Leather industry in India

The Indian Leather Industry

What is leather?

Leather industry in India is an extremely flexible and durable material manufactured by processing animal skin, e.g. cow, buffalo, sheep, goats, crocodiles, mink etc. Leather has been developed since ancient times, and with the advancement of technology and through scientific research, it has now become a regular feature of the market. High grain leather is one of the most premium and original types of leather and also the most sought after in the market.Leather products are used in footwear, garments, upholstery, accessories, harnesses, tannery etc.

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leather industry in india

leather manufacturing is a leading industry in India. It employs the largest number of skilled, semi-skilled workers and is also the largest foreign exchange earner. It is used in various industries like garments, upholstery, saddles, harnesses, footwear etc., and the market is only thriving each year for more leather products.

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India is the world’s second-largest manufacturer of leather goods after China. It can create jobs, growth, and export, with yearly exports exceeding USD 2 billion. The industry has transformed from a mere transporter of raw materials to a well-established exporter of value-added leather products and completed goods.

Leather Industry in India

The Indian leather industry in india one of the oldest globally, having been in operation since the 19th century. Since its inception, the industry has been tied to the social and organisational structure. It appears complex with aspects of continuity and traditional systems that have evolved. The supreme quality of Indian leather and efficient craftsmanship has given Indian leather goods a firm foothold worldwide. The market also has a high capability for expansion and has become more organised over the years.

The leather and footwear industry employs 4.42 million people, making it one of the most labour-intensive industries in India. It is also one of the main sources of employment for women, with roughly 40% of the workforce being female. More than half a million unemployed persons have found work in this industry in the previous five years after receiving training from various government programs.

With an annual leather manufacturing capacity of 1.8 billion square feet, India is the world’s largest animal producer. India produces 13 per cent of the world’s footwear output, or 16 billion pairs. Each year, India produces 2065 million pairs of shoes in various styles. As a result, the company exports 115 million pairs, accounting for 95 per cent of its total output.

Exports

With a market share of 10 per cent worldwide and 2 percent of global trade, the Indian leather industry is a major exporter in India. Indian leather clothing, saddlery & harness, and leather goods are all exported from India, making it the second-largest exporter of leather and leather goods globally. Now, the industry is at a point where it’s utilising all available raw materials to their full potential and reaping the most from exports. Singh international

India’s leather exports are increasing, while leather’s share of India’s total exports has decreased. Industrial tariff liberalisation is expected to benefit developing countries like India, with a price advantage over their primary exports.  Many companies have to contend with a lack of access to capital and regulatory hurdles in setting up, maintaining, and growing a business due to inadequate infrastructure and weak institutional frameworks. Removing these restraints is essential to the sector’s ability to run smoothly.

What to export?

Leather is one of the most sought after products in fashion and footwear, and despite many competitive and alternative materials out there, leather has never gone out of style. Owning a leather jacket or premium leather made shoes are always the sought after pieces in every person’s closet. Leather has a variety of types, from premium quality high grain leather to split fragile leather. Suede leather has a raw texture and gives a different look when used in apparel. Suede and Verona – both find a wide appeal in domestic products and are the most popular choices of leather in the market.

Patent leather is glossy due to the plastic coating applied to it and finds wide use across industries. Let’s quickly take a look at the most popular products exported from India if you want to start a leather export business.

  1. Leather garments: Leather is most popularly used in the garment industry. With each passing year, more fashion trends are evolving across the globe. India is the second-largest exporter of leather garments across the world. If you’re interested in fashion, this can be a great avenue to pursue in business.

You can study the fashion trends at international festivals, create a detailed import-export business plan and plunge into exporting leather garments. Although it is a very competitive market, if you produce high-quality leather, there are better chances of making a profit as you will always find takers.

Another winning strategy can be to create expertise in a particular category of leather garments and specialise in it. This way the production cost can be reduced, and you can have a steady flow of sales due to the expertise in your area.

  1. Leather footwear: Footwear is primarily produced in Tamil Nadu, West Bengal, Uttar Pradesh, Maharashtra. India exports dress shoes, moccasins, Horrachies, Sandals, Ballerinas, Boots and Sandals etc. India produces 2065 million pairs of shoes, of which 95% are for domestic needs. There are plenty of opportunities listed online for Leather footwear, and if you have an interest in footwear, then this is a great prospect to delve into.
  2. Leather upholstery: Leather upholstered furniture is known for its regal look, comfort, durability and quality. If you’re interested in export, you must decide on a specialised area in this business. Several businesses within this domain using only exotic leather or some that use different styles of upholstered furniture. This is a wide avenue to delve into and has a great demand in local and international markets.
  3. Tanning: If you have expertise in the tannery business, then this is also a competitive market. You can provide hides to other industries like garments, furniture, shoes, accessories etc. Determine the type of tannery you want to become by analysing the market demands and conducting research in the international market. Find the gap in the supply and demand of a good quality leather tannery and create a solid brand in this domain.

Challenges and Opportunities:

  1. Environmental Concerns: The leather industry faces challenges in terms of environmental sustainability and waste management. Adopting eco-friendly practices and investing in research and development for sustainable alternatives can create opportunities for growth and ensure long-term viability.
  2. Technological Upgradation: Embracing advanced technologies, such as automation and digitalization, can enhance productivity, improve product quality, and streamline the supply chain. Investing in research and development to develop innovative techniques and finishes can also provide a competitive edge.
  3. Skill Development: Continued focus on skill development and training programs can help bridge the gap between traditional craftsmanship and modern manufacturing techniques. This would enable the industry to produce innovative designs and cater to evolving market trends.

Reforms to grow

Leather Industry in India

The Indian government has taken several steps to boost the country’s footwear industry. At first, tanning the hide or skin and turning it into leather was a time-consuming and labour-intensive procedure. Processing leather and turning it into final goods used to take weeks or months back in the days before modern technology. Consumer tastes and demand necessitate that leather goods be high quality, variety, and consistent. As a result of the Indian leather industry’s successful launch, scientific ideas have been integrated into the industry’s business model.

Export growth in

Leather Industry in India

A new battleground has formed over trade liberalisation, economic growth, and environmental effects in the leather and leather goods industry worldwide in the last decade. India’s eighth-largest earner of foreign currency is leather. Many traded commodity lines enjoy significant price advantages because of small and medium-sized businesses (SMEs).

Industry and government have responded in various ways, but several critical problems that might aid the sector’s progress toward profitability are still open for discussion and resolution today. New policies to attract foreign direct investment (FDI) in the tanning industry and infrastructure development in leather clusters are among the study’s primary concerns. Increasing commerce and competitiveness in the country necessitates that the industry’s technological and organisational skills and productivity be upgraded.

Future Prospects of the

Leather Industry in India

Under the automatic approach, 100 % FDI is already permissible in this area. An investment of Rs. 2600 crore is being made by the government in the Indian Footwear, Leather and Accessories Development Programme (IFLADP), which provides financial assistance for key areas such as increasing production capacity and upgrading technology, upgrading CETPs, HRD, and establishing institutional facilities, etc. Consequently, the Indian leather and footwear sector has become an attractive investment destination because of the vast market potential and the Government’s support measures and ease of doing business policies.

Start-ups in the leather and footwear industry have room to grow now that COVID has passed, both domestically and internationally. The following are some of the most important of these. Due to changes in the MSME definition, 98 per cent of the leather, leather products, and footwear businesses now fall within the MSME category, up from 92 per cent in the past.

The leather and footwear sector has significantly benefited from the involvement of the Council for Leather Exports. This industry has a lot of potential for growth and development, both domestically and internationally.

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