India's Leather Exports to Europe

A
Project Report
On
A Study Of Leather Export from India to Europe
Guided By:
Dr. JITENDRA KUMAR SINGH
Submitted by: Aishwarya Sharma
REGD.NO: 1305003370
CENTER CODE: 00963
Master of Business Administration
In
International Business Management
November 2014 Winter Session
BONAFIDE CERTIFICATE
Certificated that this project report titled A Study Of Leather Export From
India To Europe is the Bonafide work of Aishwarya Sharma, bearing Roll NO:
1305003370 who carried out the project work under my Supervision.
Guide
Dr. JITENDRA KUMAR SINGH
Head of Department
JAYESH BHATNAGAR
DECLARATION
I, Aishwarya Sharma
hereby declare that this Project Report titledA
Study Of Leather Export From India To Europe,
is a genuine project
undertaken by me under the guidance of Dr. Jitendra Kumar Singh, SMU,

Rajouri Garden in partial fulfillment of the requirements of the award of the MBA.
All findings and analysis in this project report are true, authentic and
impartial. I promise that the data gathered for the purpose of this report will not be
made public and will be kept confidential, except for academic purpose.
ACKNOWLEDGEMENT
The satisfaction which accompanies the successful completion of the project , is
incomplete without the mention of a few names. I take this opportunity to
acknowledge the efforts of the many individuals who helped me make this project
possible. First and foremost, I would like to express my heartiest appreciation and
gratitude to my Guide Dr. Jitendra Kumar Singh. His vision and execution aimed
at creating a structure, definition, and realism around the project and fostered the
ideal environment for me to learn and grow. This project is a result of their
teaching, encouragement and inputs in the numerous meetings he had with me,
despite their busy schedule. He has helped provide the scope and direct my studies
in a matter to make them most beneficial to me and to the company. I am
extremely grateful to my Faculty Guide for this project Mr. B.N Sharma for her
valuable inputs from time to time. I would also like to thank all the faculty
members of SMU, Rajouri Garden for helping me a lot.
ABSTRACT
The topic chosen for the current Thesis study is A study of leather exports from India to
Germany. The following study is based on a strong assumption that India is one of the major
exporters of leather and leather goods to North-American countries. This Hypothesis is based
on an excerpt from the study conducted in Germany Embassy to Indias on the bilateral trade
patterns.
Nature of Study
The Thesis study in subject now is an exploratory study with a touch of descriptive
research. Fundamentally it is a Primary Data Study.
Mode of data collection
Questionnaires & Internet is the only source for obtaining the data for this Thesis.
However for converting the data into the Germanyble format and context MS Word
and MS Excel have been extensively used.
Analytical tools used
Simple Percentages and growth rates have been used as a part of

Mathematical tools.
Using statistical tools like GAP, the complex data has been tabulated
and drawn into charts and analyzed subsequently.
As a part of business tools, SWOT analysis has been adopted.
Theoretical Orientation
The study must include all the basic knowledge about the industry and Economies involved in
the study. For this purpose, an extensive understanding of the different aspects of links involved
in the whole value chain of the study had to be carried out. Once the reader felt the gasp of the
topic and nitty-grittys involved, I have introduced him to various combination of the quantitative
data relevant to the topic.
Outcomes
The above dealt tools are sure to establish clear-cut relationship between the missing information
obtained from the secondary research. The outcome necessary for establishing the conclusion
and to prove the hypothesis would be from the quantitative information.
Limitations of the Research
For the sake of better understanding and analysis, Germany has been
defined as GERMANY and Canadian markets only.
The data quoted in this report is considered to be latest, since the
available sources are not uniform and not as often updated.
No future projections for the Industry have been made, since such projections are
subjected to a lot of intricate factors of the Industry. And it is not possible to deal with so many
factors in a small study like this.
ACKNOWLEDGEMENTS
I would like to convey my gratitude to Mrs. Shweta Wadhwa for her kind support
and insightful guidance at every step of this Thesis Writing, without whom this work
would not have seen the light of the day. He has been of great inspiration and
support for me at every turn of the process.
Further I would like to thank and credit all my professors at JIMS with the success of
this work, which is an offshoot of the seeds of knowledge sown by them. Most
Importantly, I would like to thank Mr. Anoop Sethi for their invaluable suggestions
in this work and for having guided me to the right path at the right time.
TABLE OF CONTENTS
INTRODUCTION TO THE TOPIC

1.
2
About the Leather Industry
.......
1.1.1 Introduction to Leather Crafts in India .3

2.
.4
India Snapshot of the Economy and Infrastructure...

2.1
Economic Overview...4
2.2
Infrastructure.....5
2.3
Indian Ports....6
3.
Organizational Setup for Promoting Exports in India..
.8
4.
3.1
ITPO....8
3.2
Fairs in India......9
3.3
Fairs Aboard...........9
Trade Initiatives with Germany....11

4.1
4.2
......15
5.
16
Trade with North NAFTA...11

Measures Undertaken for Export Promotion to NAFTA..
Current Status of Leather Exports from India.....

5.1
About Council for Leather Exports (CLE)...17
5.2
5.3
Global Leather Industry.18

Forms of the Leather Exported.....19
5.4
Export Duty Chargeable on the Indian Leather Goods..
5.5
Global Exports vis--vis India's Export.....23
.22
6.
GERMANY
..25
Country
Profile...
6.1
Economic Overview.........25
6.2
Trade Policy Developments.27
6.3
INDO-Germany Leather Trade.
6.4
Government of Indias Initiatives.......31
30
7.
Canada Country Profile...32

7.1
About the Country.......32
7.2
Economic Overview.32
7.3
Trade Policy......33
METHODOLOGY ...............................................................................
..............35
ANALYSIS
8.
Supply Side Analysis37
8.1
...37
Quick
Facts
About
the
Indian
Leather
Market.
8.2
Market Size...39
8.3
Performance of Leather Exports in the Past...
8.4
Trade with Germany......43
8.5
Competitive Scenario...44
..40
8.6
Exports
India....46
9.
Promotion
Measure
for
Leather
Industry
in
Demand Side Analysis.....47

9.1
Germanys Total Leather Imports...47
9.2
Germany
Trade
Products...50
Policy
on
Footwear
and
Leather
GAP ANALYSIS
10.
Demand Supply Gap.51

10.1 Calculation of the Net Imports of the Germany..51
10.2 Calculation of Net Exports from India to Germany...51
10.3 Demand
-Supply
GERMANY..51
Gap
for
Leather
Trade
with
the
10.4 Demand -Supply Gap for Leather Trade with Canada...

52
10.5 Demand
North..52
-Supply
Gap
for
Indian
Leather
Trade
with
SWOT ANALYSIS
11.
Strengths
and
Industry.54
Weaknesses
for
Indian
Leather
11.1 Strengths..54
11.2 Weaknesses..56
12.
Opportunities
and
Industry..57
Threats
in
the
Global
Leather
12.1 Opportunities...57
12.2 Threats..59
12.3 Major Competitors .61
RECOMMENDATIONS 62
CONCLUSION ...63
BIBLIOGRAPHY ...65
LIST OF TABLES
i.
Types of Leather and Their Application 3
ii.
Economic Indicators of India...5
iii.
Snapshot of Indian Infrastructure ..5
iv.
Indias Export and Import to/from the Germany...
11
v.
Indias Export and Import to/from Canada..13
vi.
Export Duty Charged on Indian Leather goods...
22
vii.
Economic Indicators of United States....27
viii. Economic Indicators of Canada in 200633
ix.
Sources of Production of Leather...37
x.
Category-wise leather producing Firms39
xi.
Leather Production by Category....39
xii.
Value of Indian Leather Products Exported During 2005
06...40
xiii. Destinations
Including
Canada
for
Indian
Leather
exports....41
xiv. Leather Imports by India....42
xv.
Exports of Broad Categories of Leather ...43
xvi. Top 10 Exporters of Leather as a Share of the Worlds
Exports....44
xvii. Top 10 Exporters of Leather as a Share of the Worlds
Imports....44
xviii. Indias
Share
in
the
World-wide
Leather
Imports...45
xix. Value of the Leather Apparel Imported by the Germany in the Recent
Past...47
xx.
Imports of Leather by the Germany in the Recent Past.48
xxi. Value of the Leather Apparel Imports by Canada in the Recent
Past...48
xxii. Value of the Leather Imports by the Germany in the Recent
Past49
xxiii. Value of the Leather Imports by Canada in the Recent Past..
49
xxiv. Net Imports of Leather Products in Germany....51
xxv. Net Imports of Leather Products in Germany51
LIST OF FIGURES
I.
Important
Hubs
for
Leather
Production
in
India38
II.
Breakup of Total Indian Leather Exports in 2005 06.
.40
III.
Value of Leather and Leather Products Exported During 1999
2005.41
IV.
Demand-Supply
Gap
with
GERMANY..52
V.
Demand-Supply Gap with Canada...

