India

Textile and garment industry leaders in India are criticizing the newly-released 2015-16 Union Budget, claiming that it contains no measures to promote apparel manufacturing in India. Specifically, industry stakeholders are speaking out against decisions to reduce the allocation for the Technology Upgrade Fund Scheme and to not do away with import duties. It was widely believed that the new budget, released last week, would contain more benefits for the industry. (The Hindu)
 
The state of Gujarat says it plans to impose a Value Added Tax (VAT) on technical textiles produced in the state because the industry is getting larger. The sector had previously been free of a VAT, but local leaders now say the new tax will provide up to US$13 million in new tax revenue for the state. The government has reduced the VAT on other sectors, like imitation jewelry, to balance the added VAT. (Business Standard)
 
Home furnishings company Ikea says it plans to increase its sourcing from India and expand its supplier base in the country. The Swedish company was the first major single-brand retailer to get Foreign Direct Investment (FDI) approval from the Indian Government and also recently announced a new “Make More in India” initiative. The company currently has about 50 Indian suppliers and says it hopes to double its sourcing volume from India by 2020. (Fibre2Fashion)
 
India continues to be an attractive long-term retail destination, according to the Indian government citing AT Kearney’s latest Global Retail Development Index. While India’s rank slipped from 13th to 20th in the latest survey, government leaders say that the country’s large population and rising disposable incomes still make it an attractive destination for retailers. The report also said that it expected the country’s e-commerce market to grow by as much as 50% over the next 5 years. (Fibre2Fashion)