HISTORIC PRESENCE:

Manufacturing of Leather products has a presence in the Indian Subcontinent since times immemorial. Ancient civilizations used leather products like bags, harnesses, armors, scabbards, boots, and sandals etc. Patrons often hired artisans to manufacture leather products meeting their specific demands.

EVOLUTION:

The Indian leather segment has undergone a sea of change post liberalization. Innumerable opportunities have opened up for Indian manufacturers. Global markets look at India as a preferred sourcing option.  Indian products in the sector, meet the requirements of leading US brands and those of Europe. Thus, Indian exporters seem to enjoy a larger share in the global market.

The industry holds an important place in the country’s economy today. With a turnover of approximately $5 million per annum, it also employs 2.5 million workers. While the country merely exported raw material in 60’s and 70’s, the industry has changed phenomenally over the years, to being an exporter of value-added products.

This transformation in Indian Leather Industry is attributed to various reforms initiated by government of India.  The foresightedness of these initiatives paid desirable results, with an emphasis on its planned development, aimed at maximum utilization of available raw material, maximizing returns, particularly from offshore destinations. Not only has the business progressed to a significant goal in the economy of India, but also, it contributes significantly to the exports sector, with its presence among the 7 largest export-oriented industries earning foreign exchange.

The Government’s stand on leather industry noticed a significant transition 1974 onwards, prioritizing exports of value-added products. Exporting semi finished and raw material was banned since 1991, making room for exports of finished product alone. Thereafter, Indian manufacturers set up factories beginning 1991, manufacturing shoe uppers, shoes, leather goods and garments. The import duties on capital goods were reduced as an incentive to Indian exporters.

The sector was kept reserved as small scale industry, preventing Foreign Direct Investment (FDI) there. FDI on leather industry between August 1991 and December 2005 was $51.84 million.

THE AMBITIOUS UPRISING:

The Indian Leather Industry today meets 10% of global finished leather requirement. Different products manufactured in the country include footwear, garments, finished leather, jackets, long coats, waist coats/shirts, aprons, industrial leather garments, gloves, saddler, & harness etc. Indian leather garments have been making giant strides in the world of fashion too.

Footwear falls under a significant segment of the industry. Being the second largest global producer after China, India accounts for 13% of global footwear production of 16 billion pairs. The country produces 2065 million pairs of various categories of footwear including shoe uppers, of which, approximately 115 million pairs are exported. Thus, Indian suppliers take nearly 5% of its production to the offshore destinations.

Country exported leather garments worth $428.52 million in 2009-10. Exports garments account for a share of 12.60% in India’s total leather trade of $3400.97 million in 2009-10. Export of finished products reached $625.54 million in 2009-10. Export of leather goods and accessories including gloves touched $756.02 million the same year.  During 2009-10, India’s export of Saddlery & Harness was US$ 83.39 million.

GROWTH PROSPECTS:

With an abundance of raw material and skillful workforce available, the leather industry is bound to grow to a greater extent on its ambitious goal of global markets

The industry has experienced a significant rise in footwear exports, increasing from $82.56 million in 1979 to $507.51 million in 2009-10. Germany, UK,  Italy, USA, France, Spain, Netherlands, Portugal, UAE, Denmark, Australia, Sweden, Canada, South Africa, Japan and others are major export destinations for Indian footwear, with their respective share being 14.88%, 19.66%, 13.93%, 8.20%, 9.58%, 6.37%, 4.32%, 1.50%, 2.63%, 1.13%, 1.03%, 0.81%, 0.62%, 0.65%, 0.36%, 14.35%.