok Sabha today.

Home

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14 CITI-NEWS LETTER

Export Promotion Scheme

(Source: Press Information Bureau, July 17, 2019)

The Government of India has launched a scheme namely, Trade Infrastructure for

Export Scheme (TIES) from FY 2017-18 with the objective to assist Central and State

Government Agencies for creation of appropriate infrastructure for growth of exports

from the States. The Scheme provides financial assistance in the form of grant-in-aid to

Central/State Government owned agencies for setting up or for up-gradation of export

infrastructure as per the guidelines of the Scheme. The scheme can be availed by the

States through their Implementing Agencies, for infrastructure projects with

overwhelming export linkages like the Border Haats, Land customs stations, quality

testing and certification labs, cold chains, trade promotion centres, dry ports, export

warehousing and packaging, SEZs and ports/airports cargo terminuses. The Scheme

guidelines are available at http://commerce.gov.in.

Under the TIES Scheme, a total of 28 export infrastructure projects have been provided

financial assistance during FY 2017-18, 2018-19 and 2019-20 (as on 1st July, 2019). The

state-wise and Year-wise details of projects, located in various States/UTs, is given at

Annexure-I.

The Government of India strives to ensure a continuous dialogue with the State

Governments and Union Territories on measures for promoting exports and for

providing an international trade enabling environment in the States, and to create a

framework for making the States active partners in boosting exports from India.

Under the Foreign Trade Policy (FTP), DGFT operates various Export promotion

schemes such as Advance Authorization, Duty Free Import Authorization, Export

Promotion of Capital Goods, Merchandise Exports from India Scheme (MEIS) and

Services Exports from India Scheme (SEIS). To give effect to these schemes, Central

Board of Indirect Taxes and Customs has issued various exemption notifications. The

details of various exemptions provided for these schemes are given in the FTP.

MEIS was introduced in the FTP from 01.04.2015, providing rewards for exporters of

specified goods. The objective of the MEIS is to offset infrastructural inefficiencies and

associated costs involved in exporting goods/products which are

produced/manufactured in India. The scheme incentivizes exporters in terms of Duty

Credit Scrips at the rate of 2, 3, 4, 5, 7 % of FOB Value of exports realized. These scrips

are transferable and can be used to pay certain Central Duties/taxes including Customs

Duties.

As regards promotion of trade in services, Government of India provides fiscal benefits

through Services Exports from India Scheme (SEIS) for some identified sectors.

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15 CITI-NEWS LETTER

Government of India is following a multi-pronged strategy, including negotiating

meaningful market access through multilateral, regional and bilateral trade agreements,

trade promotion through participation in international fairs/exhibitions and focused

strategies for specific markets and sectors to promote Trade in Services. An ‘Action Plan

for Champion Sectors in Services’ has also been approved in February, 2018 to give

focused attention to 12 Champion Services Sector like Information Technology /

Information Technology Enabled Services, Tourism and Hospitality Services and

Medical value Travel.

The Agriculture Export Policy was launched in 2018 to harness export potential of

Indian agriculture, through suitable policy instruments, to make India global power in

agriculture and raise farmers’ income. This comprehensive “Agriculture Export Policy”

aims to increase agricultural exports by integrating Indian farmers and agricultural

products with the global value chains.

Section 10AA of the Income-tax Act, 1961 provides for deduction of profits and gains

derived from the export of articles or things or from services in respect of newly

established Units in Special Economic Zones. Such deduction is allowed to

an entrepreneur as referred to in clause (j) of section 2 of the Special Economic Zones

Act, 2005, from his Unit, who begins to manufacture or produce articles or things or

provide any services during the previous year relevant to any assessment year

commencing on or after the 1st day of April, 2006, but before the first day of April,

2021. The deduction is allowed as under:

hundred per cent of profits and gains derived from the export, of such articles or things

or from services for a period of five consecutive assessment years beginning with the

assessment year relevant to the previous year in which the Unit begins to manufacture

or produce such articles or things or provide services, as the case may be, and fifty per

cent of such profits and gains for further five assessment years and thereafter.

For the next five consecutive assessment years, so much of the amount not exceeding

fifty per cent of the profit as is debited to the profit and loss account of the previous year

in respect of which the deduction is to be allowed and credited to a reserve account (to

be called the "Special Economic Zone Re-Investment Reserve Account") to be created

and utilized for the purposes of the business of the assesse in the manner laid down.

Home

Indian CFOs keen to ride on economic expansion in 2019: Amex Global

Survey

(Source: KR Srivats, The Hindu Business Line, July 17, 2019)

90% of them want to improve cash and working capital management

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16 CITI-NEWS LETTER

Indian CFOs are quite bullish about the economic growth prospects this year. According

to an American Express Global Survey, 80 per cent of Indian CFOs surveyed expect a

substantial or modest economic expansion in the year ahead, substantially higher than

their global peers at 71 per cent.

