• The Leather Industry holds a prominent place in the Indian economy. This sector is known for its consistency in high export earnings and it is among the top ten foreign exchange earners for the country.


• With an annual turnover of over US$ 7.5 billion, the export of leather and leather products increased manifold over the past decades and touched US$ 4.86 billion in 2011-12, recording a cumulative annual growth rate of about 8.22% (5 years).


• The Leather industry is bestowed with an affluence of raw materials as India is endowed with 21% of world cattle & buffalo and 11% of world goat & sheep population. Added to this are the strengths of skilled manpower, innovative technology, increasing industry compliance to international environmental standards, and the dedicated support of the allied industries.


• The leather industry is an employment intensive sector, providing job to about 2.5 million people, mostly from the weaker sections of the society. Women employment is predominant in leather products sector with about 30% share.

Though India is the second largest producer of footwear and leather garments in the world, India accounts for a share of close to 3% in the global leather import trade of US$ 137.96 billion (2010)

• The major production centers for leather and leather products in India are located in Tamil Nadu - Chennai, Ambur, Ranipet, Vaniyambadi, Vellore, Pernambut, Trichy, Dindigul and Erode ; West Bengal – Kolkata ; Uttar Pradesh – Kanpur, Agra, Noida, Saharanpur; Maharashtra – Mumbai ; Punjab – Jallandhar ; Karnataka – Bangalore ; Andhra Pradesh - Hyderabad ; Haryana  - Ambala, Gurgaon, Panchkula, Karnal and Faridabad; Delhi; Madhya Pradesh – Dewas ; Kerala – Calicut and Ernakulam / Cochin

Strengths of Indian leather sector

• Own raw material source – 2 billion sq ft of leather produced annually
• Some varieties of goat / calf / sheep skins command premium position
• Strong and eco-sustainable tanning base
• Modernized manufacturing units
• Trained / skilled manpower at competitive wage levels
• World-class institutional support for Design & Product Development, HRD and R & D.        
• Presence of support industries like leather chemicals and finishing auxiliaries 
• Presence in major markets – Long Europe experience
• Strategic location in the Asian landmass

Emerging strengths

• Design development initiatives by institutions and individuals
• Continuous modernization and technology upgradation
• Economic size of manufacturing units
• Constant human resource development programme to enhance productivity
• Increasing use of quality components
• Shorter prototype development time
• Delivery compliance
• Growing domestic market for footwear and leather articles

Highlights of Leather Product Segments:

• Tanning Sector – Annual production 2 billion Sq.ft. Accounts for 10% of world leather requirement. Indian colors continuously being selected at the MODEUROPE Congress
• Footwear Sector - Second largest footwear producer after China.  Annual Production 2065 million pairs. Huge domestic retail market 1950 million pairs (95%) are sold in domestic market. Footwear export accounts for 45.05% share in India’s total leather & leather products export. The Footwear product mix Gents 52%, Ladies  39% and Children 9%
• Leather Garments Sector – Second largest producer with annual production capacity of 16 million pieces. Third largest global exporter. Accounts for 10.43% share of India’s total leather export
• Leather Goods & Accessories Sector including Saddlery & Harness - Fifth largest global exporter.  Annual production capacity - 63 million pieces of leather articles, 52 million pairs of Industrial gloves & 12.50 million pieces of Harness & Saddlery items. Accounts for 23.44% share of India’s total export

Product-wise Brands sourced from India:

Besides, major brands are sourced from India, MNC brands are sold in India and Indian brands sold in India.

