The government has drawn up a Rs 1,350-crore project to improve leather extraction, processing and the quality of value added products. Massive technology inputs will be infused in all the leather processing centres to help the sector achieve a turnover of Rs 8000 crore by 2006, up from Rs 1500 crore now.
The project has been mooted by the Central Leather Research Institute (CLRI) in Chennai. A presentation was made to minister for science and technology Murli Manohar Joshi a fortnight back. Joshi is expected to put the proposal up for cabinet approval within the next couple of months.
The main objective of the project, scheduled to be executed over eight years from 1999-2006, is to increase value realisation of Indian leather from $1.70 per square feet to $3.0 per square feet. This will be made possible by improving the entire value chain, from skinning to the finished product. Sources in the Council for Scientific and Industrial Research (CSIR), the parent body of CLRI, told Business Standard that the project will cover 40 per cent of the organised sector and 35 per cent of the unorganised sector. It will also create a human resource base, skilled in new and clean technologies, for the sector.
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The sources said in addition to traditional leather centres like Chennai, Agra and Kanpur, the project will help extend the industry to new areas, like Rajasthan, Himachal Pradesh, Madhya Pradesh, Maharashtra, Gujarat, Andhra Pradesh and Jammu and Kashmir.
Since the industry was perceived as `dirty', many entrepreneurs were unwilling to take it up in spite of high returns. With the new technology, the sector had the potential of becoming a leading export industry.
Technology inputs will be provided on soft loan terms through banking channels. The CLRI will provide initial training and consultancy services to enable small leather units to adapt to the new technology.
The cornerstones of the CLRI technology are environmental sustainability, cost reduction and product quality improvement. Several technology packages have been prepared and more research will be undertaken to fine tune these packages.
Traditional Indian leather goods-making skills will be enhanced with modern processing methods to protect the environment and improve unit realisation. The organised sector, which accounts for 30 per cent of the industry will be provided with technology inputs to bring their output at par with international standards.
The project was taken up after the success of a CLRI leather technology mission in 1994-1997. The Supreme Court had ordered the closure of over 2000 units on environmental grounds. However, the CLRI provided the technology for tanning and effluent treatment, which saved the units and the source of livelihood of over 25,000 people.