New Delhi: Industry association Ficci urged government to promote setting up of large tannery parks and warehouses with cold-chain facilities for strengthening import of raw leather and ensure adequate supply of raw material to domestic industry.
In a representation to National Manufacturing Competitiveness Council (NMCC), the chamber has said the shortage of raw leather could affect the growth of leather industry in the country and hamper its employment potential.
Observing the dismal growth in the last few years, Ficci said that the average annual growth rate of this industry was almost negligible from 2001-02 to 2005-06. And, even in the current fiscal year the leather industry grew by only 0.9% for April-February 2006-07.
The average annual growth rate for last six years of India’s exports of leather and leather products has been merely 9% as compared to over 20% growth in the total merchandise exports. While, imports have increased at a rate of 15% annum for the same period.
The chamber has demanded capital subsidy scheme for the sector, on the lines of Technology Upgradation Fund (TUFS) Scheme for textile sector and setting-up of more design institutes in leather parks and clusters for providing access to small leather units to international designs.
Besides domestic investment, it has also expressed the need for special efforts for attracting large-scale FDI from focus countries in EU (Italy, Spain etc) and East Asia (Korea, Taiwan etc).