NEEMRANA, RAJASTHAN
Wednesday, December 28, 2011
Friday, December 23, 2011
Thursday, December 15, 2011
Monday, December 12, 2011
Tuesday, November 22, 2011
Monday, November 21, 2011
NEWS PAPER CUTTING
ARTICLE APPEARED IN THE ECONOMIC TIMES, NEW DELHI ON 22.11.2011, WHICH IS SELF EXPLANATORY.
REGARDS
UMESH GUPTA
PRESIDENT
GINNI INTERNATIONAL LTD
NEEMRANA
REGARDS
UMESH GUPTA
PRESIDENT
GINNI INTERNATIONAL LTD
Friday, October 28, 2011
info
Textiles debt restructuring may add up to Rs 5,000 crore
NEW DELHI: The government is working on a package to restructure loans to the tune of Rs 4,000-5 ,000 crore for the textiles sector but has ruled out a debt waiver.
Facing a slowdown, the textiles sector has been saddled with loans and has proposed a four-pronged strategy to deal with the burden, textiles secretary Rita Menon said. It wants the interest rate on the debt to be reset, besides seeking conversion of working capital into fresh debt, which will cost Rs 835 crore.
Further, companies have sought a two year moratorium on repayment of the restructured debt and have proposed a 4.5% interest subsidy on packaging credit.
Menon said she has already discussed the issue with the finance ministry and a detailed proposal will be submitted in the next few days. In addition, she is going to approach RBI Governor D Subbarao to allow banks to treat the restructured loans as standard assets that do not require higher provisioning. Under RBI norms, restructured loans are treated as doubtful or substandard assets that require higher provisioning.
This makes banks wary of loan recast. One way to deal with the issue is deal with loans under the corporate debt recast cell, an inter-bank forum that enables banks to recast loans without making higher provisions.
"In principle we had asked them to consider this and this week we will take to them the numbers. Probably we will able to get it true to our abilities," Menon said.
An analysis by the ministry shows that demand for cotton fabric dipped by around 19%, while there has been a 15% fall in demand for cotton yarn, 5% for blended yarn.
Rgds/saurabh
Thursday, October 20, 2011
CITI organises Cotton Farmers Meet in Bhilwara
| CITI organises Cotton Farmers Meet in Bhilwara | |
| October 20, 2011 (India) | |
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RGDS/SAURABH
Monday, October 17, 2011
Uzbek cotton sales in 2011 will not be to western companies
Uzbek cotton sales in 2011 will not be to western companies
The 7th International Cotton and Textile Fair took place in Tashkent on 12-13 October without a single buyer from a western company represented among the delegates.
In 2011, for the first time, all the cotton and textiles sold at the Uzbek cotton fair will be destined for CIS countries and countries further east including China, Bangladesh, Vietnam, Japan, UAE, Iran, Turkey, Pakistan, South Korea and Singapore.
According to figures published by the CottonCampagin website, Russian companies have bought around 40% of the cotton produced in Uzbekistan this year, the remaining 60% will be bought up by Asian traders.
Demand for Uzbek cotton gradually declining
At the recent trade fair Uztsentrimpex, the centralised company which coordinates the sale of cotton, has signed contracts to supply around 600,000 tonnes
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| We can hardly expect sales volumes to fall by as much in subsequent years. Western traders have simply been replaced now by Russian and Asian buyers" | |
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of ‘white gold’ with a value of more than US$550 million. This is around 50,000 tonnes less than the sales volume one year ago.
The fall in cotton sales has been attributed to the refusal of European and American firms to buy cotton cultivated with the exploitation of forced labour including forced child labour, experts in Tashkent believe.
However, analysts also say that the boycott that western companies have mounted against Uzbek cotton has not had a significant impact on the sales of raw cotton, since the reduction in export volumes began before western companies stopped buying the cotton from Uzbekistan.
In 2007, the quantity of cotton sold at the Uzbek cotton fair fell by more than 50% compared to the previous year – from 1.7 million tonnes in 2006 to 650,000 tonnes in 2007.
