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Rediff.com  » Business » Why Kanpur leather industry has started shifting to Kolkata

Why Kanpur leather industry has started shifting to Kolkata

By Virendra Singh Rawat
April 05, 2019 18:31 IST
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Closure of tanneries pulls down domestic finished leather exports and local price of raw-skin.

The Rs 12,000-crore finished leather industry in Kanpur has seen closure of about 250 tanneries over the past four months.

Kanpur tanneries were ordered to close between December 15, 2018 and March 15, 2019, for ensuring a cleaner Ganga during the Kumbh Mela at downstream Prayagraj (Allahabad).

 

However, even after the Kumbh’s culmination, barely a tenth has resumed operations, since the UP Pollution Control Board has not issued the necessary clearances, say owners.

UP comprises three major leather industry hubs, of Kanpur-Unnao, Agra and Noida.

Of the Rs 20,000 crore estimate of its annual worth, half is accounted for by the export market.

The state accounts for almost a third of India’s annual leather trade and export.

As a result of the Kanpur shutdown, the finished leather segment is witnessing a severe beating in export volume, even as other segments continue to grow.

Finished leather commands the third largest share of 14 per cent in the broader leather industry sphere, topped by leather footwear and leather goods at 38 and 25 per cent, respectively.

“The tanneries had started to shut from November 18 onwards. This industry has almost come to a standstill,” Small Tanners’ Association member Nayyar Jamal told Business Standard.

He said he’d even met the state chief minister but without respite.

The price of rawhide has dwindled ov­er recent months, from Rs 2,000 a piece to about Rs 700, since processing of these had almost stopped since mid-Nov­ember, he added.

Since, the rawhide is now being sent to other places, mainly Kol­kata, its price had also crashed in the Kol­kata market to Rs 500 or less, Moha­m­mad Ibrar, managing director of Kolkata-ba­sed Adiba Leather, said over the telephone.

For, in Kolkata, supply has in­c­reased beyond the processing capacities.

Javed Iqbal, chairman of the Council for Leather Exports’ (CLE) central region, said the drop in the domestic finished leather space was largely due to the tannery shutdown in Kanpur, which was among the major processing hubs (Jalandhar, Kolkata and Chennai are among the others).

Mukhtarul Anin, a former CLE chairman and leading Kanpur-based exporter, said buyers had already started looking at other markets such as Brazil, Bangladesh and Thailand.

Especially for heavy buffalo processed leather, for which Kanpur is noted.

“We are in touch with the state government authorities, chief secretary and the pollution department in this regard and hope things get sorted soon,” he said.

He estimates the Kanpur industry’s loss at almost Rs 6,000 crore from the indefinite closure, especially in the Jajmau industrial area.

“The closure continues to bleed the tanneries heavily and most of them are already financially drained,” he said.

The Kanpur leather cluster (this includes adjacent Unnao district), is estimated at Rs 12,000 crore a year, half of this being exported to places like the Gulf, Europe and China, providing livelihood to 200,000 people directly.

Satyadev Pachauri, UP’s minister for micro, small and medium enterprises (also the ruling Bharatiya Janata Party’s candidate  for the coming Lok Sabha contest from Kanpur), says the government will not compromise on the issue of pollution and a cleaner Ganga.

“The leather industry will have to follow the pollution control norms and regulations,” he said.

Photograph: Cathal McNaughton/Reuters

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Virendra Singh Rawat in Lucknow
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