.53
VI.
Demand-Supply Gap with Germany....54
PREFACE
This Thesis report is motivated to study one of the emerging topics of the Indian
Foreign Trade. The topic chosen for the current Thesis study is A study of
leather exports from India to Germany.
The nascent motive in studying this particular topic is to investigate the rapidly
changing conditions in the Foreign Trade Environment and the promises that it has
in store for the Emerging Economies like India.
The present study is based on a strong assumption that India is one of the major
exporters of leather and leather goods to North-American countries. This
Hypothesis is based on an excerpt from the study conducted in Germany Embassy
to Indias on the bilateral trade patterns. The referred article observes that Indias
major exports to Germany include gems and jewellery, textiles, coir, jute and
handicrafts, chemicals and allied products, engineering goods, leather and leather
manufactures, etc.
The Hypothesis could be proved with the help of a thorough probe into the leather
trade trends in the past both at the Exporters and Importers end. We will try to
identify the Gap in the foreign trade trends between India and Germany. We will
plug the Gap with the help of some judicious analytical tools. The resulting trend
would give us a clear picture about the actual scenario of the Leather Trade trends
between India and Germany.
Here for this study purpose I have considered the GERMANY and Canada as the
whole Germanyn market.
INTRODUCTION TO TOPIC
1. About the Leather Industry
Leather
Leather is the suitable forms of Animal skins and hides. These skins and hides are
treated to preserve them. Tanning converts the otherwise perishable skin to a stable
and non-decaying material. Though the skins of animals such as ostrich, lizard, eel,
and kangaroo have been used, the more common leathers come from cattle,
including calf and ox; sheep and lamb; goat and kid; horse, mule, and zebra;
buffalo; pig and hog; and seal, walrus, whale, and alligator. Leather making is an
ancient art that has been practiced for more than 7,000 years
Tanning
By the term Tanning, one might get confused with a term used for tanning of fair
skin into dusky. The tanning of fair skin in humans by sunlight is completely
different: ultraviolet light causes production and redistribution of the pigment
melanin in epidermal cells.
In case of Leather industry it is the process through which raw animal hides or skins
are chemically treated to convert them into leather. Vegetable tanning (using bark,
wood, roots, or berries) has been practiced since prehistoric times. After removal of
hair, flesh, or fat, a tanning agent displaces water from the interstices between the
protein (mostly collagen) fibers in the skin and cements the fibers together. The
agents most widely used are vegetable tannin, salts such as chromium sulfate, and
fish or animal oil.
Types of Leather
i.
Types of Leather and Their Application
Types of Leather
Application/Nature
Full-Grain leather
Furniture and Foot-wear
Corrected-Grain leather
Leather garments of inferior quality
Suede
Processed hide known as Latigo
Patent leather
Plastic coated leather
Shagreen
Un-tanned leather from horses back
Buckskin
Imperishable leather
Belting leather
Used in Luxury products like briefcases,

portfolios, and wallets
Napa leather
Used in higher quality wallets, toiletry kits,

and other personal leather goods
Source:
www.answeRScom
1.1 Introduction to Leather Crafts in India
Rajasthan
The Rajasthan state has a long history in leather craft and industry and leather
shoes known as jootis or mojdis (shoes decorated with beautiful embroidery) are
made in Jaipur and Jodhpur. Embroidery known as kashida is done on the jootis.
This embroidery is mainly done by the women, who also do a bit of fancy stitching
or appliqu work to give a designer look to the shoes that have neither a left nor a
right foot. Leather is also used for bookbinding and Alwar is well reputed for this
craft that flourished in the 19th century under Maharaja Banni Singh. Bikaner is
again famous for its kupis or camel-hide water bottles.
Delhi
The current Indian capital Delhi was also an important centre of leatherwork during
the Mughal period, Traditional leather jootis and slippers, which were sometimes
ornamented with pearls, gold and silver were the piece de resistance. Embroidered
bags, shoes were other popular items.
2. India Snapshot
Infrastructure
of
the
Economy
and
2.1 Economic Overview
The economy of India is the fourth largest in the world as measured by purchasing
power parity (PPP), with a GDP of Germany D3.63 trillion. When measured in USD
exchange-rate terms, it is the twelfth largest in the world, with a GDP of USD785.47
billion or Rs 35, 34,615 0 million in 2005. India is the second fastest growing major
economy in the world, with a GDP growth rate of 9.1percent, as of the first quarter
of 2006. India's per capita income (PPP) of USD 3,400 is ranked 122nd in the world.
For most of its independent history, India adhered to a quasi-socialist approach, with
strict government control over private sector participation, foreign trade, and
foreign direct investment. Starting from 1991, India has gradually opened up its
markets through economic reforms by reducing government controls on foreign
trade and investment. Privatisation of public-owned industries and some sectors to
private and foreign players has continued amid political debate.
India has a labour force of 496.4 million of which 60percent is employed in

agriculture or agriculture-related industries, 17percent in mainstream industry and
23percent in service industries. India's agricultural produce includes rice, wheat,
oilseed, cotton, jute, tea, sugarcane, potatoes. Major industries include textiles,
chemicals, food processing, steel, transportation equipment, cement, mining,
petroleum and machinery.
ii.
Economic Indicators of India
FY 2005 -06
Indicator
Value
USD
in
million
Service sector growth

Domestic and International air traffic growth
Domestic and International air cargo traffic
growth
Growth in merchandise exports

GDP at factor cost at current prices
Percent growth
9.8
36.3
17.5*
29.2
72,316.3
12.5
114,937.8
2.3
Food grains production (tones)
209.3
2.3
Index of industrial production
215.4
7.8
458,600
4.7
Agriculture and allied sectors
Electricity generated (kwh)

Wholesale price index
196.2
(on February 4, 2006)

Money supply (Outstanding at the end of
financial year)
Imports
at
current
(April-Jan 2005-06)
prices
Exports at current prices
576700.5
108,803
74,978
(April-Jan 2005-06)
Foreign currency assets
133,770
(by end January 2006)

Exchange rate (Re/USD)
(Average April-January 2005-06)
44.25
4.1
16.4
26.7
18.9
8.2
2.1
(* Estimated figure)
Source: http://www.ibef.org
2.2 Infrastructure
iii.
Snapshot of Indian Infrastructure in the Recent Past
Indian Roads
Gauge
Period
Broad
National
Widening
Route
(km)
Running
Track Widening
Total Track
(km)
Highways
Major
to (km)Two to
Four
total
length
bridges
Lanes
Lanes
(in km)
44,220
62,180
2002- 03
Meter
58,112
15,180
710
15,880
418
14
31,060
2003- 04
Narrow
65,569
3,410
671
3,450
799
17
6,860
221
841
2004- 05
65,569
1,06,400
Services
Mumbai
Delhi
Chennai
Calcutta
International and Domestic

30.3
21.8
9.2
7.1
Bangalore
5.1
Hyderabad
Limited
International
Domestic
Limited
International
Domestic
Limited
International
Domestic
Limited
International
Domestic
Thiruvananthapuram
Ahmedabad
Goa
Calicut
Percentage
traffic
of
Name of the City
total
and
3.55
and
3
2.1
and
and
1.4
Railway Network (1998-99)
Air traffic at Major Airports
Source:
http://civilaviation.nic.in/
http://www.indiacore.com
2.3 Indian Ports

