the only way forward is digitalization

YR 21 ISSUE 05

APPAREL EXPORT PROMOTION COUNCIL MAGAZINE I MAY 2021 100

COMPLETELY TRANSFORMING THE GLOBAL APPAREL SECTORDIGITALIZATION The Only Way Forward is

FOCUS COUNTRY

UNITED STATES

AIM FOR $400 BILLION MERCHANDISE EXPORTS: COMMERCE MINISTER

TEXTILES MINISTER CALLS FOR VACCINATION OF APPAREL WORKERS

APPAREL | CHAIRMAN’S MESSAGE

We have come a long way through these trou-bled times and with God’s blessings and our positive attitude we are sure to come out of the

pandemic protecting both lives and livelihoods.RMG exports of $1,294 million in April 2021 is back to

pre-Covid levels with an increase of 920% year-on-year. Last fiscal saw an overall decline of about 21% yoy, which shows a tremendous resilience and enterprise of our apparel exporting sector.

As we found different ways of coping with the emerging scenario while firefighting at many fronts in the pandemic year, one the most strategic moves that the Council took for a lasting solution is the way we engage with buyers. We embraced digitalization in all our activities from showcasing our apparels to engaging in B2B talks. Our cover story is aptly on this subject – how digitalization is transforming the apparel sector.

Continuing with our focus on the MMF segment, we organized a webinar last month with MMF fabric suppliers from China and Taiwan to help fill the domestic shortage. I have requested Hon’ble Textiles Minister Smt Smriti Zubin Irani to include 20 MMF HS codes in focus products under Production Linked Incentive (PLI) scheme.

Magic Authorities, USA, organized an online matchmaking business meeting attended by 40 buyers for opportunities in the US market, including MMF garments and organic cotton products. Meanwhile, International Apparel Federation (IAF), Netherlands, has welcomed our request to join them and is finalizing the modalities to work together for setting common standards for sourcing terms and procurement practices.

Considering the second wave of Covid-19 pandemic and proposed lockdowns, I have requested Hon’ble Ministers of Home, Finance, Health, Textiles, Commerce and Industry, their secretaries and several state governments for keeping factories free from lockdowns, and urged them to consider apparel export industry as an essential services sector. Based on our request, Tamil Nadu, Uttar Pradesh and Haryana have allowed all apparel manufacturing units with export commitments and their vendor units to continue functioning under Essential Commodities and

Dear Friends,

Dr A Sakthivel Chairman, AEPC

APPAREL EXPORT PROMOTION COUNCIL MAGAZINE | MAY 2021 / 1

Continuous Process Industries with full compliance to pandemic safety norms.

As yarn prices have shot up, we have requested urgent intervention of the Hon’ble Textiles Minister to increase the supply of cotton yarn to domestic manufacturers. We have suggested quantitative restrictions and duty on exports of cotton yarn. Besides, we have urged the Hon’ble Ministers of Commerce and Textiles, in different online meetings, for early announcement of RoDTEP rates and continuation of RoSCTL rates till then. The Hon’ble Textiles Minister has assured of taking it up with other ministries.

We were successful in requesting the RBI Governor for extension of Interest Equalisation Scheme (IES) for pre and post shipment rupee export credit till 30 June 2021. We have now requested for its extension up to 31 March 2022. We have also requested that the 5% IES available only to MSMEs may be extended to all apparel exporters. I have also written to Hon’ble Ministers of Finance and Commerce on this.

Hope all member exporters are vaccinating their workers and staff as requested. You can use your CSR funds towards Covid care facilities. Do write in your suggestions at [email protected].

With a little extra effort, a lot can be achieved!

EVENTSCALENDAR

INDIA TEX TREND FAIR (ITTF)

TOKYO, JAPAN

PURE LONDON (PURE ORIGIN)

SOURCING AT MAGIC FAIR, USA

SOURCING AT MAGIC FAIR,

USA

WHO’S NEXT, PARIS, FRANCE

APPAREL TEXTILE SOURCING,

CANADA

AUSTRALIA INTERNATIONAL SOURCING FAIR

28-30 June 2021

9-10 September 2021

February 2021

8-11 August 2021

September 2021

23-25 August 2021

November 2021

APPAREL | EVENTS CALENDAR

2 / APPAREL EXPORT PROMOTION COUNCIL MAGAZINE | MAY 2021

Printing Press Royal Press, New DelhiEmail: [email protected]

Content & Design Vanman Communications Pvt LtdEmail: [email protected]

CHAIRMAN AEPCDr A Sakthivel

CHAIRMAN EPMr Sudhir Sekhri

Secretary General, AEPCDr LB Singhal

ADVISOR AEPCMrs Chandrima Chatterjee

PUBLISHERApparel Export Promotion CouncilApparel House, Sector-44,Institutional Area, Gurugram,HARYANA – 122003.Phone: 0124-2708000www.aepcindia.com

YR 21 ISSUE 05

APPAREL EXPORT PROMOTION COUNCIL MAGAZINE I MAY 2021 100

COMPLETELY TRANSFORMING THE GLOBAL APPAREL SECTORDIGITALIZATION The Only Way Forward is

FOCUS COUNTRY

UNITED STATES

AIM FOR $400 BILLION MERCHANDISE EXPORTS: COMMERCE MINISTER

TEXTILES MINISTER CALLS FOR VACCINATION OF APPAREL WORKERS

YR 21 | ISSUE 05 | MAY 2021 | Pages 60

01| CHAIRMAN’S MESSAGE

02 | EVENTS CALENDAR

04 | KEY STATISTICS • RMG exports grow 920% in April 2021

• Textile manufacturing falls 4.5% in February 2021

06 | UPFRONT• India’s export sector to take off:

Commerce Secretary

10 | COVER STORY• Digitalization – The only

way forward

16 | SPECIAL FEATURE• LVMH, Prada Group and

Cartier to form Aura Blockchain Consortium

18 | FOCUS COUNTRY• US economy to outpace many

in 2021

26 | COUNCIL AFFAIRS • Apparel exporters seek help from

global MMF fabric suppliers• Hon’ble Textiles Minister calls

for vaccination of apparel sector workers

• AEPC appeals for uninterrupted manufacturing at factories

• Hon’ble Textiles Minister cautions mill associations on yarn prices

• Meeting on availability of PPE kits• Full support to exporters, aim for

$400 bn merchandise exports: Commerce Minister

• AEPC to join International Apparel Federation

34 | INDIA NEWS• India can be most natural ally for EU:

Shri Piyush Goyal• Centre initiates vaccination centres at

workplaces• India, Bangladesh agree on trade

remedial measures• First convocation at Kashmir NIFT• Hon’ble Commerce Minister launches

trade facilitation app• Container shortage eases in India

40 | GLOBAL NEWS • Nike commits to reduce its carbon

footprints• Life 360 environmental strategy of

LVMH• PVH joins hand with Americares• Versace and Luxottica Group renew

license agreement• Gap Inc plans to sell Janie and Jack• Tommy Hilfiger appoints Alegra

O’Hare as Global CMO• H&M collaborates with lemlem to

promote sustainability• Levi Strauss & Co publishes 2021’s

first quarter results• Gap Inc ties up with Barclays and

Mastercard• H&M promotes sustainability with

Maisie Williams• Three ways to think by Nike

47 | OBITUARY

48 | GST UPDATE

52 | NOTIFICATIONS

54 | CIRCULAR

60 | MEDIA COVERAGE

APPAREL | CONTENTS


India’s Ready-Made Garment (RMG) Export Update for April, FY 2021-22

RMG EXPORTS GROW 920% IN APRIL 2021


RMG exports were to the tune of USD 1294.42 million in April 2021 showing a positive growth of 920.52 per cent against the corresponding month of April 2020 and decline of 8.12 percent against April 2019.

APPAREL | KEY STATISTICS

India’s RMG Export to World

Month

( In US$ Mn.) MoM Growth (%)

2019-20 2020-21 2021-222019-20

Over 2018-19

2020-21 Over

2019-20

2021-22 Over

2019-20

2021-22 Over

2020-21

April 1408.77 126.84 1294.42 4.2 -91.00 -8.12 920.52

May 1530.06 517.02 14.2 -66.21

June 1233.52 804.29 -9.2 -34.80

July 1365.78 1065.73 7.1 -21.97

August 1261.92 1085.61 -2.4 -13.97

September 1080.63 1192.9 -2.2 10.39

October 1108.93 1180.03 -2.1 6.41

November 1058.54 1046.98 -6.4 -1.09

December 1409.46 1196.9 2.4 -15.08

January 1453.45 1296.19 -4.9 -10.82

February 1477.85 1349.1 -4.4 -8.71

March 1120.48 1425.59 -34.8 27.23

Total 15509.39 12287.18 -4.0 -20.78

Source: DGCI&S, Kolkata, 2021 April, 2021 data is based on PIB prelimanary data

India’s Textile & Ready Made Garment (RMG) Update for Index for Industrial Production (IIP) for February, FY 2020-21

TEXTILE MANUFACTURING FALLS 4.5% IN FEBRUARY 2021

Manufacturing of Textiles for the month of February, 2021 is 111.5 which has shown a decline of 4.5% as compared to February, 2020. Manufacturing of Textiles for the financial year Apr-February, 2020-21 is 88.4 which has shown a decline of 24.4% as compared to the financial year Apr-February, 2019-20.

Manufacturing of Wearing Apparel for the month of February, 2021 is 141.2. which has shown a decline of 14.2% as compared to February, 2020. Manufacturing of Wearing Apparel for the financial year Apr-February, 2020-21 is 105.0 which has shown a decline of 33.6% as compared to the financial year Apr-February, 2019-20.


Manufacture of

Textiles

MoM

Growth Rate

(In %)

Manufacture of Wearing

Apparel

MoM Growth Rate

(In %)

Month 2019-20 2020-212020-21/2019-

202019-20 2020-21 2020-21/2019-20

April 119.8 5.3 # 165.1 6.3 #May 115.6 31.5 # 163.5 97.5 #June 110.1 50.3 -54.3 167.3 100.9 -39.7July 113.8 97.0#* -14.8#* 166.8 118.9#* -28.7#*

August 115.0 95.9#* -16.6#* 158.6 120.5#* -24.0#*September 115.2 101.7#* -11.7#* 144.2 123.9#* -14.1#*

October 115.9 107.0* -7.7* 137.1 120.9* -11.8*November 119.7 108.0* -9.8* 139.1 112.9* -18.8*December 123.5 114.6* -7.2* 170.8 136.7* -20.0*January 122.2 115.4* -5.6* 162.3 129.5* -20.2*February 116.7 111.5* -4.5* 164.6 141.2* -14.2*

Total (Apr-Feb) 117.0* 88.4* -24.4* 158.1* 105.0* -33.6*

Source: CSO, 2020

* Figures for February 2021 are Quick Estimates.

APPAREL | KEY STATISTICS

APPAREL | UPFRONT

After showing tremendous resilience during 2020-21, India’s trade performance is all set to take off on the back of improvement in Ease

of Doing Business (EoDB), creation of a plug and play investment/ manufacturing environment, and launch of Production Linked Incentive Scheme (PLI), as per Commerce Secretary Dr Anup Wadhawan.

“Prospects for a quick recovery in world trade have improved as merchandise trade expanded more rapidly than expected in the second half of last year. World mer-chandise trade volume is expected to increase by 8.0% in 2021 (Jan-Dec) after falling 5.3% in 2020 (Jan-Dec), as per the WTO,” Dr Wadhawan said in an official note.

World trade continues its rebound from the pandem-ic-induced collapse that bottomed out in the second

INDIA’S EXPORT SECTOR TO TAKE OFF: COMMERCE

SECRETARY

quarter of last year, he said as per a press release issued by the Ministry of Commerce and Industry, Gov-ernment of India on 20 April 2021.

“The Covid period has revealed new opportunities for Indian food sector. There is a rise in demand in US, Europe, Australia, New Zealand, Israel, Palestine and Egypt. Enquires for fresh/ dehydrated garlic, spices


APPAREL | UPFRONT

(chilli, turmeric, ginger), seed spices (cumin, fennel), sesame seeds/ oil, sugar (new demand from Sri Lanka) and groundnut have been received by the exporters. The demand for non-basmati rice from new buyers such as Malaysia and the Philippines is likely to boost exports in the coming months,” the Commerce Secretary said.

The Indian economy has shown significant resilience amidst the global pandemic and trade shock that began to impact the global economy towards the end of 2019-20 and acquired catastrophic proportions in 2020-21, the ministry said.

The cumulative value of overall exports (merchandise and services) during April-March 2020-21 has been estimated at $493.19 billion compared to $528.37 billion during April-March 2019-20, registering a negative growth of (-) 6.66 per cent. He added that it reflects a remarkable recovery over the course of the financial year after the huge downturn in April 2020 reflected in decline in merchandise exports by (-) 60.28 per cent and

services exports by (-) 8.92 per cent.

“India’s dominance in the pharma sector has been re-inforced with supply of critical covid related supplies to over 150 countries and rapid growth in exports during the Covid period. This sets an excellent foundation for our export sector to take off on the back of significant improvement in EoDB, creation of a plug and play investment/ manufacturing environment across various industrial corridors, and launch of the very substantive PLI schemes across 13 sectors,” Dr Wadhawan said.

The Prime Minister’s clarion call for an ‘Atmanirbhar Bharat’ envisages policies for the promotion of an efficient, equitable and resilient manufacturing sector in the country. Keeping in view this vision and to enhance India’s manufacturing capabilities and exports, an outlay of Rs 1.97 lakh crore was announced in Union Budget 2021-22 for PLI schemes for 13 key sectors for a period of 5 years starting from fiscal year 2021-22.


APPAREL | UPFRONT

These 13 sectors are mobile manufacturing and specified electronic components, critical key starting materials/ drug intermediaries and active pharmaceu-tical ingredients, manufacturing of medical devices, automobiles and auto components, pharmaceuticals drugs, specialty steel, telecom and networking products, electronic/ technology products, white goods (ACs and LEDs), food products, textile products: manmade fibre (MMF) segment and technical textiles, high efficiency solar PV modules, and advanced chemistry cell (ACC) battery.