Also, 90 per cent of Indian CFOs believe that improving cash and working capital

management will be more important this year as compared to the last. The 2019 Global

Survey covered 901 senior finance executives from companies around the world with

annual revenues of $500 million or more. In all, 180 CFOs and other senior finance

executives from Asia and 30 from companies in India participated in the study.

“Indian firms are gearing up to efficiently manage their spending and investment this

year with a keen eye on the future,” Manoj Adlakha, CEO, American Express India, said.

“While they balance spending to drive top-line growth with profitability, they are

pressing ahead with plans to take advantage of demographic and economic changes to

stay relevant and competitive in the next 5-10 years,” he said.

Economic expansion expectations remain highest in the Asia/Australia region (79 per

cent, down from 94 per cent last year) and lowest in Latin America (43 per cent, down

from 52 per cent last year).

On a growth path

Indian companies continue to grow; 87 per cent of companies surveyed in India

reported higher profits or much higher revenue in the last 12 months, as compared to 43

per cent last year. The number is notably higher than the average worldwide (65 per

cent) and in Asia (63 per cent) for this year.

Indian CFOs continue having a positive outlook towards global trade policy, with 63 per

cent expecting global trade policy to strengthen their company’s growth prospects,

according to the Survey.

Spending outlook

Senior finance executives remain optimistic about the economy, the outlook for their

companies and their investments for the future, according to the 2019 Global Business

& Spending Outlook, a survey released by American Express and Institutional Investor

Thought Leadership studio. Over 83 per cent CFOs are looking at moderate to

aggressive increase in spending and investment this year to support topline growth. As

many as 33 per cent expect their company’s spending and investment worldwide to

change by 10 per cent or more this year.

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17 CITI-NEWS LETTER

Odisha mulls new industrial policy to sweeten sops, take on rival states

(Source: Jayajit Dash, Business Standard, July 17, 2019)

New policy to offer exemption on SGST, electricity duty after state eyes top-3 spot in ease

of doing business

Sensing competition from peer states to woo new investments, the Odisha government

is mulling to recast its Industrial Policy Resolution (IPR) last revised in 2015.

Though IPR 2015 was loaded with fiscal and non-fiscal incentives, other states with

more sops were better positioned to lure the new investors, especially in non-mineral

sectors.

“We don't want to lose edge in drawing investments. The changing dynamics, investor

perception and rising competition from other states cannot be wished away. Hence, we

are going for a revamp of the existing IPR to accommodate new provisions. The new

policy statement is likely to be unveiled in 2020,” said an official source.

Aiming to be positioned among the top three states in 'Ease of Doing Business', Odisha

shed four places to finish at the 11th slot at the latest rankings released in 2018. Though

Odisha improved its score in compliance with Business Reforms Action Plan and earned

the tag of 'leader', it lost ground to competing states in investor perception.

To burnish its image, Odisha plans a revised IPR that will offer investors sops like SGST

(State Goods & Services Tax) holiday and electricity duty exemption for five years. It is

also expected to sweeten the subsidy on fresh capital investments by existing and

prospective investors. The new policy statement is set to be valid for at least five years

from the date of its promulgation.

The proposed industrial policy envisages industrial parks for each of the focus sectors

and creation of industrial corridors to set up small & medium enterprises across the

state. For extension of credit at concessional rates to the eligible MSMEs (micro, small &

medium enterprises), a suitable interest subvention scheme shall be introduced by the

government.

The state government has been in a fix over extending incentives announced under VAT

(Value Added Tax) after the roll out of Goods & Services Tax (GST). Since revenues slid

after GST implementation, the finance department was not keen to dangle the VAT

related incentives in the post GST era.

Investors in emerging sectors such as electronics manufacturing & information

technology, textiles & apparel, petroleum, chemicals & plastics, ancillary & downstream

industries and food processing were looking for customized sops to set up their facilities

in the state.

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18 CITI-NEWS LETTER

Keeping to the requirement of the investors, the state government has been unveiling

sector specific policies. The industries department has rolled out several investor

friendly apps and to top it all a definitive portal- Government of Odisha Single Window

Investor Facilitation & Tracking- GOSWIFT which tracks the entire life cycle of an

investment- beginning from proposal to implementation and beyond.

Over the past four years, the state has intensified its outreach efforts, staging roadshows

in domestic and overseas locations. Make in Odisha, a biennial investor conclave was

first held in 2016 with the state attracting Rs 2.03 trillion worth of investment intents.

The second edition organised in November 2018 was a grander showpiece event where

investors across sectors pledged Rs 4.19 trillion for Odisha.

Home

Preferential trade status under GSP for India should continue: IACC

(Source: Indian Express, July 17, 2019)

The key products/industries that will be majorly impacted include dairy products, items

of gold or silver, chemical products, engineering sector and textile goods, participants at

a roundtable said here on Wednesday.

The Indo-American Chambers of Commerce (IACC) has said that preferential trade

status under the Generalised System of Preference (GSP) conferred over the last three

decades between India and US should continue for enhancing trade between the two

countries.