“We can hardly expect sales volumes to fall by as much in subsequent years. Western traders have simply been replaced now by Russian and Asian buyers,” said
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| Logo of 2011 Tashkent cotton fair |
one employee of a consultancy in Tashkent, who asked us not to give his name.
USA and Europe won’t buy cotton harvested by children
The boycott of Uzbek cotton by European and US firms began in 2008. To date more than 60 companies have stopped buying Uzbek cotton, including famous clothing brands and chain stores such as Burberry, Levi Strauss & Co, Marks & Spencer, Target, H&M, Gap, C&A and Wal-Mart, the Responsible Sourcing Network claims.
On 12th October, as the International Uzbek Cotton Fair 2001 opened its doors, these companies signed a declaration that they would not allow cotton harvested by children to be used in the production of their goods. They have committed to maintaining the boycott until the Internationl Labour Organization (ILO) confirms that Uzbekistan has ceased entirely its use of forced child labour to harvest cotton.
Low costs luring Indian textile makers to Bangladesh
New Delhi, Oct 16
Many Indian garment makers have shifted base or opened new units in neighbouring Bangladesh to take advantage of low labour cost and duty concessions on exports to US and European markets.
"Labour cost in Bangladesh is almost one-third of that in India. Average monthly labour cost in India is over Rs.7,000 per person, while it is just around Rs.2,500 in Bangladesh," said D.K. Nair, secretary general of the Confederation of Indian Textile Industry.
"More than 35 Indian textile firms have opened factories in Bangladesh so far, most of them in the recent months," Nair, who oversees the apex industry body for the $55-billion Indian textile industry, told IANS.
Some of the leading Indian garment exporters like Shahi Exports, House of Pearl Fashions, Jay Jay Mills and Ambattur Clothing are using Bangladesh as an important destination in their journey to the western markets.
According to Bangladesh's Board of Investment, Indian textile firms have invested nearly $80 million in 35 factories.
Bangladesh, which is categorised as a least developed country (LDC), enjoys duty-free access to European markets, while Indian firms have to pay 9.6 percent duty.
"If you take duty concessions, labour and other costs into account, garments produced in Bangladesh is almost 20 percent cheaper," said Nair, alluding that it thus becomes difficult for Indian firms to compete globally.
This apart, the aggressive monetary tightening policies of the Reserve Bank of India (RBI) in the recent months has also made cost of capital expensive and further added to the woes of Indian textile makers.
O.P. Lohia, chairman and managing director of Indo-Rama Synthetics , a leading polyester fibre maker, said Indian companies were attracted to Bangladesh despite relatively poor infrastructure and uncertain political situation.
"Textile companies are facing cut-throat competition. Profit margin is very low and 15-20 percent cost difference is a big thing. So people are getting attracted to Bangladesh," Lohia told IANS.
He said even China is not able to stand the competition and is losing its share of exports in US and European markets to Bangladesh.
"Textiles is perhaps the most labour intensive industry. In Bangladesh labour is not only cheap but also easily available when you compare it with India and China," Lohia said.
Besides labour cost and duty advantage, raw materials and real estate costs are also cheaper in Bangladesh.
In a bid to help the domestic industry, Indian Commerce Minister Anand Sharma said the government has adopted a multi-pronged strategy to address the concerns of garment makers and exporters.
"I am aware that there is a serious concern on exports to the US and European countries," Sharma said, adding that the government will provide incentives to exporters in the form of interest subsidy and duty benefits.
Friday, September 16, 2011
FW: News clipping
Sharad Jaipuria
Chairman & Managing Director
Ginni International Ltd
New Delhi
+919811083203
From: S.Kumar [mailto:s.kumar@ginniint.com]
Sent: Friday, September 16, 2011 12:27 PM
To: sharad.jaipuria@ginniint.com
Subject: News clipping
Kindly see the attached file.