The PLI schemes will will make Indian manufacturers globally competitive, attract investment in the areas of core competency and cutting-edge technology; ensure efficiencies; create economies of scale; enhance exports and make India an integral part of the global supply chain, the ministry said in another press statement.

Growth in production and exports of industrial goods will greatly expose the Indian industry to foreign com-petition and ideas, which will help in improving its ca-pabilities to innovate further. Promotion of the manufac-turing sector and creation of a conducive manufacturing ecosystem will not only enable integration with global supply chains but also establish backward linkages with the MSME sector in the country. It will lead to overall growth in the economy and create huge employment opportunities.

Trade data for March 2021, the final month of 2020-21 reflects the build-up of a strong recovery in exports despite several challenges. The overall export (mer-chandise and services) for March 2021 is estimated at $52.20 billion, registering a positive growth of 31.64 per cent vis-à-vis March 2020.

Merchandise exports in March 2021 grew by 60.29 per cent as compared to March 2020, which was substantial even after factoring in the base effect. This was driven by healthy export growth in key sectors such as engi-neering goods (71.30%), gems and jewellery (78.93%), petroleum products (35.52%), drugs & pharmaceuticals (48.49%) and organic & inorganic chemicals (46.50%).

Merchandise exports other than petroleum, oils and lubricants (POL) and gems and jewellery had an even more impressive performance in March 2021 attaining a value of $27.42 billion, as against $16.95 billion in March 2020, an increase of 61.75%.

The cumulative value of merchandise exports during April-March 2020-21 has been estimated at $290.63 billion compared to $313.36 billion during April-March 2019-20, which is a negative growth of (-) 7.26 per cent, which is fairly moderate given the prevailing global


APPAREL | UPFRONT

situation. If gems and jewelry and POL exports, both in-volving very moderate value addition, are excluded, the growth in merchandise exports in 2020-21 was actually (+) 1 per cent i.e. an increase over 2019-20, notwith-standing the Covid disruption.

This reflects immense adaptability in our exporters in capturing new opportunities in sectors like other cereals, oil meals, rice, cereal preparations and miscel-laneous processed items, drugs and pharmaceuticals, spices, fruits and vegetables, carpets, jute manufac-tures, ceramic products & glassware and organic and inorganic chemicals, while containing the downturn in other sectors in the face of huge challenges.

The decline in export values in petroleum products and G&J also, predominantly reflected decline in global prices rather than volumes.

The commodities/ commodity groups which have re-corded positive growth during 2020-21 as compared to 2019-20 are other cereals (219.13%), oil meals (87.91%), iron ore (86.78%), rice (37.06%), cereal preparations and miscellaneous processed items (21.16%), drugs and pharmaceuticals (18.07%), spices (10.37%), fruits and vegetables (8.63%), carpet (8.39%), jute manufacturing including floor covering (8.29%), ceramic products and glassware (6.02%) and organic and inorganic chemicals (0.51%).

The overall trade deficit, taking merchandise and ser-vices together, for April-March 2020-21 is estimated at $12.74 billion as compared to the deficit of $77.76 billion in April-March 2019-20. The merchandise trade deficit between 2019-20 and 2020-21 declined from $161.35 billion to $98.56 billion


APPAREL | COVER STORY

DIGITALIZATION – THE ONLY WAY FORWARD

Completely Transforming the Global Apparel Sector


These lines clearly reflect that digi-talization is the need of the hour for all industry and sectors and there is no need to undertake any prior mar-ket study to understand the impor-tance of digitalization in today’s fast changing consumer behaviour.

Apple products – computers, lap-tops, iphones, ipad, and iwatch are the examples which reflect the power of technology and its influence on both consumers and companies. The company has revolution-ized the electronics sector.

One key point needs to be understood here clearly before moving forward. Digitalization does not mean use of a computer on a table in a company. In the fast chang-ing business environment and consumer behaviour, the apparel industry has to use all high end digitalization tools to increase efficiency in their organisation and cater consumers.

Key tools of digitalization which are changing the global apparel industry include – artificial intelligence, augmented and virtual reality technology, cloud comput-ing, Internet of Things, robotics, voice-assisted shopping, data and analytics, smart and modern future ready stores (online and offline both), payment gateways, use


“SOME PEOPLE SAY GIVE THE CUSTOMERS WHAT

THEY WANT, BUT THAT’S NOT MY APPROACH. OUR JOB IS TO FIGURE OUT

WHAT THEY’RE GOING TO WANT BEFORE THEY DO. I THINK HENRY FORD ONCE SAID,

‘IF I’D ASK CUSTOMERS WHAT THEY WANTED, THEY WOULD’VE TOLD ME A FASTER HORSE.’

PEOPLE DON’T KNOW WHAT THEY WANT UNTIL YOU SHOW IT TO THEM. THAT’S WHY I

NEVER RELY ON MARKET RESEARCH. OUR TASK IS TO READ THINGS THAT ARE

NOT YET ON THE PAGE.”

APPLE FOUNDER STEVE JOBS



of robots, RFID tags, QR codes in logistics and delivery of goods, and blockchain technology.

Use of these tools are completely changing the way companies used to operate their businesses and consumers used to buy goods. These tools are not only promoting efficiency and transparency in the ecosystem of a company domestically, but also help in a greater way to tap growing business opportunities world over.

Digitalization in simple terms means use technology and modern tools to make things move smoother - be it running machines in a factory, making products, transportation of those items to godowns, managing that inventory, wholesaling, retailing, undertaking bank-ing transactions and paperwork to carry out all these moves. At every single step, digitalization is changing the way companies used to do business in earlier times. The whole supply chain needs to be transformed digital-ly in order to be competitive in this highly competitive market, otherwise you will be replaced.

Faster a company adapts digitalization, the faster it can tap growing opportunities in today’s world, when consumer behaviour and business models are changing every second.

The global apparel industry contributes significantly in the world economy both in terms of revenues and creating jobs.

According to a Deloitte report, fashion is one of the

most challenging fields, highly impacted by global economic uncertainty as well as distinct trends and in-dustrial changes. In response to the pressure for growth and cost efficiency, many brands have started a series of initiatives to improve their speed to market and to implement sustainable innovation in their core product design, manufacturing and supply chain processes.

The fast changing consumer behaviour and business environment are keeping companies on toes and forcing them to adopt different forms of digital tools. Compa-nies engaged in the apparel sector are using robots and modern machines to design and manufacture products. They are no longer dependent only on human minds and hands. Starting from HR practices to manufacturing to packaging and transporting, digital medium is being used to make things better and smoother.

The whole paperwork is now being done through online processes, be it taking orders to track trans-portation of orders, everything is online. According to an industry expert, these measures have significantly transformed the way the apparel industry used to work decades back.

Varanasi-based apparel player Rakesh Agarwal said that earlier they used to maintain physical registers or notebooks for everything, and due to that business growth was abysmal. “Now changing market scenar-ios have made us understand that we need to change



ourselves and change the way we do our businesses. Now we use modern tools like accounting softwares, and softwares for designing clothes. It has totally changed the business and made it smoother,” Agarwal said.

A Deloitte report stated that digital transformation is the means by which companies affect organizational change, manage reputational risks and close the gaps between customers’ expectations and the service and experience they receive. Digital transformation is about challenging and changing ingrained perceptions about what a company is, does and says, in order to increase relevance to consumers.

360-DEGREE CHANGE AFTER PANDEMICThe ongoing crisis has impacted each and every nook and corner of the globe, from rich to poor. Globally companies have realized that digitalization is not only beneficial but now it’s a need, without which things will collapse. Now even the MSEs (micro and small enter-prises) are adopting tools to digitize all the processes. For example, Indian apparel sector, without losing time, immediately jumped on organising virtual buyer-seller meets and virtual fairs and exhibitions to attract global buyers.

According to Federation of Indian Export Organisa-tions (FIEO) Director General Ajay Sahai, organizing virtual or online trade shows are helping Indian export-ers to showcase their products and keep the economic activity wheel moving. Apparel firms are modernizing their websites, using IT tools to permit employees in the administrative departments to work from home. Com-panies also gauged the need to diversify their manufac-turing on account of the pandemic. They got into making key goods used in this health crisis such as face masks, PPE kits and other items.

This crisis showed the widening digital divide in the apparel sector. On one hand, units in poor countries are still using traditional methods as broadband connec-tivity has still not reached their territory. On the other hand, big manufacturing players of the world were quite well-prepared to deal with the crisis. Gradually every-one is understanding the importance of digitalization and started taking steps in that direction.

According to a report of McKinsey & Company, “Digi-tal is not only an increasingly important sales channel; it can also help companies adapt cost structures and make each step of the value chain better, faster, and cheaper. For example, digitalization can enable new logistics and sales-fulfillment options (such as click-and-collect and drive-through), fuel innovative ways of customer acquisition, and help predict and manage inventory to create a more resilient supply chain. The fundamental enabler to all this will be data – the trans-



parency, governance and accuracy. It has never been more important.”

INDIAN APPAREL EXPORTERSTo overcome the restrictions on physical movements, Apparel Export Promotion Council (AEPC) launched a virtual exhibition platform on 9 November 2020 to show-case garments made by Indian apparel exporters round the year (24x7x365), where brands and buyers from across the world can visit and place their orders.

AEPC Chairman Dr A Sakthivel said, “Buyers can have a near physical experience of the exhibition while navigating through the options in high resolution 360 de-gree avatars. The platform offers free flowing two way communication between buyers and exhibitors through video call and WhatsApp chat facilities. Exhibitors have the real time flexibility to change their products on display and have the security feature of allowing only select buyers into their stalls. Buyers can collect prod-ucts on their ‘Wishlist’ for discussion.

“Usually apparel exporters have a set of buyers from a set of countries with whom we do business. But with this virtual platform, we can get orders from new buyers and from new countries as it is open to everyone in the world. I expect at least 500 exporters to enroll for this virtual platform in the initial phase. We also have sep-arate showrooms for medical textiles in the exhibition now that India is the second largest producer.”

SCENARIO IN INDIACiting a Cisco report, news agency PTI has reported that India is expected to have over 907 million internet users by 2023, up from 398 million in 2018. These figures reflect multi-fold increase in smart phones and data by common people. It is leading to a digital revolution in the country and the private sector has to adopt this before it gets too late.Indian apparel companies from north to south and from east to west, are using these tools to improve efficiency in their factories and retailers to enhance consumer’s experience, though in a gradual manner.

Apparel retailers have quite understood the fact that Covid protocols, like physical distancing, and wearing masks, would be a normal affair in the years to come, which means less footfall of consumers in shops and malls. A kind of contact-free economy is prevailing and is likely to prevail in the years to come world over. This clearly means, one has to adopt e-commerce ways and automation to grab the eyes of consumers and maintain revenues

WAY FORWARDJudicious use of all the tools of digitalization is going to change the face of a business and retailer. Data and

data analytics will be key. It will help in understand-ing demand for raw material and manufacturing final products. Companies are now hiring data scientists for the purpose. Using social media tools is going to be crit-ical. Gradually companies will have to increase usage of social media digital tools to attract consumers and understand their needs.

So, need of the hour is rapid digitalization of organi-sations and not just automation. Employees, machines and systems need to interact with each other and provide real time data so that decision making becomes effective, which would push the growth of Indian apparel industry.



MYTH BUSTEROne can argue that digitalization has a negative effect. It can lead to job losses. But this is not true. With chang-ing needs, a worker, be it working on a machine or on a computer – both have to upskill themselves to survive and help their company adopt best global practices during such a crisis era.

Digitalization will enhance efficiency in every depart-ment of a company. Increasing efficiency will increase the scale of operations, which needs investments. And, all this will help in creating many more jobs as they will have to cater large numbers of retailers and wholesal-ers.

HUMAN CONNECT CONTINUE TO REMAIN KEYWhile digitalization would improve efficiency and reve-nue books, one should not forget about human connec-tion. There should always be a forum or platform in an organization, which continuously engages employees to connect with each other and with management. This needs to be taken care of. Connecting machines with digital tools should not leave out human connect


APPAREL | SPECIAL FEATURE

LVMH, PRADA GROUP AND CARTIER TO FORM

AURA BLOCKCHAIN CONSORTIUM

Global giants of luxury sector LMVH, Prada Group and Cartier have jointly announced the creation of Aura Blockchain Consor-tium, which will promote the use of a single

global blockchain solution and will be open to all luxury brands throughout the globe.

This step will help in providing consumers with additional transparency and traceability. According to its press release, LMVH, Prada Group and Cartier, that are part of Richemont, have created together a single solution to address the shared challenges of communicating authenticity, responsible sourcing and sustainability in a secure digital format.

Toni Belloni, Managing Director of LMVH said, “The Aura Blockchain Consortium is a great oppor-tunity for our sector to strengthen our connection with customers by offering them simple solutions to get to know our products better. By joining forces with other luxury brands on this project, we are lead-ing the way on transparency and traceability. I hope other prestigious players will join our alliance.”

Brands are trying real hard to lessen the gap be-tween them and consumers; gap that is brought in by the pandemic. To regain consumers, it is necessary to earn their trust. This is the point where transpar-ency plays a key role.

As per the release, the technological system of a multi-nodal blockchain is secured by Consen-Sys technology and Microsoft. It will be working


APPAREL | SPECIAL FEATURE

towards security of information and its non-repro-duction and generate an owner’s unique certificate. This will enhance desire for beautiful materials made with high-quality sustainable materials. It was further learned that the consortium will be available to all luxury brands irrespective of their operational sub-sec-tor or geography. Companies with varying sizes will be eligible for the Consortium’s support. The Consortium is a non-profit organisation that aims to enhance customer relationships; also providing with brand protection.

