 "pet toys")
On an overcast and muggy Friday afternoon, this reporter was walking towards the office of Mohammed Saif, owner of Bestochem, a Kanpur-based company that supplies chemicals for curing and manufacturing leather at tanneries in the city and nearby Unnao. We had just shaken hands and sat down in his modest one-room office to discuss the possible impact of the US’ 50 per cent tariff on leather exports when he said, “Aap galat waqt pe aaye hain” (You have come at the wrong time).
This reporter was puzzled. As the mind raced to find reasons why this was a bad time to meet him, Saif’s explanation offered a clue.
The Kanpur leather industry, he said, is largely export-dependent, with 60-70 per cent of goods produced in the city and Unnao shipped to the US. With tariffs kicking in, importers in the US had, for the most part, halted orders. Most tanneries in both towns were at a near standstill.
The situation, he added, would worsen after September, once exports for pending orders were shipped and fresh demand from the US dried up. “Our biggest advantage, especially in leather goods, was the cost edge from cheaper labour compared to competitors such as Italy or Brazil. A decade ago, the focus was on exporting high-quality leather. Now, we can compete in neither leather goods nor quality leather,” he said.
The high tariffs would also mean that the city’s leather and leather goods industry — already strained by the Uttar Pradesh government’s pollution crackdown and rising competition from China’s faux leather — would now have to raise prices sharply just to keep the lights on, Saif said.
“The only option left to survive is to charge more. What we made, whether leather or leather goods, was not fundamentally exclusive. For example, the products Kanpur made for ₹100 could be made elsewhere for at least ₹200 due to labour cost differences. That edge is now gone,” he said.
Despite earlier hurdles, India’s leather industry has grown over the past three years. In 2024–25, leather and leather goods exports from India stood at $4.36 billion, a modest rise from 2023–24’s $4.28 billion.
In 2022–23, India exported leather and leather goods worth $2.91 billion, according to the Ministry of Commerce.
“If this tariff situation is not resolved soon, the impact will be clear. Our exports will halve — make no mistake about it,” he said.
Not far from Jajmau in Kanpur, where Saif’s office is, Yash Kapoor manufactures dog toys and pet food. His four manufacturing units in Fazalganj Industrial Estate are less than 10 kilometres away, but this is Kanpur — known for its gridlocked roads.
Short bursts of rain had left the streets soaked, adding to the chaos. After nearly an hour of battling the traffic and another 10 minutes finding his factory, this reporter finally reached his office.
As soon as the “big blue gate” in front of MR Steels opened, the smell of freshly baked cookies drifted out — the aroma of dog treats being made on the ground floor.
Past the manufacturing unit, narrow stairs led to a sparsely furnished waiting room. In its centre stood a heavy black glass-top oval table, surrounded by six neatly placed chairs. The real eye-catcher, though, was the hundreds of dog toys — of every imaginable shape and size — arranged methodically. This reporter was still wondering which of them his Labrador named Sheldon would like best when a factory helper walked in, placed two bottles of water, and said “Sir” would arrive soon.
About five minutes later, Kapoor walked in, smiling warmly, and offered a handshake. We hadn’t even sat down before he said his four units were operating at less than 5 per cent capacity. “The global pet product market is roughly $300 billion, with the US accounting for $40–60 billion, according to estimates. This includes toys, food, and healthcare. India’s exports to the US in this segment are $200–300 million, while China’s share is $8–10 billion,” he said.
Firms like his had expected a larger share of the market after China was hit with tariffs, initially over 100 per cent and later reduced but still above 35 per cent. Kapoor had also banked on India’s lower initial tariff of 10 per cent giving it an advantage over competitors such as Vietnam and Thailand. “We thought we could dominate product categories where labour was essential but advanced technology or tight specifications weren’t as crucial. With these tariff rates, I don’t think that’s the case anymore,” Kapoor said.
To compete with China, the world’s biggest pet product maker, India needs tariffs at least 15–20 per cent lower than the current structure, he said. Even then, orders would go only to Indian companies with long-standing US importer relationships.
“No importer switches suppliers for just a 5 per cent difference. In manufacturing, if an importer asks for a 5 per cent cut, the manufacturer usually agrees or they split the cost,” Kapoor said.
Pet product manufacturing is as labour-intensive as textiles, but with higher skill demands depending on toy categories and natural pet food. Although production has nearly stalled, the tariff hikes mean workers can’t simply be let go, he said.
“Take rope toys for dogs. Each must be hand-woven, then stitched, filled, and cut properly to last. Training workers takes time.
Once trained, it makes no business sense to lose them,” Kapoor said, adding that he hoped the government might offer support to small and medium enterprises like his to help them weather the tariff barriers.
The day’s third meeting was with Shashank Agarwal, deputy managing director of Kanpur Plastipack, a maker of flexible intermediate bulk container (FIBC) bags.
Kanpur traffic delayed both of us, but we eventually reached his bungalow on the upscale Parwati Bagla Road (formerly Amherst Street) within minutes of each other. Dressed in a white shirt embroidered with his company’s name, Agarwal led this reporter to the sitting area. Like Kapoor, he quickly launched into figures, but dismissed concerns over the US’ 50 per cent tariff.
“India exports about $1 billion worth of FIBCs annually, in a $5 billion global market. Of that, $450 million goes to the US. India holds about 75 per cent of the US market, more than China, Türkiye, Vietnam, and Bangladesh combined in this category,” he said.
Fears of a slowdown in US-bound FIBC exports are misplaced, Agarwal argued, given India’s dominant market share. “These products can’t be made elsewhere, even if others have the labour. Even at a 400 per cent tariff (on India), no other country can meet the manpower FIBCs require,” he said.
While tariffs may cause short-term volatility over the next three months and push importers to explore other suppliers in the next 12–24 months, Agarwal said cost and scale advantages would keep India in the lead.
“People here are nervous, but our distributors and importers aren’t. Even at an overall 58.4 per cent tariff, they’re telling us to keep shipping,” he said.
A distinct ray of hope, Agarwal added, is that tariffs announced with immediate effect rarely last long.
“For orders already agreed upon or despatched, contracts aren’t rewritten overnight. For many large US importers, this is just a line item in the accounting books, hardly worth worrying about,” Agarwal said.
