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THE ROLE OF LEATHER INDUSTRIES IN THE DEVELOPMENT OF OUR ECONOMY NEERAJ KUMAR Research Scholar,

THE ROLE OF LEATHER INDUSTRIES IN THE DEVELOPMENT OF OUR ECONOMY

NEERAJ KUMAR

Research Scholar, Department of Economics, Mewar University, Chittorgarh Raj. (India)

ABSTRACT

The leather industry is one of the oldest traditional industries. It makes significant contribution towards economic growth, balanced regional development, employment generation and overall poverty reduction in the field of leather and allied product manufacturing. The Leather industry is bestowed with an affluence of raw materials as India is endowed with 21% of world cattle & buffalo and 11% of world goat & sheep population. Added to this are the strengths of skilled manpower, innovative technology, increasing industry compliance to international environmental standards, and the dedicated support of the allied industries. The leather industry is an employment intensive sector, providing job to about 2.5 million people, mostly from the weaker sections of the society. Women employment is predominant in leather products sector with about 30% share.

Keywords: Contribution, Economic growth, Employment Generation.GDP, Poverty reduction

I. INTRODUCTION

Leather sector occupies a very important place in the development of our economy on account of its substantial export earnings, potential for creation of employment opportunities and favorable conditions for its sustained

growth. There is a large potential to increase the domestic production and exports. The Leather Industry holds a prominent place in the Indian economy. This sector is known for its consistency in high export earnings and it is among the top ten foreign exchange earners for the country. With an annual turnover of over US$ 12 billion, the export of leather and leather products increased manifold over the past decades and touched US$ 6.5 billion during 2014-15, recording a cumulative annual growth rate of about 13.10% (5 years). The Leather industry is bestowed with an affluence of raw materials as India is endowed with 21% of world cattle & buffalo and 11% of world goat & sheep population. Added to this are the strengths of skilled manpower, innovative technology, increasing industry compliance to international environmental standards, and the dedicated support of the allied industries. The leather industry is an employment intensive sector, providing job to about 2.5 million people, mostly from the weaker sections of the society. Women employment is predominant in leather products sector with about 30% share. The leather sector is working the following segments are given below:

Tanning sector

Footwear

Leather Garments

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 Leather Goods & Accessories Sector including Saddlery&harness. II. LITERATURE REVIEW Leather industries play

Leather Goods & Accessories Sector including Saddlery&harness.

II. LITERATURE REVIEW

Leather industries play an important role in the development of our economy, While describing some basic issues pertaining to the leather industries in developing economies, Some review of literature are given here. Shetty (1963) pointed out that the technological base in the industry was extremely primitive and a unit was rarely interested to adopt technological modification in the process. Usha (1985) based on Tamil Nadu Leather Tanning Industry in Year 1978-79.she focused attention on some selected issues related to the structure of work force, Mechanization and the prospect of the traditional skilled and unskilled workforce in the industry. Her Major findings were that the leather tanning sector in Tamil Nadu, about 90.0 per cent of the total entrepreneurs‟ belonged to the Muslim Community and rest belong to the Hindu Community. As regards the Mechanization of Industry, most of the tanning and manufacturing units were using Labor-intensive technique, in which the skilled hand workers formed a majority of the workforce. Qureshi (1990)discussed some issues of leather making artisans of Mewat region in the district of Gurgaon, Haryana A large Majority of Leather Products makers were facing problems of inferior quality of goods, time consuming, less profitability, low prices for products, non availability of credit and payment delays. Sahasranaman (1993)pointed out some basic problems of the leather product industry. According to this study, in the Leather product Industry, the dominance of traditional production system, confinement of production to a particular community, absence of modernization of technology, were the basic problems of the producers. Chandramouli’s (1999)on “Leather and Social Development” focused on some characteristics of Leather Industry. The author stated that the production of leather and leather products involves various socio-economic activities. The economic activities were largely in the form of generation of income, creation of employment, etc. On the other hand, the production of leather and leather goods led to the social development in the form of understanding, awareness, social equity, better health, education and nutrition. Bhavani (2010) highlights the issue of quality employment generation by the SSIs and negates the short term attitude of increasing the volume of employment generation compromising with quality. The author argues that employment generation by the SSIs may be high in quantitative term but very low in quality. Technological up gradation would enable the small firms to create quality employment improving, duration and skill. This structural shift may reduce the rate of employment generation in the short run but would ensure high-income employment generation in the long run.

III. OBJECTIVE OF THE STUDY

The proposed investigation has the following objectives:

To examine the role of leather industries in the growth of our economy.

To investigate how the economic performance of industry determines.