In a world that has suddenly turned to unpredictable, brand-consumer relation needs a special support. In a predictable world of post-COVID era, consumers will become rational and choosy. Authentication guarantee followed by transparency will play a major role in at-tracting consumers. On the other hand, brands will need extra support to recover from the hard effects of the pandemic. Something like Aura Blockchain Consortium will provide these brands with protection; it will help them with establishment/re-establishment of their brand with technology and tactics. This would certainly be an onus for brands to regain their market-place. If there is any best time for luxury brands to be open to consum-ers and talk about their making processes, that time is now-to start. The Aura Blockchain Consortium will help customers to have direct access to product history and authenticity; this would enormously contribute in attracting them.

President and CEO of Cartier International Cyrille Vigneron said, “The Aura Consortium represents an unprecedented cooperation in the luxury industry. Blockchain is a key technology to enhance customer service, relationship with partners and traceability. The luxury industry created timeless pieces and must ensure that these rigorous standards will endure and remain in trustworthy hands. We therefore invite the entire profession to join this consortium to design a new luxury era enabled by blockchain technology.”


APPAREL | FOCUS COUNTRY

US ECONOMY TO OUTPACE MANY IN 2021The United States, a highly developed mixed economy, is the world’s largest economy powered by technologically superior firms. It’s the world’s largest importer and the second-largest exporter. The US dollar is the world’s leading reserve currency. The US economy entered recession, the worst ever since the Great Depression, in the first half of 2020 due to Covid-19 pandemic. It contracted 3.5% in 2020. However, forecasts suggest that the US is likely to have a strong recovery in 2021. It may record a growth rate of 6.5% in 2021, which will be the fastest in the last three decades.



ECONOMIC INDICATORS -

Indicators ValueReal GDP (Purchasing Power Parity), 2019 est. $20,524,945,000,000

GDP (official exchange rate), 2019 est. $21,433,228,000,000

Real GDP (Per Capita), 2019 est. $62,530

Real GDP Growth Rate,2019 est. 2.16%

Inflation Rate, 2019 est. 1.8%

Industries

highly diversified, world leading, high-tech-nology innovator, second-largest industrial output in the world; petroleum, steel, motor vehicles, aerospace, telecommunications, chemicals, electronics, food processing, consumer goods, lumber, mining

Source: The World Factbook-CIA

LOCATION - North America, bordering both the North Atlantic Ocean and the North Pacific Ocean, between Canada and Mexico

CLIMATE - mostly temperate, but tropical in Hawaii and Florida, arctic in Alaska, semiarid in the great plains west of the Mississippi River, and arid in the Great Basin of the southwest; low winter tem-peratures in the northwest are ameliorated occasionally in January and February by warm chinook winds from the eastern slopes of the Rocky Mountains

AGE STRUCTURE -0-14 years: 18.46% (male 31,374,555/female 30,034,371)

15-24 years: 12.91% (male 21,931,368/female 21,006,463)



65 years and over: 16.85% (male 25,014,147/female 31,037,419)(2020 est.)

USA’S APPAREL TRADE-

USA’S RMG IMPORT FROM WORLD AND INDIA

2018 2019 2020 % Change 2020/2019

USA’s RMG Import from World, (USD Mn.) 86728.3 87522.8 71187.3 -18.7

USA’s RMG Import from India, (USD Mn.) 4025.4 4262.4 3202.5 -24.9

India’s Share in USA’s RMG import from world, % 4.6 4.9 4.5 -7.6

Source: UN Comtrade, 2021

The above table shows that USA’s RMG import from world were to the tune of USD



71187.3 mn. in 2020 showing a decline of 18.7% as compared to 2019. RMG import from India has remained USD 3202.5 mn. registering a decline of 24.9%. as compared to 2019. India’s % share in USA’s RMG import from world has remained 4.5% in 2020.

TOP RMG SUPPLIER TO USA -

Top RMG Supplier to USA (Values in USD mn.)

S. No.Exporters 2020 % Share

World 71187.35 1001 China 19545.37 27.5

2 Viet Nam 13182.32 18.5

3 Bangladesh 5284.106 7.4

4 Indonesia 3668.834 5.2

5 India 3202.51 4.5

6 Cambodia 3056.993 4.3

7 Mexico 2439.325 3.4

8 Honduras 1991.527 2.8

9 Jordan 1568.773 2.2

10 Sri Lanka 1541.334 2.2


The above table shows that China has remained a top supplier of RMG to USA with a % share of 27.5% in 2020. India is the 5th largest supplier of RMG to USA with a % share of 4.5 %. Bangladesh, and Cambodia have a % share of 7.4% and 4.3%.


USA’S TOP 10 RMG PRODUCTS IMPORT FROM WORLD VS INDIA’S SHARE

USA’s Top 10 RMG Import from World vs India’s share

S. No.

Product code

Product label

United States of America’s imports from world,Value in

2020,USD mn.

United States of America’s imports from India,Value in

2020,USD mn.

India’s share in

%

RMG 71187.3 3202.5 4.5Sum of Top 10 33069.7 1023.8 3.1

1 611020Jerseys, pullovers, cardigans, waistcoats and similar arti-

cles, of cotton6331.2 360.8 5.7

2 621010

Garments made up of felt or nonwovens, whether or not

impregnated, coated, covered or laminated

4661.6 25.3 0.5

3 611030Jerseys, pullovers, cardigans, waistcoats and similar arti-

cles, of man-made fibres4522.2 21.8 0.5

4 620342Men’s or boys’ trousers, bib and brace overalls, breeches

and shorts, of cotton 3669.2 95.0 2.6

5 610910 T-shirts, singlets and other vests of cotton 3637.9 207.6 5.7

6 620462Women’s or girls’ trousers,

bib and brace overalls, breeches and shorts of cotton

3616.2 79.4 2.2

7 621210Brassieres of all types of tex-tile materials, whether or not

elasticated1914.5 35.7 1.9

8 610463

Women’s or girls’ trousers, bib and brace overalls,

breeches and shorts of syn-thetic fibres

1698.5 2.9 0.2

9 620520 Men’s or boys’ shirts of cotton 1557.1 158.2 10.2

10 610462Women’s or girls’ trousers,

bib and brace overalls, breeches and shorts of cotton

1461.4 37.2 2.5

Source:UN Comtrade,2021

The above table shows USA’s top 10 RMG products imported from world vis-à-vis from India and India % share in those top 10 products. The top 10 products imported from world were to the tune of USD 33069.7 mn. in 2020 and import from India of these top 10 products were to the tune of USD 1023.8 mn. India has a % share of 3.1 % in USA’s top 10 products import from world.

The top products imported by USA from world includes Jerseys, pullovers, cardigans, waist-coats and similar articles, of cotton, Garments made up of felt or nonwovens, whether or not impregnated, coated, covered or laminated, Jerseys, pullovers, cardigans, waistcoats and similar articles, of man-made fibres, Men’s or boys’ trousers, bib and brace overalls, breeches and shorts, of cotton and T-shirts, singlets and other vests of cotton.



USA’S TOP 10 RMG PRODUCTS IMPORT FROM INDIA

USA’s Top 10 RMG Products Import from India Equivalent ad valorem tariff

applied by United States of

America,In %

pS. No.

Product code

Product labelUSA’s Import from

India, USD mn. % Share in 2020

2020RMG 3202.5 100

Sum of Top 10 1769.3 55.2

1611020

Jerseys, pullovers, cardigans, waistcoats and similar articles,

of cotton360.8 11.3

11

2 611120Babies’ garments and clothing

accessories of cotton 217.3 6.8 14

3 610910T-shirts, singlets and other vests

of cotton 207.6 6.5 17

4 620630Women’s or girls’ blouses, shirts

and shirt-blouses of cotton 202.3 6.3 9

5 620520 Men’s or boys’ shirts of cotton 158.2 4.9 14

6 620442Women’s or girls’ dresses of

cotton 152.5 4.8 9

7 610510 Men’s or boys’ shirts of cotton 137.6 4.3 20

8 610711Men’s or boys’ underpants and

briefs of cotton 127.6 4.0 7

9620640

Women’s or girls’ blouses, shirts and shirt-blouses of man-made

fibres 110.6 3.5

14

10620342

Men’s or boys’ trousers, bib and brace overalls, breeches and

shorts, of cotton 95.0 3.0

9


The above table shows USA’s top 10 RMG products imported from India. USA’s top 10 prod-ucts imported from India were to the tune of USD 1769.3 mn with a % share of 55.3 % in USA’s total RMG import from India.

The top products imported by USA from India includes Jerseys, pullovers, cardigans, waist-coats and similar articles, of cotton, Babies’ garments and clothing accessories of cotton, T-shirts, singlets and other vests of cotton, Women’s or girls’ blouses, shirts and shirt-blous-es of cotton and Men’s or boys’ shirts of cotton.




USA’S PPE IMPORTUSA’s PPE Import from World and India

S. No.

Product code

Product label Import from World, 2020, USD mn.

Import from India, 2020, USD mn. % Share

PPE Kit 32115.7 154.5 0.5

1 630790Made-up articles of textile materials, incl. dress pat-

terns, n.e.s.19649.5 118.2 0.6

2 621010Garments made up of felt or nonwovens, whether or not impregnated, coated,

covered or laminated4661.6 25.3 0.5

3 621710Made-up clothing accesso-ries, of all types of textile

materials, n.e.s. 191.1 2.2 1.1

4 611780Ties, bow ties, cravats and

other made-up clothing accessories

266.9 2.2 0.8

5 401519 Gloves, mittens and mitts, of vulcanised rubber 4201.5 2.1 0.1

6 621050Women’s or girls’ garments of textile fabrics, rubberised

or impregnated, coated, covered

624.5 1.8 0.3

7 401511Surgical gloves, of vul-

canised rubber (excluding fingerstalls)

426.3 1.5 0.3

8 621790Parts of garments or clothing

accessories, of all types of textile materials, n.e.s.

9.2 0.5 5.5

9 902000 Breathing appliances and gas masks 368.7 0.5 0.1

10 900490Spectacles, goggles and the

like, corrective, protective or other

1028.9 0.1 0.0

11 611610Gloves, mittens and mitts,

impregnated, coated or cov-ered with plastics or rubber

687.7 0.1 0.0

Source:UN Comtrade, 2021

· USA’s PPE import from World in 2020 were to the tune of USD 32115.7 mn. Import from India were to the tune of USD 154.5 mn. with a % share of 0.5%.


FOCUS APPAREL PRODUCTS FOR USA: MAN MADE FIBRES

Based on KPMG study commissioned by Indian Embassy, Washington and AEPC for US Market, the Indian industry needs to focus on the following Top 10 HS codes(Accounting for ~48% of Synthetics products imported in the US Market) to capture higher share of US Synthetics Fibres Apparel Imports:

HS Code DescriptionValue of US imports

- 2019Value of US imports

- 2020 % Change (2020/2019)(IN USD Bn.) (IN USD Bn.)

611030

Jerseys, pullovers, cardigans, waistcoats and similar articles, of man-made fibres, knitted or crocheted (excluding wadded

waistcoats)

6.5

4.52 -30.4

621210Brassieres of all types of textile mate-rials, whether or not elasticated, incl.

knitted or crocheted2.21

1.91 -13.4

620193

Men’s or boys’ anoraks, windcheaters, wind jackets and similar articles, of man-

made fibres (not knitted or crocheted and excluding suits, ensembles, jackets, blazers, trousers and tops of ski suits)

1.73

1.20 -30.8

610463

Women’s or girls’ trousers, bib and brace overalls, breeches and shorts of synthetic

fibres, knitted or crocheted (excluding panties and swimwear)

1.7

1.70 -0.1

620343

Men’s or boys’ trousers, bib and brace overalls, breeches and shorts of synthetic

fibres (excluding knitted or crocheted, underpants and swimwear)

1.63

1.30 -20.4

620293

Women’s or girls’ anoraks, windcheaters, wind jackets and similar articles, of man-

made fibres (not knitted or crocheted and excluding suits, ensembles, jackets, blazers, trousers and tops of ski suits)

1.55

1.03 -33.6

611596

Full-length or knee-length stockings, socks and other hosiery, incl. footwear

without applied soles, of synthetic fibres, knitted or crocheted (excluding graduat-ed compression hosiery, pantyhose and

tights, women’s full-length or knee-length stockings, measuring per single yarn <

67 decitex, and hosiery for babies)

1.51

1.34 -11.2

620640Women’s or girls’ blouses, shirts and

shirt-blouses of man-made fibres (exclud-ing knitted or crocheted and vests)

1.320.78 -40.7

610343

Men’s or boys’ trousers, bib and brace overalls, breeches and shorts of synthetic

fibres, knitted or crocheted (excluding swimwear and underpants)

1.23

1.02 -16.7

620443Women’s or girls’ dresses of synthetic fibres (excluding knitted or crocheted

and petticoats)1.22

0.78 -36.5



APPAREL EXPORTERS SEEK HELP FROM

GLOBAL MMF FABRIC SUPPLIERS

Indian apparel exporters, aspiring to have a slice of $200 billion global manmade fibre (MMF) garment trade, have sought help from

international MMF fabric suppliers to overcome the shortage of the fabric, in the short run, and also to improve the quality of local production of the fabric eventually.Speaking at a webinar on ‘MMF Fabric Sourcing from International Suppliers’, hosted by Ap-parel Export Promotion Council (AEPC) on 9 April, AEPC Chairman Dr A Sakthivel said that the country needs to import MMF fabric from interna-tional suppliers to increase MMF manufacturing in India.“Initially we want to import fabric from you all and we expect it at international price, so that we can manufacture MMF garments and export out of India. Besides, we are also interested to have investment in fabric processing in India,” Dr Sakthivel said to the participating MMF suppliers from China and Taiwan.The Chairman said that India has abundant production of yarn but is in short supply of good quality MMF fabric as domestic producers lack the latest processing technologies.

