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Leather Industry

 

Leather Industry and exports

INTRODUCTION
The leather industry has a significant impact on the Indian economy. It is among the top ten foreign exchange earners for the country. Indian cattle & buffalo population accounts for 20% and the goat & sheep population of the country accounts for 11% of the world’s total. This places it in a dominant position in terms of affluent raw material availability.
 
With the leather industry being among the oldest trade in the country, India has a strong skilled manpower and innovative technology. The country has a strong and eco-sustainable tanning base and modern manufacturing units. It also has strong support from the leather chemical and auxiliary industries. The industry employs about 4.42 million people in the country. It is a prominent source of employment in the rural parts of India with women employment at about 30% in the sector.
 
India has four main leather sectors: Tanning, Footwear, Leather Garments and Leather garments and Accessories. The country accounts for 13% of the world’s total leather production. It is also the second largest producer and consumer of leather footwear.
 
Major footwear and leather products producing states in India are Tamil Nadu, West Bengal, Uttar Pradesh, Maharashtra, Punjab, Karnataka, Madhya Pradesh, Haryana, Kerala, Rajasthan and Jammu & Kashmir.
 
EXPORT TREND
India is the second-largest exporter of leather garments, the third-largest exporter of saddlery & harness and the fourth-largest exporter of leather goods in the world. The garments sector accounted for 7.03% of the country’s total leather export in 2021-22.
 
Out of the total leather and leather products exported out of India, the footwear segment accounts for the majority of exports, with April-August 2022 exports valued at US$ 1,077.80 million. The export of leather, leather products and footwear for the period April-August 2022 touched US$ 2,377.34 million as against the performance of US$ 1,831.35 million in April-August 2021, recording growth of 29.81%.The finished leather and footwear components export in April-August 2022 stood at US$ 189.73 million and US$ 121.64 million (20.59% YoY increase) respectively. The exports of saddlery & harness and non-leather footwear stood at US$ 110.29 million and US$ 125.64 million, respectively in April-August 2022.
 
During 2021-22, India exported total leather and leather products of value US$ 4.87 billion, a 32% increase from the previous year. In August 2022, the total leather exports stood at US$ 473.87 million.
 
EXPORT DESTINATIONS
India exports leather to more than 50 countries. USA, Germany, the UK, Italy, France, Spain, Netherlands, China, Belgium, UAE, Australia, Poland, Hong Kong, Denmark, Canada, Vietnam and Portugal are among the top importers of leather and leather products from India. The top 15 countries account for about 79.57% of the total exports.
 
USA is the largest importer of leather and leather products from India and accounted for 25.19% of the country’s total leather exports during April-August 2022. Germany and the UK accounted for 10.86% and 9.71% of the exports during the same period.
 
During April-August 2022, the total export of leather products to USA was valued at US$ 598.8 million, an increase of 51.35% YoY. During the same period, Germany and the UK imported leather and leather products worth US$ 258.12 million and US$ 230.75 million from India, respectively.
 
Italy, France and Netherlands together accounted for 49.32% of total leather exports from India, with their import values at US$ 161.53 million, US$ 115.57 million and US$ 101.62 million.
 
GOVERNMENT INITIATIVES
Indian Footwear and Leather Development Programme (IFLDP)
The IFLDP scheme was launched to develop the infrastructure, increase production, facilitate investments and generate employment in the leather industry of India. Under this scheme, Rs. 1,700 crore (US$ 220 million) has been allocated till 2026. Following are the six sub-schemes under IFLDP:
  • Sustainable Technology and Environment Protection (STEP)The STEP initiative is aimed at sustainable and environment-friendly industrial and tanning activities which are particularly linked to environmental concerns. Considering these issues, zero liquid and wastewater discharge is made mandatory in some states. Assistance for the upgradation of Common Effluent Treatment Plants (CETPs) and vision document preparation is provided under the scheme.
  • Integerated Development of Leather Sector (IDLS)The main objective of this scheme is to encourage entrepreneurs to diversify and set up new units leading to better productivity.
  • Establishment of Institutional Facilities  - The scheme aims to provide infrastructure upgradation of campuses of Footwear Design and Development Institute (FDDI)
  • Mega Leather Footwear and Accessories Cluster Development (MLFACD) The scheme is launched to assist entrepreneurs by providing modern infrastructure, technology, training and skill development and human resource development inputs.
  • Brand Promotion of Indian Brands in LeatherThe scheme aims to provide Indian footwear and leather manufacturers international branding support to provide better product visibility.
  • Footwear Sector and Development of Design StudiosThis scheme will provide design support, technical assistance and opportunities for employment and business.
 
GOVERNING BODY
Council for Leather Exports (CLE)
Formed in 1984, the CLE is the largest and apex body for trade promotion of the leather and leather industry of India. The objectives of the council are to develop and strengthen the leather industry, undertake promotion and market development activities, assist importers, provide guidance and act as a liaison between the government and industry.

 

RELATED SITES

COUNCIL FOR LEATHER EXPORTS

MINISTRY OF COMMERCE AND INDUSTRY

Source: India Brand Equity Foundation


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