Considering more initiatives to promote growth of leather sector: DPIIT

The commerce and industry ministry is considering extending some initiatives to the leather and footwear sector to further promote the growth of this labour-intensive segment, a senior official said on Tuesday.

Additional Secretary in the Department for Promotion of Industry and Internal Trade (DPIIT) Rajiv Singh Thakur said that those measures are still at a discussion stage.

When asked if the government is looking at extending financial incentives under the PLI (production linked incentive) scheme to the sector, he said "all these things are being considered, but as of now no decision" has been taken.

"We are trying to bring in some more initiatives which are under the pipeline," he told reporters here.

The department, he said, is trying to create schemes through which availability of raw material can be enhanced to the industry.

They are also looking at ways to monitor the imports and there are suggestions for imposing minimum import price (MIP).

"All suggestions need to be looked seriously," Thakur added.

Talking about the Indian Footwear and Leather Development Programme (IFLDP), he said out of Rs 1,700 crore envisaged for this scheme, so far Rs 350 crore has been released under three sub-schemes of IFLDP.

Those three are Integrated Development of Leather Sector(IDLS), Sustainable Technology and Environmental Promotion (STEP), and Establishment of Institutional Facilities (EIF).

There are no disbursals so far under the other three sub-schemes of the programme -- Mega Leather Footwear and Accessories Cluster Development (MLFACD), Brand Promotion, and Development of Design Studios.

The government on January 19, 2022 has approved continuation of the IFLDP with an allocation of Rs 1,700 crore till March 31, 2026.

IFLDP is being implemented with these six sub-schemes. It is aimed at development of infrastructure for the leather and footwear sector, address environment concerns, facilitate additional investments, employment generation and increase in production.

The industry's estimated value is around Rs 82,000 crore while its exports are around Rs 42,000 crore at present.

India's exports account for only 2.65 per cent of the global export in the sector. The sector provides employment to close to 4.42 million people.

Support from the government for the sector started from 9th Five Year Plan (1997-2002) which continued till 2020-21.

Under the IDLS, as many as 1,225 units have been provided financial assistance amounting to Rs 464.96 crore for their modernisation and technology up-gradation in the sector in the last nine years.

In the STEP sub-scheme, 13 CETPs (common effluent treatment plant) have been upgraded and commissioned in Tamil Nadu and Rs 344 crore was released as assistance.

Under the MLFACD. Singh said six proposals from Bihar, Madhya Pradesh, Uttar Pradesh, Maharashtra, Tamil Nadu and Manipur have been submitted.

"These proposals have been scrutinised and likely to be considered soon," he said.

He added that eight applications involving Rs 21.37 crore have been submitted for the Development of Design Studios.

"These proposals have been scrutinised by NID (National Institute of Design) and likely to be considered soon," the official said.

In the last nine years, a total of Rs 2,198 crore were released under IFLDP.