West Bengal's Leather Exports Projected to Grow by 10% in FY24

In a significant development for the Indian economy, the leather goods industry in West Bengal is set to witness a robust growth of 10 per cent in the fiscal year ending March 2024. This optimistic forecast comes amidst concerns over geopolitical tensions and potential recessions in key markets such as the US and Europe. The Indian Leather Products Association (ILPA) has attributed this positive outlook to a strategic shift in sourcing, moving from a China First approach to a China-Plus-One strategy, thereby increasing demand for Indian leather goods.

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ILPA President A.M. Kulkarni expressed confidence in maintaining this growth momentum, highlighting that the state achieved exports worth Rs 5,000 crore in the 2022-23 fiscal year, marking a 10 per cent increase. The growth is primarily fueled by the global leather brands' adoption of the China plus one strategy, aiming to diversify their sourcing to mitigate risks and manage costs effectively. India, with its major leather clusters in Tamil Nadu, Uttar Pradesh, Punjab, Delhi, Maharashtra, Haryana, and West Bengal, stands as a beneficiary of this shift.

Rajarshi Dey, Vice-President of ILPA, pointed out that China's dominance in the leather and non-leather product supply chain has significantly reduced from 34-35 per cent in the pre-Covid era to around 20 per cent. This decline has positioned India as a major recipient of the redirected demand. Dey also noted that manufacturing labour wages in China have surged nearly three-fold from 2010 to 2020, making India an attractive manufacturing hub due to its cost-effectiveness and skilled workforce.

The association's members are known for supplying to prestigious global brands such as Porsche, Gucci, Prada, MARC, Zara, Mango, Diesel, Police, and Max Mara. This underscores India's capability and reputation as a reliable source for high-quality leather products.

Furthermore, the West Bengal leather industry is actively seeking additional land to support its expansion plans. The demand for at least 20 acres of land aims to accommodate both the growth of existing units and the establishment of new companies from other states. The current leather park at Bantala near Kolkata has reached its full capacity. Kulkarni emphasized the industry's labour-intensive nature and expressed hope that the state government would allocate land close to the city to facilitate this expansion.

This projected growth of West Bengal's leather goods industry not only highlights India's rising prominence as a global manufacturing hub but also showcases the strategic shifts businesses are making to adapt to changing global dynamics. With its skilled workforce and cost-effective manufacturing capabilities, India is well-positioned to capitalize on these emerging opportunities.