The termination of preferential trade status — which has significantly contributed to the

growth of trade between the two countries — for India under GSP from June will

negatively impact the Indian exports of goods to US which were earlier eligible for GSP

benefit, members of the Western India Council of IACC said.

The key products/industries that will be majorly impacted include dairy products, items

of gold or silver, chemical products, engineering sector and textile goods, participants at

a roundtable said here on Wednesday.

Further, due to the rise in duty rates for aluminium/steel, exporters in India have

suffered a setback and the Indian government has raised a retaliation claim to recover

the cost to the tune of $241 million levied on steel/ aluminium exports, they said.

On the other hand, the impact on the US companies due to removal of GSP will cost

American businesses over $ 300 million additional tariffs every year.

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19 CITI-NEWS LETTER

“New tax will result in job losses, cancelled investments and cost increases for

consumers. US companies do not get access to the Indian market,” they said.

IACC proposed that new ventures may evaluate setting up of processing units in the

United States, especially in areas like defence related textiles and clothing.

“This shall be a win-win situation for both the countries in a way that the basic raw

materials such as yarn and fibre can be exported from India to US markets leading to

value addition and employment in the US,” the industry body said.

Home

Making life easy, Pratibha Syntex distributed home appliances to over

4,000 associates

(Source: Apparel Resources, July 17, 2019)

Pratibha Syntex, a leading Indian textile conglomerate with focus on sustainability, has

again come forward to support its more than 4,000 associates (workers). And how!

The textile giant, in association with Fairtrade, distributed home appliances to its

workers – an initiative that got support from the cream of brands like Patagonia, MEC

and Prana.

Recently Fairtrade Premium Programme 2019 took place at Indore, which was attended

by Sumita Sharma, Fairtrade, H.S. Jha, VP – HR and Aditya Chopra, VP, Productions

from Pratibha Syntex.

H.S. Jha, VP – HR of the company told, “To understand the need of the associates and

their families, a survey was conducted prior to the event. On the basis of responses

received from associates, five options including 190 litre freezer, washing machine and

combo offers like iron+ cooler, mixer grinder + iron + fan, iron + induction cooktop +

blender, induction cooktop + mixer grinder were given. The associates had an option to

select any one option on the basis of requirement of his family.” He further added that

such activities strengthen bond between company and its associates. This initiative was

started in 2014 with the distribution of raincoats and has since been instrumental in

motivating associates to perform. “We hope that our initiative will ease the life of our

associates as these home appliances will help them in their daily routine,” he concluded.

Working with top global and Indian brands and retailers, Pratibha Syntex is a leading

company that has won many awards for sustainable initiatives.

Home

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20 CITI-NEWS LETTER

Demand for digitally skilled manpower to rise to 2.7 mn in FY23: NASSCOM

(Source: Business Standard, July 17, 2019)

As digital technologies disrupt our industries, capacity building and skill development

emerge as core components working towards bridging the current skill gap, said Debjani

Ghosh, President, NASSCOM

The demand for digitally skilled professionals will rise to 2.3-2.7 million in fiscal 2023

given the current trajectory. The demand for digital talent is expected to grow at around

35 per cent compound annual growth rate (CAGR) between FY 2019-2023, said the IT-

BPM industry trade body National Association of Software and Services Companies

(NASSCOM).

At present, the digital talent base in IT-ITeS industry in the country is growing at over

20 per cent and has a base of 2,60,000 in cloud computing, 185,000 in AI & big data

analytics, 185,000 in social media and mobile platforms and 170,000 in IoT.

The skills that are being developed in these technologies include development of

applications, data management, designing use case platforms for operations and directly

working with the technology for applications on a daily-basis.

Demand for digital skills has gone up over the past year. Several organisations are

adopting new age technologies to remain relevant. The industry is witnessing rising

investments towards skilling initiatives in technologies such as AI, ML, data science,

cyber security, cloud and blockchain.

"As digital technologies disrupt our industries, capacity building and skill development

emerge as core components working towards bridging the current skill gap. With re-

skilling and automation emerging as the future drivers of the industry, we aim to craft a

new wave of growth and innovation through a digitally skilled pool of professionals,"

said Debjani Ghosh, President, NASSCOM. She was in Chennai as part of the annual HR

Summit organised by NASSCOM.

Home

Japan's Uniqlo to foray into India in October, open 3 stores in Delhi-NCR

(Source: Business Standard, July 17, 2019)

The first store will be in South Delhi at Ambience Mall, the second one will be at DLF

Place Saket, the third store will be at DLF CyberHub in Gurugram

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21 CITI-NEWS LETTER

Japanese global apparel retailer UNIQLO Wednesday announced its plans to make a

foray into the Indian market and will open three stores in the first year in Delhi-NCR.

Given the size and fast growth of the Indian market, the launch will involve three

separate stores.

The first of the three UNIQLO stores will open in October in New Delhi, the company

said in a statement.

