Centre mulls plan to boost leather exports

The Centre would chart out a major marketing strategy to help the leather industry achieve the envisaged export target of $7 billion by 2010-11. It would also look at setting up five special economic zones for leather goods and products, according to Jairam Ramesh, Union minister of state for commerce.

Addressing a press conference after releasing 'India Leather Industry - a vision document for 2010-11, he said that the Council for Leather Exports had proposed a five-year plan for the leather industry to enhance its exports to $7 billion over the next five years from the present $2.39 billion (2004-05).

He called for four major changes in the leather sector to achieve quantum growth over the next five years.

Firstly, he asked the industry to increase the share of footwear in leather exports to 50 per cent during next five years. In the world market, product-mix is dominated by footwear to an extent of 65 per cent while it is 36 per cent in India.

Secondly, in terms of shift in market focus, Ramesh called for concerted efforts to focus on unexplored markets like Scandinavian and African countries and increase the share of exports to US from the present 12 per cent to 25 per cent, over the next five years.

At present, Europe accounts for about 63 per cent of India's leather exports.

He also stressed the need to change the product-mix in the footwear segment in favour of growth segments like children and ladies shoes. Currently, most of India's footwear exports is dominated by men's shoes.

Finally, he asked the industry to switch to volumes rather than persisting in high-value segments.

The government would work on attracting top brands in US and Taiwan. Three Taiwanese companies "� Stella, Evrite and Pauchen, had evinced interest in setting up their shops in India, particularly in Tamil Nadu, he added.

Along with the industry, the government will develop five SEZs at Chennai, Kanpur, Kolkata, Agra and Tada. Similarly, for the tanning sector, it would propose two exclusive tanning clusters "� one near Nellore and the other near Ennore in north Chennai "� to double the tanning capacity.

Ramesh said he had asked CLE to develop leather sector in new areas. Assam and Bihar have been identified as potential areas for the leather sector, as these states offer high quality raw hides.

The Central Leather Research Institute had been asked to submit a report on investment needs for tanning industry in the state to meet the zero discharge norm by June 2007, he added.

Answering a question, he said that working conditions in the leather industry would meet international standards once more foreign companies set up shops in the country.

Noting that he was surprised to know that there was no direct shipping services between Chennai and Europe or US, he said that he would take up the issue with the shipping ministry.

About two-thirds of leather exports is done through sea routes.