Tuesday, August 16, 2011
FW: News clipping
Sharad Jaipuria
Chairman & Managing Director
Ginni International Ltd
New Delhi
+919811083203
FW: News clipping
Sharad Jaipuria
Chairman & Managing Director
Ginni International Ltd
New Delhi
+919811083203
Wednesday, July 27, 2011
FW: News clipping
Sharad Jaipuria
Chairman & Managing Director
Ginni International Ltd
New Delhi
+919811083203
From: S.Kumar [mailto:s.kumar@ginniint.com]
Sent: Wednesday, July 27, 2011 12:23 PM
To: sharad.jaipuria@ginniint.com
Subject: News clipping
Kindly see the attached file.
Wednesday, July 6, 2011
FW: News clipping
Important, the industry is in deep financial trouble, we all need to save costs.
Sharad Jaipuria
Chairman & Managing Director
Ginni International Ltd
New Delhi
+919811083203
Wednesday, June 22, 2011
Nahar Spinning likely to report loss for this quarter: MD
In an interview with ET Now, Dinesh Oswal, MD, Nahar Spinning Mills , shares his outlook for the textile sector. Excerpts:
ET Now: Cotton prices in last three months have slipped by 37%, how will that change life for Nahar Spinning?
Dinesh Oswal: Like all other textile and spinning units the margins will be negative this time. Because of the such a adverse fall in the prices of the raw cotton.
ET Now: So are you likely to report a loss for this quarter?
Dinesh Oswal: I think so.
ET Now: Would you not be passing on this cost decline to end customers?
Dinesh Oswal: The prices have come down not have gone up. And all good textile mills they tend to cover their raw material by the month of March-April for next six months because Government of India had allowed export of raw cotton but surprisingly had banned the export of cotton yarn. Now the result is all good textiles are having the raw cotton at to the price of 62,000 and the prices have crashed down to 38,000 level and so have the prices of yarn crashed down. Now we having been stuck with the high rate of inventory and can do nothing but have to sell at such a big loss.
ET Now: Some spinning mills are actually running at half the capacity just about 50%, what are your current utilisation levels?
Dinesh Oswal: We also like the industry, our utilisation is not 100% but we are trying to run it to the maximum capacity. Because, if we do not run, we will be carrying the stocks to the next season that we do not want.
ET Now: So what is the likely inventory loss because of drop in cotton prices for Nahar?
Dinesh Oswal: This I cannot calculate and tell you because the market prices are going down every week.
ET Now: Have spinning margins come down for both the category of yarns?
Dinesh Oswal: All categories cores, count, medium (5:21) profitability. We will see this time all the spinning mills are going to have all over India very big negative impact. And moreover Government of India in spite of the fact that there was a drawback, and there is a drawback involved and it is the policy of the Government not to export taxes but still surprisingly there is no drawback. We are requesting the government that if you have to save the industry there was a drawback but on the plea of the government and its own wisdom, I do not know why they had withdrawn this or benefits. We are again pleading to government that please restore the at least the drawback benefits but still government is doing nothing.
ET Now: Initially you had a plan of implementing 90,000 spindle expansions as well so would one assume that those plans of expansion have now been shelved?
Dinesh Oswal: No, no because it was in a very final stage of implementation and in fact about 50,000 spindles are already now working and the next batch will be completed by September-October. But hopefully this will benefit in the next season after October because we do not have cotton beyond October.
ET Now: But what will happen to the yarn demand, I would reckon that if cotton prices are down yarn demand will also pick up?
Dinesh Oswal: They should, but now it is not only the yarn all the textile segment all over the world I do not know why. Whether it is garment or fabric the demand is very very low, retailers are not placing the order, everyone is waiting and watching because all over the world people know that India is stuck up with two months stock all spinning mills. So they want to push the market down before placing for the order. But I think by within one month time people will eventually start buying now because their pipeline must be now dry.
ET Now: Have global spinning margins come down or this more like a India specific phenomenon?
Dinesh Oswal: No, it is all over world phenomena including India. The prices of export and domestic prices are same and all are negatives.
