The Indian leather, leather products and footwear industry occupies a prominent place in the Indian economy. This sector is known for its consistency in high export earnings and is among the top ten foreign exchange earners for the country. Although identified as one among the 12 Focus Sectors by the Indian government to help the country emerge as a global supplier by tapping into its inherent strengths, leather players, mostly small or medium scale enterprises, continue to be besieged by a host of issues. Let’s first take a look at the strengths:
- The export of footwear, leather and leather products from India was to the tune of US $3.68 billion during 2020-21. India is the second largest producer of footwear in the world, next only to China.
- The industry is rich in raw materials as the country is endowed with 20% of world cattle and buffalo and 11% of goat & sheep population. Added to this are the strengths of skilled manpower, innovative technology, increasing industry compliance to international environmental standards, and dedicated support of allied industries.
- The leather industry is an employment intensive sector, providing jobs to about 4.42 million people, mostly from weaker sections of the society. Women employment is predominant in leather products sector with about 30% share.
- India is the second largest exporter of leather garments, third largest exporter of saddlery & harness and fourth largest exporter of leather goods in the world,
Firstly, it is important to understand why leather presents such a complex situation for sustainability programmes. Essentially, this is due to its highly fragmented and complex supply chain. Leather production starts in farms, where cattle are raised and slaughtered. The hides are sold to tanneries, which can be located across the world. Tanneries process the hides into what we call leather, which is sold to manufacturers to be turned into a huge variety of end products, from shoes and jackets, to car seats and bags. At every stage a huge number of employees and private sector entities are involved, including farmers, leather traders, wholesalers and retailers, high fashion brands, SMEs and more.
Throughout this process, leather often travels around the world, from Africa to India and then to Europe or America. It is not just an international chain, but a global network. A testament to this is the fact that a large number of the world’s tanneries are located in the global south, including India and Bangladesh, far away from where most profit on these products is made, namely in high income countries in Europe.
This last point also reinforces the deeper sustainability issues in the leather sector.
The Leather Working Group (LWG) has set a standard and audit system for chemical management in tanneries and now certifies around 20% of global leather production. Increasingly, companies will only buy leather if it is LWG certified. Despite the real value LWG adds to this sector, it is still far from a real supply chain sustainability system. Multi-stakeholder initiatives for sustainability are poorly developed, and sorely needed in the leather sector. Apart from a few larger companies, the leather sector’s presence is poor in initiatives which form a representative action group.