According to Council for Leather Exports (CLE), with multinational players specially from the US and Europe making a beeline in India as China struggles to keep its labour cost advantages, inadequate production capacities could come in the way of taking advantage of the situation.
"Indian manufacturers have a capacity of producing around 2,000 pairs a day, which is not enough to meet the demand," CLE Chairman Mukhtar-ul Ameen told PTI.
The sector needs a major capacity boost to meet demands from foreign firms, he added.
"Factors like rising labour costs have forced the US and European retailers to move out and explore the Indian market, but our infrastructure such as machinery and storage facilities are facing tremendous constraints," Ameen said.
Indian firms are eyeing exports worth $ 4.5 billion in 2010-11, up from $ 1.4 billion in 2007-08.
"We are also seeking to increase India's share of 2.65 per cent to 5 per cent mark in leather goods production by the end of 2010-11," he said.