India’s export of leather and leather products for Five years

(Value in Million $)
	2007-08		2008-09		2009-10			2010-11		2011-12
Finished Leather	807.19		673.37		627.95			841.13		1023.21
Footwear	1489.35		1534.32		1507.59			1758.67		2077.27
Leather Garments	345.34		426.17		428.62			425.04		572.54
Leather Goods	800.46		873.44		757.02			855.78		1088.09
Saddlery & Harness	106.18		92.15		83.39			87.92		107.60
Total	3548.51		3599.46		3404.57			3968.54		4868.71
% Growth	15.99%		1.44%		-5.41%			16.57%		22.68%
Source: DGCI&S

% Share of Leather Products in Export Performance (2011-12)

% share of various countries in India’s Leather & Leather Products Exports (2011-12)

Major Markets:

The major markets for Indian Leather & Leather Products are Germany with a share of 15.01%,  UK 11.15%, Italy 10.85%, USA 9.02%, Hong Kong 7.38%, France 6.25%, Spain 6.08%, Netherlands 4.07%, Belgium 2.32%, China 2.54%, U.A.E.2.24%, Australia 1.39%, These 12 countries together accounts for nearly 78.30% of India’s total leather& leather products export.

India’s Export of Leather & Leather Products to the European Union touched US$ 3116.52 mn in 2011-12, accounting for a share of 64.01% in India’s total leather export trade of US$ 4868.71 mn.

 

(Value in million USD)

COUNTRY	2007-08	2008-09	2009-10	2010-11	2011-12	% Share
Germany	493.34	508.45	491.28	575.38	730.77	15.01%
Italy	490.77	461.56	398.56	455.76	528.39	10.85%
UK	417.64	413.24	456.59	505.20	542.99	11.15%
USA	311.21	359.22	296.37	348.13	439.27	9.02%
Hong Kong	280.97	237.72	251.53	325.20	359.51	7.38%
Spain	216.07	219.18	219.13	247.99	295.81	6.08%
France	198.52	221.33	255.29	280.04	304.23	6.25%
Netherlands	134.75	148.77	137.10	155.43	198.29	4.07%
U.A.E.	76.23	85.79	69.06	74.27	109.11	2.24%
Portugal	56.93	48.17	39.39	39.62	46.55	0.96%
Belgium	55.32	54.77	65.39	80.89	113.08	2.32%
China	55.46	49.96	48.58	75.48	123.78	2.54%
Australia	50.44	55.76	53.92	51.81	67.79	1.39%
Denmark	49.58	60.12	55.73	57.75	74.15	1.52%
Sweden	38.99	38.03	36.07	31.36	44.29	0.91%
Canada	36.92	35.29	27.66	29.32	40.01	0.82%
Korea Rep.	29.55	26.17	29.04	31.31	38.22	0.78%
South Africa	27.90	22.45	24.60	32.14	41.17	0.85%
Switzerland	25.79	26.07	27.10	25.02	33.52	0.69%
Austria	25.68	27.22	28.01	27.01	38.43	0.79%
Greece	23.57	17.82	12.77	10.05	10.88	0.22%
Saudi Arabia	15.96	19.28	21.01	22.14	40.89	0.84%
Japan	15.95	20.24	17.19	21.74	33.18	0.68%
Russia	15.77	12.01	6.68	19.99	33.05	0.68%
Indonesia	15.31	13.45	10.08	20.15	25.16	0.52%
Finland	14.39	15.52	9.96	14.57	22.14	0.45%
Ireland	8.15	6.44	5.79	5.36	7.56	0.16%
New Zealand	5.61	5.46	4.29	5.98	7.29	0.15%
Others	361.74	389.97	306.42	399.45	519.20	10.68%
Total	3548.51	3599.46	3404.57	3968.54	4868.71	100.00%

                                                                                                                                     

Region-wise Export of Leather & Leather Products 2011-12

Future Outlook:

The Government of India had identified the Leather Sector as a Focus Sector in its Foreign Trade Policy 2004-09 in view of its immense potential for export growth prospects and employment generation. Accordingly, the Government is also implementing various Special Focus Initiatives under the Foreign Trade Policy for the growth of leather sector. With the implementation of various industrial developmental programmes as well as export promotional activities; and keeping in view the past performance, and industry’s inherent strengths of skilled manpower, innovative technology, increasing industry compliance to international environmental standards, and dedicated support of the allied industries,  the Indian leather industry aims to augment the production, thereby enhance export, and resultantly create additional employment opportunities for overall one million people.