The Department of Industrial Policy and Promotion (DIPP) has sought a package of Rs 4,000 crore from the Finance Ministry to support the leather and footwear industry, which may turn out to be a game-changer for the sector.
“We have floated a revised policy. ILDP (Indian Leather Development Programme) ended with 12th Five Year Plan (2012-2017). Now every plan is being continued for three years. We have projected some expenses up to 2020. At this stage, we are projecting an amount of Rs 4000 crore,” a senior government official told.
DIPP is awaiting comments from all ministries concerned with the leather sector including Skill Development, Environment and Water Resources Ministry. Once these ministries come up with their preliminary views by the month-end, the Finance Ministry’s expenditure finance committee (EFC) will examine the proposal, the official said.
“Once EFC approves the proposed amount, then the policy will take shape. It will be taken up by Cabinet in July,” the official said.
In the Budget 2017-18, Finance Minister Arun Jaitley had said that a special scheme for creating employment in the leather and footwear industries will be launched and will be on lines of the Rs 6,000 crore package which was announced for the textile sector last year.
DIPP is the nodal agency for the central sector scheme, ILDP, which was approved with an outlay of Rs 990.36 crore, during 12th Plan period (2012-17). The Centre has already allocated Rs 500 crore towards ILDP for the current financial year.
ILDP aims at “augmenting raw material base through modernisation and technology upgradation of leather units, addressing environmental concerns, human resource development, supporting traditional leather artisans, addressing infrastructure constraints and establishing institutional facilities.”
With six sub-schemes including Integrated Development of Leather Sector (IDLS), human resource development, support to the artisan, leather technology innovation and mega leather cluster under ILDP, DIPP wants more incentives to scale up the programme.
“Rs 4000 crore that we have projected is inclusive of the Rs 500 crore that has already been allocated for ILDP,” the official said, adding that the broad features of the scheme will be the scheme, along with an addition of a new sub-scheme that will take care of employment generation.
The department is looking at liberalising labour laws by incentivising employers to bring labours under the formal sector.
“We will also be giving employer’s portion of the EPF (Employees Provident Fund). Out of 12 percent, the government will be paying 8.33 percent towards Employee Pension Scheme (EPS) (under Pradhan Mantri Rojgar Protsahan Yojna). The government will also be paying 3.67 percent EPF contribution of the employer for the leather sector,” the official said.
The scheme is expected to boost exports, generate employment and make the leather and footwear industry competitive globally.
Source: Money Control