ET Now: Do you have any exposure to the fabric business or you are a pure spinner?
Dinesh Oswal: In Nahar Spinning we have only spinning as well as garmenting.
ET Now: So I am sure your garment business will make more money as yarn prices have come down?
Dinesh Oswal: But the volume of garment is very small as compared to the volume of the yarn.
ET Now: What is your current operating loss on a daily basis?
Dinesh Oswal: Actually the loss will be converted when we are able to dispose of the yarn but as of now, the outflow of yarn is very less so we cannot quantify the loss as it is.
ET Now: You are the Managing Director the company I am sure you get the number on a daily basis that what is a difference in operating income and the operating loss?
Dinesh Oswal: No, you are right but the difference we have to calculate at a certain price. Now this price is fluctuating every day, so I just cannot quantify that.
Rgds/saurabh
Tuesday, June 21, 2011
Cotton yarn exports dip, post-monsoon revival seen
| Dilip Kumar Jha / Mumbai June 22, 2011, 0:14 IST |
India’s cotton yarn exports declined 33 per cent in the first two months of the current financial year, due to low demand. The directorate-general of foreign trade (DGFT) registered 134.55 million kg for export in April and May and the actual shipment is estimated at 100-110 million kg, as against 150-160 million kg in the corresponding period last year.
“Actual shipment runs generally with a lag of 15 days and, hence, we do not think, total export quantity could have surpassed 110 million kg,” said D K Nair, secretary-general of the Confederation of Indian Textile Industry.
Demand abroad for both cotton and cotton yarn has declined steeply, partly due to the government’s policies. Last year, it imposed an upper export limit of 720 million kg, which ginners executed in the first 10 months, anticipating an extension of the quota. But, the government did not do so. Hence, there was close to zero shipment in the last two months, February and March. Importers from Bangladesh and China, the two main destinations for India’s cotton yarn, opted for synthetic yarn.
Cotton yarn prices have dived 60 per cent in the past two months. The benchmark 42-count is traded at Rs 170 per kg on Tuesday. It is the same abroad; in Bangladesh, the benchmark 30S category yarn is below $5 a kg from $7 a kg in February-March. Powerlooms in Bhiwandi, a hub of cotton yarn manufacturing units near Mumbai, are operating at 40 per cent of capacity to avoid further stockpiling. When prices were over Rs 240 a kg early this year, lots of stockists built inventories in anticipation of further price rise. They are now releasing stocks and supply has gone up substantially in the past two months surpassing demand by a wide margin, said Bharat Malkan, promoter of IB Yarn Agency, a Mumbai-based trader.
Ginners are optimistic that demand from both domestic and foreign textile mills would revive after the monsoon, for which inquiries and orders should start soon. Says Malkan: “Despite the markets looking dull, we are keeping our fingers crossed for an early revival in cotton yarn demand.”
A dramatic fall in cotton prices is also supporting the downward trend in the yarn market. Cotton was Rs 63,000 per candy (1 candy = 356 kg) only a quarter earlier. It is now below Rs 40,000 a candy.
Monday, June 20, 2011
FW: News clipping
Sharad Jaipuria
Chairman & Managing Director
Ginni International Ltd
New Delhi
+919811083203
From: S Kumar [mailto:s.kumar@ginniint.com]
Sent: Tuesday, June 21, 2011 10:52 AM
To: sharad.jaipuria@ginniint.com
Subject: News clipping
Kindly see the attached file.
Thursday, June 16, 2011
DGFT may curb cotton export application quantity
The Directorate General of Foreign Trade (DGFT), responsible for monitoring smooth shipment of 1 million bales (1 bale = 170 kg) of additional cotton exports, has framed stringent guidelines for export applications, likely to be announced soon.
Trade sources say DGFT would restrict registrations to genuine exporters and cap on maximum application quantity at 100,000 bales. This is unlike the earlier round, when there was no such bar on application quantity and many opportunistic exporters applied for even 1 million bales.