“We are ready for a joint venture or technology transfer or 100% investment. There are produc-tion facilities in India but do not have the latest technologies in processing. Even the government has come out with good incentives like plans to set up seven mega textile parks and production linked incentives (PLI) to promote MMF production. “AEPC will make all arrangements to facilitate any technology transfer, joint venture or direct investment in the country,” Dr Sakthivel assured the international MMF fabric suppliers who ex-pressed their interest in knowing the details about the benefits offered by the Indian government and what AEPC could do to help them out.India’s export of MMF garments constitute only 10% of its total apparel exports, which was about $16 billion in 2019-20. In the calendar year 2019, India imported $442 million worth of MMF fabric. AEPC, which sees future growth dependent on success in the MMF segment, has been taking ini-tiatives to improve availability of MMF fabric.Mr Vinit Neb, Director, TR Alliance Co Ltd, Tai-wan, said, “We are in every part of the value chain as this ensures efficiency and productivity. We do knowledge management continuously – learn from

APPAREL | COUNCIL AFFAIRS


old orders, new orders and new things that enter the market and enhance our offerings.” Ms May, Business Head, Wuyue Textile Group, China, said, “We are vertical supplier and ex-porter doing weaving, dyeing and printing. We sell a lot of quality, sustainable, fashionable and innovative fabrics to buyers all over the world. We look forward to hearing about the requirements of Indian manufacturers.” Mr Mukesh Sharma, Head (Sales), HAE FA Tex-tile Group, Taiwan, said, “We have manufacturing plants in three countries – Taiwan, China and Vietnam. All have their specialties in fabric like Taiwan is majorly for high end sportswear and functional fabrics. We are supplying to almost all major textile countries.” Mr Girish Shah, Director, Chang Zhou Miao Zhou Trading Co Ltd, China, said, “We are mostly in woven and high quality items. As we have our own factory, we can keep developing new things, doing all the blend items there. We are shipping 90% of our fabric to Bangladesh and 10% to India.” The fabric suppliers took the opportunity to showcase some of their best MMF fabrics, talked about their specialties, usage in different gar-ments and seasons, popularity in different mar-kets and how they supplied to the biggest brands in the world. The webinar had a huge attendance of apparel exporters.

WEBINAR




Acting on the instruction of Hon’ble Textiles Minister Smt Smriti Zubin Irani, Apparel Export Promotion Council (AEPC) on 26 April asked its 8,000 plus member exporters to get their workers and staff vaccinated soon.

“AEPC requests all its members to get their workers/ staff Covid-19 vaccinated at the earliest and also requests them to use their CSR funds for setting up makeshift hospitals and temporary Covid Care facilities,” AEPC Chairman Dr A Sakthivel said.

The Chairman issued a circular making the request based on a resolution passed in the Council’s 267th Executive Committee meeting held on 23 April, a day after the Hon’ble Minister suggested AEPC to take the initiative in support of India’s vaccination drive.

In a virtual meeting with Dr Sakthivel on 22 April, Hon’ble Textiles Minister said that all the workers and staff working in the apparel factories should get vaccinated at the earliest.

Same day, the government clarified that CSR funds will be allowed for setting up makeshift hospitals and temporary Covid care facilities.

India has launched the biggest Covid-19 vaccination drive in which about 14 crore people have already been vaccinated. Further, from 1 May 2021, the third phase of India’s Covid-19 vaccination drive will begin allowing all citizens of 18 years of age and above to get vaccines.

“With an aim to support this initiative of the Hon’ble Minister of Textiles and Government of India, AEPC has asked its member exporters for carrying out vaccination of apparel sector workers,” Dr Sakthivel said, adding that the industrial establishments would be able to procure vaccine doses from the manufacturers.

The industries are mandated to follow all protocols such as being captured on CoWIN platform, linked to AEFI (Adverse Event Following Immunization) reporting

HON’BLE TEXTILES MINISTER

CALLS FOR VACCINATION

OF APPAREL SECTOR

WORKERSAEPC REQUESTS 8,000 PLUS APPAREL EXPORTERS TO VACCINATE THEIR WORKERS


and all other prescribed norms, as per the government’s guidelines on the Phase-III strategy of the National Covid-19 vaccination program.

The industries have been instructed to coordinate with their respective state health departments for carrying out the vaccinations at their factory premises.

India’s National Covid-19 Vaccination Strategy has been built on a systematic and strategic

end-to-end approach, proactively building capacity across R&D, Manufacturing and Administration since April 2020. While pushing for scale and speed, it has simultaneously been anchored in the stability necessary to sustainably execute the World’s Largest Vaccination Drive.

In its Phase-III, the National Vaccine Strategy aims at liberalised vaccine pricing and scaling up of vaccine coverage. This would augment vaccine production as well as availability, incentivising vaccine manufacturers to rapidly ramp up their production as well as attract new vaccine manufacturers, domestic and international. It would also make pricing, procurement, eligibility and administration of vaccines open and flexible, allowing all stakeholders the flexibility to customise to local needs and dynamics.




WANTS ESSENTIAL SERVICE SECTOR TAG FOR APPAREL EXPORT INDUSTRY

WILLING TO FOLLOW STRICTER SAFETY MEASURES TO PREVENT INFECTION

SAYS LOCKDOWNS WILL WASTE YEAR-LONG EFFORTS TO REVIVE INDUSTRY

AEPC APPEALS FOR UNINTERRUPTED

MANUFACTURING AT FACTORIES

Concerned over possible imposition of lockdowns due to a resurgence in coronavirus infections, Ap-parel Export Promotion Council (AEPC) on 12

April urged the government to keep factories free from lockdowns and requested for essential service sector tag for the labour-intensive apparel export industry.

For ensuring uninterrupted manufacturing at factories, the Council has written letters to Hon’ble Home Minister Shri Amit Shah, Hon’ble Health Minister Shri Harsh Vardhan, Hon’ble Textiles Minister Smt Smriti Zubin Irani, Hon’ble Commerce and Industry Minister Shri Piyush Goyal, their Secretaries, and Chief Ministers of

some states including Tamil Nadu.

“The industry, which supports over 13 million work-ers directly and many more indirectly, in rural and backward areas and largely comprises MSMEs, will be severely impacted by the disruption, if the lockdown is again imposed in the factories,” AEPC Chairman Dr A Sakthivel wrote in his letters to the government.

“Being one of the most labour intensive industries, while we are concerned about the health and safety of the workers, we are also concerned about their live-lihoods,” he said while thanking the government for undertaking one of the largest vaccination drives in the world for protecting the people of the country.

All factories have been taking stringent measures and following strict health protocols, as per the MHA guide-lines and other advisories. The regular tests and check-ups are also being done, he said. The apparel exporters are willing to follow even more strict safety measures but would want to avoid even partial lockdowns.

“It is requested that the work at the factories are not disrupted by lockdown and we also request for exempt-ing the apparel export industry as an essential service sector,” the Chairman said, adding that such lockdowns create widespread disruption and impact not just in the short term but also the long term health of the industry.

Dr Sakthivel said that the apparel export industry recently got back on track, migrant labourers were back, orders have started stabilizing and exports are looking up. “The lockdown, at this point, will disrupt the last one year of hard work put in by the industry in getting back on the global map and on the survival path,” he said.



HON’BLE TEXTILES MINISTER CAUTIONS MILL ASSOCIATIONS ON YARN

PRICES

MEETING ON AVAILABILITY OF PPE KITS

Hon’ble Textiles Minister Smt Smriti Zubin Irani cautioned mill associations saying that

the Cotton Corporation of India (CCI) will blacklist the mills which are hoarding and inflating the prices of cotton yarn. She also requested Textiles Secretary Shri Upendra Prasad Singh to immediately take it up with CCI for taking required penal action. AEPC Chairman Dr A Sakthivel along with EC members Mr Gautam Nair and Mr Premal Udani raised the issue of continu-ing fluctuations in the prices and availability of cotton yarn in a video conference with the Hon’ble Minis-ter on 22 April 2021.

Hon’ble Textiles Minis-ter Smt Smriti Zubin Irani called a meeting on

availability status of Personal Protective Equipment (PPE) kits and masks on 22 April 2021 with AEPC Chairman Dr A Sakthivel and representatives of other in-dustry associations. The review meeting was done in the wake of the second wave of Covid-19 pandemic. She asked the indus-try to fulfil the demand of PPE kits and masks of the country. Earlier on 21 April 2021, Dr A Sakthivel had a meeting with Shri Nihar Ranjan Dash, Joint Secretary in Ministry of Textiles, on the issue where the status had been submitted.



Hon’ble Minister of Com-merce and Industry Shri Piyush Goyal, in a meeting with Export Promotion

Councils (EPCs) on 20 April 2021, said that the government will extend all kinds of support to the exporters and that they should aim to achieve $400 billion merchandise exports in the current financial year.

“The government will go all out to support the exporters. Many of their issues, falling within the ambit of the Ministry, would be resolved in a time-bound manner. Most of the sectors have larger export potential, which need to be identified and har-nessed. I call upon the exporters to strive to attain ambitious growth of more than 25 per cent to reach $400 billion merchandise exports during current year,” Shri Goyal said.

Lauding the performance and resilience of exporters, he said that exporters have done the nation proud in such difficult times. During 2020-21, India’s value of overall exports declined by just 7 per cent compared to previous year, despite disruptions, uncertainty, lockdowns, supply chain difficulties, labour issues, and order cancellations.

“Under the circumstances, the performance of the sector was really superlative. Trade data for March 2021 reflects build-up of a strong recovery in exports, as merchan-dise exports in March 2021 grew by 60.29% as compared to March 2020,” he said.

Apparel Export Promotion Council (AEPC) Chairman Dr A Sakthivel, while sharing the export scenario

of readymade garments (RMG) and complimenting the government for the first India-EU high level dialogue on trade and investment, raised some concerns of the sector and proposed specific suggestions.

Dr Sakthivel requested early announcement of RoDTEP rates, continuation of RoSCTL rates till announcement of RoDTEP rates, extension of Interest Equalisation Scheme on Pre and Post Shipment Rupee Export Credit for a period up to 31 March 2022, extension of 5% IES available to MSMEs to all apparel exporters, and allowing self declaration where SION does not exist for apparel products.

FULL SUPPORT TO EXPORTERS, AIM FOR $400

BN MERCHANDISE EXPORTS: COMMERCE MINISTER


APPAREL EXPORT PROMOTION COUNCIL MAGAZINE | SEPTEMBER 2020 / 35


Attn: Dr. A. Sakthivel

Chairman AEPC New Delhi, India Zeist, April 6th, 2021

Reference: IAF/MC/2132

E-mail: [email protected]

Re: Your letter dated April 2nd, 2021

Dear Dr. Sakthivel,

First of all, let me thank you very much for reaching out to the IAF on behalf of AEPC. Thank you also

for your kind compliments regarding the initiative that IAF has taken on behalf of garment

manufacturers from across the globe. The strength of the initiative, as has already been recognized

by several media and by numerous stakeholders, including several global brands and retailers, is the

sheer combined trade volume represented by the initiative. It is therefore that we are very happy to

receive your request to join the IAF, and through the IAF to join the initiative to ensure better terms

to supplying to brands and retailers.

In addition to the combined trade volume our initiative also hinges upon the real collaboration

among the participants. This collaboration is built up in careful steps. The STAR Network had invested

in inter-association team building. Then, to set up this project, IAF teamed up with STAR as we found

the only overlapping members were BGMEA and BKMEA so that we could quickly grow in size. We

started by adding 4 associations from 3 countries from the IAF membership and we are now getting

ready to welcome more IAF members into the initiative.

Besides this important project, IAF will be looking forward to work with AEPC on several collective

and also individual projects and services. It would be excellent therefore to plan an online meeting

including also IAF President Han Bekke, whom I have sent a copy of this letter, to discuss in more

detail how AEPC can best benefit from its IAF membership. I will send an invitation to you and to Mr.

Bekke shortly. Regarding officially joining the ‘manufacturers’ payment and delivery terms’ initiative, I will plan a

project management meeting next week and I will move to include AEPC in the initiative. The project

management group consists of Alexandra Behns and Marc Beckmann representing GIZ FABRIC; Miran

Ali, (newly re-elected) BGMEA Board of Directors member representing the STAR Network and

undersigned as project lead. During the meeting I will discuss the exact timing, communication and

other details to ensure a smooth entry of AEPC and I will keep you fully informed.

Kind regards,

Matthijs Crietee Secretary General IAF

Copy to: Shri Rahul Mehta, Executive Committee Member AEPC, Immediate Past President IAF, Han Bekke;

President MODINT, President IAF

AEPC TO JOIN INTERNATIONAL APPAREL FEDERATION


Addressing the ambassadors of the European Union (EU) member states on 13 April 2021, Hon’ble Commerce and Industry Minister Shri Piyush Goyal said, “India can prove to be the most natural ally for the European Union.”

Describing India-EU trade as balanced and complementary, Shri Goyal said that there is a vast scope of enhanced engagement. The partnership of EU and India can emerge as a model of good governance, growth and development.

“India and EU’s ‘Union of Diversity’ shares values of democracy and rule of law. They also share strong economic, socio-cultural, strategic and political ties. India and EU are one of the world’s largest markets. EU

countries collectively are the largest trading partner for India, as well as one of the largest investors in India. India-EU collaboration in research and innovation has expanded significantly, and there is large scope of further enhancement of engagement,” he said.

Shri Goyal said that combination of India’s manufacturing and EU’s innovation capacity can be a game changer. Calling for resilient India-EU relations, he said that India and EU should look at vast areas of convergence. He said that India looks forward to advance the negotiations towards an agreement between India and EU on investment facilitation and protection for mutually beneficial outcome.

He emphasised on the need for proportional and

INDIA CAN BE MOST NATURAL ALLY FOR EU: SHRI PIYUSH GOYAL

APPAREL | INDIA NEWS


simultaneous discussions on both trade and investment, so that, we have balanced outcome for both parties. The minister called for Early Harvest agreements, which he said are fully WTO compliant. He called for addressing the non-tariff barriers on both sides.

