Sipcot to set up leather SEZ

In a bid to attract new investments into the leather industry, the State Industries Promotion Corporation of Tamil Nadu Ltd (Sipcot) is proposing a sector-specific SEZ for the leather industry at Ranipet, about 120 km from Chennai.

The project, proposed over 260 acres of land, is expected to attract investments worth over Rs 500 crore from international and domestic leather companies.

The land has already been acquired by Sipcot, the developer of the SEZ, and formal approval for the SEZ status has been obtained. The SEZ notification from the Centre is likely to be obtained in the next couple of months.

The SEZ would also facilitate the expansion and modernisation of leather units located near Ranipet and Ambur, key leather clusters in Tamil Nadu. Planned near the leather belt of Tamil Nadu, it is expected to house all types of leather units such as footwear, footwear components, garments and accessories.

There are over 100 tanneries in and around Ambur. About five big leather houses operate 15 shoe factories here, and another nine medium-sized units have been making their mark in the international shoe markets. Ranipet also houses a number of leather footwear and component units.

Though this location is much more advantageous than the Irungattukottai SEZ for leather units, the leather industry is slightly worried over the availability of manpower for the units in the future.

"The existing leather factories near Ranipet are already facing manpower shortages and this will be a key issue in the near future if we are to locate our units in the Ranipet SEZ," said a top official with a leading leather export house.

Two SEZs for the leather industry are already coming up at Irungattukottai and Cheyyar. A footwear SEZ is being promoted by Sipcot, adjacent to the Footwear Component Park in Irungattukottai, about 34 km from Chennai. Around 150 acres have been earmarked for the purpose and it is proposed to make available about 105 acres of saleable land to domestic and international footwear companies.

Taiwan-based Feng Tay, manufacturer of sports shoes, skate shoes and casual shoes for Nike and other global brands, is setting up its production units over a 275-acre SEZ in Cheyyar, 90 km from Chennai.

The company had announced plans to invest Rs 300 crore to establish its footwear manufacturing facility.

The facility, which is expected to have an initial production capacity of 200,000 shoe pairs a month, is likely to be operational in early 2008. This may generate job opportunities for about 5,000 people, of which about 70 per cent would be women, in 2-3 years.