Leather industry needs to make more value-added products: Parveen Kumar

Interview with Convener, Punjab Chapter, CLE; Managing Director, Raghu Exports (India) Pvt Ltd

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India's leather exports are targeted at $14 billion by 2016-17, from $6 billion (projected) in 2013-14, according to the Council for Leather Exports (CLE). However, this will require certain interventions, points out Parveen Kumar, Convener, Punjab Chapter, CLE, and also Managing Director, Raghu Exports (India) Pvt Ltd, in an interview with Vijay C Roy. Edited excerpts:

How has the leather industry performed in the last few years on the export front? What are the projections for the future?

After leather exports reached an all-time high of $5 billion in 2012-13, we are confident they will witness 20 per cent growth in 2013-14. According to estimates, the industry will be able to achieve $6-billion shipments in 2013-14 (the final data is yet to be compiled). The industry has set a target of $14 billion by 2016-17, according to the Council for Leather Exports.

Do you think the target is achievable?

Yes, the target can be achieved if the government at both the Centre and state level, and the industry itself, take proactive action to boost leather exports.

What kind of policy interventions does the leather industry need to achieve this target?

We need to maintain consistent growth of 20 per cent and that can be done by the government taking certain steps and entrepreneurs adding value to products. The availability of leather is a major cause of concern for the industry and will be a major factor which will decide the growth of this sector. We don't have organised animal farming in India. As a result, there is acute shortage of raw material. So we request some policy interventions to increase the supply of raw material in the domestic market either by increasing the export duty or banning the export of raw hides, skin, wet blue leather, etc.

Further, the state and Central government should introduce investor-friendly policies. The leather industry comes under the Red Category - polluting industries - and there should be not any fear among the industrial community. The state government should set up necessary infrastructure like effluent treatment plants for treating pollutants and provide us a subsidy for setting up treatment plants for in-house wastes.

What else does the industry need to meet the target?

Since India has a very low share of the global market, the industry needs to create new capacities and production centres of value-added leather products. In addition, the industry needs to explore new markets for exports besides China, Italy and the United States.

What is the size of the industry in Punjab?

The majority of the leather industry is concentrated in Jalandhar, and consists of leather tanneries and manufacturers of shoes, bags, jackets, purses and belts. The industry is dominated by SMEs, with the total industry size pegged at around Rs 1,000 crore.

What are the Punjab leather industry's expectations from the state government?

We want an institute like the Footwear Design & Development Institute (FDDI) to be set up near Jalandhar, which can cater for all the needs of the footwear, leather products industry and the retail sector, such as human resources, design, testing and consultancy. The institute should provide high-end training facilities.