In absolute numbers, the total exports during FY16 for the same period was at $5396.7 million and for FY17, it fell to $5174.12 million. Considering the fluctuation of the rupee, data shows a negative growth of 1.40 per cent.
“We can attribute the fall to the unstable European markets. However, the negative growth is not as steep as the trend in 2015-16, as the Europe-focused approach is changing. Increasing reliance on the US market is paying off and we will register a positive growth this fiscal,” said Israr M Ahmed, Regional Chairman, South, Council for Leather Exports (CLE).
Factory owners say that the negative growth has narrowed only compared to the previous year, and the business has not picked up compared to 2014.
“Consumption has come down, the job market is down and demand has not picked up in the European market. In the place of 3 orders, we get two orders,” said Rafeeque Ahmed, Chairman, Farida Group, which exports leather footwear. He added that despite turbulent markets, the company has been able to sustain the business and not suffer losses.
Among the 7 categories of leather being exported, finished leather recorded a negative growth of 15.67 per cent, hurting the whole segment, while footwear components and non-leather footwear exports grew marginally, at 3.69 per cent and 6.70 per cent respectively. Other categories, including leather garments, leather footwear, leather goods and saddler and harness registered a negative growth.
Exporters of finished leather say that a 5-10 per cent fall in the international leather prices has been one of the major reasons for the negative growth in terms of value.
“Finished leather is the main input for all the products manufactured and with lower input prices; the export has taken a hit,” explained Shafeeq Ahmed, Chairman, Indian Finished Leather Manufacturers and Exporters Association.
Exporters add that the initial signs for the current fiscal show flat growth, owing to unfavourable market conditions.
Source: Times of India