Earlier, the government had capped cotton exports at 5.5 million bales. However, the agriculture ministry had opposed the cap, arguing that production was more than consumption this year. As a consequence, DGFT, according to sources, received applications for over 40 million bales.
Since the scrutiny of all applications was difficult, DGFT allotted a random 10 per cent of applied quantity to all applicants. Those who applied with genuine quantity of stocks and orders, therefore, were left behind in the process and many fresh entrants successfully obtained permission for exports.
A number of irregularities were found later, with inexperienced traders passing on the permitted quantity to perennial exporters at a cost.
Since cotton prices were high overseas, Indian exporters were eager to make maximum possible profits through shipment of the textile raw material. Overseas demand was also very high. Now, cotton prices both in global and Indian markets have fallen 33 per cent since the beginning of this year and demand has also declined due to cheaper replacement substitutes. Only real exporters will be able to make a dent this time, a trader said.
“Other than some stringent guidelines, the government is believed to have put a cap on application quantity, which is very new,” said M B Lal, ex-chairman of Cotton Corporation of
Genuine exporters are happy with this proposed guideline. The textiles ministry had opposed easing the export cap on the grounds that cotton production in 2010-2011 was estimated to be 31.2 million bales, down from its earlier estimate of 32.5 million bales. However, its objection did not find much support.
S K JINDAL (SR.G .M)
GINNI INTERNATIONAL LIMITED
NEEMRANA(RAJ)
Weak demand, heavy selling hit cotton prices
AHMEDABAD: Cotton prices fell by Rs 2,000 per candy (a candy weighs 256 kg) in the last two days across
Unseasonal rains have also ensured huge stocks in mandis. The Directorate General of Foreign Trade (DGFT) is likely to issue a notification on the quota allotment process on Friday.
"Shankar 6, which was earlier fetching Rs 42,000 a candy, was selling at Rs 40,000 a candy on Thursday in Kadi mandi. Yarn manufacturers are not purchasing, owing to the existing carry forward stock and poor demand from the garment manufacturer," said Kadi-based ginner Paresh Haribhai Patel.
The ginner's unit Uday Cotton Industry has an annual capacity to gin 1.2 lakh bales (one bale=170 kg). Kadi is the biggest ginning hub in the country, processing 10,000-15,000 bales daily. The current arrival of cotton in the state is expected to be over 12,000 bales with exporters and traders largely making the purchases.
"The arrivals are more than the previous year's at this period of time owing to unseasonal rains. Farmers are selling the crop even as others watching the market developments," added Patel. Poor demand from finished goods manufacturers and mills is expected to keep cotton prices bearish, feel traders.
On the NCDEX, cotton contract expiring on February 29 traded in a range of Rs 709 to Rs 730 per 20 kg, registering a decline of Rs 30. After
"Prices are likely to remain bearish. The macro factors like economic condition and bank rates are not supportive except for bad weather condition in
A Maharashtra-based trader said that good quality cotton could touch Rs 35,000 a candy in the coming days. "We don't expect the prices to come back to the previous levels even as the export begins with a huge cotton stock in the country," said Delhi-based VRA Cotton Mills chairman Vinod Ahuja.
S K JINDAL (SR.G .M)
GINNI INTERNATIONAL LIMITED
NEEMRANA(RAJ)
Monday, June 13, 2011
FW: News clipping
Sharad Jaipuria
Chairman & Managing Director
Ginni International Ltd
New Delhi
+919811083203
From: S Kumar [mailto:s.kumar@ginniint.com]
Sent: Tuesday, June 14, 2011 11:39 AM
To: sharad.jaipuria@ginniint.com
Subject: News clipping
Kindly see the attached file.
FW: News clipping
Sharad Jaipuria
Chairman & Managing Director
Ginni International Ltd
New Delhi
+919811083203
From: S Kumar [mailto:s.kumar@ginniint.com]
Sent: Tuesday, June 14, 2011 11:39 AM
To: sharad.jaipuria@ginniint.com
Subject: News clipping
Kindly see the attached file.
