For the sixth consecutive month, export of leather and leather products from India posted a negative growth. Yet, exporters feel that Indian leather sector has a strong future.
From April to September 2015, > export of leather and leather products stood at $3,158 million against $3,479 million registered for the corresponding period last year, marking a fall of 9.23 per cent. However, the exports for September 2015 came down to $480 million from $546 million for August 2015 and $572 for September 2015.
Talking to The Hindu , M. Rafeeque Ahmed, Chairman, Council of Leather Exports said: “India’s global market share stands in leather and leather products is three per cent. We are suffering on two counts, namely high tariff and weak euro currency. In the European market, we have to compete with Portugal, Romania and Slovakia on cost and logistic factors. While we have to adjust the cost price according to prevailing currency, European exporters have an advantage over us. In the export market, we compete with Indonesia, Bangladesh, Vietnam and Thailand on tariff.”
“Indian exports have been falling for the last nine months. The Centre has not done much to revive the leather sector. Although we are getting some concession through Asia Pacific Trade Agreement for exporting our products, it is not sufficient. We have asked the Commerce Ministry to come out with favourable tariff so as to revive this sector. Besides, the Centre has to allocate Rs.100 crore for marketing,” he said
According to him, China which was once considered as a big threat was losing its cutting edge, due to increase in raw material price. And buyers were finding it uncomfortable to source material from our neighbour.
“China is no longer a competitor or threat to us. While China imports leather products worth $2 billion per annum, India exports only $500 million to China and we have a huge opportunity. While it is not easy to enter new markets within a short span, we can use China as a base to expand our market share in China and enter other markets too,” he said.
CLE Chief said that Indian manufacturers can increase the global market share by reducing productivity waste of 5-7 per cent. “This amount can be adjusted to bring down the manufacturing cost. Besides, we have to be aggressive in marketing and pricing,” he said.