Shri Goyal also spoke about the pandemic situation, strict lockdown and preparations like ventilators and infrastructure. “Despite the lockdown, we met our international commitments, particularly in services and didn’t allow any value chain to get affected. We ensured essentials commodities like food grains, vegetables, milk, medicine, etc reached each home,” he said.

He said that after the gradual unlocking, government’s efforts brought the economy back to the near normalcy. It maintained a delicate balance between lives and livelihoods. He said that the government is conscious of the fact that Covid-19 numbers in the second wave are even more worrisome.

He assured that the government is taking various steps to control the pandemic, while also protecting livelihoods. Shri Goyal said that during Covid-19, investments have

fallen worldwide, but they have grown in India. It shows that the world also appreciates and recognises India’s true potential, which is clearly evident by record FDI and Portfolio numbers, even during the pandemic year.

The India-EU relation dates back to the year 1960. India was among the first countries to establish diplomatic relations with the European Economic Community. Co-operation agreement between the two in 1994 added further progress to the bilateral relations. First India-EU Summit in 2000 is marked as a head start to strong bilateral relations. The 5th India-EU Summit of Hague in 2004 witnessed strategic partnership of the two.

Trade and Investment between India and the EU further saw enhancements in 2005, when both adopted Joint Action Plan (further reviewed in 2008). While India sees a wide scope of growth in EU, which has innovative technologies, EU nations see Indian market as crucial for the growth of their economies. EU’s support is of much importance for India aspiring to be a global force. The next India-EU Summit is scheduled to be held in May 2021.




With the extension of COVID-19 vaccination to all citizens aged 45 years or more from 1 April 2021, the Central Government has

taken a crucial step to extend the cover of vaccination while easing the exercise for this segment of citizens, a substantial proportion of whom are in the organized sector of the economy and are involved in formal occupation in offices (government and private) or manufacturing and services.

As per the Ministry of Health and Family Welfare, it has written to all states and UTs that Covid-19 vaccination sessions may now be organized at workplaces (both

public and private) which are having about 100 eligible and willing beneficiaries by tagging these workplaces with an existing Covid Vaccination Center (CVC).

To support the states in this initiative, guidelines have been prepared by the Central Government. These guidelines will support the state and district programme managers with the requisite information and guide them on organizing vaccination sessions at such workplaces (both public and private). States have been further advised to initiate due consultations with private/ public sector employers and management to prepare for launch of workplace vaccination.

CENTRE INITIATES VACCINATION CENTRES AT

WORKPLACES



4. Once identified, all such workplace vaccination centres will be registered in the CoWIN portal as Government or Private Covid-19 Vaccination Centre at workplace.

5. DTF/ UTF will ensure verification of availability of three rooms as waiting, vaccination and observation rooms at workplace CVC. These rooms should be part of the permanent structure of the workplace or proper and stable structure like hangars should be erected. Temporary shamiyana/ tent like structure should not be used.

6. Every CVC in a government workplace will be tagged to an existing and nearest CVC in the government medical facility; and, every CVC in the private workplace will be tagged to an existing and nearest CVC in the private medical facility.

7. District health authorities will normally deploy the vaccination team at government workplaces. Private CVC will deploy the vaccination team at private workplaces.

8. All workplace CVC will have a medical officer as supervisor/ team leader.

9. One type of vaccine will be provided at such sessions that are conducted at the workplaces. This is necessary to avoid mixing of vaccine types in the 1st and 2nd dose of a beneficiary.

10. Verification will be done by Verifier (Vaccination Officer-1) preferably using Aadhar.

11. While Covid-19 vaccination at government workplace organized by district health authorities will be free of cost, vaccination organized by private CVC would be on payment basis and will be at the same rate as of vaccination at private health facilities.

12. The financial ceiling of the total amount recoverable by private health facility is Rs 250 per person per dose.

13. The private health facility that will be organizing vaccination at the private sector workplace will deposit the cost of vaccines up front in the bank account designated by the National Health Authority.

Further, the Government of India has announced a Liberalised and Accelerated Phase 3 Strategy of Covid-19 Vaccination from 1 May 2021 wherein everyone above the age of 18 years will be eligible to get a vaccine against Covid-19.

Vaccine manufacturers have been incentivized to further scale up their production, as well as attract new national and international players. They have been allowed to release up to 50 per cent of their supply to state governments and in the open market at a pre-declared price.

SOME OF THE GUIDELINES ISSUED TO REGULATE VACCINATION DRIVE IN WORKPLACES ARE:-

1. The District Task Force (DTF) chaired by District Magistrate and Urban Task Force (UTF) chaired by Municipal Commissioner will identify government and private workplaces with relevant senior staff for vaccination purposes.

2. Only employees of the workplace who are aged 45 years and above will be eligible to get vaccinated at the workplaces.

3. Beneficiaries must be registered in the Co-WIN portal prior to vaccination. CVC Nodal Officer will ensure registration of all targeted beneficiaries and facility of on-the spot registration will also be available but only to employees of the workplace.


FIRST CONVOCATION AT KASHMIR NIFT

Srinagar’s National Institute of Fashion Technol-ogy (NIFT) witnessed its first convocation at the Sher-i-Kashmir International Conference Centre.

Hon’ble Union Minister for Textiles and Women and Child Development Smt Smriti Zubin Irani was present as the chief guest on the occasion.

The Hon’ble Minister addressed the students and congratulated them on adding to the golden page in the 35 year old history of the institution. She said that the Government of Jammu and Kashmir has recently announced a package of Rs 30,000 crores as a part of the state’s industrial development policy. She urged the students to be prepared and make the most of it, which would help in the growth of the state. In the near future, NIFT is to work towards introducing technical textiles as an academic subject.

Hon’ble Minister of State for Youth Affairs and Sport Shri Kiran Rijiju was invited as the Guest of Honour.

Shri Rijiju, while congratulating the graduates and their parents, urged them to see opportunities with the resources they have and make the most of it. He said the fashion industry is one with a lot of potential, and that NIFT Srinagar has a key role to play while working towards that potential.

The Union Cabinet approved a Memorandum of Un-derstanding (MoU) signed between India’s Direc-tor General of Trade Remedies and Bangladesh’s

Trade and Tariff Commission to establish a framework in the area of trade remedial measures.

The MoU aims to promote co-operation between the two countries in the area of Trade Remedies, covering the broad activities related to exchange of information, undertaking capacity building activities and activities

in accordance with various provisions of World Trade Organization in the area of anti-dumping, countervail-ing and safeguard measures in bilateral trade between India and Bangladesh.

The agreement seeks to foster better cooperation between the relevant authorities of both the countries so as to discourage unfair trade practices and promote rule based bilateral trading between the two countries.

INDIA, BANGLADESH AGREE ON TRADE

REMEDIAL MEASURES




Shortage of containers has been eased now in the country. Special Secretary in the Logistics Division, Min-istry of Commerce and Industry, Shri Pawan Agarwal informed that 58 per cent additional exports (yoy) have been handled in March 2021. He added that the Contain-er Shipping Lines Association (India) said that this was about 17-18 per cent more than the level of March 2019 (pre-Covid).

During a review along with Federation of Indian Export Organizations (FIEO) and CSLA on 15 April 2021, FIEO informed that due to coordinated efforts, the issue of shortage of containers has been almost sorted out, ex-cept some shortage of food-grade containers for export of tea/coffee/spices and is localized to Southern Ports (Kochi/ Tuticorin/ Chennai/ Mangalore), which CSLA ap-prised is a long term issue due to import deficit at these ports. Close coordination is being maintained between shipping lines and exporters which has resulted in an excellent shared understanding of the situation and requirements and better planning by both sides.

Hon’ble Commerce and Industry Minister Shri Piyush Goyal launched DGFT ‘Trade Facilitation’ mobile app on 12 April 2021 for promoting ease of doing business and providing quick access to information to importers and exporters.

“Very often, the simple trade-related process becomes cumbersome, and when they are available with a touch of a button, like with a mobile app, we will ensure the ease of doing business and the speedy growth in inter-national trade. We desire to move towards paperless, automated processing systems, simple procedures for trade players, online data exchange between depart-ments and digital payments and acknowledgements,” Shri Goyal said.

In the post-covid world, tech-enabled governance will play a key role in determining India’s growth and competitiveness, he said. The app has liberated last-mile beneficiaries from location based constraints and enhanced EoDB. It will reduce transaction cost and time for imports and exports related processes, and usher in transparency. He said that the app is a symbol of India’s Atmanirbharta.

TRADE FACILITATION APP IS READY FOR INDUSTRY 4.0, AS IT PROVIDES:

Real-time trade policy updates, notifications, applica-tion status alert, tracking help requests

Explore item-wise export-import policy and statistics, track IEC portfolio

AI-based 24x7 assistance for trade queries

DGFT services made accessible to all

Your trade dashboard accessible anytime, anywhere

HON’BLE COMMERCE MINISTER LAUNCHES TRADE FACILITATION APP

CONTAINER SHORTAGE EASES IN INDIA


APPAREL | GLOBAL NEWS

Global sportswear giant Nike is taking the crisis of global climate into consideration and framing out its role in contribution of its well-being. Increased

environmental awareness has led Nike to step up and stand in solidarity with the environment. Nike is seen as a company of commitment that has taken its stand for social and environmental causes from time to time.

Nike is committed to reduce greenhouse gas emissions by 65 per cent in its owned and operated spaces and by 30 per cent across its extended supply chain, according to a press release. The company believes that clear strategies and systematic ways would be helpful in achieving target.

Nike has always been one of those companies that actively participate and constantly do their part of contribution to the society. In a crucial stage like this, brands like Nike, have huge responsibility on their shoulders. “When I think about

the global climate crisis and the role of a company like Nike, I think about our mission and values. I think about who we are, who we serve and the future we want to see,” said Chief Sustainability Officer of Nike, Noel Kinder.

Years of wearing and tearing have brought us to a point where collective steps are demand of the time. The world has pledged to keep the global warming temperature below 1.5 degree Celsius. It is high time for sectors to come forward and play their part for the revival of climate.

Nike further shared its vision of the next 5 years to reduce its carbon footprints.

The sportswear giant is planning to reduce 0.5 million tons of greenhouse gas emissions by increasing the use of environmentally preferred materials to 50 per cent of all key materials.

The company further talks about de-carbonizing its

NIKE COMMITS TO REDUCE ITS CARBON

FOOTPRINTS



supply chain. It will be taking resorts to renewable energy and alternative fuels. It will be doing 70 per cent reduction of greenhouse gas emission across its owned and operated facilities through 100 per cent renewable electricity and fleet electrification.

Assessing its performance of the past five years, the company said that it fell short of meeting its carbon emission goals for the fiscal year of 2020. Despite of reducing material waste and expanding renewable energy, it faced challenges with shifts to more complex materials and product designs, inbound airfreight and changes to the electric grid in some of its primary manufacturing region. Open acceptance of its failure to meet its carbon footprints goal is a courageous and promising way to work.

Climate change is no joke. There have been many

movements and seminars on impact of humans on environment but those haven’t helped and here the world is; in a place and situation that require utmost participation. Land can have boundaries but environment has none. This is the reason for it to be a global concern as it will impact the globe on a whole.

For environment to heal, it is necessary for industries to take vital steps. Clothing sector alone can contribute significantly as it holds an adequate stake when it comes to global pollution. Many global brands are seen coming up in support of environment. This global problem can only be solved when collective steps would be taken. Reputed companies like Nike working towards low-carbon emission program would inspire masses around the world to take part, let alone other major brands to come and support.


PVH JOINS HAND WITH AMERICARES

PVH Corporation, in a press release, has proudly announced its collaboration with Americares Emergency Response Partner Program and has committed to support the health-focused reliefand development of the organization’s ongoing preparedness, response and recovery efforts around the world. The PVH Foundation will provide annual funding to Americares emergency relief efforts, allowing it to maintain a constant state of readiness for emergencies, including pre-positioning relief supplies in disaster-prone countries, maintaining an international roster of on-call disaster response experts, supporting needs assessments and deploying emergency response teams to disaster zones. This is an important partnership in the fight against climate change and the impacts that major climate disasters can have on individuals around the world. Guy Vickers, President, PVH Foundation said that, this partnership builds on PVH’s overall disaster relief efforts that provide company and associate driven funding for immediate relief and long-term recovery in communities where our associates live and work. Further, he added that they are proud to continue their support of Americares important work on the ground in communities around the world and further PVH purpose to drive fashion forward for good. Earlier this year, the PVH Foundation partnered with Americares by providingsupport to its response to the)Texas)cold weather crisis. Americares responded with emergency shipments of bottled water, life-saving medicines, PPE and other essential relief items for families and local health centers affected by the severe winter weather that wreaked havoc across the state. In response to this big step Kate Dischino, Vice President of Emergency Programs, Americares thanked PVH Foundation for the generosity and commitment.

French luxury goods conglomerate LVMH announced new objectives of its Life 360 environmental strategy, once again centering on the relationship between nature

and creativity. On 22 April 2021, International Earth Day, LVMH presented a bold new vision of luxury by unveiling its 360 environmental strategy.

The first stage of this ambitious initiative is an in-depth review and precise measurement of the impact of the Group’s activities on biodiversity, water and the climate, the company said in a release. This work has been carried out with input from science consultants, researchers and students, establishing a framework for the priorities of LIFE 360 for the coming years.

It is an initiative with precise targets and timeframes. All LVMH Maisons will contribute to achieve goals through their specific action plans. Firstly, by creating products in harmony with nature thanks to “creative circularity” and traceability By 2030, 100 per cent of the Group’s new products will result from ecodesign. And by 2026, packaging will contain zero plastic from virgin fossil oil. Inspired by a belief that luxury products should last forever, repair services, upcycling, reuse of precious materials and efforts to identify alternative materials will all be strengthened between now and 2023. Secondly, by preserving ecosystems by limiting impact and regenerating what is taken from nature.

