Boost for unbranded footwear

The Rs 11,000 crore footwear industry in the country has received a boost with lowering of customs duty on imported capital goods required for non leather footwear industry from 20 per cent to five per cent.

Increasing the excise duty exemption level on footwear items priced from Rs 125 to Rs 250 would also help the lower rung of the footwear industry.

However, the leather industry as a whole expected relief like enhancement of duty free import entitlement from one per cent to three per cent on embellishments, exemption from central excise on manufacturing of footwear components, duty free import of effluent treatment machinery, duty free import of packaging materials and removing CVD on furskin import. These did not materialise in this budget.

S S Kumar, chairman of Council for Leather Export, said withdrawal of CVD exemptions on items attracting central excise duty had made import of machinery even with concessional basic duty more expensive.

Taxation on labelling and packaging of part of the manufacturing chain was retained let down last year and industry was expecting the tax to be abolished this time.

"Outsourcing of finished leather shoe is a practice in Kanpur and Kolkata. We had made presentation to the government but nothing happened," Suman Roy Barman of Khadim said.

Non-leather footwear now had almost 50 per cent of the market.

The industry also welcomed the budget proposal for a fund for regeneration of traditional industries, with an initial allocation of Rs 100 crore.

This included traditional industries like coir, handloom, handicrafts, sericulture, leather, pottery and other cottage industries. The details, including mechanism for utilization of the fund will be worked out in consultation with the industries concerned.

"We are yet to get the fineprint. But this is a welcome step," Kumar pointed out.