Jalandhar leather units face crisis as prices of goods fall

The hub of Punjab's leather industry, Jalandhar, is going through a depression phase because prices of finished goods are not increasing in proportion with the prices of raw materials. In the past four months, the gap has widened.

"The disconcerting factor in the present situation is the decline in exports. The cost of raw leather sheet has gone up by Rs 5 per square feet and prices of chemicals have increased by almost 10 per cent and a further increase of 10 per cent is expected in the near future," said Ajay Sharma, executive member, Council of Leather Exports.

The increase in petrol prices has been a factor in the stress, and, synthetic leather is creating problems by virtually flooding the domestic market, according to Sharma.

"The government should evolve a regulatory mechanism to revive the leather industry in the state," Sharma said.

He added that the industry was facing a decline in exports with the likelihood of the imposition of an anti-dumping duty on China products from European countries.

A decline of more than 45 per cent had been seen in the finished leather goods production due to competition from China, on account of its EU trade restrictions.