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IV. RESEARCH METHODOLOGY Data are mostly collected through desk research of online resources, research papers,

IV. RESEARCH METHODOLOGY

Data are mostly collected through desk research of online resources, research papers, conference documents, and other publications. Data from Council from leather export has been used. Annual report on MSMEs, Annual report of ministry of commerce and industry, various annual reports of State Financial Corporation, and various financial institutions have been used. The data have been compiled from three types of sources: published documents and reports, the World Wide Web and statistical agencies. All data sources are listed at the end of this note and Web links are provided where possible. Simple statistical tools have been used for analyzing data. Analysis of Export Performance of Leather and Leather Products April-August 2015 vis-à-vis April- August 2014 As per officially notified DGCI&S monthly export data, the export of Leather and Leather products for the period April-August 2015 touched US$ 2653.64 mn as against the performance of US$ 2872.64 mn in the corresponding period of last year (April-August 2014), recording a negative growth of -7.62%. In rupee terms, the export touched Rs. 169367.00 million in April-August 2015 as against the previous year‟s performance of Rs. 172557.35 million registering a negative growth of -1.85%. A Statement showing the Product-wise Export performance during April-August 2015 vis-à-vis April-August 2014 is given below:

Table 1: product wise Export Performance during April-august 2014 Value in US $ MILLION

Category

April -Aug 2014

April -Aug 2015

% share

Finished leather

605.47

486.34

18.33%

Leather footwear

1010.22

962.75

36.28%

Footwear component

171.61

134.68

5.08%

Leather garments

264.11

260.22

9.81%

Leather goods

606.06

590.83

22.26%

Saddlery and hardness

74.07

63.35

2.39%

Non leather footwear

141.11

155.47

5.86%

Total

2872.64

2653.64

100.00%

Source: ITC, Geneva & DGCI &S, Kolkata

In Rupee Terms, export of leather & leather products have shown positive growth in all the product segments during the period April-August 2015.

In Dollar Terms, export of leather & leather products have shown positive growth in all the product segments during the period April-August 2015.

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Country-Wise Analysis: Major export markets are USA 14.35%, U.K. 12.32%, Germany 11.09%, Italy 6.95%, Hong

Country-Wise Analysis:

Major export markets are USA 14.35%, U.K. 12.32%, Germany 11.09%, Italy 6.95%, Hong Kong 5.85%, U.A.E. 5.66%, Spain 5.56%, France 4.94%, Netherlands 3.02%, China 2.90%, Vietnam 1.81% and Belgium

1.42%.

These 12 countries together accounts for nearly 75% of India‟s total leather& leather products export. Export of leather & leather products to major markets like Germany, Italy, France, Hong Kong, Russia, Netherlands, Denmark, Greece, Canada, Switzerland, Sweden etc. Have shown negative growth during April- August 2015. However, export of leather and leather products to the markets viz., USA, New Zealand, South Africa, Japan, UAE, Korea Rep. Etc., has recorded positive growth during the reporting period.

has recorded positive growth during the reporting period. Figure 2:Percentage share of footwear in export Source:

Figure 2:Percentage share of footwear in export

Source: ITC, Geneva & DGCI &S, Kolkata

V. CONCLUSION

Continuous export growth in the various segments of leather industries shows that the leather industries play a vital role in the development of our economy. India can generate additional economic development growth by fostering leather industries activities within its borders, particularly within its burgeoning middle class. Not only has leather industries been found to yield significant economic benefits in a wide variety of nations, but India specifically has reached a point in its development where it can achieve similar results through other industries efforts. Among other things, India is poised to generate new business startups in the high technology area that can help it become a major competitor in the world economy.

REFERENCES

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[1] Hussain Abid, (1997), „Report of the Expert Committee of Small Enterprises‟, National Council of

[1]

HussainAbid, (1997), „Report of the Expert Committee of Small Enterprises‟, National Council of Applied

[2]

Economic Research, New Delhi. Desai, Vasanta (2000), “The Dynamics of Entrepreneurial Development and Management”, Himalaya

[3]

Publishing House, New Delhi. Bhattacharyya, D.K (2004), “Research Methodology”, Excel Books, New Delhi.

[4]

Mohd, Saud Ilahi (2007), “Non Monetary Support for Development of Entrepreneurship in Small Scale

[5]

Industry of Delhi state”, Ph.d Thesis, JamiaMilliaIsllamia New Delhi Mehta, Om Prakash (2009), Global Economic Crisis and Challenges to Micro, Small and Medium

[6]

Enterprises, “LaughuUdyogSamachar” (Aug- 2009), New Delhi. Varma U. K (2011), New and Innovative Schemes for Technology Development of MEMEs,

[7]

“LaughuUdyogSamachar” (Feb- 2011), New Delhi. Annual Report: Ministry of Micro, Small and Medium Enterprises

[8]

www.leatherindia.org

[9]

www.fddiindia.com

[10] www.vvgnli.com [11] www.msme.gov.in [12] www.msme.org [13] www.sidbi.com [14] www.smallindustryindia.com [15] www.ssi.nic.in

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