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Monday April 15th, 2024

Sri Lanka’s Star Garments achieves carbon neutrality

ECONOMYNEXT- Star Garments group, owned by the US-based Komar is now CarbonNeutral certified for its entire portfolio of 14 factories, officials said.

Star Garments earned the certification by the Sustainable Future Group (SFG), a sustainability verification and certification body based in Sri Lanka on Thursday.

“We as a company engaged in the apparel industry basically operates as B2B business with no dealing with the end consumer,” Star Garments Managing Director A Sukumaran said.

“But these days end consumers tend to be more concerned on how products are manufactured, he said.

“Customers look to purchase goods manufactured in an ethical and sustainable manner.”

The CarbonNeutral certification is given by Natural Capital Partners (NCP) to companies that have reduced their carbon footprint to net zero in accordance with The CarbonNeutral protocol. SFG is the regional partner of NCP.

The protocol is the global standard for carbon-neutral certification, assisting businesses to measure Greenhouse gas emissions and help reduce it with credible solutions.

Sukumaran said businesses must strive to help reduce carbon emissions.

“Businesses are the main reason for carbon emission which is now a growing concern among the masses since global warming is affecting the whole world,” he said.

“As businesses, we have to do everything within our power to help alleviate global warming,” he said.

He went on to say that the company “endeavours to reduce whatever carbon we emit in our operations by investing in carbon credits and other sustainable businesses.2

Having achieved its carbon-neutral status two years ahead of schedule, Star Garments is currently the largest company in Sri Lanka and the only apparel company with all 14 of its facilities assessed and certified.

“Star Garments has expanded about 40 per cent over the last few years and we are continuing to expand within the next two years in factories, backward integration and also overseas process,” Sukumaran said.

Sanith de S. Wijeratne, chief executive of the Carbon Consulting Company, said Star Garments had achieved carbon neutrality in a short period.

“We applaud Komar’s leadership in driving sustainability in Star Garments and we are honoured to be their partner in achieving this goal,” he said.

Sukumaran claimed that the Sri Lankan apparel industry stands in a good place at the moment.

“If you look at the 2019 numbers, we have increased our exports by about 6 per cent to 5.3 billion US dollars and I think it will only grow this year and next year,” he added.

“There are challenges but we cannot sit back and complain or take a step back from where we are,” he added.

“As businesses, we have to be able to work with these challenges in the industry. We have to keep moving forward.”

Meanwhile industry experts predict Sri Lanka’s garment exports to drop till April 2020 due to poor conditions in key markets after growing 5.1 percent to a record 5.3 billion US dollars in sales in 2019.

Sri Lanka expects a boost in exports if preferential trade conditions are extended from markets like India and China and the inception of the fabric processing zone in Eravur. (Colombo/Jan24/2020)

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Iran President to visit Sr Lanka on April 24 anid rising tension, inaugurate Omaoya power project

ECONOMYNEXT – Iranian President Ebrahim Raisi will arrive in Sri Lanka on April 24 on a one-day official visit to inaugurate Tehran-assisted $529 million worth Uma Oya multipurpose development project with 120MW hydro power generation capacity, official sources said.

The announcement on President Raisi’s visit comes two days after Iran launched explosive drones and fired missiles at Israel in its first direct attack on Israeli territory, a retaliatory strike that raised the threat of a wider regional conflict.

“The President is visiting to inaugurate the Omaoya project. He will be on a one-day visit,” an official at Iran embassy in Colombo told EconomyNext.

A Sri Lankan Foreign Ministry official confirmed the move.

This is the first time an Iranian President coming to Sri Lanka Iranian after then President Mahmoud Ahmadinejad’s visit in April 2008.

The Omaoya project was originally scheduled to be completed in 2015, but had been delayed several times due to unexpected issued faced during the project cycle and funding issue after the United States imposed economic sanctions on Iran and economic crisis in Sri Lanka.

The project was started in 2010 and the funding was to be received as loan grant from the Iranian government. However, Iran was able to provide $50 million before the sanctions. Sri Lanka has to bear the cost after the sanctions.

The project includes storing water in two reservoirs with dams before being brought through a 23 km tunnel to two turbines located underground and generating hydro power with a capacity of 120 megawatts and added to the national grid.

After power generation, the water is expected to be brought to three reservoirs while supplying water to 20,000 acres of old and new paddy fields in both the Yala and Maha cultivating seasons.

The Memorandum of Understanding (MOU) for the construction was signed between the two countries in 2007 while Sri Lanka’s Cabinet approved the execution of the contract agreement between the Executing Agency, Sri Lanka’s Ministry of Irrigation and Water Management (MOIWM) of the GOSL and Iran’s FARAB Energy and Water Projects (FC).

When commencing the project on March 15, 2010, the scheduled date of completion of the project was on March 15, 2015. But the schedule completion date was extended to December 31, 2020 due to the unexpected water ingress into the head race tunnel and followed by social impacts.

The trade between the both countries suffered after the US sanctions. However, Sri Lanka inked a deal in December 2021 with Iran to set off export of tea to Iran against a legacy oil credit owed by state-run Ceylon Petroleum Corporation to the National Iranian Oil Company.

Sri Lanka owes $251 million for crude imported before the US imposed sanctions on Iran. (Colombo/April 15/2024)

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Sri Lanka to discuss two contentious points with bondholders: report

ECONOMYNEXT – Sri Lanka and sovereign bondholders are to discuss two matters in the near future which the two sides failed to reach agreement at March talks in London, a media report quoting a top aide to President Wickremesinghe as saying.

Sri Lanka and bondholders had discussed four matters on restructuring international sovereign bonds in late March and agreement had been reached on two, President’s Chief of Staff Sagala Ratnayake was quoted as saying on state-run ITN television.

A restructuring proposal by bondholders was not in line with IMF requirements, and Sri Lanka had sent a counter proposal, he said.

The matters will be discussed at round of talks in the near future.

Sri Lanka was optimistic of reaching an agreement with the bondholders before June, officials have said.

According to matters already in the public domain, sovereign bond holders are keen to get a bond tied to dollar gross domestic product, as they feel IMF growth projections are too low.

In past re-structuring so-called value recovery instruments, a type of warrant, gave their owners extra payments if a country did better than expected and were tied to items like oil prices.

Bondholders had initially proposed bond which would have a lower hair cut initially, and it will have additional hair cuts if growth is low (about 3.1 percent) as projected in an IMF debt sustainability analysis. (Colombo/Apr15/2024)

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BIMSTEC Secretary General visits Sri Lanka, discusses regional cooperation

ECONOMYNEXT – The Secretary General of the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC), discussed measures to enhance regional cooperation, during his visit to the island last week.

Ambassador Indra Mani Pandey, Secretary General of BIMSTEC visited Sri Lanka from 07 – 12 April 2024, following his assumption of office as Secretary General of BIMSTEC in January this year.

The Secretary General “met with senior officials of relevant Ministries/Agencies to discuss measures to enhance regional cooperation under various BIMSTEC initiatives,” the Foreign Ministry said in a statement.

Several BIMSTEC countries have bilateral trade agreements, such as Sri Lanka and India, Thailand and Myanmar, Sri Lanka and Thailand, but no collective regional agreement to enable intra-regional leverage.

During the visit, Secretary General Pandey held discussions with Ministry of Foreign Affairs officials and paid courtesy calls on the President and the Minister of Foreign Affairs.

Secretary General Pandey participated at an event on “Regional Cooperation through BIMSTEC” organized by the Lakshman Kadirgamar Institute (LKI) on 9 April. (Colombo/April15/2024)

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