FW: News clipping
Sharad Jaipuria
Chairman & Managing Director
Ginni International Ltd
New Delhi
+919811083203
Friday, June 10, 2011
FW: News clipping
Sharad Jaipuria
Chairman & Managing Director
Ginni International Ltd
New Delhi
+919811083203
From: S Kumar [mailto:s.kumar@ginniint.com]
Sent: Friday, June 10, 2011 11:56 AM
To: sharad.jaipuria@ginniint.com
Subject: News clipping
Kindly see the attached file.
Tuesday, May 31, 2011
FW: News clipping
Sharad Jaipuria
Chairman & Managing Director
Ginni International Ltd
New Delhi
+919811083203
Sunday, May 29, 2011
Fall in cotton price unlikely to impact garment prices
Sarah Jacob, Madhvi Sally and Sutanuka Ghosal from ET Bureau have reported that though cotton prices are down 30% in two months, large clothing companies have no plans to reduce prices and pass on the benefit to consumers for propping up falling demand.
The report highlights the fact that raw material costs have been the biggest concern for apparel makers since August as cotton prices increased over 50% due to a global production shortfall. The raw materials account for around 80% of the garment production cost.
The report quotes Mr. Ashesh Amin, President - Apparel and Retail at SKNL, as saying that they did not increase prices when the raw material prices were going up, and therefore the price decsrease will not be across the board, but maybe considered in selected categories.
The report also quotes Mr. J. Suresh, MD and CEO of Arvind Lifestyle Brands and Retail, Mr. Pankaj Jain, retail head of Kewal Kiran Clothing, and Mr. Komal Kumar Jain, Chairman, Duke Clothing.
S K JINDAL (SR.G .M)
GINNI INTERNATIONAL LIMITED
NEEMRANA(RAJ)
Friday, May 20, 2011
Vidarbha Farmers welcomes decision to Permit 15 lakh Cotton Bale Export
Vidarbha cotton farmers who are killing themselves due to cotton price crash after the imposition of export ban on cotton bales welcome the assurance given by Textile Minister Dayanidhi Maran and Finance Minister Pranab Mukherjee to Gujarat congress delegation who met today pressing hard demand increase in Cotton export quota.as per Gujarat Congress’s statement, the delegation demanded approval of 1.5 million bale export of Cotton which “was accepted by Textile Minister Dayanidhi Maran” and it is also reported that Maran told delegation that he would call Cotton Advisory Board’s meeting and promised that export of 15 lakh bale will be permitted, Kishore Tiwari of Vidarbha Janandolan Samiti VJAS informed in press note today .
As cotton price are further crashed in India more farmers suicides are being reported the reason for much Taboo on Cotton exports from India is result of unholy cartel of finger counting textile tycoon and Union Textile Minister Dayanithi Maran which is responsible for present cotton rowers crisis in India ,farm activist group Vidarbha Janandolan Samiti VJAS allged and urged Indian prime minister to sack Union Textile Minister Dayanithi Maran to save more than 5 million dying cotton farmers of Maharashtra .
“This is not complete relief as 15 lakhs cotton bales export permission is peanut as against demand of 15 million bales but it will certainly stop the raw cotton prices restoration in local market where farmers are selling the cotton at throw away price in panic sale .we are trying to meet UPA convener Smt.Sonia Gandhi in a day or two asking her for urgent intervention in order to resolve the crisis as Textile minister initially restricted cotton bales export to 55 lakhs bales from earlier year 84 lakh bales even when country cotton production is higher by another 25 lakhs bales then ban export of cotton yarn and now surprisingly as per Quota Policy of Cotton items now added Cotton Waste ( Comber Noil) H. S. Code No. 5202 as Cotton Waste is a ‘By-product’ of Cotton Yarn. when plenty of quota of Cotton Yarn lying unutilized the hostile functioning of Union Textile Minister Dayanithi Maran has a allaowed textile cartel to include the by-product banned with a major raw material and brought under same category in the field of exports” Tiwari said..