Indian Ports are the gateways to India's international trade by sea and are handling
over 90percent of foreign trade.
The 6,000 km long Indian coastline has 12 major ports and 181 minor/ intermediate
ports out of which 139 are operable. The major ports are located at Calcutta/ Haldia,
Chennai, Cochin, Ennore, Jawaharlal Nehru Port at Nhava Sheva, Kandla, Mormugao,
Mumbai, New Mangalore, Paradip, Tuticorin and Vishakhapatnam.
The 12 major Indian ports handle 90 percent of the all-India port throughput. The
139 minor ports are under the jurisdiction of the respective State Governments.
During 2001- 2002, the total cargo handled at major ports was 287.56 million tones
as against 281.10 million tones during 2000- 2001.
Though the bulk of Indian trade is carried by sea routes, the existing port
infrastructure is insufficient to handle trade flows effectively. The current capacity at
major ports is overstretched. The major ports together have a capacity of 215
million metric tones (MMT) at 1997- 98 levels. The major ports handled 287.56
million tones in 2001- 2002. The situation of limited capacity and high demand has
inevitably resulted in port congestion.
Problem Areas
The performance of Indian ports does not compare favorably with that of efficient
international ports. On three important parameters- capacity, productivity and
efficiency, Indian ports lack in comparison to some of the major international ports.
In international terms, labor and equipment productivity levels are still very low due
to the outdated equipment, poor training, low equipment handling levels by labor,
uneconomic labor practices, idle time at berth, time loss at shift change and high
mining scales and low datums.
3. Organizational Setup for Promoting Exports in

India
3.1 INDIA TRADE PROMOTION ORGANISATION (ITPO)

The Trade Fair Authority of India (TFAI) was incorporated under Section 25 of the
Companies Act, 1956, on 30th December 1976, and commenced business with effect
from 1st March 1977. Subsequently, the Trade Development Authority, a society,
registered under the administrative control of Ministry of Commerce & Industry, was
merged with the TFAI with effect from 1st January 1992 and the newly formed
Company was renamed as India Trade Promotion Organization.
To strive to be the pre-eminent trade promotion organization of India and as such to
promote, facilitate, encourage and coordinate various activities and programmes
which would enhance Indias share in international trade and contribute in
maximizing the countrys foreign exchange earnings through the instrument of
trade in goods and services.
Objectives
To promote, organize and participate in industrial trade and other fairs and
exhibitions show-rooms and depots in India and abroad and to take all measures
incidental thereto for boosting up countrys trade.
To publicize in India and abroad International Trade Fair and Exhibitions to be
held in India and invite the foreign participants to participate in them.
To organize and undertake trade in commodities connected with relating to
such fairs, exhibitions show-rooms and depots in India and abroad and to undertake
the purchase, sale, storing and transport of such commodities in India or any where
else in the world.
To undertake promotion of exports and to explore new markets for traditional
items of export and development exports of new items of export and development
exports of new items with a view to maintaining, diversifying and expanding the
export trade.
3.2 Fairs in India

ITPOs domestic exhibitions mirror the latest developments in various sectors of the
Indian industry.
These events provide opportunity to the Indian manufacturers/
exporters to promote their export and also launching and test marketing of their
new products and services. During 2005-06, ITPOs calendar of exhibitions consist of
23 exhibitions including IITF 2005, India International Leather Fair, International
Lather Goods Fair, Tex-Styles India, Delhi Book air, Arogya, Aahar, Sajavat Fair,
Stationery Fair, Gardening fair (new event), Sports Goods & Physical Fitness
Equipment Exhibition, I.T. India and Education and Job Fair. In addition, 70 other
exhibitions are being organized by Industry Associations, EPCs and private fair
organizers. These include Indian Handicrafts & Gifts Fair, Auto Expo 2006, Plast
India, DEF Expo and World Book Fair.
During the year 2006-07, ITPO targets to organize about 26 fairs in India. This will
include some well established fairs like IITF, Aahar, Delhi Book Fair, IILF Chennai
besides event on new product like Gardening and Cool Home etc. In addition, the
other organizers are likely to hold 60 third party events including major fairs like
Indian Handicrafts and Gifts Fair, Garment Fair, Super Seven Show, Indian
Enginerring. Trade Fair, 2006.
3.3 Fairs Abroad

During April-December 2005, ITPO organized participation in 46 trade fairs out of
total 58 events expected to be held during the year 2005-06.
Out of these 46
event, 18 were general events and 28 were specialized events further of all the 46
events, 12 were in WANA, 16 were in Europe, 8 in South East Asia and 10 in
America.
It includes Expo 2005 Aichi, Japan concluded in the month of
September, 2005.
Trade Development Activities

ITPO organizes several export development programme by using different
promotional tools for selected products in identified markets.
This created
awareness of Indias manufacturing and export capabilities especially in new

markets, as also provided opportunities to Indian exporters to garner export orders
During the year up to
December 2005, four Buyer Seller Meets were organized- the 16 th India Home
Furnishing Fair and the 26 th India Garment Fair in Japan and one Buyer Seller Meet in
Auckland, New Zealand and another one in Sydney, Australia. These four events
together generated business worth USD 26.24 million and were attended by 2733
buyers from leading department stores, wholesalers, importers, trading houses etc.
Two BSMs/ Indian exhibitions are targeted to be organized in Japan during 2006-07.
During the year up to November, 2005, visit of 10 Buying Delegations from Japan, Russia,
GERMANY and Germany was hosted and one to one meetings were organized with the potential
India units during their visits. During 2006-07, we expect to host about 12 Buying Delegations
from various countries across the globe.
In order to get maximum foreign business delegation at the time of IITF 2005, a
Seminar on International Trade Opportunities in Technology was organized.
An
export potential Seminar is proposed to be organized during Tex-Styles India 2006.

Under the new Business Development Programme with Department Stores, two
Department Stores have been identified for organizing India Promotion during next
year.
4. Trade Initiatives with Germany
4.1 Trade with Germanyn Free Trade Agreement (NAFTA)

Region
The Germany Free Trade Agreement (NAFTA) was signed in 1994. It is a free trade
area among the United States of America, Canada and Mexico. It is the largest and
most important trading block of the world. Indias bilateral trade with member
countries of the NAFTA are as follows:
India-U.S. Bilateral Trade
The Germany is Indias largest trading partner and foremost export destination. At present it
accounts for 16.48 percent of Indias exports and around 6.26 percent of Indias imports. India
accounts for only about 1.06 percent of the GERMANYs total exports and imports.
iv.
Indias Export and Import to/from the Germany

Percentage
Year
Exports
Imports
Growth
(In
million
USD)
Balance of
Percentag
e Growth
Trade
2000-2001
9305.12
10.83
3015.00
(-) 15.31
6290.12
2001-2002
8513.34
(-) 8.50
3149.62
4.46
5363.73
2002-2003
10895.76
27.98
4443.58
41.08
6452.18
2003-2004
11490.11
5.45
5034.86
13.31
6455.25
2004-2005
13271.47
15.50
6833.19
35.72
6438.28
Source: DGCI&S
Trend in India-U.S. Bilateral Trade
Growth of India's exports to the Germany in the year 2004-05 over the previous
year was 15.50percent while the growth in the Germany exports to India was
35.72percent over the previous year.
There is a huge untapped potential to
increase bilateral trade. Major items of Indian exports to the Germany are: Gems &
Jewellery (USD 4040.95 million); RMG Cotton incl. Accessories (USD 1403.38
million); Manufactures of Metals (USD 738.02 million); Primary & Semi-Finished Iron
& Steel (USD 576.99 million); Drugs, Pharmaceuticals & Fine Chemicals (USD 576.42
million). Major import items from the Germany to India are: Electronic Goods (USD
1248.68 million); Machinery except Elec. & Electronic (USD 812.94 million); Other
Commodities (USD 717.05 million); Organic Chemicals (USD 363.50 million);
Transport Equipments (USD 348.42 million).
During the period April-August, 2005, Indias exports to the Germany at USD
6003.36
million
registered
positive
growth
of
14.26percent
over
the
Corresponding period of the previous year when the exports were USD 5254.17
million.
During the period April-August, 2005, Indias imports from the Germany at USD
2760.11 million registered a positive growth of 26.38percent over the corresponding
period of the previous year when the imports were USD 2184.02 million.
FDI Approvals
The Germany ranks first and accounts for about 24.41percent (USD 16.40 billion) of
the total FDI approvals of USD 67.84 billion accorded since 1991.
The leading
sectors attracting FDI from the Germany are Fuels (Power & Oil Refinery),
Telecommunications,
Services.
Electrical
Equipments,
Food
Processing
Industries
and
Prospects in Trade for the Region

