Leather & Leather Products

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  • ReportofWorkingGroup

    on

    Leather&LeatherProductsTwelfthFiveYearPlanPeriod(201217)

    Submittedby:

  • TheTwelfthFiveYearPlan(20122017)

    MOCI/DIPP/WORKINGGROUPREPORT/12thFIVEYEARPLAN/LEATHERINDUSTRY Page|2

    BACKGROUNDOFTHEWORKINGGROUP

    ThePlanningCommissionconstitutedaWorkingGroupforLeather&LeatherProductsfortheTwelfth Five Year Plan 201217 by Office Memorandum dated 28.04.2011, under theChairmanshipofSecretary,DepartmentofIndustrialPolicy&Promotion,GovernmentofIndia.TheNodalDepartmentforthisWorkingGroupisDIPP.

    TheCompositionoftheWorkingGroupwasasfollows:

    1. Shri R.P. Singh, Secretary, Department of Industrial Policy & Promotion - Chairman 2. Member- Secretary, National Manufacturing Competitiveness

    Commission or Nominee - Member. 3. Secretary, Department of Commerce or Nominee - Member 4. Secretary, Ministry of Micro, Small & Medium Enterprises

    or Nominee - Member 5. Secretary, Department of Animal Husbandry or Nominee - Member 6. Secretary, Ministry of Environment & Forests or Nominee - Member 7. Secretary, Ministry of Food Processing Industries or Nominee - Member 8. Adviser (Industries), Planning Commission - Member 9. Director, Central Leather Research Institute, Chennai or Nominee - Member 10. MD, Footwear Design & Development Institute or Nominee - Member 11. Director, IIT Kanpur or Nominee(for Saddlery Development) - Member 12. CEO, National Skill Development Corpn. Or Nominee - Member 13. Chairman, Council for Leather Exports, Chennai or Nominee - Member 14. President, Indian Footwear Components Manufacturers Association,

    Mumbai or Nominee. -Member 15. President, Indian Leather Products Association, Kolkata or Nominee - Member 16. President, Indian Leather Garments Association, Delhi or Nominee - Member 17. President, Agra Footwear Manufacturers & Exporters Chamber - Member

    (AFMEC),Agra or Nominee. 18. Chairman/MD, Bata India Ltd. - Member 19. CEO, Liberty Shoes Ltd. - Member 20. Chairman/MD, Crew B.O.S. Products Ltd. - Member 21. Chairman/MD, M/s. Tata International Ltd. - Member 22. Chairman/MD, M/s. Bhartiya International Ltd. - Member 23. CEO, Nike India 24. Shri M.C. Singh, Sr. Economic Adviser, DIPP - Member 25. Shri Chaitanya Prasad, Joint Secretary (Leather), DIPP -Member

    Secretary

    TheTermsofReferencefortheWorkingGroupisgivenbelow:

    I. Toarticulate the long termgoals tobeachieved in termsofgrowth, competitivenessandshareinglobaltradeintheleatherandleatherproductssector

  • TheTwelfthFiveYearPlan(20122017)

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    II. Toreviewthestatusof leather, leatherfootwear, leathergarments, leathergoodsandsaddlerindustryalongwithforwardandbackwardlinkagesandindentifytheissuesandgapareasthatneedtobeaddressedtoachievethelongtermgoals

    III. Toexamine thestatusandeffectivenessofallongoingschemespertaining to leathersector,and itsforwardandbackward linkagesbeing implemented inthe11thFiveYearPlan

    IV. TobenchmarkIndianleatherindustryagainstthebestpracticesofinternationalleatherindustry

    V. Toevolveacomprehensivestrategyforthedevelopmentofinternationallycompetitiveleatherindustryincludingforwardandbackwardlinkageskeepinginviewthelongtermgoalstobearticulatedasperitem1above

    VI. Toestimatetheyearwisedemandandcapacityforallsegmentsoftheleatherindustryforindigenousconsumptionaswellasforexportupto201617intheperspectiveofthelong term goals and to assess the requirement of rawmaterials, skilledmanpower,technology,infrastructureetcformeetingthesame.

    VII. To identifytheenvironmentrelated issues includingproblemsofzero liquiddischarge,removalanddisposaloftotaldissolvedsolidsetcandsuggestmitigationmechanism.

    VIII. To indicate themilestonestobeachieved inthe12thPlan inthecontextof long termgoalsasperitem1above,andrecommendprogrammes/schemes/measuresthataretobe initiated, continuedordiscontinued in the12thPlanperiodandestimated fundrequirement.