"We are committed to the Indian market and are very excited to be launching our first

three stores in Delhi, a region that embraces diversity and culture, from art and design

to craftsmanship and fashion," UNIQLO Founder and Chairman, President & CEO, Fast

Retailing Tadashi Yanai said.

The first store will be in South Delhi at Ambience Mall, Vasant Kunj spread over 35,000

square feet. The second one will be at DLF Place Saket, also in South Delhi while the

third store will be located at DLF CyberHub in Gurugram, UNIQLO said.

The opening of the three stores represents a significant step in in the company's global

strategy, Yanai said.

"We look forward to offering our high-quality, affordable LifeWear apparel to the people

of India," he added.

The company's announcement to start operations in India comes after the country

allowed 100 per cent FDI in single brand retail, although foreign retailers still need to

source 30 per cent of their products from local suppliers, preferably medium and small

enterprises.

In 2006, the government had allowed 51 per cent FDI in single brand retail. In January

2018, 100 per cent FDI was permitted for foreign players in single brand retail trade to

set up own shops in India without government approval.

Home

Toda embroidery duplicates threaten local artisans’ livelihood

(Source: The Hindu, July 17, 2019)

More than 300 women who depend on the profession face the prospect of running out of

business.

Artisans from the Toda tribe in the Nilgiris fear that duplication of their traditional

handwoven textile designs may soon edge them out of the market, leading to the more

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22 CITI-NEWS LETTER

than 300 women who depend on the sale of traditional Toda-embroidered clothing

items being out of business in the next few years.

According to artisans involved in embroidering the signature Toda designs on shawls,

quilts, bags, jackets, bags, mufflers and even keychains and bookmarks, the demand for

hand-embroidered traditional Toda goods has been on the decline over the last few

years. “In shops run by members of the community, including ones being operated with

the help of the forest department near major tourist attractions, we are lucky if we sell

4-5 pieces of handwoven textiles each day,” said one of the women artisans from the

community.

“While making a shawl by hand could take anywhere up to a week for a Toda woman,

the cheaper, mass manufactured Toda-embroidery duplicates can be produced by a

team of non-tribal seamstresses in huge quantities,” said the woman.

As they are handwoven, the original Toda embroidered items are much more expensive

than the duplicates, with a single shawl being sold for around Rs. 2.000.

“However, a saree, with the Toda design being duplicated is sold for just Rs. 1,500,” said

Northey Kuttan, a member of the community and President of the Nilgiri Primitive

Tribal People’s Federation (NPTPF).

Mr. Kuttan said that as the Toda-embroidered textiles are protected by the Geographical

Indication (GI) tag, the replication of the designs by “non-tribals” was illegal.

“Moreover, as the community does not have the resources to market their products as

effectively as private players, we stand at an even greater disadvantage,” said Mr.

Kuttan, who called on the government to clampdown on the duplication of Toda

designs.

Assistance sought

“We have asked the government to assist us with marketing our products online, and to

also help us with mandating that Toda-crafted textiles and goods be inserted with

barcodes, which can be used to verify their authenticity when required,” said Mr.

Kuttan.

M. Alwas, Secretary of the Nilgiris Adivasi Welfare Association (NAWA), said that the

handcrafted textiles were a part of the Todas’ tradition, with deep cultural roots, and

that their duplication was causing much distress among members of the community.

“As a result, the members of the community, with the help of organizations such as ours,

have complained to the collector, who in turn has directed the police to investigate the

duplication of Toda embroidered goods,” said Mr. Alwas, who added that the private

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23 CITI-NEWS LETTER

firms profiting from producing duplicates are liable to pay financial compensation to the

community if found guilty.

Home

When it's not waste

(Source: The Daily Pioneer, July 18, 2019)

The textile industry is responding to the challenges posed by shrinking resources in a

variety of innovative ways, says Saimi Sattar

Garments that are upcycled, clothes that answer to the description of circular fashion or

those which do not waste water — how often do we see labels flaunting these ideas?

Sustainable is a term often bandied about by different industries. And often times we, as

consumers, wonder if it is nothing more than a marketing gimmick. However, the textile

industry is stepping up its act from start to finish to ensure that sustainability and

circular fashion extend beyond being mere words and become constructive actions.

Of course, there is a context and a reason why this particular industry needs to step up

and get its act together. After agriculture, the textile industry is a front runner in the

consumption of water. According to the Water Footprint Network, in conjunction with

the United Nations Educational, Scientific, and Cultural Organisation (UNESCO) IHE

Institute for Water Education, creating a single pair of jeans requires about 2,866

gallons of water! The use of chemical dyes pollutes the environment while waste

products generated during pre- and post-production as well as frequently discarded

garments choke up landfills.

At Textile Fairs India 2019 (TFI), which was being held at Pragati Maidan, there were

companies and designers showcasing their particular effort on making it a more

sustainable effort.

WARP AND WEFT

The world seems to be practically submerged in a sea of plastic. But then, so are the

seas. In view of that, some of the yarn manufacturing companies have resorted to the

best possible solution — mopping up PET bottles and then fashioning it into yarn.