Considering the size of the U.Ss import market, there is an immense scope for expanding our
export base. In light of Chinas performance in the U.S. market, it is felt that it should be possible
for India to raise its market share from 1percent to 2percent in the U.S. market in the next three
years, with the right medium term strategy.
India-U.S. Commercial Dialogue
During the visit of the U.S. President to India, a document India-Germany Relations:
A Vision for the 21st Century was released by the Prime Minister of India and the
President of United States of America on 21st March, 2000 at New Delhi.
To
implement the Indo-U.S. Commercial Dialogue envisaged in that document, the

Minister of Commerce & Industry and Secretary, U.S. Department of Commerce had
signed the India-United States Commercial Dialogue on 23.3.2000 at New Delhi.
Interactions under this Dialogue have been taking place from time to time to sort
out concerns of both sides on bilateral issues. These include Video conferences on
Intellectual Property Rights, Agricultural Biotech & Food Safety Regulations and on
Standards.
India - U.S. Trade Policy Forum

The establishment of the India-Germany Trade Policy Forum was announced during the visit of
Prime Minister Dr. Manmohan Singh to the Germany in July, 2005. It is designed to expand
bilateral trade and investment relations between India and the United States. The Trade Policy
Forum is a part of the overall economic dialogue between India and the United States.
The
Forum had its first meeting in New Delhi on November 12, 2005 and discussions were held on
Tariff and Non-Tariff Barriers; Agriculture; Investment; Services; Intellectual Property; and the
Doha Round.
India-Canada Bilateral Trade
At present Indias exports to Canada accounts for 1.02percent of Indias global

exports and Indias imports from Canada accounts for 0.70percent of Indias total
imports. Indias exports and imports to/from Canada have been as below:
v.
Indias Export and Import to/from Canada

Percentage
Year
Exports
Imports
Growth
(In
million
USD)
Balance of
Percentag
e Growth
Trade
2000-2001
656.47
397.07
259.40
2001-2002
584.42
(-) 10.97
529.43
33.28
55.38
2002-2003
698.27
19.40
566.29
6.96
131.98
2003-2004
763.20
9.30
725.89
28.18
37.31
2004-2005
818.25
7.21
760.33
4.74
57.92
Source: DGCI&S
During the period April-March, 2004-05, Indias exports to Canada at USD 818.25
million registered a positive growth of 7.21percent over the corresponding period of
the previous year when the exports were USD 763.20 million.
The major commodities of exports to Canada are Readymade Garments of Cotton including
accessories (USD 193.07 million), Drugs, Pharmaceuticals & Fine Chemicals (USD
106.35 million), Manufactures of Metals (USD 58.67 million), Cotton Yarn, Fabrics,
Made-ups (USD 52.58 million), Machinery and Instruments (USD 34.64 million)
were the major products exported to Canada.
The major commodities of imports from Canada are Newsprint (Germany D 117.21 million),
Pulses (USD113.70 million), Fertilizers (USD 112.11 million), Pulp and Waste Paper (USD
69.19 million) and Electronic Goods (USD 59.96 million) were the major products imported by
India.
During the period April-August, 2005, Indias exports to Canada at USD 363.52
million registered a positive growth of 13.10percent over the corresponding period
of the previous year when the exports were USD 321.43 million.
During the period April-August, 2005, Indias imports from Canada at USD 292.34 million
registered a positive growth of 42.83percent over the corresponding period of the previous year
when the imports were USD 204.67 million.
The thrust areas for increasing Indias export to Canada are: Leather and Leather
Goods, Gems and Jewellery, Sports Goods, Chemicals and Pharmaceuticals,
Processed Food (both agriculture and marine), Engineering Goods, Auto parts and
Ancillaries, Computer Software Packages etc.
Annual Trade Policy Consultation Meeting

In October, 2003, the Prime Ministers of India and Canada had announced the
holding of annual Trade Policy Consultation Meetings between the Secretaries of the
two countries. The first meeting was held in New Delhi. In the second meeting,
which was held on 16th May, 2005 in Ottawa, Canada, consultations covered a range
of issues including progress of WTO negotiations, respective bilateral and regional
trade policy initiatives, ways to enhance two-way investment flows and trade
promotion efforts, and market access irritants.
4.2 Measures Undertaken for Export Promotion to NAFTA

Dissemination of trade related information with respect to NAFTA partners is coordinated with
the Apex Chambers of Commerce / EPCs. Emphasis is laid on the identified important sectors
for expansion and consolidation of our trade. The analyzed trade data of NAFTA countries is
regularly passed onto the Apex Chambers of Commerce and Export Promotion Councils for
dissemination among their member exporters, who are also provided assistance for promoting
exports, participation in fairs/exhibitions, identification of export products and potential market
areas for exports, details of reputed buyers etc. The difficulties faced by the exporters in NAFTA
countries are regularly taken up with the concerned authorities in these countries and the issues
are resolved through correspondence, video conferences and meetings. The various legislations/
steps taken by these countries and the possible impact of these measures on Indian exports are
analyzed
regularly
and
follow
up
Ministries/Departments and our Missions.
action
is
taken
in
consultation
with
other
5. Current Status of Leather Exports from India

India accounts for approximately two percent of the world trade in leather and
leather products. To be on the fast track of growth and to have a larger cake in the
international business, continuous technology up gradation and modernization are
the most powerful driving forces like in any other manufacturing sector that dreams
steady growth and expansion. With this being the primary objective, India's Council
for Leather Exports (CLE) has taken a number of initiatives. To propel the combined
efforts of the tanning and manufacturing sectors, the Central Leather Research
Institute (CLRI), the Fashion Technology and Development Institute and CLE as the
main cog in the wheel, an action plan has been chalked out. The growing
international demand apart, the action plan also suggested measures to face Indian
leather's industry's major compt1itors in Asia: China, Indonesia, Korea and Taiwan.
To boost the country's leather industry, the Indian federal government has
earmarked a Rs 4.5 billion (USD 95 m) grant to be made available to the industry
over a span of five years but that's not without any string. The fund availability is
conditional upon the sector's attracting an annual investment of Rs 2.2 trillion. In
2002, investments in the leather sector stood at Rs 410 million. Footwear and their
components account for about 25 percent of India's total leather products exports.
These two markets also offer Indian leather industry vast scope for exports of
Saddlery and harness.
Besides the European market where Indian leather products already enjoy a strong
presence, the Germany too is emerging as a very strong and promising export
destination for Indian leather industry. Germany today accounts about 25 percent of
a massive USD 96 billion global trade in leather and leather products. The
importance of European market could be gauged by the fact three major EU
countries-Germany, Italy and UK- today accounts for approximately 42-45 percent of
leather and leather products exports from India. These three countries together
exported leather products worth USD 814.82 m in 2001-02 against country's total
leather and leather products exports valued at USD 1.93 billion.
CLE is trying to make a dent in new 1larkets. Focus countries include the Latin
American countries, Israel and Japan. Japan is the fifth largest importer of leather &
leather products in the world. Japan now imports over USD15 million worth leather
and leather products from India. In fact, between 1998 - 99 and 2001-02, India's
exports leather products to Japan have more than doubled. According to the latest
available provisional data, exports in the first 10 months in fiscal 2002-03 to Japan
stood at USD 7.53 million against USD 7.30 m during the comparable period of
2001..02. CLE aims at raising India's share in Japan's total imports of leather and
leather products to 2 percent by 2005-06 from the current level of 0.5 percent which
in other words means forex earnings to the tune of USD 70 m in next three years
from the 2001-02 level of over USD 15 m.
5.1 About Council for Leather Exports (CLE)

