Leather units in Jalandhar seek SEZ status

Leather units of Jalandhar want the central government to grant them SEZ status. Once scattered, the units got consolidated in a location in the 1990s. They generate a turnover of Rs 300 crore, which they say will rise to Rs 1,000 crore.

In 1986, the leather complex was established to consolidate the scattered units, the idea being to minimise pollution. But the complex was operationalised in 1990. It can accommodate 117 units. There are 45 tanneries and 17 dry units working in the complex.

Talking to Business Standard, Ajoy Sharma, an industrialist and a member of the Council of Leather Exports (CLE), said, "In our case the land is there, and so the government does not have to bother about the acquisition of land to set up the SEZ. The land can accommodate about 57 more units. We want a notification from the central government in this regard, so that we can compete in overseas markets."

Sharma said the excise duty on footwear was 16 per cent on those priced above Rs 750, and 8 per cent on those below Rs 750, in addition to the 4 per cent VAT and 1 per cent octroi.

"This adds to input cost and hinders competition overseas. Besides, we have to shell out Rs 4 per quintal on raw material as octroi," he added.

He said, "Once SEZ status is granted, there will be no excise duty and income tax. There will also be reforms of labour laws and taxes. This will ultimately lead to cuts in input costs and we can easily compete in overseas market on price."

Sharma said the leather industry was growing fast in this country apparently because Indian leatherwear enjoyed good demand abroad.