“Cotton prices have increased from Rs 30000/candy in April 2010 to Rs 60000/candy April 2011 which is an increase of about Rs 70-75 per kg and immediately Spinners increased the price of yarn from rs 150/- per kg in April 2010 for 30s combed to Rs 230/- per kg in April 2011. increase of Rs 80 per kg which reflects in cotton value to Rs 30000/per candy minimum. Fabric weavers too have increased prices of grey fabric of 40 x 40 counts 124 x 64 with 200 gm per mtr which is quoted at about Rs 70/- per sqmtr as against Rs 38 in April 2010. There s an increase of Rs 32/mtr which is Rs 160/- per kg which in terms of candy is about Rs 58/60000 and present ban on export has brought back cotton prices to the level of April 2010 which is artificial an stage managed and Union Textile Minister Dayanithi Maran is directly involved in this scam ” Tiwari added.
‘As Cotton is an agricultural commodity and higher the prices farmers get, they will be encouraged to produce more and more of cotton and when Cotton production has grown from a low of 225 lac bales to 330 lac bales in last 5 years the undue protection to Local textile mills benefiting of buying Indian cotton at prices which are at least
lower by 30% as compared to its competitor in Bangladesh, Pakistan and other countries who buy from other growths which is reason behind the present restriction of cotton export and when Indian cotton after lot of hard work and promotion by exporters have found a very stable and regular market of its cotton in foreign countries and Govt should ensure that the markets created are not lost to competition due to faulty Govt policies.” It is alleged.
‘We need the urgent central intervention and demand to lift all export restriction of cotton bales and yarn too so that farmers get higher price to cotton ‘’Tiwari urged.
Thursday, May 19, 2011
FW: Media coverage of press conference held on 18th May 2011
Sharad Jaipuria
Chairman & Managing Director
Ginni International Ltd
New Delhi
+919811083203
From: Confederation of Indian Textile Industry [mailto:mail@citiindia.com]
Sent: Thursday, May 19, 2011 11:34 AM
To: SITRA; Prem Malik Yahoo; Adish Oswal; P.A. to Sharad Jaipuria; Sharad Jaipuria; Ashish Bagrodia; Hardyal Singh Cheema; K.K. Agarwal Alps Industries Ltd.; Mukund Choudhary; P.A. to Ashish Bagrodia; Sanjay Kumar Jain TT Ltd.; Sanjay Singhal; nitma@airtelmail.in; Rajiv Sharma - NITMA
Subject: Media coverage of press conference held on 18th May 2011
Dear Sirs,
The media coverage of press conference held on 18th May 2011 is attached.
Livemint Video Coverage:
http://www.youtube.com/watch?v=3kRz6sSKgh4
Regards,
D.K. Nair
Secretary General
CONFEDERATION OF INDIAN TEXTILE INDUSTRY (CITI)
6th Floor, Narain Manzil, 23, Barakhamba Road, New Delhi - 110 001, India
Phone: +91-11-23325012, 13, 15 & 55 Fax: +91-11-41519602
Web: www.citiindia.com www.nsts.in
Wednesday, May 18, 2011
FW: Crisis in spinning industry - 1/3rd production cutback from May 24
| May 18, 2011 (India) |
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While lamenting that the situation is unprecedented in the textile industry, it was unanimously decided in the meeting that spinning mills in India would be closed on 23rd May 2011. From 24th May onwards, it was decided to have a production cut back of 33.33 percent (1/3rd) of existing daily production. Such a drastic step was needed to ensure a reasonable price and boost up the sagging demand for the cotton yarn.
It was also decided that a review meeting off the stakeholders will be called on 1st week of June 2011 to take stock of the price and demand position and to chalk out further action. “Our sincere hope is that with the support of the government and cutback in production the crisis situation will be blown over and the industry will be back on the rail” textile leaders opined.