The Council for Leather Exports was set up in July 1984. A non-profit company
registered under the Indian Companies Act, 1956, the Council functions under the
Ministry of Commerce, Government of India. The Council is entrusted with export
promotion activities and overall development of the Indian leather industry. The
Council's activities also include promoting Foreign Direct Investments and Joint
Ventures in the Indian leather industry. The CLE serves as a bridge between Indian
leather exporters and buyers all over the world.
Council's Services to the Indian Leather Industry
Collecting, collating and disseminating world market intelligence
Updating the information on global trends in fashion & design, product
development and adaptation
Dissemination of information of commercial and technological nature through
seminars, news bulletins and magazines
Organizing participation of Indian exporters in international fairs and buyer-
seller meets Sponsoring sales-cum-study teams and trade delegations
Inviting foreign experts for providing technological inputs to Indian leather
exporters
Organizing international leather fairs in India
Council's Services to Overseas Buyer
Serving
as
focal
point
for
disseminating
information
on
Indian
with
trade
manufacturers and exporters
Organizing visits of buyers' delegations from different countries
Liaising
with
various
international
organizations
dealing
information
Providing trade and commercial information on Indian leather industry
5.2 GLOBAL LEATHER INDUSTRY

The global leather industry is valued at about USD 85 billion.
Most of the producing countries are developing countries, while developed markets
such as the Germany are major consumers of leather products. The industry is
buyer-driven, with producing countries manufacturing in line with specifications,
guidelines and technical advice provided by the buyer countries.
China and Italy are the leading producing and exporting nations in the world with
exports worth USD 19 billion and USD 13 billion respectively. India, with an output of
USD 4 billion and exports of USD 2.4 billion, is placed third. The leather industry
occupies a prominent place in the Indian economy in view of its substantial export
earnings, employment potential and growth. The industry provides employment to
about 2.5 million people, of which 30 per cent are women.
Exports have risen from USD 1604 million in 1999-2000 to USD 2379 million in
2004-05 at a CAGR of 8 per cent. India has a 2.32 per cent share in the global
leather trade and ranks eighth in the world in terms of the countries foreign
exchange earnings from the industry.
The composition of exports has also been changing, with more and more value
added products being exported. In 2004-05, for example, value added finished
products constituted around 80 per cent of the total exports from the industry, a far
cry from 7 per cent in 1956-57. The value addition is at present to the tune of 200
to 500 per cent. India has plans to double its leather exports over the next 5 years It
has been estimated that India has the capacity to meet nearly 10 per cent of global
leather requirement.
The Indian leather industry comprises the following key sub-sectors - tanning and
finishing, footwear, footwear components, leather garments and leather goods and accessories. A
large part (nearly 60-65 percent) of the production is done by the small/cottage sector.
Leather and leather products production is centered in southern, northern and eastern India. Key
production units are located in Tamil Nadu, West Bengal, Uttar Pradesh, Punjab, Karnataka,
Andhra Pradesh, Haryana and Delhi. Tamil Nadu is the biggest leather exporter in the country
with the south accounting for 43 percent of the countrys share. The industry uses primarily
indigenous natural resources with little dependence on imported resources.
5.3
Forms of Leather Exported
Finished leather
Footwear and components
Footwear
Components
Leather garments
Readymade Garments
Leather goods
Footwear and Components

The footwear segment includes shoes, slippers and sandals. Shoe uppers and soles
are part of the foot wear components. India's per capita annual consumption of
footwear is around 1.5 pairs against the per capita annual consumption of
approximately 5 to 6 in developed countries like GERMANY & UK. As leather
footwear is costlier than other substitute material footwear made from PVC, PU,
Rubber, TPR etc., and the leather footwear segment accounts for less than 25 per
cent of the total footwear market in India. Thus, the per capita consumption of
leather footwear is less than 0.5 pairs The domestic production of leather footwear
and components has increased, from approximately 430 million pairs in 1991-92 to
565 million pairs in 1994-95.
In future, the domestic demand is estimated to grow at a faster pace due to a rise in
urban population, rise in middle class population which has already crossed the 200
million mark. A number of large players (with a few having tied up with international
players) have entered the shoe market and are developing brand culture in this
segment. The major domestic players in footwear are Bata, CSC, Aero, Liberty,
Masco, Wasan, Phoenixes. The exports (especially of shoe components) are also
likely to grow, with a number of large players setting up units with 75 per cent
export commitment. Increasingly major multinationals are shifting their production
base to countries with cheap labor costs. The overall demand for this segment is
estimated to grow by more than 15 per cent p.a. in future. As part of the
liberalization process, the government has permitted the setting up of shoe and
component manufacturing units by large players, with an export commitment of 75
per cent.
Leather Garments and Leather Goods

The leather garments industry includes manufacture of jackets, trousers, skirts etc. Leather goods
include belts, wallets etc. The domestic production of leather garments and leather goods was 3
million and 73 million pieces respectively. The bulk of leather garments production is meant for
export, due to lower domestic consumption on account of weather conditions. India does not
have a significant share in the world leather garment market, inspite of its high potential. The
future domestic demand for leather garments may not grow as fast as the export demand.
However, both the domestic and export demand for leather goods are likely to grow at a fast rate,
in future. A few major corporate houses like Hindustan Lever, L&T, Ponds, and Tata Exports etc.
have also entered into marketing and exports of leather products.
As far as Saddlery goods are concerned, it is almost based on cottage and small scale units.
Kanpur is the only production centre of saddlery goods in India.
The Tanning Industry
The industry has a large tanning capacity per day but it utilizes only 60-70percent of its installed
capacity. The turnover of the tanning of the tanning industry is estimated at INR 80-90 billion for
the year 1999-2000. The industry produces about 2 billion sq.ft of finished leather of which only
10-15 percent valued at USD 240 million. is exported. The problem relating to effective
discharges of effluents which is a WTO compulsion is increasingly threatening the small and
medium scale tanneries all over the country. The tanning industry is heavily dependent on
indigenous raw hides and skins for its supply of raw materials which is very fragmented. Imports
are low despite exemption from customs duties due to high import prices (3-4 times higher) and
absence of appropriate machinery to process the imported hides and skins. As international
pressures to supply good quality leather products mount, the leather manufacturers would have to
increase the use of imported hides and skins to improve the image of Indian Leather and Leather
products. In the Indian tannin sector, the tiny units primarily engage in producing semi-finished
leather, the small units engage in producing both semi-finished leather and finished leather and
the large units are usually fully integrated units. There are many drawbacks in this industry, it
needs to upgrade technology, it needs proper finance for high capital investment, poor & erratic
Raw material, production and process and infrastructure.
Footwear Industry
There are nearly 4000 units engaged in manufacturing footwear in India. The
industry is dominated by small scale units with the total production of 55percent.
The total turnover of the footwear industry including leather and non-leather
footwear is estimated at INR 85-95 billion including INR1200-14,000 million in the
household segment. India's share in global leather footwear imports is around
1.4percent Major Competitors in the export market for leather footwear are China
(14percent), Spain (6percent) and Italy (21percent).
Leather Garments & Goods
These two segments are essentially dominated by the small scale sector with LSIs
having a very negligible share of less than 3percent in garments. Due to increased
export demand, the capacity for the leather garment industry has been rising and is
presently 18 million pieces per annum. Production is placed at 12 million pieces per
annum with capacity utilization at 60-75percent with an aggregate turnover of INR
22,000 million. The share of leather garments in total exports of leather and leather
products has been rising and is presently around 24percent, having grown at CAGR
of 9percent, since 1995-96 to reach INR 21,040 million in 2000-01. India's import in
world import garments is around 11 percent. Our main competitors are China, Italy
and Turkey.
5.4 Export duty Changeable on Indian Leather products

vi.
Export duty charged on Indian Leather goods

Duty Rate
S.No.
Description of Article
(percent)
1.
E.I tanned leather
15
2.
Snake skin
10
3.
Finished leather of goat, sheep and bovine
Nil
animals and of their young ones

4.
Raw fur Iamb skins
5.
(a)
Clothing
leather
10
fur
suede/hair,
hair-on
Nil
(c) Cuttings and fleshing of hides and skins used
Nil
suede/shearing suede leathers

