role of export promotion council in leather garments

8/2/2019 Role of Export Promotion Council in Leather Garments

http://slidepdf.com/reader/full/role-of-export-promotion-council-in-leather-garments 1/29

DAVV, INDORE

SESSION-2010-11

P r e s en ta t io n : - ”RO LE O F EXP O RTr e s en ta t io n : - ”RO LE O F EXP O RT

P R O M O T IO N C O U N C I L IN L E A T H E RR O M O T IO N C O U N C I L IN L E A T H E R

G A R M E N T S TO E U R O P E M A R K E T ”A R M E N T S T O E U R O P E M A R K E T ”



Roadmap

• Introduction

Leather industry- Overview- History-Structure of Indian Leather Industry

• Leather Garment Industry• Export Promotion Council• Institutions for Leather Industry• Top 10 Leather Exporters• India’s trade of leather all over the world• Trade with Europe• Initiatives taken by GOI

• FTP 2009-14• Future Opportunities• Conclusion• References

http://var/www/apps/conversion/current/tmp/scratch11981/ftp://ftp%202009-14/

http://var/www/apps/conversion/current/tmp/scratch11981/ftp://ftp%202009-14/



INTRODUCTION

• The leather industry occupies a place of prominence in the Indian economy in viewof its massive potential for employment,growth and exports.

• India has the capacity to meet 15% of global demand for leather products. Export

promotion council plays an important rolein maintaining this percentage.



• Indian leather industry, the eighth largest foreignexchange earner for the country, with an export value of $2.1 billion provides employment to 2.5 million people.

• India's leather exports constitute about 2% of worldtrade.

• Nearly 60-65 per cent of leather production is in thesmall/cottage sector. Main emphasis is on its planneddevelopment, aimed at optimum utilization of availableraw materials.

The exports gained momentum during the past twodecades from Rs.320 million in the year 1965-66 to

Rs.69558 million in 1996-97. Today it has attained well merited recognition in

international markets.

Policy initiatives taken by the Government of Policy initiatives taken by the Government of India since 1973 have been instrumental to such aIndia since 1973 have been instrumental to such a

transformation.transformation. Direct and indirect employment of the industry isDirect and indirect employment of the industry is

around 2 million.around 2 million. The skilled and semi-skilled workers constituteThe skilled and semi-skilled workers constitutenearly 50% of the total work force.nearly 50% of the total work force.

Indian Leather Industry Overview



Pre liberalisation period:-• The history of leather tanning in India dates back to

3000 BC. Tanning in the rural areas was done by

indigenous techniques, making the use of thismaterial easier.• The most popular Indian leather products include

footwear and hand bags. The footwear came invarious designs of traditional embroidery, brocade or textile. Bright colors and unique designs are used.

• The all time favorite, Kolhapuri chappals of Maharashtra, are soft and very comfortable to wear.

A special type of thickish shoes, called mojadis aredesigned in Rajasthan.

Post liberalization Period:-Post liberalization Period:-• The Post liberalization Period opened up floodgates of The Post liberalization Period opened up floodgates of

opportunities for the Indian leather industry.opportunities for the Indian leather industry.

• With global players looking for new sourcing optionsWith global players looking for new sourcing options(in addition to China), the country is uniquely positioned(in addition to China), the country is uniquely positioned

to gain a bigger share of the global market.to gain a bigger share of the global market.• Renowned brands from the US and Europe areRenowned brands from the US and Europe are

planning to import leather and leather products fromplanning to import leather and leather products from

India.India.

Global players who took part at the India InternationalGlobal players who took part at the India International

Leather Fair, 2005, consider India as the marketLeather Fair, 2005, consider India as the market to be in.to be in.



Jalandhar Jalandhar

DelhiDelhi

AgraAgra

MumbaiMumbai

Ambathur Ambathur

RanipetRanipet

ChennaiChennai

VanyambadiVanyambadi



Some of theimportant leather products exportedby India include -

• Leather Footwear

• Footwear Components (ShoeUppers, Soles etc.)

• Leather Garments

• Leather Goods

• Harness & Saddlery

• Finished Leather



Leather Garment Industry

• Leather garments form a significant segment of the Leather Industry in India. Leather garments production capacity is estimatedto be 16 million pieces annually.• India produces different types of leather garments i.e., jackets, longcoats, waist coats/shirts, pant/shorts, motorbike jackets, industrial

leather garments, leather aprons etc.• India is the second largest producer of leather garments, next onlyto China, which produces 70 million pieces of the total global tradevolume of about 120 million pieces .