Briefing the press in New Delhi along with heads of other textile associations, Mr. Shishir Jaipuria, Chairman, Confederation of Indian Textile Industry (CITI), said that a combined representation has already been sent to the Textile Minister, Commerce Minister and senior officials in the ministries of Textiles, Commerce and Finance highlighting the current problems of the textile industry.
Mr. Jaipuria explained that short-sighted Government policies with reference to both cotton and cotton yarn in the recent past have converted a profitable spinning industry into a crisis ridden sector during the last few weeks. The leaders of various associations explained that the following urgent steps would be required to prevent the current crisis from deepening further.
(i) The Drawback facility on export of cotton yarn was withdrawn on 29th April, 2010 and the DEPB benefits on export of cotton yarn was withdrawn on 21st April, 2010. Both these facilities may be reinstated with retrospective effect immediately.
(ii) An Excise duty of 10.30% was imposed on manufacture of garments. We request the government to withdraw the Excise duty on garments to perk up the consumer demand. This should be done at least till the GST is introduced.
(iii) An announcement may be made by Government that no restrictions would be placed on export of cotton yarn in future so that mills can start winning the confidence of their buyers which will now take a long time since the damage has already happened and buyers have moved to the competitors. This will also help in resuming the investments in the production of cotton yarn.
(iv) Providing 2% interest subvention for all textile and clothing products i.e. all products falling under chapters 50 to 63, excluding fibres.
(v) Since the spinning mills are incurring huge cash losses, government may consider giving one year moratorium period for repayment of loans and interest and also exempt this period for TUF eligibility so that NPAs are avoided.
(vi) Permit conversion of a portion of CC limits into term loans to fill up the gap in the CC limits caused due to sudden fall in the prices of unsold yarn and cotton and such loan should be given five years repayment period with normal interest rate and it should not affect the credit rating of such units resulting in proliferation of Non Performing Assets (NPAs).
(vii) Address the pollution issues prevailing in various dyeing clusters particularly Tirupur and other places in Tamil Nadu so that the domestic garment industry works in full capacity which in turn boost yarn sales.
Mr. Shishir Jaipuria observed that the present predicament of the textile industry is due to a combination of factors. The Government abruptly imposed a restriction on export of cotton yarn to 720 million kgs for the year 2010-11 based on an unsubstantiated complaint made by cotton yarn users of high prices and low availability.
Consequently, there was no export of cotton yarn for over two and a half months from 15th January, 2011 to 31st March 2011. This led to a huge stock of unsold cotton yarn with the mills as on 31st March 2011, considerably higher than the figures released by the Textile Commissioner in the last meeting of the Cotton Yarn Advisory Board (CYAB).
Post withdrawal of restrictions on export of cotton yarn from 1st April 2011, exports have been very tardy since non-shipment of Indian cotton yarn for over two months have diverted several regular importers of the Indian cotton yarn to other sources. Cotton yarn exporters are finding it extremely difficult to win back these buyers now. On the top of it, immediately after the withdrawal of restrictions, the mills, which have accumulated inventories have off loaded them at a reduced price internationally, which has led to price decline. Even that did not help boosting the demand on account of the steep decline in demand for cotton fabrics internationally.
“Our understanding is that exports of cotton yarn during the last five weeks have amounted to less than 50 million kgs. as against 70-75 million kgs. per month, which was being exported last year before the restriction was imposed,” says Mr. Jaipuria.
Mentioning that the textile mills are holding a stock of around 500 million kgs, Mr. Jaipuria observed that this has completely eaten into their working capital. Faced with cash losses and negligible working capital, mills are finding it impossible to buy cotton and this has resulted in a decline in cotton prices in the market. However, he added that decline in cotton prices is no indication of adequate availability.
| The press conference was addressed by senior functionaries of CITI, Southern India Mills Association (SIMA), North India Textile Mill Association, Texprocil, Indian Spinners Association (ISA), Tamil Nadu Spinning Mills Association, Andhra Pradesh Spinning Mills Association, South India Spinners Association, Annur Spinning Mills Association, Madurai Spinners Association and Karur Textile Forum. | ||
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