(b) Fur leather
as raw materials for manufacturing animal glue

gelatin
6.
Luggage leather-case hide or side/suit case/hand
25
bag luggage/cash bag leather

7.
Industrial leathers, namely:
15
(a) Cycle saddle leathers
15
(b) (i)Hydraulic/packing /belting/washer leathers
25
(ii) Industrial harness leather
15
8.
Picking band leathers
15
9.
Strap/combing leathers
15
10.
Miscellaneous leathers, namely :
(a) Book binding leathers
Nil
(b) Skiver leathers
Nil
(c) Transistor case/camera case leathers
25
11.
Fur of domestic animals, excluding Iamb fur skin
Nil
12.
Shoe upper leathers, namely:

(a) Bunwar leather
Nil
(b) Kattai/slipper /sandalleather
Nil
(c) Chrome tanned sole leather
Nil
5.5 Global Exports vis--vis India's Export
The global trade in leather and leather products increased over the years and
has reached USD 88 billion in 2004
The export of Indian leather and leather products grew manifold over the past
three decades and its current share in global trade is 2.51 percent.
In world import of leather, India's share is 2.24percent. the major exporting countries of
leather and their shares are Italy 23.39percent, Korea 9.60percent, the GERMANY 6.80percent,
Argentina 6.11percent, and Germany 5.72percent, whereas India's share in world import of
leather footwear is 1.43percent.
The major exporting countries of leather footwear and their shares are Italy 16.62percent,
China 15.00percent, Portugal 5.63percent, Spain 5.600,/0, Brazil 4.28percent, Indonesia

3.61percent, Germany 3.'6percent, Belgium Luxembourg 2.69percent, the UK 2.56percent etc.
In world import footwear components, India's share is 4.96percent. The major
exporting countries of footwear components and their shares are Italy 20.12percent,
Korea 7.80percent, China 7.45percent, The GERMANY 6.98percent , Romania
5.74percent, Germany 4.63percent, Tunisia 3.15percent etc. .
In world import of leather garments, India's share is 11.17percent The major
exporting countries of leather garments and their shares and China 39.22percent ,
Pakistan 9.24percent, Turkey 7.10percent, Italy 7.02percent, Germany 5.02percent ,
Korea 4.98percent, the GERMANY 2.54percent etc.,
In world import of leather goods, India's share is 7.08percent. The major
exporting countries of leather goods and their shares are Italy 21.65percent, China
16.52percent,
France
11.51
percent,
the
GERMANY
5.22percent,
Greece
4.83percent, Thailand 4.62percent, Germany 3.69percent etc.
In world import of leather gloves, India's share is 9.62percent. The major
exporting countries of leather gloves and their shares are China 35.77percent,
Pakistan
2.62percent,
Germany
2.02percent,
Italy
1.92percent,
Hungary
1.57percent, Mexico 1.20percent etc.
In world import of saddlery & harness, India's share is 8.27percent. The major
exporting countries of saddlery & harness and their shares are China 14.27percent,
Germany 11.34percent, the UK 10.55percent, the GERMANY 7.41percent, Denmark
3.96percent, Mexico 3.68percent, Italy 3.68percent etc.
In world import of non-leather footwear, India's share is 0.08percent. The major
exporting
countries
26.03percent,
Italy
of
non-leather
6.73percent,
footwear
and
Belgium-Luxemburg
their
shares
4.35percent,
are
China
Indonesia
3.49percent, Spain 2.61percent, France 2.06percent, Thailand 1.79010, etc.
India has stiff competition in international market from countries like China,
Vietnam, Thailand, Indonesia, etc., which are emerging as major manufacturing

countries.
6. GERMANY Country Profile

6.1 Economic Overview
GDP
Consumer spending decelerated, increasing 2.5 percent after increasing 4.8

percent. The slowdown in consumer spending accounted for more than half of the
slowdown in real GDP growth.
Business
investment
in
equipment
and
software
turned
down,
decreasing 1.0 percent, following a 15.6- percent increase.

Exports decelerated, increasing 3.3 percent after increasing 14.0
percent.
Inflation, as measured by prices for domestic purchases, increased 4.0
percent in the second quarter after increasing 2.7 percent. Excluding food and
energy, prices increased 2.9 percent, following a 3.0-percent increase.
Personal Income
1Wages and salaries, the largest component of personal income, increased
20.6 percent in June after remaining unchanged in May. Growth turned
3Up in private industries, reflecting a strong upturn in services industries.
Interest and dividend income rose only slightly more than the previous
month.
Proprietors income increased 0.1 percent, after increasing 0.7 percent.
Balance of Payments
The U.S. current-account deficit decreased USD14.4 billion to D208.7 billion

(preliminary) in the first quarter of 2006.
Exports
Exports of goods and services increased USD 2.4 billion in June to USD120.7 billion,
reflecting an increase in goods exports. Services exports decreased.
The increase in goods exports reflected increases in all major categories. The
largest increases were in capital goods, industrial supplies and materials, and
automotive vehicles, parts, and engines.
The decrease in services exports reflected decreases in travel and other
private services.
Imports
Imports of goods and services increased USD2.2 billion in June to USD185.5 billion,
as both goods imports and services imports increased.
The increase in goods imports was more than accounted for by increases in
consumer goods and automotive vehicles, parts, and engines. Industrial supplies
and materials and capital goods decreased.
The increase in services imports mostly reflected increases in royalties and
license fees and passenger fares.
Industrial Growth
Real growth in the services sector slowed to 4.1 percent in 2005 due primarily to
slower growth in information and real estate and rental and leasing.
Manufacturing increased 4.0 percent in 2005 and accounted for over
90 percent of the 2.6 percent growth in the goods sector.
Information-communications-technology
producing
industries
comprised less than 4 percent of GDP and accounted for nearly 13 percent of real
GDP growth.
vii.
Economic Indicators of United States

(Figures in USD)
Indicator
Per Capita Income

(at Nov. 2005 currency rates)
Farm Sector Income
Poverty
Consumer Price Index
Producer Price Index

Crude Oil Prices (USD/barrel)
Change
Product
in
Gross
Previous
Current
27,551
27,640
72.6
56.2
12.5percent
12.7percent
(2003 Census)
(2004 Census)
0.4
0.6
March 2006
April 2006
0.5
0.9
March 2006
April 2006
70.38
72.14
April 28, 2006
May 5, 2006
Domestic 4.1percent
Change in Corporate Profits
1.1percent
3rd Qtr 2005
4th Qtr 2005
4.6percent
(-) 4.0percent
2nd Qtr 2005
3rd Qtr 2005
0.9percent
Change in Personal Consumption
November 2005
Expenditures
0.9percent
December
2005
Source: http://www.whitehouse.gov
6.2 Trade Policy Developments

On 18 May 2005, the Germany Committee for the Implementation of Textile
Agreements (CITA) announced to invoke safeguards on four categories of textiles