DGM exports, Sulochna Cotton Spinning Mills K S I Rajesh, says, “We are converting

10,980 million pet bottles every year into fibre. The plastic is blended with Better Cotton

Initiative (BCI) or fair trade cotton, which is being grown by farmers trained by several

NGOs to conserve water and use organic fertilisers. So we are contributing in two ways,

by using plastics and also by using BCI.” But not just this, the Tirupur-based company is

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24 CITI-NEWS LETTER

also actively working on water conservation. A process called pigmentation uses zero

water. It is keenly working on environmental factors where the air emissions, chemical

discharge and water wastage are being minimised. “Hundred per cent of our energy

needs are fulfilled by renewable energy power as we have our own solar and wind

projects,” he points out.

However, this is not the lone player in the game. Lotusville, which too, is based out of

Tamil Nadu, is manufacturing yarn with 80 per cent cotton and 20 per cent polyester.

“Even the cotton that we use is pre-production waste from the cutting section of the

garment factories while the 20 per cent of polyester is made from pet bottle waste.

Moreover, since there is no dyeing involved as the fibre takes the colour of the original

cotton, water is saved as well,” says A S Pravin, managing director. While using different

waste products at different times does alter the colour of the yarn, this is not visible to

the naked eye and can be observed only under a colour test. The company supplies yarn

to home textile manufacturers who manufacture towels, gloves and more for markets

like Russia and other parts of Europe.

Pravin also says that initially when the company started out with the idea of

sustainability, there were not too many takers. So they marketed it as a more economical

option to virgin cotton. “When we started recycling three years ago, most of the people

were buying it as a cheaper alternative. But the enquiries from the past six months have

been specifically related to sustainability. We did about 60 tonnes in two-and-a-half

years which rose by another 40 tonnes in the last six months when the focus changed to

sustainability,” he says.

The idea took birth in 2015 as the company wanted to innovate as it was not possible to

compete in the regular market. “A lot of waste is generated in Tirupur as there is a well-

developed cotton market which finds it hard to dispose the waste fibre. It is this, that we

utilise,” he says.

However, wouldn’t the use of plastic affect the breathability as well as lead the fabric to

heat up which could could prove disastrous in a tropical country like India? Rajesh

points out, “We blend it with natural fibre and cellulose and can alter the combination to

make apparel depending on the requirements of the seasons and countries.”

DESIGNERS’ TAKE

While the yarn and textile manufacturers do their bit, it is time for the designers to step

up their act too. Sonia Tommy Antony, who has designed clothes for films like Chak de!

India and Dhoom 3, has a different take on circular fashion. “Since we want variety in

clothes, we are discarding them often. This in turn chokes the landfills. People are trying

to upcycle but I am trying to reduce the consumption rate by making garments that are

reversible. These are completely finished inside out and can be worn both ways,” she

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25 CITI-NEWS LETTER

says. One goes through the rack to find out that there are lace dresses which on being

reversed carry a print, or one with two prints on two sides or even different colours. “It

gives you the option of two different outfits without cluttering your wardrobe. It is

actually the lining of the garment which is made of a different fabric and gives it a new

look,” says Sonia.

Moving away from the delicate and feminine clothes there are the regular, everyday, de

rigueur ones, namely jeans. This particular industry even among textiles bears the cross

for using a large quantity of water. But Padma Raj Keshri is just trying to reverse that

damage in his own way. He says, “Annually, the world consumes 6.8 billion units of

denim jeans and during the manufacture about 20 per cent of the fabric is wasted. I

decided to use this and started sourcing it from factories.” He found a vendor who was

ready to attach 50 metres of fabric which he fashioned into clothes. “Even then there

was four per cent waste so I started recycling denim fibres,” he adds. The genesis of the

idea could be traced to the time when he was shifting homes and realised that he had

30-35 pairs of jeans, which were worn out from critical areas and couldn’t be used. “I

created a dress for a friend and he loved it. I realised that there was a market for this,”

says he. However, while manufacturing apparel for the market he does not prefer used

jeans as hygiene is an issue. He makes jackets, jeans, jumpsuits and is planning to

diversify into Indian wear as well. A jacket made with different pieces of denim fabric

and with a lot of detailing is one of his fastest moving items. “At a big brand it would not

retail for less than `25, 000 while I am selling it for half the price,” says the Ahmedabad-

based designer.

Next up is Aishwarya Iyengar, who works with the the philosophy of zero waste and

sustainability. Each of her garments has trims and embroidery which she has sourced

from old saris. “Unwearable saris have been fashioned into bags. The swatches that we

receive on a daily basis have been used in shoes as well as for detailing in the kurtas as

are the waste buttons,” says Aishwarya. She sources these from tailors, boutiques and

factories.

Pushpa, on the other hand, believes in the basic idea of slow fashion. “I am a designer by

day and embroidery artist by night. Whenever there is hand embroidery on anything, it

immediately becomes circular. On the other hand, anything which is replicated more is

discarded more often as happens with retail garments. If we buy clothes from a

designer, we preserve it because there is hand-feel or hand embroidery which makes it

precious,” she says.

