Profile - Leather Industry in India

The Leather Industry holds a prominent place in the Indian economy. The leather and leather products industry is one of India’s oldest manufacturing industries that catered to the international market right from the middle of the nineteenth century. The leather industry employs about 2.5 million people and has annual turnover of Rs. 2,500 millions. 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 global players looking for new sourcing options (in addition to China, India stands to gain a bigger share of the global leather market. Leading brands from the US and Europe are planning to or are already sourcing leather and leather products and leather fashion accessories from India.

India ranks first among major livestock holding countries in the world and thus has a rich endowment of raw materials in terms of the cattle population. It has the capacity to fulfill 10% of the global leather requirement. 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$ 127 billion (2007). It ranks eighth in terms of the foreign exchange earnings from the industry. It is the 10th largest sector among the Indian manufacturing sector.

The composition of exports has also been changing, with more and more value added products being exported. In 2004-05, for example, value added finished products constituted around 80 per cent of the total exports from the industry, a far cry from 7 per cent in 1956-57. The value addition is at present to the tune of 200 to 500 per cent. The trend is expected to continue for quite some time in the future.

The Indian leather industry, is well-structured and spans various segments, such as tanning and finishing, footwear and footwear components, leather garments, leather goods, including saddles and harness.