LEATHER GARMENTS (Value in Million US$)

COUNTRY APR-MAR % share

2007-08 2008-09 2008-09GERMANY 69.40 100.25 23.52%

U.S.A. 27.76 22.20 5.21%

U.K. 23.23 27.92 6.55%

ITALY 58.64 70.13 16.46%

FRANCE 27.10 42.28 9.92%

HONG KONG 1.04 2.02 0.47%

SPAIN 47.69 48.47 11.37%

RUSSIA 0.23 0.51 0.12%

NETHERLANDS 11.25 15.72 3.69%

AUSTRALIA 1.91 3.60 0.85%

NEWZEALAND 0.10 0.13 0.03%

DENMARK 12.35 23.86 5.60%

GREECE 4.48 3.61 0.85%

India’s export of Leather Garments- country wise



April-march %share

2007-08 2008-09 2008-09

CANADA 8.94 7.86 1.85%

SWITZERLAND 2.41 3.92 0.92%

SWEDEN 8.62 7.96 1.87%

S. AFRICA 0.82 0.44 0.10%

AUSTRIA 2.55 4.30 1.01%

BELGIUM 5.13 7.45 1.75%

JAPAN 0.88 1.18 0.28%

PORTUGAL 3.93 4.19 0.98%

CHINA 0.09 0.05 0.01%

IRELAND 0.17 0.00 0.00%

U.A.E. 5.33 4.13 0.97%

INDONESIA 0.00 0.00 0.00%

KOREA REP. 0.22 0.13 0.03%

FINLAND 1.00 1.05 0.25%

SAUDI ARABIA 0.06 0.10 0.02%

OTHERS 20.02 22.70 5.33%

TOTAL 345.34 426.15 100.00%

Source : DGCIS



Export Promotion Councils of India

• The Export Promotion Councils are non-profit organizations registered under theIndian Companies Act or the Societies

Registration Act, as the case may be.They are supported by financialassistance from the Government of India.



Role

• The main role of the EPCs is to project India'simage abroad as a reliable supplier of highquality goods and services. In particular, the

EPCs encourage and monitor the observance of international standards and specifications byexporters. The EPCs keep abreast of the trendsand opportunities in international markets for

goods and services and assist their members intaking advantage of such opportunities in order to expand and diversify exports.



Functions

• To provide commercially useful information and assistance to their members indeveloping and increasing their exports

• To offer professional advice to their members in areas such as technologyupgradation, quality and design improvement, standards and specifications,product development and innovation etc.

• To organise visits of delegations of its members abroad to explore overseas

market opportunities.

• To organise participation in trade fairs, exhibitions and buyer-seller meets in Indiaand abroad.

• To promote interaction between the exporting community and the Governmentboth at the Central and State levels

• To build a statistical base and provide data on the exports and imports of thecountry, exports and imports of their members, as well as other relevantinternational trade data.

http://exim.indiamart.com/reference-directories/export-promotion-councils-intro.html






Top ten Indian leather exporters Tata International Ltd.

Florind Shoes Ltd. Punihani International Farida Shoes Ltd. Mirza Tanners Ltd.

T. Abdul Wahid & Company Hindustan Lever Ltd. Super House Leather Ltd. RSL Industries Ltd. Presidency Kid Leather Ltd.



• Tata International is the country’s largest exporter of leather garments and it's product range includes jackets, coats, skirts andtrousers, handbags, wallets, cases, luggage and travel accessories.The Garment business unit creates chic and stylish leather garments for leading fashion houses like Zara, Escada, Mango, LaBella, Yuppie and it's major clients are spread across countries like

Spain, Italy, Germany, France, Belgium, Japan, Canada, Swedenand Denmark.• It has the capacity to produce 30,000 leather garments per month in

every possible range, cut and style with the aid of world-classmanufacturing processes, special sample lines and a design studioto meet customers’ requirements. All the leather products &

accessories are elegant designs crafted from high-quality leather for style and absolute convenience.• This BU is seeking exclusive fashion tie-ups with high end, niche

fashion labels and is ready with dedicated production lines, to takethis business to the next level of expertise and craftsmanship.

I tit ti R l t d T L th



Institutions Related To Leather Industry

- LEATHER INDUSTRIES DEVELOPMENT CORPORATION(LIDCOM)

-LEATHER GOODS MANUFACTURERS’ ASSOCIATION (LIGMA)-

-DHARAVI ENTIRE LEATHER GOODS TRADERS’ ASSOCIATION

(DELTA)--MAHARASHTRA SMALL SCALE INDUSTRIES DEVELOPMENT

CORPORATION

(MSSIDC):

-COUNCIL FOR LEATHER EXPORTS:



% Share of Leather Products in Export Performance (2008-09)



Export Scenario for the last 5

years



Country-wise Export Performance(2008-09)



EU COUNTRIES

• Belgium

• Denmark

• France• West Germany

• Greece

• Ireland



Marketing of leather and leather products in Germany &EU

The leather sector offers a good potential which Indian entrepreneurs canexploit in Germany and other EU markets. With a strong foothold that the