PACKAGING WONDERS

How often have you bought a sustainable product which came packaged in reams and

reams of plastic? Abhishek Jain, director, Vishal Print-N-Plast, says, “We use virgin

plastic granules to make pouches, and boxes while the carrier bags are made with pure

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26 CITI-NEWS LETTER

non-woven fabric. These are packaging solutions for online retailers as well as the ones

who have brick and mortar stores. These can be easily recycled to make plastic chairs

which is not possible in plastic bags.”

Clearly, the end to end solutions are coming from within the industry and how.

Home

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27 CITI-NEWS LETTER

GLOBAL

IMF issues fresh warning, says trade war risks weighing on global economy

(Source: Business Standard, July 18, 2019)

While the US trade war with China has cooled with a recent truce and renewed talks, the

world's second-largest economy has slowed amid President Donald Trump's tariffs

The International Monetary Fund (IMF) said more work is needed to further reduce

global trade imbalances amid increasing tensions, while issuing a fresh warning that

such conflicts are weighing on the global economy.

“It is imperative that all countries avoid policies that distort trade,” the IMF said in its

annual External Sector Report released Wednesday in Washington. “Against a backdrop

of escalating trade tensions, greater urgency is needed in tackling persistent excess

imbalances.”

The report comes as the Washington-based fund confronts a surge in protectionism

around the world that’s seen dragging on global growth, with output slowing in major

economies from China to Europe and Mexico. IMF leadership also is in flux with

Managing Director Christine Lagarde set to succeed Mario Draghi as president of the

European Central Bank.

While the US trade war with China has cooled with a recent truce and renewed talks, the

world’s second-largest economy has slowed amid President Donald Trump’s tariffs.

China’s government said this week that the economy eased to the weakest pace since

quarterly data began in 1992, highlighting effects of the ongoing trade dispute with the

US.

“With prolonged trade uncertainty, it’s weighing on business sentiment everywhere in

the world, which then has implications for global demand,” IMF Chief Economist Gita

Gopinath said at a press conference Wednesday. “We welcome the trade truce between

the US and China that came toward the end of June at the G-20 meetings, and we would

hope that the world would continue to work cooperatively to not only not trigger these

trade tensions but also to address the issues with the multilateral trading system.”

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28 CITI-NEWS LETTER

MIT and Fashion Institute of Technology join forces to create innovative

textiles

(Source: MIT News, July 17, 2019)

Advanced functional fabrics workshop, held jointly with AFFOA and industrial partner

New Balance, develops concepts for biodegradable footwear, active textiles.

If you knew that hundreds of millions of running shoes are disposed of in landfills each

year, would you prefer a high-performance athletic shoe that is biodegradable? Would

being able to monitor your fitness in real time and help you avoid injury while you are

running appeal to you? If so, look no further than the collaboration between MIT and

the Fashion Institute of Technology (FIT).

For the second consecutive year, students from each institution teamed up for two

weeks in late June to create product concepts exploring the use of advanced fibers and

technology. The workshops were held collaboratively with Advanced Functional Fabrics

of America (AFFOA), a Cambridge, Massachusetts-based national nonprofit whose goal

is to enable a manufacturing-based transformation of traditional fibers, yarns, and

textiles into highly sophisticated, integrated, and networked devices and systems.

“Humans have made use of natural fibers for millennia. They are essential as tools,

clothing and shelter,” says Gregory C. Rutledge, lead principal investigator for MIT in

AFFOA and the Lammot du Pont Professor in Chemical Engineering. “Today, new fiber-

based solutions can have a significant and timely impact on the challenges facing our

world.”

The students had the opportunity this year to respond to a project challenge posed by

footwear and apparel manufacturer New Balance, a member of the AFFOA network.

Students spent their first week in Cambridge learning new technologies at MIT and the

second at FIT, a college of the State University of New York, in New York City working

on projects and prototypes. On the last day of the workshop, the teams presented their

final projects at the headquarters of Lafayette 148 at the Brooklyn Navy Yard, with New

Balance Creative Manager of Computational Design Onur Yuce Gun in attendance.

Team Natural Futurism presented a concept to develop a biodegradable lifestyle shoe

using natural material alternatives, including bacterial cellulose and mycelium, and

advanced fiber concepts to avoid use of chemical dyes. The result was a shoe that is both

sustainable and aesthetic. Team members included: Giulia de Garay (FIT, Textile

Development and Marketing), Rebecca Grekin ’19 (Chemical Engineering), rising senior

Kedi Hu (Chemical Engineering/Architecture), Nga Yi "Amy" Lam (FIT, Textile

Development and Marketing), Daniella Koller (FIT, Fashion Design), and Stephanie

Stickle (FIT, Textile Surface Design).