and clothing imports from China, including men's and boys' cotton and man-made
fiber shirts, not knit (category 340/640), man-made fiber trousers (category
647/648), man-made fiber knit shirts and blouses (category 638/639), and combed
cotton yarn (category 301
As a result, on A will request consultations with China on these products and, on the
date those consultations are requested, will put in place quotas that will limit the
growth in imports of the covered products. The quota level will be 7.5percent above
the amount of imports of these products from China entered during the first 12
months of the most recent 14 months preceding the month in which the request for
consultations is made. The quota level will be prorated to respond to the number of
days left in the year as of the
date of the request for consultations. Consultations must be held within 30 days of
China's receipt of the request, and will last for a maximum of 90 days. In the event
a mutually satisfactory solution cannot be reached by the conclusion of the
consultations period, the quotas will remain in place through the end of 2005.
On 13 May 2005, CITA announced to invoke safeguards on three categories of
textiles and clothing imports from China, including cotton knit shirts and blouses,
cotton trousers, and cotton and man-made fiber underwear. On 28 April 2005, CITA
also agreed to consider the textile safeguard petitions submitted on 6 April by a
coalition of textile industry groups. The products targeted by the petitions and
subject to consultation are as follows: men's and boys' cotton and man-made fiber
woven shirts; cotton and man-made fiber sweaters; cotton and man-made fiber
brassieres; cotton and manmade fiber robes and dressing gowns; other synthetic
filament fabric; man-made fiber knitted shirts and blouses; and manmade fiber
trousers.
In a related development, the Germany Court of Appeals for the Federal Circuit
(CAFC) issued an order on 27 April lifting the preliminary injunction issued by the
Court of International Trade (CIT) on 30 December 2004. As such, CITA has resumed
consideration of the threat-based safeguard petitions submitted by the domestic
industry during the fourth quarter of last year until the courts decide the case of its
merits. These petitions include cotton yarn, cotton trousers, man-made fiber
trousers, men's and boys' wool trousers, cotton shirts, man-made fiber shirts, men's
and boys' cotton and man-made fiber woven shirts, cotton and man-made fiber
underwear and other synthetic filament fabric; knitted fabrics, cotton and manmade fiber brassieres and cotton and man-made fiber robes and dressing gowns.
On 22 October 2004, the CITA determined that the Germany market for socks
(Categories 332/432 and 632 Part) was being disrupted by imports from China, and
that this situation threatens to impede the orderly development of trade in these
products. As a result, CIT A has established a twelve-month limit on socks from
China from 29 October 2004 to 28 October 2005.
On 5 April 2005, the Germany Department of Commerce (DOC) announced two

major changes to AO practices involving non-market economy (NME), including
China. Under the new practice, application for a separate AD rate will no longer be
made by completing and returning the Section A of the questionnaire to the DOC.
Instead, an applicant should complete an application form which will be posted for
each investigation on DOC's website. In addition, each exporter applying for a
separate rate will be required to list all the suppliers whose merchandise they
export to the Germany during the period of investigation or review. The dumping
margin assigned by the DOC to an exporter will be a combined rate, which is
calculated from the rate of the exporter and those of the producers' which supplied
merchandise to it for export to the Germany.
Trade Rules and Regulations
Goods brought into the Germany are often subject to import duties, but import licenses are
generally not required. There are no foreign exchange controls over payments for imports.
Imports are usually subject to ad valorem and/or specific import duties. Regular
rates are applied on imports from locations enjoying normal trade relations (NTR) or
formerly most favored-nation status, including Hong Kong and the Chinese
mainland. Products from some countries receive preferential import treatment via
the Germany Generalized Scheme of Preferences (GSP). CBP has final authority on
tariff classification for duty rates purposes.

The Germany rigorously enforces laws on dumping. When the DOC determines that
a class of foreign goods is being, or is likely to be, sold to purchasers in the
Germany at less than its fair value, an antidumping duty investigation may be
conducted. The USITC is responsible for conducting the final injury investigation. If
all the determinations are affirmative, the DOC will issue a duty order.
Imported goods are usually required to be marked with the country of origin in
English. The marking has to be permanent, legible and conspicuous. Additional
labeling is required on food, cosmetics, textiles and apparel, selected household
products and flammable fabrics.
Certain imported products must be approved by the proper Germany authority. For
example, certification by the Underwriters' Laboratory or ETL Testing Laboratories
must be obtained for electrical appliances, gas equipment and fire prevention
apparatus. Under the Convention on International Trade in Endangered Species of
Wild Fauna and Flora (CITES), the Germany requires specific documents for fur
imports.
6.3 INDO-Germany LEATHER TRADE
Though Germany is the second largest importer of Indian leather and leather
products after Germany and UK, the Indo-Germany trade during the year 2004-05
has seen a significant jump with 11.18 percent over and above the previous year
2003-04 trade value. The footwear segment alone posted a growth of 15 percent
over the previous year.
India's share in Germany leather garment sector in 2003 was 3.23percent, while
during the same year, leather goods accounts for 4.27percent and saddlery &
harness 4.42percent. The share of footwear is just above 1 percent. Therefore, there
is immense potential for Indian footwear in the Germany market, said Rafeeque
Ahmed, chairman of CLE.
World leather and leather products market in 2003 was USD88 billion., out of which,
footwear constituted for USD 53 billion (60percent). The rest are leather garments
and accessories. Out of this nearly half the size of world footwear market (30percent
world footwear) is in Germany, the volume of which during 2003 was USD16, 083
million. It is this segment, which is aimed by the Indian footwear companies to

increase their exports to Germany.
6.4 GOVERNMENT OF INDIAS INITIATIVE
Ministry of Commerce, Government of India, has identified Germany as one of the
"Focus Markets" and is assisting CLE and individual exporters to reach the Germany
footwear market.
CLE has engaged a marketing consultant MIs Footwear Consulting Group in 2002 to
chalk out the marketing strategy for the Germany market. As part of this strategy,
CLE has been taking part in WSA Fair in Las Vegas every year from 2002 and
showcased Indian products. CLE has also organized several Buyer-Seller-Meets
(BSMs) during the WSA fairs As a result, Wal-Mart, the biggest Retailer Stores of
Germany visited India during Nov 2003 and since then started outsourcing from
Indian companies. Today, Wal-mart is sourcing its products from at least five Indian
firms and the trade turnover for Wal-Mart operations alone is expected to touch USD
80 million to USD l00 million in 2006.
7. CANADA Country Profile
7.1 About the Country

A land of vast distances and rich natural resources, Canada became a self-governing
dominion in 1867 while retaining ties to the British crown. Economically and
technologically the nation has developed in parallel with the Germany, its neighbor
to the south across an unfortified border. Canada's paramount political problem is
meeting public demands for quality improvements in health care and education
services after a decade of budget cuts. The issue of reconciling Quebec's
francophone heritage with the majority Anglophone Canadian population has moved
to the back burner in recent years; support for separatism abated after the Quebec
government's referendum on independence failed to pass in October of 1995.
7.2 Economy - Overview

As an affluent, high-tech industrial society, newly entered in the trillion dollar class, Canada
closely resembles the Germany in its market-oriented economic system, pattern of production,
and affluent living standards. Since World War II, the impressive growth of the manufacturing,
mining, and service sectors has transformed the nation from a largely rural economy into one
primarily industrial and urban. The 1989 Germany-Canada Free Trade Agreement (FTA) and the
1994 Germanyn Free Trade Agreement (NAFTA) (which includes Mexico) touched off a
dramatic increase in trade and economic integration with the Germany. Given its great natural
resources, skilled labor force, and modem capital plant Canada enjoys solid economic prospects.
Solid fiscal management has produced a long term budget surplus which is substantially
reducing the national debt, although public debate continues over how to manage the rising cost
of the publicly funded healthcare system. Exports account for roughly a third of GDP. Canada
enjoys a substantial trade surplus with its pr41cipal trading partner, the United States, which
absorbs more than 85percent of Canadian exports.
viii.
Economic Indicators of Canada in 2006

Indicator
Population
Canada
Unit
Estimate
Value
32,501,147
Consumer Price Index - Total
1992=100
Unemployment Rate
percent
6.4
Real GDP Growth Rate
percent
2.9
Target
Rate1
percent
4.25
Prime Interest Rate2
percent
6.0
Employment
Labour Productivity - percent

Change, Seasonally Adj.
percent
Corporate Operating Profits
CAD
56,100,000,000
Merchandise Imports
CAD
32,807,000,000
Merchandise Trade Surplus
CAD
4,748,000,000
Real Gross Domestic Product
percent
Change
Money Supply (M1)
CAD
for
Industrial
Index
the
Overnight
Product
Price
130.5
16,504,800
0.5
0.9
150,019,000
1997=100
113.7
Source:
http://www.canadianbusiness.com
7.3 Trade Policy