By 2026, LVMH aims to have zero sourcing in areas where there is a very high risk of deforestation or desertification,

LIFE 360 ENVIRONMENTAL STRATEGY OF LVMH

and wants 100 per cent of strategic raw materials certified to the highest standards guaranteeing the preservation of ecosystems and water resources.

Lastly, it aims to engage all stakeholders to drive the success of LIFE 360. People in all roles and responsibilities will receive environmental training by 2023 and an environmental management system will be in place at all production and logistic sites by 2026. A partnership approach will be pursued with suppliers to elevate their environmental performance, emphasizing responsible practices.ww ww




Versace and Luxottica Group have announced early renewal of an exclusive license agreement for the development, production and worldwide distribution of sunglasses and prescription frames under the Versace brand. The ten-year renewal is effective starting 1 April 2020 and is scheduled to expire on 31 December 2029.

“Versace is delighted to renew and further develop its strong and successful partnership with Luxottica. We look forward to the next chapter of our relationship where we will continue to innovate in the eyewear category,” commented Jonathan Akeroyd, CEO of Versace, in a press statement.

“We are pleased to renew our partnership with Versace, which marks the further extension of a long-standing relationship between our two companies dating back to 2003. Together we continue to create unique collections that express the wonder of Versace’s style through eyewear around the world,” added Francesco Milleri, CEO of Luxottica.

Founded in 1978, the Gianni Versace S.r.l. is one of the leading global fashion design houses. Under the Artistic Direction of Donatella Versace since 1997, Gianni Versace S.r.l. designs, manufactures and distributes fashion and lifestyle products including haute couture, women and men ready-to-wear, jewelry, watches, accessories, fragrances and home collection.

Luxottica is a leader in the design, manufacture and distribution of fashion, luxury and sports eyewear. Its portfolio includes proprietary brands such as Ray-Ban, Oakley, Vogue Eyewear, Persol, Oliver Peoples and Alain Mikli, as well as licensed brands including Giorgio Armani, Burberry, Bulgari, Chanel, Coach, Dolce & Gabbana, Ferrari, Michael Kors, Prada, Ralph Lauren, Tiffany & Co., Valentino and Versace.

GAP INC PLANS TO SELL JANIE AND JACKAligned to Gap Inc.’s Power Plan 2023, the company is focused on growing its purpose-led, billion-dollar lifestyle brands by leveraging the power of its portfolio and the power of its platform. With this, Gap Inc. has entered into an agreement to sell Janie and Jack, a leader in premium children’s fashion, to Go Global Retail, an investment platform in the fashion and consumer brand sector. Go Global Retail intends to acquire the entire Janie and Jack business, including the e-commerce platform, all store leases, and assets.

Commenting on the transactions, Gap Inc. Head of Strategy, Sally Gilligan, said, “As part of Gap Inc.’s Power Plan 2023, and exemplified by this transaction, we are prioritizing strategic focus and resources behind the growth and potential of our billion-dollar brands in Old Navy, Gap, Banana Republic and Athleta.” BofA Securities Inc. acted as exclusive financial advisor to Gap Inc. on the transaction.

Gap Inc. acquired Janie and Jack in 2019 and today the brand has about 115 store locations in the United States and an e-commerce business.

VERSACE AND LUXOTTICA GROUP RENEW LICENSE AGREEMENT



TOMMY HILFIGER APPOINTS ALEGRA O’HARE AS GLOBAL CMOThe PVH Corp owned company Tommy Hilfiger, has appointed Alegra O’Hare as Chief Marketing Officer for Tommy Hilfiger Global. “Tommy Hilfiger, which is owned by PVH Corp, is pleased to announce the appointment of Alegra O’Hare as Chief Marketing Officer, Tommy Hilfiger Global, effective April 12, 2021,” the company said in a statement. Alegra’s expected role is to develop global marketing strategies and introduce marketing strategies to engage consumers.

Alegra has had some impressive past results with working along brands like Adidas and Wrangler. Her effectiveness is something that TH seems to be looking forward to. “Alegra’s appointment is a crucial next step in this new era for TOMMY HILFIGER,” said Avery Baker, President and Chief Brand Officer of Tommy Hilfiger Global. On the other hand, Alegra said, “Tommy Hilfiger has always been a brand that’s ahead of the curve, and I’m excited to embark on this new journey with the team amid a drastically changed consumer landscape.”

H&M COLLABORATES WITH LEMLEM TO PROMOTE SUSTAINABILITYH&M announced its collaboration with clothing brand lemlem, founded by Liya Kebede. Liya Kebede is an Ethiopian supermodel, actress and women’s empowerment advocate. The two companies have come together to bring out a womenswear collection that features beachwear, swimwear, jewellery and accessories that are made with sustainable materials. The H&M x lemlem collection is in some selected H&M stores from April 22. It will also be available online on H&M’s website. The company informs that sustainable materials like organic linen, recycled polyester and Tencel

Lyocell will be used in the manufacturing of garments.On the collaboration, Liya Kebede said, “I love that

H&M has always been at the forefront of doing really cool collaborations. So for lemlem, it’s really exciting to be part of that group of collaborating brands. It’s also a first for us to add jewellery as part of this collection and create a whole lemlem look. My creative direction included the campaign, too, which was so much fun and special because I got to shoot with my daughter.”


LEVI STRAUSS & CO PUBLISHES 2021’S FIRST QUARTER RESULTSLevi Strauss & Co announced its financial results for the first quarter of the year 2021. According to the report published by the company, its net revenues of $1,306 million declined 13 per cent on a reported basis and 16 per cent on a constant-currency basis. This figure is in comparison to the previous year. As per the company, this downfall is due to the impacts of the COVID-19 pandemic; the non-inclusion of Black Friday benefits has also affected the company’s performance. Further, its recorded net income for the quarter was $143 million and adjusted net income was $140 million, compared to $153 million and $162 million of the previous year, respectively.

CEO of Levi Strauss & Co Chip Bergh is optimistic with the report. “We’ve started the year strong, beating our internal expectations even as we are lapping a particularly good quarter in the prior year,” he said. The company said it looks forward to emerging from the effects of pandemic in a stronger manner and showing profitable and sustainable growth. Its top priority will continue to be the health and safety of its associates, consumers and employees of its business partners throughout the world.


GAP INC TIES UP WITH BARCLAYS AND MASTERCARDGap Inc, a collection of lifestyle brands like Banana Republic and Gap, has entered into new, long-term credit card agreements with Barclays and Mastercard. According to a statement released by Gap Inc, Barclays will become the exclusive issuer of Gap Inc’s co-branded and private label credit card program in the U.S. beginning in May 2022. In addition, Gap Inc and Barclays will issue the co-branded credit cards on the Mastercard payment network.

As per the company’s press note, Gap Inc plans to enhance its reward programs to attract new customers and create ‘enduring relationships’ that would turn them to lifelong loyalists. It further said that Gap Inc, Barclays and Mastercard share a common goal of delivering great value to customers and an exceptional card member experience. The decision looks futuristic as it is like a stepping stone for the company to step into the financial sector. The apparel company strongly looks forward to march towards a world where credit, as believed, will be playing a significant role. It recently launched its partnership with Afterpay and PayPal.


THREE WAYS TO THINK BY NIKE

H&M PROMOTES SUSTAINABILITY WITH MAISIE WILLIAMSClothing giant H&M has announced its partnership with the Game of Thrones star actress Maisie Williams. This partnership has appointed the actress as H&M’s global sustainability ambassador. In a statement, H&M said, “We are thrilled to announce a partnership with Maisie Williams to lead a worldwide initiative towards a more sustainable fashion future.” Maisie Williams, who actively works in the fields of women empowerment, environment and diversity, will be working on various sustainability initiatives by H&M in the year 2021.

There are several on-going programs on the environment in the clothing sector that proves the shift from fast-fashion to sustainable fashion. Terms like ‘sustainability’ and ‘carbon emission control’ are being widely used these days. In the era that seems to be inclined towards environmental welfare, H&M aims to use recycled and other sustainably sourced materials for its production purposes. “In a major effort towards meeting the goal of only using recycled or other sustainably sourced materials by 2030, Williams will join H&M throughout the year to drive change in fashion in the virtual world and real life. Encouraging the reuse, remaking and recycling of unwanted garments in a united effort to close the loop in fashion,” H&M said.

Global sports apparel brand Nike released a new content series on Earth Day. The series is called Talking Trash and features conversations between young leaders and some leading climate experts of the world. The conversations include small and practical ways on how an individual can contribute to the health of the planet. Nike constantly aims to contribute towards the betterment of the environment. “At Nike, we know scaling sustainable ideas is the game-changer for climate change. At a company our size, it boils down to small decisions repeated over time, at a high volume, to create a big impact down the line,” said Nike.

The first round of Nike’s Talking Trash was between singer-songwriter Billie Eilish and Dr Ayana Elizabeth Johnson. Their discussion revolved around the opportunities to influence a wider movement for the environment. They talk about small initiatives that can be taken to nurture the environment. Further, Nike talks about reducing its carbon footprints and monitoring its global products. The company also aims to develop renewable energy sources so that it could contribute to the healing of the environment.



Apparel Export Promotion Council (AEPC) was established in 1978. Shri Vijay Mehta was one of the founding members and also a signatory of AEPC’s Memorandum of Articles and

Association. He was also the President of the Garments Exporters Association. He was one of the pioneers of the apparel export industry and was known as an ace and innovative marketer. He brought many international brands like Derhy, Giorgio, Kauten and Anderson brothers to India. Shri Mehta’s contribution to the industry and to the council is very laudable. Initial garment fairs participation, imported sewing machines, quality controlling and compliance adherence were his forte. He will be sadly missed by the industry.

APPAREL | OBITUARY

Shri Hari Kapoor, CMD of Allied Exports Industries, had become a member of AEPC in 1985 and since then Shri Kapoor contributed a lot to the promotion of apparel exports. He held the post of

Vice Chairman of the Council during 2010-11. He also was the Vice Chairman of Apparel Training and Design Centre (ATDC) in 2010 and held the position till recently. During his service to the Council and the training institute, his acumen and knowledge about skill building was remarkable. He played a leadership role in the revival and resurgence of ATDC during his tenure. The entire apparel export industry will miss him and remember his contribution. Shri Kapoor provided critical guidance in negotiating with global machine makers like JUKI, finalizing Centre locations, meeting with numerous state authorities, and also building the ATDC internal team. He nurtured and empowered ATDC to become a name in skill development for the apparel sector.

SHRI HARI KAPOOR

SHRI VIJAY MEHTA

ALLIED GARMENTS EXPORTS INDUSTRIES

INTERCRAFT LTD


APPAREL | GST UPDATE

DE-LINK OF ITC ON DEBIT NOTE WITH INVOICES AND OTHER CLARIFICATIONS BY CA BALKISHAN CHHABRA

The government keeps on amending and updating the provisions related to different types of taxes.

The reason could be anything, but in most cases, the changes are made for the ease of the taxpayers. Recently government has made changes in refund procedure in case of export, new GST returns mechanism, linking of various returns, E-invoicing etc., to boost the economy and minimize the fraud by taxpayers.

AMENDED SECTION 16(4) TO DE-LINK ITC ON DEBIT NOTE WITH INVOICE

Input tax credit is a beneficial piece of legislation but subject to various conditions and limitations prescribed under Section 16 and 17 of CGST Act, 2017. One of the conditions contained in Section 16(4) is that such right is not indefinite and can be availed up to a prescribed time limit. As per Section 16(4), the

assesse cannot claim the input tax credit on supply of goods or services after the due date of furnishing of the return under section 39 (i.e. GSTR-3B) for the month of September following the end of financial year or furnishing of the relevant annual return, whichever is earlier. After the introduction of GST, Section 16(4) reads as under:

‘(4) A registered person shall not be entitled to take input tax credit in respect of any invoice or debit note for supply of goods or services or both after the due date of furnishing of the return under section 39 for the month of September following the end of financial year to which such invoice or Invoice relating to such debit note pertains or furnishing of the relevant annual return, whichever is earlier.’

The above Section as originally enacted links the time limit to claim the Input tax credit on the Debit Note with the Financial Year in which the corresponding Invoice is issued

instead of Financial Year in which Debit Note is issued. For example, Invoice was issued in F.Y. 2018-19 and Debit Note corresponding to the Invoice was issued in F.Y. 2020-21. As per original Section 16(4), ITC on the Debit Note can be claimed latest up to September following the financial year in which Invoice was issued. Since, Invoice was issued in F.Y. 2018-19, ITC can be claimed latest up to September 2019 whereas Debit Note itself is issued after September 2019. This is nothing but an anomaly in the Section 16(4) which seeks to do impossible. This was a big loss to the recipient of Debit Note without any revenue loss to the Government as the Supplier is required to pay GST charged on such Debit Notes, whenever issued

Unlike, Credit Notes, which seeks to reduce the output tax liability and its issuance to adjust the GST liability is barred by time limitation under Section 34(2) latest up to



September month following the Financial Year to which supply is made, there is no express time limits prescribed under GST law till when a Debit Note against corresponding Invoice should be issued. This is due to obvious reason that issuance of Debit Note increasing GST liability adds to the Govt. Exchequer’s kitty.

However, by restricting the ITC on Debit Notes by linking it with the original corresponding Invoice, it is unfair and unjust for the recipient of goods or services which caught attention of lawmakers which led to amendment in Section 16(4) by Finance Act (No. 2), 2020 to rectify the anomaly and de-link the time limit to claim ITC on Debit Note with Original Invoice and hence, availability of ITC can be determined independently on the basis of Financial Year in which Debit Note has been issued. Amended Section 16(4) reads as under (which has been made effective w.e.f. 1st January 2021):

‘(4) A registered person shall not be entitled to take input tax credit in respect of any invoice or debit note for supply of goods or services or both after the due date of furnishing of the return under section 39 for the month of September following the end of financial year to which such invoice or Invoice relating to such debit note pertains or furnishing of the relevant annual return, whichever is earlier

The effect of the aforesaid amendment is that time limit to claim ITC on Debit Note as prescribed under Section 16(4) can be applied independently irrespective of the fact in which Financial Year Invoice was issued. For example, Invoice was issued in F.Y. 2020-21 and Debit Note corresponding to the Invoice was issued in F.Y. 2021-22. As per amended Section 16(4), ITC on Debit Note can be claimed latest up to September 2022 as against earlier the same could be claimed up to September 2021 (as the same was linked with Financial Year in which corresponding Invoice was issued).