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29 CITI-NEWS LETTER

Team CoMIT to Safety Before ProFIT explored the various ways that runners get hurt,

sometimes from acute injuries but more often from overuse. Their solution was to

incorporate intuitive textiles, as well as tech elements such as a silent alarm and LED

display, into athletic clothing and shoes for entry-level, competitive, and expert runners.

The goal is to help runners at all levels to eliminate distraction, know their physical

limits, and be able to call for help. Team members included Rachel Cheang (FIT,

Fashion Design/Knitwear), Jonathan Mateer (FIT, Accessories Design), Caroline Liu ’19

(Materials Science and Engineering), and Xin Wen ’19 (Electrical Engineering and

Computer Science).

"It is critical for design students to work in a team environment engaging in the latest

technologies. This interaction will support the invention of products that will define our

future," comments Joanne Arbuckle, deputy to the president for industry partnerships

and collaborative programs at FIT.

The specific content of this workshop was co-designed by MIT postdocs Katia

Zolotovsky of the Department of Biological Engineering and Mehmet Kanik of the

Research Laboratory of Electronics, with assistant professor of fashion design Andy Liu

from FIT, to teach the fundamentals of fiber fabrication, 3-D printing with light,

sensing, and biosensing. Participating MIT faculty included Yoel Fink, who is CEO of

AFFOA and professor of materials science and electrical engineering; Polina Anikeeva,

who is associate professor in the departments of Materials Science and Engineering and

Brain and Cognitive Sciences; and Nicholas Xuanlai Fang, professor of mechanical

engineering. Participating FIT faculty were Preeti Arya, assistant professor, Textile

Development and Marketing; Patrice George, associate professor, Textile Development

and Marketing; Suzanne Goetz, associate professor, Textile Surface Design; Tom Scott,

Fashion Design; David Ulan, adjunct assistant professor, Accessories Design; and Gregg

Woodcock, adjunct instructor, Accessories Design.

To facilitate the intersection of design and engineering for products made of advanced

functional fibers, yarns, and textiles, a brand-new workforce must be created and

inspired by future opportunities. “The purpose of the program is to bring together

undergraduate students from different backgrounds, and provide them with a cross-

disciplinary, project-oriented experience that gets them thinking about what can be

done with these new materials,” Rutledge adds.

The goal of MIT, FIT, AFFOA, and industrial partner New Balance is to accelerate

innovation in high-tech, U.S.-based manufacturing involving fibers and textiles, and

potentially to create a whole new industry based on breakthroughs in fiber technology

and manufacturing. AFFOA, a Manufacturing Innovation Institute founded in 2016, is a

public-private partnership between industry, academia, and both state and federal

governments.

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30 CITI-NEWS LETTER

“Collaboration and teamwork are DNA-level attributes of the New Balance workplace,”

says Chris Wawrousek, senior creative design lead in the NB Innovation Studio. “We

were very excited to participate in the program from a multitude of perspectives. The

program allowed us to see some of the emerging research in the field of technical

textiles. In some cases, these technologies are still very nascent, but give us a window

into future developments.”

“The diverse pairing and short time period also remind us of the energy captured in an

academic crash course, and just how much teams can do in a condensed period of time,”

Wawrousek adds. “Finally, it’s a great chance to connect with this future generation of

designers and engineers, hopefully giving them an exciting window into the work of our

brand.”

By building upon their different points of view from design and science, the teams

demonstrated what is possible when creative individuals from each area act and think as

one. “When designers and engineers come together and open their minds to creating

new technologies that ultimately will impact the world, we can imagine exciting new

multi-material fibers that open up a new spectrum of applications in various markets,

from clothing to medical and beyond,” says Yuly Fuentes, MIT Materials Research

Laboratory project manager for fiber technologies.

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Zara owner promises 100 per cent sustainable fabrics by 2025

(Source: Business Green, July 18, 2019)

Italian firm which owns fashion brands Pull&Bear, Massimo Dutti and Zara

has promised to overhaul its sourcing strategies

Inditex, one of the world's largest fashion companies, has promised that by 2025 100

per cent of the cotton, linen, and polyester used by all its brands will be organic,

sustainable or recycled.

The move, which is almost unprecedented amongst mainstream fashion retailers, means

90 per cent of the materials purchased from the group will come from a sustainable

source, CEO Pablo Isla told shareholders at an Annual General Meeting yesterday. By

2023, all the viscose it uses will also be certified as sustainable.

Isla added that by the same date 80 per cent of the power used in the Group's activities

will come from renewable sources.

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31 CITI-NEWS LETTER

Zara accounts for around 70 per cent of sales across the Inditex Group. Although the

fashion brand has released a host of sustainable collections in recent years,

today's announcement is by far its most ambitious green commitment to date.

"Sustainability is a never-ending task in which everyone here at Inditex is involved and

in which we are successfully engaging all of our suppliers," said Isla.

Fashion is one of the most polluting industries in the world, responsible for an outsize

environmental impact in terms of greenhouse gas emissions, water use, and chemical

pollution. The UN has been urging fashion companies to do more to tackle their impact,

but so far any reforms have been limited.

