Maran assures support to leather industry

India International Leather Fair 2006 inaugurated in Chennai

Union minister of communications and information technology, Dayanidhi Maran, has assured the leather industry his support on issues related to modernisation scheme, allotting special fund for reverse osmosis plants and abolition of countervailing duty (CVD) on import of leather machinery.

After inaugurating the India International Leather Fair 2006, Maran also announced that India Trade Promotion Organisation (ITPO) had promised to add 6000 sq mt at Chennai Trade Centre (CTC) complex, a JV of ITPO and Tamil Nadu Industrial Development Corporation, to accommodate more exhibitors in the upcoming fairs.

Earlier, speaking at the inaugural function, Rafeeque Ahmed, chairman of Council for Leather Exports (CLE), sought the help of Maran to get a special fund of Rs 100 crore from the Centre for setting up reverse osmosis plants in various common effluent treatment plants (CETPs) to meet Pollution Control Board's direction of becoming zero liquid discharge units by 2007.

He added that it would be difficult for many of the units in the leather sector to invest in reverse osmosis plant to meet the requirements as these units were not financially strong.

He suggested that 25 per cent of the cost of the machinery should be borne by the CETP concerned and the remaining 75 per cent cost could be met from the proposed Rs 100-crore fund.

Ahmed also sought the removal of countervailing duty (CVD) on leather market machinery in the forthcoming budget. Stating that CVD collected so far in the last year was only a few lakh of rupees, he said that the abolition of CVD would help the small and medium entrepreneurs to a large extent.

He also suggested that the Centre apply the modernisation scheme announced in November 2005 to the entire five year plan period from January 2002, to effectively use Rs 290 crore earmarked for the purpose .

Centre's attention was also drawn to leather industry's earlier request to rationalise and reduce some of the duties and bring it on par with the textile industry.

While assuring support to leather industry, Maran said that he would take up the issues with the prime minister and finance minister.

Stating that the UPA government, in its common minimum programme, had recognised leather as one of the thrust segments, he said that the composition of export leather and leather products from India had undergone a structural change from being merely an exporter of raw material in the sixties to value added products in the nineties.

Suggesting appropriately orienting marketing strategies both at macro and micro levels to meet the challenges, he said that marketing opportunities need to be nurtured regularly and marketing credibility would have to be established as a long term measure.

Maran cautioned that the complacency in the leather industry against the background of the sheltered home market would ruin the exports in the long run. He appealed to the industrialists and exporters to look out for fresh dynamism and strive for excellence.

He also stressed the need for upgrading technology in line with the demand pattern and focus on improving quality. Stating that IILF 2006 witnessed more number of foreign exhibitors, N N Khanna, chairman and managing director, ITPO, said Brazil and Italy were participating at national level.

Countries from SAARC region, namely Pakistan and Bangladesh, too had sizeable representation.