CLARIFICATION ON REFUND RELATED ISSUES CLARIFICATION IN RESPECT OF REFUND CLAIM BY RECIPIENT OF DEEMED EXPORT SUPPLY

Various representations have been received seeking clarification on some of the issues relating to GST refunds. The issues have been examined and to ensure uniformity in the implementation of the provisions of law across the field formations, the Board, in exercise of its powers conferred by section 168 (1) of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as “CGST Act”), hereby clarifies the issues detailed hereunder:

Representations have been received in respect of difficulties being faced by the recipients of the deemed export supplies in claiming refund of tax paid in respect of such supplies since the system is not allowing them to file refund claim under the aforesaid category unless the claimed amount is debited in the electronic credit ledger.

Para 41 of Circular No. 125/44/2019 – GST dated 18/11/2019 has placed a condition that the recipient of deemed export supplies for obtaining the refund of tax paid on such supplies shall submit an undertaking that he has not availed ITC on invoices for which refund has been claimed. Thus, in terms of the above circular, the recipient of deemed export supplies cannot avail ITC on such supplies but when they proceed to file refund on the portal, the system requires them to debit the amount so claimed from their electronic credit ledger.

The 3rd proviso to Rule 89(1) of CGST Rules, 2017 allows for refund of tax paid in case of a deemed export supply to the recipient or the supplier of deemed export supplies. The said proviso is reproduced as under:

“Provided also that in respect of supplies regarded as deemed exports, the application may be filed by, -

(a) the recipient of deemed export supplies; or

(b) the supplier of deemed export supplies in cases where the recipient does not avail of input tax credit on such supplies and furnishes an undertaking to the effect that the supplier may claim the refund”

From the above, it can be seen that there is no restriction on recipient of

deemed export supplies in availing ITC of the tax paid on such supplies when the recipient files for refund claim. The said restriction has been placed by the Circular No. 125/44/2019-GST dated 18.11.2019.

In this regard, it is submitted that in order to ensure that there is no dual benefit to the claimant; the portal allows refund of only Input Tax Credit (ITC) to the recipients which is required to be debited by the claimant while filing application for refund claim. Therefore, whenever the recipient of deemed export supplies files an application for refund, the portal requires debit of the equivalent amount from the electronic credit ledger of the claimant.

As stated above, there is no restriction under 3rd proviso to Rule 89(1) of CGST Rules, 2017 on recipient of deemed export supply, claiming refund of tax paid on such deemed export supply, on availment of ITC on the tax paid on such supply. Therefore, the para 41 of Circular No. 125/44/2019-GST dated 18.11.2019 is modified to remove the restriction of non-availment of ITC by the recipient of deemed export supplies on the invoices, for which refund has been claimed by such recipient. The amended para 41 of Circular no. 125/44/2.019-GST dated 18.11.2019 would read as under:

“41. Certain supplies of goods have been notified as deemed exports vide notification No. 48/2017-Central Tax dated 18.10.2017 under section 147 of the CGST Act. Further, the third proviso to rule 89(1) of the CGST Rules allows either the recipient or the supplier to apply for refund of tax paid on such deemed export supplies. In case such refund is sought by the supplier of deemed export supplies, the documentary evidences as specified in notification No. 49/2017- Central Tax dated 18.10.2017 are also required to be furnished which includes an undertaking that the recipient of deemed export supplies shall not claim the refund in respect of such supplies and shall not avail any input tax credit on such supplies. Similarly, in case the refund is filed by the recipient of deemed export supplies, an undertaking shall have to be furnished by him stating that


refund has been claimed only for those invoices which have been detailed in statement 5B for the tax period for which refund is being claimed and the amount does not exceed the amount of input tax credit availed in the valid return filed for the said tax period. The recipient shall also be required to declare that the supplier has not claimed refund with respect to the said supplies. The procedure regarding procurement of supplies of goods from DTA by Export Oriented Unit (EOU) / Electronic Hardware Technology Park (EHTP) Unit / Software Technology Park (STP) Unit / Bio-Technology Parks (BTP) Unit under deemed export as laid down in Circular No. 14/14/2017-GST dated 06.11.2017 needs to be complied with.”

The manner of calculation of Adjusted Total Turnover under sub-rule (4) of Rule 89 of CGST Rules, 2017.

Doubts have been raised as to whether the restriction on turnover of zero-rated supply of goods to 1.5 times the value of like goods domestically supplied by the same or, similarly placed, supplier, as declared by the supplier, imposed by amendment in definition of the “Turnover of zero-rated supply of goods” vide Notification No. 16/2020-Central Tax dated 23.03.2020, would also apply for computation of “Adjusted Total Turnover” in the formula given under Rule 89 (4) of CGST Rules, 2017 for calculation of admissible refund amount.

Sub-rule (4) of Rule 89 prescribes the formula for computing the refund of unutilised ITC payable on account of zero-rated supplies made without payment of tax. The formula prescribed under Rule 89 (4) is reproduced below, as under:

“Refund Amount = (Turnover of zero-rated supply of goods + Turnover of zero-rated supply of services) x Net ITC ÷Adjusted Total

Turnover”

Adjusted Total Turnover has been defined in clause (E) of sub-rule (4) of Rule 89 as under:

“Adjusted Total Turnover” means the sum total of the value of-

(a) the turnover in a State or a Union territory, as defined under clause (112) of section 2, excluding the turnover of services; and

(b) the turnover of zero-rated supply of services determined in terms of clause (D) above and non-zero-rated supply of services,

EXCLUDING- (i) the value of exempt supplies other than zero-rated supplies; and (ii) the turnover of supplies in respect of which refund is claimed under sub-rule (4A) or sub-rule (4B) or both, if any,

during the relevant period.’

“Turnover in state or turnover in Union territory” as referred to in the definition of “Adjusted Total Turnover” in Rule 89 (4) has been defined under sub-section (112) of Section 2 of CGST Act 2017, as:

“Turnover in State or turnover in Union territory” means the aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on reverse charge basis) and exempt supplies made within a State or Union territory by a taxable person, exports of goods or services or both and inter State supplies of goods or services or both made from the State or Union territory by the said taxable person but excludes central tax, State tax, Union territory tax, integrated tax and cess”

From the examination of the above provisions, it is noticed that “Adjusted Total Turnover” includes “Turnover in a State or Union Territory”, as defined in Section 2(112) of CGST Act. As per Section

2(112), “Turnover in a State or Union Territory” includes turnover/ value of export/ zero-rated supplies of goods. The definition of “Turnover of zero-rated supply of goods” has been amended vide Notification No.16/2020-Central Tax dated 23.03.2020, as detailed above. In view of the above, it can be stated that the same value of zero-rated/ export supply of goods, as calculated as per amended definition of “Turnover of zero-rated supply of goods”, need to be taken into consideration while calculating “turnover in a state or a union territory”, and accordingly, in “adjusted total turnover” for the purpose of sub-rule (4) of Rule 89. Thus, the restriction of 150% of the value of like goods domestically supplied, as applied in “turnover of zero-rated supply of goods”, would also apply to the value of “Adjusted Total Turnover” in Rule 89 (4) of the CGST Rules, 2017.

Accordingly, it is clarified that for the purpose of Rule 89(4), the value of export/ zero-rated supply of goods to be included while calculating “adjusted total turnover” will be same as being determined as per the amended definition of “Turnover of zero-rated supply of goods” in the said sub-rule. The same can explained by the following illustration where actual value

per unit of goods exported is more than 1.5 times the value of same/ similar goods in domestic market, as declared by the supplier:

Illustration: Suppose a supplier is manufacturing only one type of goods and is supplying the same goods in both domestic market and overseas. During the relevant period of refund, the details of his inward supply and outward supply details are shown in the table below:



Net admissible ITC = Rs. 270 All values in Rs.

OUTWARD SUPPLY VA L U E P E R UNIT

NO OF U N I T S

TURNOVER TURNOVER AS PER AMENDED DEFINITION

Local (Quantity 5) 200 5 1000 1000

Export (Quantity 5) 350 5 1750 1500(1.5*5*200)

Total 2750 2750 2500

The formula for calculation of refund as per Rule 89(4) is : Refund Amount = (Turnover of zero-rated supply of goods + Turnover of zero-rated supply of services) x Net ITC

÷Adjusted Total Turnover

Turnover of Zero-rated supply of goods (as per amended definition) = Rs. 1500 Adjusted Total Turnover= Rs. 1000 + Rs. 1500 = Rs. 2500 [and not Rs. 1000 + Rs. 1750] Net ITC = Rs. 270 Refund Amount = Rs. 1500*270 = Rs. 162

2500 Thus, the admissible refund amount in the instant case is Rs. 162.

OTHER IMPORTANT NOTIFICAIONSApplicability of Dynamic Quick Response (QR) Code on B2C invoices and compliance

Notification No. 06/2021-Central Tax, dated 30th March 2021 had been issued to extend the requirement of Dynamic QR Code on B2C invoice issued by taxpayers having aggregate turnover more than 500 crore rupees, up to 30th day of June 2021. Now the Dynamic Quick Response (QR) Code on B2C invoices is applicable from 1st July, 2021.

Clarification on reporting 4-digit/6-digit HSNs

Notification No. 12/2017-Central Tax dated June 28, 2017, as amended vide Notification No. 78/2020 – Central Tax, dated October 15, 2020, mandates taxpayers to declare specified digits, as follows, of Harmonised System of Nomenclature (HSN) / Service Accounting Code (SAC) Code on raising of tax invoices, w.e.f. April 1, 2021.

S. NO. AGGREGATE TURNOVER IN THE PRECEDING FINANCIAL YEAR

NUMBER OF DIGITS OF HSN CODE

1. Upto INR 5 crores 4

2. More than INR 5 crores 6

LINKING OF FASTAG DATA WITH E-WAY BILLFASTag data has been integrated with the e-way bill system. On a daily average, 24 lakh FASTag transactions from

826 toll plazas, related to commercial vehicles, are exchanged between NPCI/NHA and NIC systems. These details will help the GST officers to track the movement of e-way bills using the new analytical reports.

ITC not available on promotional items distributed FOC to their distributor’s franchiseesThe Hon’ble AAR, Karnataka in Re: M/s Page Industries Limited [Advance Ruling No. KAR ADRG 54/2020 dated

December 15, 2020] held that assessee is in essence not eligible to claim input tax credit (“ITC”) on promotional products/materials and marketing items used in promotion of their brand and marketing their products which is distributed to their distributors/franchisees free of cost (“FOC”).

At the end, it is requested to the government that Considering Covid-19 and resultant Lockdown in many parts of the countries, there are delay in compliances on part of trade. However, these delays being not deliberate, the late fee should be waived off permanently till the situation gets normal in the country and the interest if not waived, shall be reduced up to the maximum.

[The author is Senior Partner in M/s. CHHABRA B K & ASSOCIATES (Delhi / NCR). He can be reached at [email protected] and # 9810380489 / 9871630858]



APPAREL | NOTIFICATIONS

S. No. Particulars Scale of Fee

(In Rupees)6(A) Annual Updation of IEC during the period April

to June as per para 2.05 of HBPNil

Interest Equalization Scheme on Pre and Post Shipment Rupee Export Credit-Extension

RBI vide its Notification No. RBI/2021-22/21 dated 12th April, 2021 has approved the extension of Inter-est Equalization Scheme for pre and post shipment Rupee export credit, with same scope and cover-age, for three more months i.e., upto June 30, 2021. The extension takes effect from April 01, 2021 and ends on June 30, 2021 covering a period of three months.

Consequently, the extant operational instructions issued by the Reserve Bank under the captioned Scheme shall continue to remain in force upto June 30, 2021.

Change of office address of Regional Authority, Ahmedabad.

DGFT vide its Public Notice No. 52/2015-2020 dated 7th April, 2021 has notified about the new address of Regional Authority, Ahmedabad.

Electronic filing and Issuance of Preferential Cer-tificate of Origin (CoO) for India’s Exports under

India-Mauritius Comprehensive Economic Cooper-ation and Partnership Agreement (IMCECPA) w.e.f. 01st April 2021

DGFT vide Trade Notice No. 01/2021-2022 dated 01.04.2021 in continuation to the earlier Trade No-tice(s) 34/2015-2020 dated 19.09.2019,41/2019-2020 dated 12.12.2020, 53/2019-2020 dated 02.03.2020, 01/2020-2021 dated07.04.2020, 30/2020-2021 dated 13.10.2020 and 43/2015-2020 dated 23.02.2021, it is informed that the electronic platform for Preferen-tial Certificate of Origin(CoO) is being expanded further to facilitate electronic application of Pref-erential Certificates of Origin under the India Mau-ritius Comprehensive Economic Cooperation and Partnership Agreement (IMCECPA)

Amendment in Appendix-2K providing for upda-tion of IEC

DGFT vide its Public Notice No. 49/2015-20 dated 31st March, 2021 has informed about the insertion of new provision under S. No. 6 of Para 1 Appendix 2K (Scale of Application Fee and procedure for Deposit/Refund of Application Fee/Penalty etc.) of FTP, 2015-2020, as under-

NOTIFICATIONS


APPAREL | NOTIFICATIONS

Amendment of Appendix 2B [List of Agencies Au-thorised to issue Certificate of Origin (Preferen-tial)] of Foreign Trade Policy, 2015-2020.

DGFT vide its Public Notice No. 51/2015-2020 dated 31st March, 2021 has notified about the list of authorised agencies allowed to issue Certificate of Origin (Preferential) for India-Mauritius CECPA.

