25-08-2017, 09:32 PM
The Indian Leather Industry
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EXECUTIVE SUMMARY
Indian leather sector today has greater opportunities for augmenting its exports. All the developed countries which are major consumers of leather products in the world today depend increasingly on imports because of their drastic decline in domestic production mediated by rising cost. Indian Govt. is placing an emphasis on export of leather products such as footwear, leather goods and leather garments in view of their potential for contributing towards economic growth of the nation. The leather products industry has an advantage to capitalize the low labour costs available in India. The industry should also exploit of liberal export policies of the govt. and introduce new technologies in processing and automations.
INTRODUCTION
During the last three decades there has been a rapid progress in Indian Leather Industry transforming it into a vibrant export oriented sector imbided with immense potential to earn valuable foreign exchange and to provided gainful employment to more than 15 lakh people of which greater proportion belong to weaker sections of the community. With a share of 5.6% of the country’s foreign exchange earnings, the Indian leather industry ranks fourth among the commodities that are being exported.Its tremendous performance with fourteen fold growth in the exports from Rs 412 crore in 1990-91 to a level of Rs 5928 crore in 2000-2001.,it has been considered as one of the illustrious success stories in the export front. However,despite this performance,India’sshare in the global leather trade has not significantly been improved,though the world trade has gon up over the years.The country has not missed the finest opportunity to establish itself earlier,when goal trade shifted to South Korea,Taiwan,HongKong etc.during 1970’s .
Since the industry moving again to low cost labour countries,such as China ,Indonesia, and Thailand,it is an oppurtuned time for India to register sufficient jump in the export of leather products to claim from the current level.Indian leather sector today has greater opportunities for augumenting its exports.All the developed countries which are major consumers of leather products to claim from the current level of 4.5% in 1995 to 10 % share in the world market by 2000 A.D. Indian leather sector today has greater opportunities for augumenting its exports.All the developed countries which are major consumers of lerater products in the world today depend increasingly on imports because of their drastic decline in domestic production mediated by rising cost.Indian Govt. is placing an emphasis on export of leather products such asfootwear,leather goods,and leather garments in view of their potential for contributing towards economic growth of the nation.The leather products industry has an advantage to capatalise the low labour costs available in India. The industry should also exploit of liberal export policies of the govt. and introduce new techonologies in processing and automations.
INDIAN LEATHER INDUSTRY
Leather, a traditional industry continues to hold a prominent place in the modern Indian economy too. The leather sector’s export has increased manifold over the past decades. The current annual export value of US$ 2.5 billion makes this sector the eighth major foreign exchange earner for the country. More importantly, this sector provides employment to nearly 2.8 million people in the semi urban and rural centers.
The Indian Leather Industry which has undergone a dramatic transformation shows value added products accounting for over 80% of this total export which was a mere 7% in late 1950’s. It is heartening to note that the leather and the leather products export registered about 12% growth last year and in the 1st half of the current year the growth is much more impressive at nearly 17%. This in the backdrop of mere 3.5% global annual import growth.
The entire leather sector now is no more under SSI reservation. 100% Foreign Direct Investment through automatic route is possible. Also in place are several facilitating schemes to aid the ambitious growth of plan of doubling export by 2010. A Tanning Complex, a Footwear Park, two Footwear Component Park and a Leather Goods Park are likely to become operational over the next one to two years.
All these will make it possible to reach an estimated US$ 12 billion output, out of which US$ 4 million will be the export by 2010. As a result the current export share of 2.32% in the global leather trade of US$ 81 billion should increase to around 4%.
PRODUCTS & CATEGORIES
There are various kinds of Leather Products.The most commonly used or manufactured for export by India manufacturers are displayed below with their description. These are few products out of many being exported.
SADDLE:
A saddle is a rider’s seat, placed on the back of the horse or pony. Its object is therefore to provide the rider with maximum security, control and comfort, as well as to protect the back of the animal. Saddles vary according to their use, but in general they fall into two main classes: The English or flat saddle and the Western saddle (with high pommel and cantle)
BRIDLE:
A bridle is the head - gear of both riding and driving harnesses. There are a number of different kinds of bridles, but, in general, the various parts of the bridle are common to all varieties, even though their form may vary. English type bridles are usually made of plain leather but there are also more expensive ones made in rounded leather. For racing and show purposes, the brow band is often covered in plastic or silk. The nose band can also be in rounded leather, padded or covered with sheepskin.
EXPORT MARKET STRATEGY
Marketing is defined as using all of the resources of the organization to satisfy customer needs for a profit. The difference between export marketing and domestic marketing is simply that it takes place across national borders. This means that you are faced with barriers to trade that you will not have encountered before, such as differing languages, politics, laws, governments and cultures. You may need to account for getting the product half-way across the globe to distant markets and pay the import duties imposed on these products by the importing country. You will also need to deal with the logistical and documentation problem surrounding exports. These are just some of the problems you will face. Export marketing also involves preparing an offering that will entice the foreign buyer and customer. This offering comprises a product that is offered at a certain price and that is made available – distributed – to the foreign customer. At the same time, the offering is communicated – or promoted – to the buyer using
certain communication or promotion channels. These elements – the product, price, distribution (also referred to as the place) and promotion – are called the marketing mix.