Agra invites JVs with China firms

Reasponding to the apprehensions shown by a recent delegation of US footwear importers regarding the significantly low production capability of footwear units in India, the Indian leather industry has decided to invite major competitor China to set up joint ventures with Indian footwear manufacturers at footwear and leather goods manufacturing clusters in the country, including Agra.

The entry of global footwear giant China into the Indian leather industry is being eagerly awaited by the footwear industry of Agra, which is currently stagnating for lack of sufficient investment despite its capabilities to produce quality footwear.

The Agra footwear industry is currently earning more than Rs 1,000 crore through exports, though it is still a minuscule proportion of the market penetration achieved globally by China.

According to industry sources, if collaboration did materialise with the Chinese counterparts, it would bring a major boost in the footwear exports share of India, combining quality with quantity for the first time.

Talking to Business Standard, R K Shukla, Export Promotion Officer and spokesman, Council for Leather Exports (CLE), said a 13-member delegation of industrialists linked to the leather trade had recently visited China under the aegis of the Council for Leather Exports as part of the Centre's Integrated Leather Development Programme named "Intechmart".

The delegation made a detailed representation and held business meetings with the Chinese leather industry in the Dongguan and Guangzhou regions of China and enlightened the Chinese footwear manufactures about investment possibilities available in the footwear industry of India.

He said the team was seeking Chinese investment in the Indian leather industry by way of joint ventures and technical cooperation.

The visit of the Indian leather delegation had evoked good response from the Chinese industry, especially the Guangdong leather industry association, which was an organisation of major leather goods manufacturing units of China. The delegation enlightened its Chinese counterparts about the investment climate prevailing in India for overseas investments and also various government support policies.

According to Shukla, the Chinese leather industry in Guangdong had acknowledged that India had become a big production base for shoe and leather products in South Asia and they had evinced keen interest to work closely with the Indian Leather Industry for mutual benefit.

He said that the leather industrialists of both the countries had agreed on strengthening mutual communication to promote the common development of their leather industry and as a part of this process, a delegation of Guangdong Leather Industry Association and the Association of Guangdong shoe manufacturers shall be visiting India during March-April 2006 for the purpose of studying investment opportunities in India, covering all important leather and footwear manufacturing clusters of the country.