Indian leather industry has had for long in these markets, and its advantageof raw material and labour resources, Indian leather exporters can, andshould, mount a strength and potential. This has to be done against thebackground of the well-known salient features of the German market:

•The world's second largest import and export market

• A difficult buyers' market with hyper competition and high expectations• A dynamic multi-faceted market with rapid technological development andinnovations A market where a considerable amount of buying power isdevoted to satisfying individual needs

• A market influenced by the rising average age of the population and lowbirth rate

• A market where environment awareness and eco-friendly productionbecomes more and more a pre-requisite for successful marketing of products



India - Denmark Leather Trade:

• * India’s export of leather and leather products to Denmarkhas increased from US$ 17.60 million in 2002 to US$49.10 million in 2007-08, growing at a CAGR of 22.77%.

• * The major leather products exported from India toDenmark are footwear with a share of 35.52%, followed byleather goods 30.16% and leather garments 25.09%.

• * Presently India holds a share of 3.84% in Denmark’stotal leather products import trade.



Government Initiatives• Duty free import scheme

• Indian leather development programme• IDLS

• The Additional Ambernath Export Promotion

Leather Complex Zone.• Focus Programme for Leather Products in Europe

Facilitation of Members Participation in MIPEL

Fair, Italy

September 2009 Edition

March 2010



FTP 2009-14

• Leather sector shall be allowed re-exportof unsold imported raw hides and skinsand semi finished leather from public

bonded ware houses, subject to paymentof 50% of the applicable export duty.

• Enhancement of FPS rate to 2%, would

also significantly benefit the leather sector



Union budget 2009-10• Inclusion of new inputs for manufacturer exporters of leather garments, footwear

(including non-leather footwear) and other leather products under the 3% Duty FreeImport Scheme (DFIS)

• The 2% interest subvention scheme for certain labour intensive sectors including theleather sector has been extended from Sept. 30,2009 to March 31, 2010. This willfacilitate reduced interest rates @ BPLR minus 4.5% for the leather sector on pre-shipment and post-shipment rupee export credit.

• Additional Benefits (coverage) under Export Credit Guarantee scheme have beenextended till March 2010. As per current package of ECGC, the percentage of cover is

enhanced by 5% under Export Credit Insurance Policies issued to exporters and by10% under Export Credit Insurance Covers for Banks. Thus, the total coverage for theexporters will be 95% and for the banks to 85%.

• The Excise Duty Exemption is being extended to Ethylene Vinyl Acetate (EVA)compound manufactured by a job worker, for further use in the manufacture of footwear, on par with PVC Compound.

• Exemption of Service Tax on foreign agents commission and transport of goodsthrough road. To facilitate flow of credit at reasonable rates, Rs.4,000 crore providedas special fund out of Rural Infrastructure Development Fund (RIDF) to SmallIndustries Development Bank of India (SIDBI). This will incentivise Banks and StateFinance Corporations (SFCs) to lend to Micro and Small Enterprises (MSEs) byrefinancing 50 per cent of incremental lending to MSEs during the current financialyear



FUTURE OPPORTUNITIESFUTURE OPPORTUNITIES

Rising potential in the domestic market.Rising potential in the domestic market.

Growing fashion consciousness globally.Growing fashion consciousness globally.

Use of information technology and decision support software to helpUse of information technology and decision support software to helpeliminate the length of the production cycle for different products.eliminate the length of the production cycle for different products.

Use of e-commerce in direct marketing.Use of e-commerce in direct marketing.



FAIR CALENDAR FOR 2009-10Delhi International Leather Fair Pragati Maidan New Delhi

Oct 23-25, 2009

India International Leather Fair Chennai, India

Jan. 31- Feb. 3, 2010

International Leather Goods Fair Kolkata , IndiaFeb. 19-21, 2010



CONCLUSION

• In rupee terms, during the first five months (April to August) of the currentfinancial year 2009-10, export of Leather Garments has registered amarginal increase of 2.25% and non-leather footwear increased by 2.51%.

• However, in Rupee and Dollar terms, all leather product categories haverecorded declining trend during the said period.

• Export of leather & leather products to major European countries and theUSA have shown declining trend during the April to August 2009.

• With its rich resource base of raw hides, skins and human capital, Indianleather industry has the capability to increase its share in global leather trade. At present, Indian leather exports account for 3% of the global tradewith USA, Germany, UK and Spain as major markets. The country has a lotof potential to increase its share in these markets by utilizing its uniqueadvantage of economies of scale and the capability to produce nicheproducts.



REFERENCES

• www.exim.indiamart./com

• www.infodriveindia.com

• www.india profile.com• www.tatainternational.com

• www.dgft.org

• http://www.leatherindia.org/

http://www.tatainternational.com/

http://www.dgft.org/

http://www.dgft.org/

http://www.tatainternational.com/

role of export promotion council in leather garments

Documents