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Boosting the leather industry

Print edition : Jan 02, 2004

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BEFORE it lost its primacy to Tamil Nadu and Uttar Pradesh, West Bengal was, at one point of time in the 1970s, considered the tannery centre of the country. Even now, it has 523 tanneries and 2,000 leather goods units. The goat's skin available here is one among the best. Chief Minister Buddhadeb Bhattacharjee is hopeful of restoring some of the lost ground in terms of leather production once the Calcutta Leather Complex (CLC) in Bantala, starts functioning, perhaps in this fiscal year.

The CLC will be the world's largest integrated leather complex built at the lowest infrastructural costs. Set up by M.L. Dalmiya & Co Ltd on the build-operate-transfer (BOT) basis in a joint venture with the West Bengal government, the CLC is expected to bring in greater investments in the leather industry, scientifically and technologically advanced manufacturing and management practices, and additional employment.

Situated 14 kilometres away from Science City on the recently upgraded four-lane Kolkata-Basanti Highway, about a 25-minute drive from the city centre, the CLC has a total tanning capacity of 1,000 tonnes using 30 million litres of water a day. It has a state-of-the-art central effluent treatment plant, equipped with the latest technology to keep the entire complex pollution-free.

The CLC is one of the foremost eco-friendly and planned leather complexes in the country. Spread over 1,100 acres (440 hectares), the CLC is complete with a police station and a fire station, a petrol pump, a post office, and a market complex. Not surprisingly, it has been declared an Industrial Park. The complex will house the entire leather industry, starting from basic raw material units to tanning and finished leather units, as well as those involved in the production of chemicals, leather machinery, by-products, components and leather goods. According to the Chief Minister , "there is no complex like the CLC in the rest of Asia. It will help the local leather industry to become a major player.''

A proposal to set up a unique Special Economic Zone (SEZ) for leather and allied industries within the complex has been placed before the government. An SEZ is a duty-free enclave that is considered to be foreign territory for purposes of trade operations, duties and tariffs. This is part of the plan to set up an export zone for leather in the complex. "Exporters in the Park will enjoy the status of offshore units, with a lot of financial and non-financial benefits, a simplified procedural regime, and in-house customs clearance facilities. It would save manufacturers within the SEZ a lot in terms of transport costs," said Avishek Dalmiya, director, M.L. Dalmiya & Co Ltd.

A large number of tanneries, located earlier in Tangra, Tiljala and Topsia in eastern Kolkata, have shifted into the complex. With West Bengal having over seven lakh workers in the leather sector - a significant portion of the all-India total of around three million - the State government is looking at the CLC not just as a relocation site for the tanneries, but as a local leather industry hub. "The CLC is a step towards India's goal of capturing 5 per cent of world trade in leather and leather products by 2007. An estimated Rs.5,000-crore direct project investment now looms large over the eastern fringe of Kolkata, which simply makes the CLC the only destination for the leather sector in the State," said Dalmiya.

The leather goods park coming up nearby is also expected to provide a fillip to leather goods exports. At a time when exports of most leather goods segments have shown a negative rate of growth, small leather products such as wallets, gloves, belts and so on have registered a positive growth rate. According to figures available with the Directorate-General of Commercial Intelligence and Statistics (DGCI&S), the exports of leather goods between April and July 2003 stood at Rs.651.8 crores, which was 0.14 per cent higher than that for the same period in 2002. The growth rate works out to 4.6 per cent in dollar terms and offsets an overall negative rate of growth for the entire sector.

During his visit to Italy in June, Buddhadeb Bhattacharjee interacted with representatives of some leading leather and leather goods manufacturing units there, and a Memorandum of Understanding (MoU) was signed between the Council for Leather Exports, India and the National Association of Italian Manufacturers of Footwear, Leather Goods and Tanning Machinery (ASSOMAC). According to the MoU, ASSOMAC has agreed to part with its expertise for the modernisation of tanneries, quality and design improvement, and the development of a leather goods park, a fashion-cum-design centre of excellence, and a training institute for workers in the leather goods industry.

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