Tanners from India, Pakistan, Bangladesh work out ways for collaboration

It takes three to tango, if you go by the view of leading tanners from south India, Pakistan and Bangladesh. They were here to work out ways for mutual cooperation to increase the exports of leather and leather products.

Muhammad Naseem Shafi, CEO of the Shafi Group, Karachi, Syed Nasim Manzur, Managing Director of Apex Adelchi Footwear from Bangladesh, and M. Rafeeque Ahmed, Chairman, Council of Leather Exports (CLE), met for the first time to discuss strategies to combat the raw material shortage, price crunch due to recession in European markets and create a regional brand image.

Talking to The Hindu, Mr. Shafi said, “We are not here to compete with each other head-on in all areas, but to make use of market information and add value to our products to stay in the global competition. We have to think ahead and keep the leather sector going.”

With a turnover of $80 million, the Shafi Group employs 2,500 people. Its units are based in Karachi, Lahore and in China. The company is finding it difficult to source raw materials in the region due to short supply. And imported materials are turning out to be costlier.

“Still we are trying to increase our business by importing material. We are also focusing on new markets such as West Asia, Africa, Latin America and Iceland. As supply for the European market has fallen from 55 per cent to 45 per cent, we will focus on increasing business in China from 30 to 45 per cent,” he said.

Mr. Manzur, a Bangladeshi exporter, said: “The leather sector in South Asia is underperforming and that’s why we are here seeking to collaborate with each other. Though the global scenario is challenging, we are holding to our growth through value addition.”

Mr. Rafeeque Ahmed urged the leather industry in the region to explore ways and means to enhance its share in the global market by adopting measures such as market and product diversification strategies, reducing transaction costs, improving design efficiency and moving up the value chain.

In his inaugural address at the two-day event on ‘Strengthening their competitiveness of South Asia in leather and leather products’, organised by United Nations Conference on Trade and Development, Rajeev Kher, Additional Secretary, Ministry of Commerce said, “It is unfortunate that no sector in the South Asian region is adequately integrated in its production network and the situation in leather is no different.”

It was unnerving that even the leather industry with historic roots did not have an organisational perspective of the industry within the region. A framework for regional organisation that would foster integration was need of the hour.

South Asia was not only a production centre but also a major market that could sustain the industry. India, Pakistan and Bangladesh were significant markets and others were also growing.

Though the focus could be on exports, the domestic markets in the region could also be tapped.

The industry should cooperate to build a South Asian brand in the leather sector, Mr. Kher said.