    IX. Tomakeanyotherrecommendationsasmaybeappropriateforsustainedgrowthandcompetitivenessofthesector

    In its firstmeetingheldon23rdMay2011, theWorkingGroupconstitutedsixSubGroups toaddressissuesrelatedtodifferentareas/subsectorsoftheleathersector.TheseSubGroupsareasfollows:

    A. MacroIssuesofLeatherSector,Convergence&LinkagesB. InfrastructureDevelopmentC. SkillDevelopmentInitiatives;D. LeatherTechnology,Innovation&EnvironmentalIssues;E. BrandBuilding;F. FDIinLeatherSectorinIndia

    ThereportoftheWorkingGroupisplacedherewith.

  • TheTwelfthFiveYearPlan(20122017)

    MOCI/DIPP/WORKINGGROUPREPORT/12thFIVEYEARPLAN/LEATHERINDUSTRY Page|4

    Contents

    BACKGROUNDOFTHEWORKINGGROUP..................................................................................2

    SUBGROUPONMACROISSUESOFLEATHERSECTOR,CONVERGENCE&LINKAGES..............11

    1. THECURRENTSTATUSANDFUTUREOUTLOOKOFTHELEATHERINDUSTRY.............12

    1.1 INTRODUCTION..........................................................................................................12

    1.2 StructureoftheIndustry............................................................................................12

    1.3Production,ExportandEmploymentinthissector...................................................13

    1.4Totalfactorproductivitygrowth................................................................................19

    1.5 SWOTAnalysis............................................................................................................21

    1.6 Futureoutlookforproductionandexports...............................................................22

    2. EVALUATIONOFTHEINDIANLEATHERDEVELOPMENTPROGRAMME(ILDP)INTHE11THPLAN...................................................................................................................26

    2.1 INTEGRATEDDEVELOPMENTOFLEATHERSECTOR(IDLS)(OutlayRs.253.43crore): 26

    2.2 LEATHERTANNINGCOMPLEXATNELLORE(OutlayRs.29crore):............................27

    2.3ESTABLISHMENTOFBRANCHOFFDDIATFURSATGANJ(OutlayRs.7.17crore):.....28

    2.4 FOOTWEARCOMPLEX(OutlayRs.3crore):...............................................................29

    2.5 SADDLERYDEVELOPMENT(OutlayRs.10crore):......................................................29

    2.6 SUPPORTTOARTISANS(OutlayRs40crore):............................................................30

    2.7HUMANRESOURCEDEVELOPMENT(OutlayRs.60crore):.......................................32

    2.8UPGRADATIONOFFACILITIESOFFDDIANDESTABLISHMENTOFOTHERSUCHINSTITUTESANDCENTRES:(OutlayRs.300.07crore):..............................................34

    2.9UPGRADATION/INSTALLATIONOFINFRASTRUCTUREFORENVIRONMENTPROTECTIONINTHELEATHERSECTOR(OutlayRs.200crore):.................................36

    2.10MISSIONMODE(OutlayRs.10crore):.....................................................................37

    2.11ESTABLISHMENTOFTRAININGCENTREINMADHYAPRADESH(Rs.24.85crore):..37

    2.12AdditionalGirlsHostelatFDDIFursatganj(OutlayRs.13.77crore):.......................38

    SUBGROUPONINFRASTRUCTUREDEVELOPMENT.................................................................39

    3. InfrastructureDevelopment........................................................................................40

    3.1 Introduction................................................................................................................40

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    3.1.1HistoricalBackground...............................................................................................40

    3.2 InfrastructureDevelopmentActivitiesImplementedduringEleventhPlanPeriod..40

    3.2.1SchemeforDevelopmentofLeatherParks............................................................40

    3.2.2IndustrialInfrastructureUpgradationScheme(IIUS)..............................................42

    3.2.3IntegratedDevelopmentofLeatherSector(IDLS)Scheme......................................43

    3.2.4Micro&SmallEnterprisesClusterDevelopmentProgramme(MSECDP)............44

    3.2.5InterventionMeasuresProposedforthe12thPlaninInfrastructureDevelopment46

    3.2.5.1 CommonInfrastructure.....................................................................................46

    3.2.5.1.1 EstablishmentofNewGreenfieldClustersviaMegaLeatherClustersScheme 46

    3.2.5.2 Establishment&UpgradationofPhysicalTestingLaboratoryofCLRI,FDDI&others.........................................................................................................................49

    3.2.6InfrastructureStrengtheningattheEnterpriseLevel...............................................50

    3.2.6.1 Modernization,technologyupgradationandexpansionofproductioncapacitiesoftheenterprisesfunctioningintheleathersector.................................50

    SUBGROUPONSKILLDEVELOPMENTINITIATIVES..................................................................53

    4. SkillDevelopmentInitiatives........................................................................................54

    4.1 Introduction................................................................................................................54

    4.1.1ToinfuseskillsetsintoartisansproductsandclustersthroughtheSupporttoArtisansscheme........................................................................................................56

    4.1.2DevelopmentofemploymentopportunityfortheunemployedyouthtomeetthegrowingdemandofthesectorthroughthePlacementLinkedSkillDevelopmentProgram&TrainingofTrainers..................................................................................5