Category: Expert Opinion

Spinning sector in dire straits with excess capacity, low demand

Is the spinning sector, created out of the government’s incentives, gradually withering away? Looks like, judging from the current State of play of the industry. It has been dogged by excess capacity due to low demand at home and abroad, especially from China. Exports have shrunk to an alarming level in the first quarter of 2017-18. Worse, many spinning units have turned non-performing assets (NPAs) with more to follow, if the present situation, continues, due to stringent RBI norms on (NPAs). What with the sharp fall in demand for yarn in China, our yarn exports have suffered due to...

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From the editor

The Ministry of Finance has increased the Merchandise Exports from India scheme (MEIS) rates for readymade garments and made-ups from 2 per cent to 4 per cent for a period of 1.11.2017 to 30.6.2018 on 24th November 2017. The industry has welcomed this announcement and thanked the government for this initiative. The enhancement in MEIS rates is a big relief to the garment export sector at this hour of crisis. It will also help in the mitigation of the currency difference to some extent. However, the industry is disappointed over the announcement of the RoSL as the rate is...

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VN textile and garment sector to benefit with signing of EVFTA next year

The EU-Vietnam Free Trade Agreement (EVFTA) expected to be signed next year which will provide tariff preferences to Vietnamese exporters to the EU. There will also be ample opportunities to upgrade the value chain for the textile and garment sector. Only “EVFTA originating” products will benefit from preferential tariffs for a maximum of seven years after entry into force, said EU-MUTRAP team leader Claudio Dordi. To be “EVFTA originating,” EVFTA requires textile and garment producers to carry out two production stages in an EVFTA country: Vietnamese producers can upgrade their value chain, adding the weaving or knitting stage to...

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Eight hidden elements to revamp your cutting room

Cutting room is a very important section in the garment manufacturing process which has a major impact on the production of a factory. The cutting room controls the utilisation of fabric which makes up to 70 per cent of the total cost. Small wastages and savings can have a huge effect on the efficiency and profitability for an organisation. Cutting is the first operation of garment manufacturing and it lays the foundation of quality of the garment to be made. Any carelessness in the cutting process can affect the quality of a garment. Hence, we need to ensure the...

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Polyester import duty doubled Makes MMF diversification difficult

The GST Council has recently reduced the tax on man-made items to 12 per cent from 18 per cent earlier. Will it help the textile and clothing (T and C) sector to diversity into the synthetic segment? Look like the diversification is not easy to come by. It is because staple fibre continues to be taxed at 18 per cent as before, whereas staple yarn has been made eligible for the reduced duly. Fabrics attract a duty of 5 per cent. To render the diversification rather difficult is the government’s latest move to affect a sharp hike in import...

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