Sub.-Online Filing of requests for Closure of Ad-vance Authorizations

DGFT vide its Trade Notice No. 49/2020-21 dat-ed 30th March,2021 has informed that DGFT has revamped its IT systems to provide a paperless, contact-less, electronic interface to the exporters/importers and other stakeholders of DGFT. The news IT system amongst other improvements in-clude process for managing the entire lifecycle of Advance Authorisations including its issuance, amendment and closure.

In this regard, it has been informed that Authori-

sation Holders are required to make online sub-missions for fulfilment of Export Obligation to the DGFT Regional Authority (RA) as per para 4.46 of Handbook of Procedures.

Sub.- Electronic filing of Non-Preferential Certifi-cate of Origin (CoO) through the Common Digital Platform for India’s Exports w.e.f. 15th April 2021

DGFT vide its Trade Notice No. 48/2020-2021 dat-ed: 25.03.2021 in continuation to the earlier Trade Notice 42/2020-2021 dated 19.02.2021, has informed that the electronic platform for Certificate of Ori-gin (CoO) (URL:https://coo.dgft.gov.in ) is being ex-panded beyond Preferential Certificate of Origin to facilitate electronic application of Non-Preferential Certificates of Origin.


APPARELEXPORT

APPAREL EXPORT PROMOTION COUNCIL(Sponsored by Ministry of Textiles, Government of India)

Apparel House, Institutional Area, Sector-44,GURUGRAM –122 003 (HARYANA)

Phone - 0124-2708000 to 003

Circular No.: AEPC/HO/EPC/2021/01 25th March, 2021

TO:- ALL MEMBER EXPORTERS OF THE COUNCIL

SUB.: EXPORT PERFORMANCE CERTIFICATE - 2021 - 2022

Reference is invited to the Notification No.2/2021-Customs dated 01.02.2021 of Government of India, Ministry of Finance (Department of Revenue) thereby making further amendment in the Principal Notification No. 50/2017-Customs dated 30.06.2017.

AEPC shall issue Export Performance Certificate (EPC) for import of items, permitted under S.No.288 (lining and inter-lining materials) subject to the condition at S.No.28 of the Notification 50/2017-Customs dated 30.06.2017 for a value equivalent to 2% of the FOB value realized in Indian Rupees in the Financial Year 2020-2021. The items under S. No. 288 is continued now subject to the condition No. 28 for 2% Export Performance Scheme. Also, as per the Principal Notification No. 50/2017-Customs dated 30.06.2017, the import of Lining and Inter-lining materials shall be restricted to 2% of the FOB Value of the garments exported and value realized during 2020-2021.

Accordingly, applications are invited from eligible manufacturer exporters & merchant exporters (having tied up with supporting manufacturer of textile garments) having valid membership of the Council for issuance of Export Performance Certificate (EPC) for the purpose of importing of Lining and Inter-lining materials of the goods given in the Notification for use in manufacture of textile garments for exports as per the Principal Notification No. 50/2017-Customs dated 30.06.2017.

In view of above, the Export Performance Certificate may be obtained for the purpose of importing of Lining and Inter-lining materials of goods as detailed in Principal Notification No. 50/2017-Customs dated 30.06.2017 of Govt. of India, Ministry of Finance (Deptt. of Revenue) and amended from time to time.

The details to be furnished in the application (Annexure- I*) should pertain to the FOB value realized in (foreign currency equivalent to Indian Rupees) on exports of readymade garments during the preceding financial year 2020-2021 i.e. Between 1st April, 2020 to 31st March, 2021.

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EXPORT

The applications along with prescribed documents and fee may be addressed to Joint Director (EPC), Apparel Export Promotion Council, Apparel House, Institutional Area Sector-44, Gurugram-122003. The EPC application can also be submitted in Council’s offices at Okhla (New Delhi), Naraina (New Delhi), Noida, Tirupur, Chennai, Bangalore, Kolkata, Mumbai, Ludhiana and Jaipur.

Please note that shipments of free sample consignments are not considered as export performance for this purpose. Therefore, please do not include any details of free samples in the statements. Exporters should quote actual and full export value realized in Indian Rupees.

Applicant exporters are required to give correct and complete information strictly following the formats supported with Chartered Accountant’s endorsement and certified Bank Certificate(s) towards realization of export proceeds equivalent to claimed export performance. There should be a certificate that all the bills referred in the format pertain to Readymade Garments only.

Invalid item, invalid realization period etc.

In such cases, where application for issuance of EPC is not claimed against FOB value realized towards export of readymade garments and date of realization is not within the applicable period of 01.04.2020 to 31.03.2021, eligible items/period will be determined by AEPC office as per the customs Notification No. 2/2021-Customs dated 01.02.2021 and EPC will be issued for a reduced value, without asking for revised Bank and CA certificate in order to reduce the transaction cost and give faster service to the trade.

Along-with EPC application, the exporter shall be required to furnish an Affidavit on Rs. 10/- Stamp Paper [ONE TIME ONLY], duly notarized, as per the format prescribed in Annex-IV. The import of Lining and Inter-lining material shall be restricted to 2% of the FOB Value of the garments exported and value realized during 2020-2021.

The Council reserves the right to call for any other documents/information that may be relevant for this purpose.

Processing Charges (Non-Refundable).

Applications should be accompanied by a Pay Order/Demand Draft in favour of “Apparel Export Promotion Council, New Delhi” or through NEFT/RTGS as per Bank details given below:Name Apparel Export Promotion

CouncilExporters payment transferred details like UTR No.,Bank Name, Branch Name transaction date & amount in (Rs.) etc

SB Account No. 59112345678906Bank Name HDFC Bank Ltd.IFSC HDFC0001202Branch DLF Phase-4, Gurgaon

The Processing charges details are given below (Non-Refundable)

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Export Performance Processing Charges - non-refundableFEE + Applicable GST (presently @ 18

Upto Rs.1 Crore Rs.3,820/- + Rs.688/- = Rs.4,508/-Above Rs.1 Crore to Rs.5 Crore Rs.14,800/- + Rs.2,664/- = Rs.17,464/-Above Rs.5 Crore to Rs.10 Crore Rs.20,000/- + Rs.3,600/- = Rs.23,600/-Above Rs.10 Crore to Rs.50 Crore Rs.32,000/- + Rs.5,760/- = Rs.37,760/- Above Rs.50 Crore to Rs.100 Crore Rs.36,000/- + Rs.6,480/- = Rs.42,480/-Above Rs.100 Crore to Rs.250 Crore Rs.50,000/- + Rs.9,000/- = Rs.59,000/-Above Rs.250 Crore to Rs.500 Crore Rs.80,000/- + Rs.14,400/- = Rs.94,400/-Above Rs.500 Crore Rs.1,20,000/- + Rs.21,600/- = Rs.1,41,600/-

* Present applicable Goods & Services Tax rate is 18%.

Upon receipt of applications from the eligible exporters, the Council will issue the Export Performance Certificate to them.

Issuance of Import CertificateAt the time of import, the exporter will apply to the concerned Regional office of AEPC in the format as at Annexure-II* along with the copy of Export Performance Certificate and supporting documents.

The Regional office of the Council, upon receipt of the said application will issue the Import Certificate for being produced before the Customs at the time of import clearance of consignments. For every import clearance, the exporter shall obtain an Import Certificate from the Head office or the Regional office of the Council by submitting an application as at Annexure-II*. Regional offices will issue the Import Certificate after debiting the details of imports against the Import Certificate in the computer master, based on the invoice duly self-attested or bill of entry submitted by the exporter along with the application for import Certificate.

Procedure for obtaining IC under EPC

The exporters, as per practice, can deposit Cheque/Demand Draft/Pay Order in favour of “Apparel Export Promotion Council” for an amount of Rs. 500/- at the time of making application for IC. The office, as per practice, will examine the case, issue the receipt of payment and issue Import Certificate.

The processing charges of Import Certificate Rs. 500/- is Non-Refundable.

As an export promotion measure and to accommodate eligible exporters in smooth import of Lining and Inter-lining materials permissible against above notifications, it has been decided to issue Import Certificates as per the actual requirement of the exporters. The scheme would be operative as follows:-

a) Import Certificate can be applied on the basis of provisional bill of entry or invoice also. It may please be noted that for each import certificate, separate application would be required to be submitted in the Office of AEPC.

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b) The exporter may obtain any number of Import Certificates, which will be debited in the computer master as per existing procedure. The exporter shall submit Bill of Entry issued by Customs within 60 (sixty) days to respective Office of AEPC.

c) The provisional bill of entry from Private Bonded Warehouses/Special Economic Zones Customs should be self – certified by exporters.

Re-credit/Add Back

No add back normally would be permitted in Export Performance Certificate for the Import Certificate once issued for those bill of entries/invoices which were provisionally prepared and submitted to AEPC for obtaining import certificate.

In exceptional cases, exporters may request AEPC for re-credit (Add Back) after surrendering the original IC to the issuing office along with DD/PO of Rs.800/- (Fee Rs.677/- + Rs.123/- applicable GST) for each IC. The exporter will have to submit the Affidavit stating that no benefit has been taken on the IC being surrendered , as per Performa given at Annexure – III*. The re-credit would be subject to the approval by Head Office of AEPC.

Drawback Directorate, Deptt. of Revenue, Ministry of Finance has clarified that duty free clearance of Lining and Inter-lining materials from Private Bonded Warehouse is permitted. Ministry of Commerce has also allowed procuring permissible of importing of Lining and Inter-lining materials from units located in Special Economic Zones also. Exporters, therefore, while seeking imports from the Private Bonded Warehouse/SEZs may carefully fill Annexure-II*, Serial No.10, at the time of making application to AEPC.

Last date of Receipt of Application

The last date for receipt of the application for issuance of EPC for the current financial year has been fixed as 31.07.2021.

Applications received after this date will be accepted along with late fee charges of Rs.1593/- (Rs.1350/- + Rs.243/-) applicable GST per application along with the normal charges as prescribed above.

Enhancement of EPC Value:- Only one application for enhancement can be submitted by the exporter. Subsequent enhancement shall be subject to specific approval of AEPC.

No processing charges would be payable for first application for enhancement of EPC, if

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after enhancement value of EPC remains within the concerned turnover slab specified above (see Processing Charges) for which initial EPC application was made. Thereafter, for every EPC enhancement application, even within the turnover slab specified above, the processing charges for issuance of initial EPC shall be levied. Exporter shall apply in format at Annexure – V*, V(A)*, V(B)*, and V(C)*.

Amendment in the Export Performance Certificate.

The applicant may apply for amendment in Export Performance Certificate along with the documents as detailed below:

i) A request on the Company’s letter head

ii) Copy of EPC earlier issued.

Export Slab Amendment Charges + Applicable GSTa) Upto Rs.1 Crore No chargesb) Above Rs.1 Crore to Rs.5 Crore No chargesc) Above Rs.5 Crore to Rs.10 Crore No chargesd) Above Rs.10 Crore to Rs.50 Crore No chargese) Above Rs.50 Crore to Rs.100 Crore No chargesf) Above Rs.100 Crore to Rs.250 Crore No chargesg) Above Rs.250 Crore to Rs.500 Crore No chargesh) Above Rs.500 Crore No charges

The complete details, as per Annexure – VI*, of firm/company be furnished on the letter head of the exporting firm/company.

As you are aware, Government of India is keen to ensure maximum penetration of cashless transactions from January 1, 2017. The Ministry of Commerce & Industry, Department of Commerce, Government of India has conveyed to ensure that all members of the Council should adopt cashless transitions for their operation.

(Neelam Seth) Joint Director (EPC)

25.03.2021

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Please ensure the following checklist before submitting the Application and tick (√) in front of each, along with the Application submitted.

1. Application form/Declaration in Annexure-I.

2. Pay Order/Draft enclosed with Application should be requisite amount in respect to your export performance, including GST and should be in favour of “Apparel Export Promotion Council”. If paid through NEFT/RTGS the details of UTR No, Bank Name, Branch Name, transfer date & amount.

3. Chartered Accountant Certificate on CA’s letter head (date of realization should be between 1.4.2020 to 31.3.2021 only). It should be certified by the practicing Chartered Accountant with stamp, address, Tel/Fax nos. and email id, UDI.No. along with Regn. No. of Firm and Membership No. of Chartered Accountant (CA) signing the certificate.

4. Bank certificate should be certified by the bank (date of realization should be between 1.4.2020 to 31.3.2021 only). The bank certificate should have the stamp, address, Tel/Fax nos. and email id of the bank, along with the name, code and designation of the signing official of the bank who has certified the export performance.

5. Certified ‘Consolidated Statement’ duly certified by Chartered Accountant (CA) of FOB amount realized in INR between 1.4.2020 to 31.3.2021 and should include the following details:-

Invoice no. & Date, Bank realization certificate no., Description of exported Items (readymade garments only), Country of export, Amount realized in foreign currency (currency & amount), FOB amount realized in INR and Date of Realization in DD/MM/YY FORMAT. The above statement should be attested by practicing CA and name & code number of signatory of statement/certificate, is to be put below the signatures. Important: While submitting the Consolidated Statement, the applicant exporter should ensure that the information certified by CA is about export of Readymade Garments only. Mention of Readymade Garments & exporter name is also mandatory.

6. Very Important & Mandatory: Notarized Affidavit (Format at Annexure-IV).

7. Company Profile in Annexure-VI.

8. Valid copy of RCMC issued by the Council.

*For detailed circular alongwith annexures may please click https://tinyurl.com/uu8ffhbf

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APPAREL | MEDIA COVERAGE


Apparel_March.indd 2 2/28/2020 6:12:44 PM

Apparel House, Institutional Area, Sector - 44, Gurugram - 122003 (Haryana)

Tel - 0124-2708000

Website: www.aepcindia.comFacebook: /apparelexportpromotioncouncilLinkedin: /apparelexportpromotioncouncil

Twitter: /ApparelCouncilInstagram: /apparelexportpromotion

APPAREL EXPORT PROMOTION COUNCIL(Sponsored by Ministry of Textiles, Government of India)

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