Isla signalled his desire to make sustainable clothing a core component of Inditex's

offer, indicating that garments sold under its 'Join Life' label which aims to emphasise

high environmental standards, will more than double this year to account for more than

a quarter of the company's production by 2020. The volume of clothing featuring the

Join Life label has already increased by 85 per cent in 2018 to 136 million garments, the

retailer said.

In addition, by the end of next year Inditex has pledged to phase out the use of plastic

bags entirely, and by 2023 eliminate all single-use plastics from customer sales. It also

promised to make its stores more energy efficient and place used clothing collection bins

in all outlets in order to boost the volume of textiles going to charity or being recycled.

Isla said Inditex it is also working with the Massachusetts Institute of Technology to

research new methods for recovering used textile fibres.

In recent years the 'fast fashion' industry has been the focus of growing concern among

environmentalists, who argue cheap clothes are being bought and worn only handful of

times before being thrown away.

Earlier this year MPs from the Environmental Audit Committee proposed a one

penny levy on every clothing item sold in the UK, to help fund new textile recycling

services. But the government said in response that it plans to look at rules on producer

responsibility for textiles by 2025, dismissing the Committee's proposal of a complete

ban on textiles going to recycling.

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32 CITI-NEWS LETTER

One small step for Saurer, one giant leap for mankind

(Source: Innovation in Textiles, July 16, 2019)

Fifty years ago, people around the globe watched in awe as a human being stepped onto

the moon’s surface for the first time. Leading textile machinery manufacturer Saurer has

a little-known connection to the occasion, which marked the start of a new chapter in

space exploration.

“On 20 July 1969, Neil Armstrong became the first person to set foot on the moon. As

the world commemorates the 50th anniversary of this event, we consider the small but

significant contribution our company made to this momentous occasion, made possible

through the expertise of our customer,” Saurer said in a statement today.

Saurer’s partnership with apparel branding innovator Lion Brothers, based in Owings

Mills, Maryland, USA, lasted seven decades. In 1967, the company had become the first

to supply the National Aeronautics and Space Administration (NASA) with embroidered

mission patches, starting with Apollo 1.

Using Saurer’s 2S-55, the most advanced embroidery machine of the time, Lion

Brothers produced the shoulder patch for Apollo 11, the mission that resulted in two

astronauts reaching the moon.

“We are proud to have made a contribution to this pioneering mission. Superb quality

has always been a distinguishing feature of our customers’ products,” states Efthimios

Katsidis, General Manager Saurer Embroidery.

At the time, punched tape was used to program embroidery machines. An image six

times the size of the design, called the cartoon, was produced. The puncher then

recorded the X and Y coordinates on the paper tape by punching holes into it. The

creation of the cartoon and digitising process were both manual. In the case of the

Apollo 11 mission patches, the government contract with Lion Brothers dictated that all

cartoons and punched tapes had to be destroyed once production was complete. This

means that any such patches produced subsequently are copies.

“As science and technology keep developing, we are eager to see our customers pushing

boundaries and using our machines to serve clients in new industries and in

unprecedented ways,” says Efthimios Katsidis. “Who knows, perhaps embroideries or

technical textiles created on Saurer machines will play a role in the first manned mission

to Mars.”

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33 CITI-NEWS LETTER

TSG expands DEFEND DWR into nonwovens

(Source: Innovation in Textiles, July 17, 2019)

TSG Finishing, which has operating plants in Hickory and Conover, NC, is expanding

its DEFEND brand of high-performance finishing products to its wide-width nonwovens

coating and converting business.

“In less than 2 years DEFEND has become the standard-bearer for high-performance

finishing in the residential and contract upholstery markets,” said Michael Goldman,

President and 5th Generation owner of TSG. “Using the DEFEND platform, we are now

able to deliver the same level of customization and performance to the nonwovens

market.”

TSG has long been in industry leader in high-speed, wide-width finishing, servicing

many markets including healthcare, construction, automotive and filtration. TSG’s

capabilities include both low and high viscosity coating to 156” (3,962mm), precision

slitting and rewinding to 172” (4,368mm) and high-speed stentering for heat setting

applications.

“The brilliance of DEFEND is our ability to bolt- on additional capabilities to the DWR

backbone, including anti-abrasion, anti-microbial, anti-static and FR,” Goldman

continued. “Providing custom solutions to solve our customers’ needs has always been

our bread and butter. DEFEND just gives us another tool in the shed.”

Current Capabilities offered by TSG Finishing:

▪ Coating & Tentering (Extending to 156 Inches)

▪ Slitting & Rewinding (Extending to 172 Inches)

▪ Low-Viscosity Coatings (Dips)

▪ High-Viscosity Coatings (Backing or Face-Coatings)

▪ Ability to Handle Difficult Materials such as Kevlar and Fiber Glass ▪ Custom

Compound of our Chemistry. TSG Finishing currently has 3 finishing plants in Hickory

and Conover, North Carolina that are dedicated to the enhancement of textile products.

Executive offices are located in Devon, PA.

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