Leather and footwear exporters seek PLI scheme in Budget to boost jobs, manufacturing, and shipments

Leather and footwear export body CLE on Tuesday sought the extension of a Production-Linked Incentive (PLI) scheme for the sector to boost job creation, domestic manufacturing, and shipments. In a pre-budget meeting with Finance Minister Nirmala Sitharaman, Council for Leather Exports (CLE) Chairman Rajendra Kumar Jalan also urged the government to provide import duty exemptions on wet blue, crust, and finished leather.

"Implementation of the PLI will lead to a structural transformation of the industry and make the country a major manufacturing hub," Jalan said. He added that the PLI would provide a major fillip to domestic and overseas investments, not only in capacity modernization and the expansion of existing units but also in start-ups, thereby expanding the overall production base.

"The benefits of the PLI will include an incremental investment of Rs. 6,000 crore and additional employment generation for about 2 million people, both directly and indirectly," he said.

He noted that while the import of wet blue, crust, and finished leathers during 2022-23 was USD 450.73 million, the export of value-added products was USD 5.26 billion—more than 10 times the import value.

"Hence, it is requested that the 10 per cent import duty now being levied on wet blue, crust, and finished leathers be removed to increase the price competitiveness of the value-added products segment," Jalan urged.

Jalan also requested the government to allow the export of all value-added leathers, including crust leathers, without any export duty. "This will lead to a quantum jump in the export of value-added leathers by at least USD 1 billion in the next 2-3 years," he said.

Presently, there is a 40 per cent export duty on raw and pickled hides, crust, and wet blue leather, and 30 per cent on raw buffalo hides.