Lok Sabha Question No. 1807 (UNSTARRED), answered on 2020-09-21
Subject: Leather Industry
Ministry: COMMERCE AND INDUSTRY
Asked by: C.N. Annadurai, Dhanush M Kumar, Gajanan Chandrakant Kirtikar, Gautham Sigamani Pon, Ganesan Selvam

## GOVERNMENT OF INDIA MINISTRY OF COMMERCE & INDUSTRY DEPARTMENT FOR PROMOTION OF INDUSTRY AND INTERNAL TRADE

## LOK SABHA

UNSTARRED QUESTION NO. 1807. TO BE ANSWERED ON MONDAY, THE 21 ST   SEPTEMBER, 2020.

## LEATHER INDUSTRY

## 1807.  SHRI C.N. ANNADURAI:

SHRI DHANUSH M. KUMAR:

SHRI GAJANAN KIRTIKAR:

SHRI GAUTHAM SIGAMANI PON:

SHRI SELVAM G.:

Will the Minister of COMMERCE AND INDUSTRY be pleased to state:

## वाणिज्य एवं उद्योग मंत्री

- (a) whether the condition of the leather industry has been severely affected due to  Covid-19  pandemic  in  the  country  particularly  in  Maharashtra  and  Tamil Nadu and if so, the details thereof;
- (b) whether  there  has  been  a  slowdown  in  the  leather  production  and  exports during the last three years and the current year and if so, the details thereof;
- (c) whether the Government has taken any steps to double the exports as the leather sector is amongst the top ten foreign exchange earners in the country;
- (d) whether the Government which is implementing Indian Leather Development Programme (ILDP) has achieved the objective for which it was set up and if so, the details thereof; and
- (e) whether the  Government  is  implementing  schemes for  setting  up  of  leather parks  to  promote  leather  industries  in  the  country  and  if  so,  the  States  in which these parks are set up and the achievement made so far?

## ANSWER वाणिज्य  एवं उद्योग मंत्री (श्री पीयूष गोयल) THE MINISTER OF COMMERCE & INDUSTRY (SHRI  PIYUSH GOYAL)

- (a) : As  per  information  received  from  Council  for  Leather  Exports  (CLE),  the leather, leather products and footwear industry all over the country inter-alia including Maharashtra and Tamil Nadu have lost export orders on account of adverse impact of COVID-19 Pandemic.
- (b): As per information received from Council for Leather Exports (CLE) and the data of Directorate General of Commercial Intelligence and Statistics (DGCI&S), export of leather, leather products and footwear (including leather

garments) from India during  2017-18,  2018-19  and  2019-20  was  USD  5.74 billion, USD 5.69 billion and USD 5.07 billion respectively

- (c): Government  has  been  implementing  significant  support  measures  for  the overall growth of the sector in the last 6 years. These include:
- i. 3% duty credit scrip for leather products & footwear and 2% for finished leather under Merchandise Exports from India Scheme (MEIS).
- ii. 5% interest equalisation under Rupee export credit for MSMEs and 3% for  non-MSMEs  in  footwear,  saddlery  &  harness  and  other  leather products (HS Code 4205).
- iii. Basic Customs duty exemption on raw materials namely hides & skins, semi-finished and finished leathers.
- iv. Basic  Customs  duty  exemption  on  import  of  notified  critical  inputs  for making value added products @ 5% of FOB value of exports in previous year for manufacturer exporters of leather products and footwear and @ 3%  of  FOB  value  of  exports  in  previous  year  for  exporters  of  leather garments.
- v. GST reduction on finished leather from 12% to 5% on leather products and leather chemicals from 28% to 18%, on CETPs from 18% to 12% and on Job work from 18% to 5%.
- vi. 5% concessional GST for footwear with sale price upto Rs.1000/- and 18% for other footwear.
- vii. Notification of revised finished leather norms has been issued on Sept. 4, 2020 to facilitate export of newer types of finished leather which is in huge demand in the global market.
- viii. Central  Sector  Scheme  'Indian  Footwear  Leather  and  Accessories Development Programme' (IFLADP) for overall development and leather and footwear industry is being implemented.
- ix. Development Council for Footwear & Leather Industry (DCFLI) has been established  for  the  formulation  and  implementation  of  promotional  and development measures for the growth of labour intensive footwear and leather sectors in India.
- (d): The  objective of central sector  scheme  'Indian  Footwear  Leather  and Accessories Development Programme (IFLADP)' has been achieved in view of the following activities taken under IFLADP scheme for overall development of leather and footwear industry -
-  Financial assistance amounting to Rs. 248.41 crore provided for modernization  and  up-gradation  of  662  units  to  incentivize  investment and manufacturing  to  tanneries,  footwear,  components,  leather  goods, leather garments, harness and saddlery manufacturing units in leather & footwear sector under  'Integrated Development  of  Leather  Sector' sub-scheme.
-  Primary Skill Development  Training provided to 4,52,076 persons @ Rs. 15000/- per person and 3,68,157 trainees provided placement in leather & footwear sector under  'Human  Resource Development' sub-scheme.
-  Approval accorded for up-gradation of twelve Common Effluent Treatment  Plants  at  Dindigul,  Ranipet,  Ambur,  Vaniyambadi,  Vellore, Pallavaram,  Trichy  and  Erode  districts  of  Tamil  Nadu  and  financial assistance  amounting  to  Rs.  80.12  crore  released  in  respect  of  ten CETP projects under 'Leather Technology Innovation and Environment Issues' sub-scheme.
-  Financial  assistance  amounting  to  Rs  38.88  crores  has  been  provided for  up-gradation  of  seven  Footwear  Design  and  Development  Institute campuses  located  at  Noida,  Chennai,  Hyderabad,  Jodhpur,  Patna, Kolkata and Rohtak into Centres for Excellence (CoEs) under 'Establishment of Institutional Facilities' sub-scheme.
-  Approval accorded for the project 'Setting up of Mega Leather Footwear and Accessories Cluster (MLFAC) at Calcutta Leather Complex, Bantala, Kolkata' under  'Mega Leather Footwear and Accessories Cluster' sub-scheme.
- (e): Yes Sir, Mega Leather Footwear and Accessories Cluster (MLFAC) sub-scheme under 'Indian  Footwear  Leather  and  Accessories  Development Programme (IFLADP)' scheme provides infrastructure support to the Leather, Footwear and Accessories Sector by establishment of Mega  Leather Footwear and Accessories Clusters. Approval has been accorded for setting up of MLFAC at Calcutta Leather Complex, Bantala, Kolkata, West Bengal.

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