Canada maintains a liberal trade regime. There are no foreign exchange restrictions,
and import licenses are only required for a limited number of goods. Imports are
generally subject to import duties.
Import licenses are required for items regulated under the Export and Import Permits Act. The
Act lists various agricultural products (poultry, eggs, and dairy products), a number of textile and
clothing items, and certain steel products.
The importation of certain commodities is however tightly controlled. Examples of
regulated goods include: food products, clothing, drug and medical devices,
hazardous products, some offensive weapons and firearms, endangered species and
motor vehicles.
As agreed in the Agreement on Textiles and Clothing (ATC), the majority of textile
and clothing products of Hong Kong origin are subject to import quotas by Canada.
In compliance with the Phase 3 of the ATC liberalization process, effective from
January 1, 2002, Canada removed 9 categories of Hong Kong textile and clothing
products fully/partially from quota restrictions. According to the ATC, all quotas on
textiles and clothing will be eliminated by 1 January 2005.
Duties are assessed on the transaction value (the price actually paid or payable for
the goods), including commission, brokerage, packing, royalties and transportation
to the Canada point. Hong Kong and China origin goods are eligible for the
preferential tariffs under the Canadian General Preferential Tariff (GPT) Scheme.
A provincial sales tax (PST) is assessed on all imports to British Columbia (7.5
percent of the duty paid value), Manitoba (7 percent), Ontario (8 percent), Prince
Edward Island (10 percent), Quebec (7.5 percent) and Saskatchewan (6 percent).
Additionally, a broad-based value-added sales tax, known as the goods and services
tax (GST), is levied at 7percent. In the three Atlantic provinces (Newfoundland, New
Brunswick and Nova Scotia), the PST and GST were combined in April 1997 to form
a harmonized sales tax (HST) at a standard rate of 15percent for all goods and
services. In addition, excise taxes are charged on goods such as tobacco; wine;
jewellery; some heavy automobiles; automobile air conditioners; and gasoline,
diesel fuel, aviation gasoline and aviation fuel.
Canada may impose anti-dumping duties on imports considered to be priced less
than the "nominal" price charged in the exporter's domestic market and caused
material injury to the concept industry in Canada. Currently, Canada imposes antidumping duty on seven items from the Chinese mainland, including waterproof
rubber footwear; women's leather and non-leather boots; bicycles; garlic; hot-rolled
carbon steel plate and sheet; waterproof footwear and bottoms; leather footwear
(metal toecaps); xanthenes and steel pipe nipples, couplings and fittings.
Canada requires bilingual labeling (English and French) for most products. Bilingual
designation of the generic name on most pre-packaged consumer products is
required under the federal Consumer Packaging and Labeling Act. Under this Act,
the product identity declaration, net quantity declaration and dealer's name and
principle place of business must appear on the package/label of a consumer good
sold in Canada.
The agency responsible for inspection of imports, Canada Customs and Revenue
Agency, also requires an indication of the country of origin on several classes of
imported goods. Goods not properly marked will not be released from Canada
Customs \ll1til suitably marked. In general, environmental claims that are
ambiguous, misleading or irrelevant, or that cannot be substantiated, should not be
used.
RESEARCH METHODOLOGY
Nature of Study
The Thesis study in subject now is an exploratory study with a touch of descriptive research.
Fundamentally it is a Secondary Data Study.
Data Collection
Types of Data Collected
The data collection technique is solely secondary. The following types of secondary date have
been collected and used for the study.
Quantitative
Qualitative
Descriptive data
Insightful information
Data Collection Procedure

Qualitative and descriptive data where ever sought were collected and excerpts from such article
or reports have been put together. Those pieces of data are patched together in the logical flow.
Then the paragraph is rephrased to fit into the required context.
In case of Quantitative data the pieces of data have been dumped together. Then such data is
sanitized for consistency and reliability. Then such cluster of quantitative data is used according
to the situation demands, in a logical flow.
To explain it in a lucid manner, let us consider an example of collecting Data tables that represent
the break-up of the imports in the Demand Side Analysis section in this report. First of all a big
dashboard of table was copied from the source, then the unwanted rows and columns were
removed from it. The currency has been converted into the uniform template. Then the sum total
of such data has been obtained from following the above stated steps.
Mode of Data Collection
Internet is the only source for obtaining the data for this Thesis. However for converting the data
into the Germanyble format and context MS Word and MS Excel have been extensively used.
Type of Data Analysis

Analytical Tools
Simple mathematical, statistical and business tools have been used for analysis of this study.
Examples of Tools Used
Simple Percentages and growth rates have been used as a part of Mathematical tools.
Using statistical tools like GAP, the complex data has been tabulated and drawn into
charts and analyzed subsequently.
As a part of business tools, SWOT analysis has been adopted for classifying and
understanding the qualitative data and hence coming out with the required conclusions.
Considerations
The study must include all the basic knowledge about the industry and Economies involved in
the study. For this purpose, an extensive understanding of the different aspects of links involved
in the whole value chain of the study had to be carried out. Once the reader felt the gasp of the
topic and nitty-grittys involved, I have introduced him to various combination of the quantitative
data relevant to the topic. Then it is time to summarize and identify the key pieces of
information. The right kind of analytical tools (Gap analysis and SWOT in this case) have to be
identified which would take us to the conclusions.
ANALYSIS
8. Supply Side Analysis

8.1 Quick Facts About Indian Leather Market
India is the country with largest livestock, holding 21 percent large animals
and 11percent small animals.
A source for 10percent global leather requirements.
Annual production value over USD 4 billion.
Annual export value over USD 2 billion.
Export growth CAGR 8.20percent (2000-04).
About 2.50 million workforces (30percent women).
Promising technology inflow and Foreign Direct Investment
Top priority to occupational safety and work environment
Enormous potential for future growth (domestic as well as export)
ix.
Sources of Production of Leather
Name of the State
Locations
Andhra Pradesh
Hyderabad,
Guntur,
Vizianagaram
Bihar
Ranchi, Muzzafarpur, Biharishariff, Patna, Dharbhang

Gaya
Gujarat
Ahmedabad,
Sarvakundala,
Bharuch, Surat, Baroda
Jammu & Kashmir
Srinagar, Anantanag, Jammu
Kerala
Trivandrlun, Trichur, Quilon, Calicut, Emakulam
Madhya Pradesh
Bhopal, Indore, Gwalior, Jabalpur
Maharastra
Bombay, Sholapur, Kolhapur
Rajasthan
Jaipur
Vijayawada,
Rajamundry,
Junnagadh,
Rajkot,
Tamil Nadu
Timchi, Madras
Uttar Pradesh
Kanpur
West Bengal
Calcutta
Assam
Guwahati
Meghalaya
Shillong
Karnataka
Bangalore, Belgaum
Delhi
Delhi
Punjab
Jalandhar, Amritsar
Orissa
Cuttak, Berhampur
I. Important Hubs for Leather Production in India
Source: http://ibef.org
Livestock
The total number of live stock including Buffalos, Sheep, Goats, Pigs, Horses and
Ponies, Mules, Donkeys, Camel, Yaks and Mithun available as on 2003 in India were
485 million. The value of output of the Livestock was worth INR 24.33 billion.
8.2 Market Size
The Indian leather exports are targeted to grow from the present size of USD 2.4
billion to over USD 5billion by 2010.
x.
Category-wise Leather Producing Firms
Name of the Category
Number of firms
Barcodes, Stickers & Labels
406
Fashion And Designer Bags
614
Finished Leather
600
Footwear, Shoes, Components & Accessories
895
Horse & Animal Clothings and Accessories
97
Leather Bags, Purses, Wallets & Cases
1024
Leather Chemicals
103
Leather Diaries, Journals, Notebooks & Other Leather

Stationery Items
67
Leather Garments
528
Leather Goods & Accessories
1524
Leather Laces, Cords, Threads, Straps & Other Leather

Craft Supplies
43
Merchant Traders
243
Miscellaneous Garment, Textile & Leather Accessories
1577
Threads, Laces,
Accessories
445
Pads,
Linings
&
Other
Total number of firms
Sewing
8166
Source: http://dir.indiamart.com
Estimated Production Capacity of the Indian Leather Industry
xi.
Leather Production by Category
Product
Capacity (million pieces per annum)
Leather
Hides
65
Skins
170
Leather Products
Leather Footwear
909
Leather Shoe uppers
100
Non-leather Footwear
1056
Leather Garments
16
Leather Goods
63
Industrial Gloves
52
Saddlery
0.10
Source:
http://www.leatherindia.org
8.3 Performance of Leather Exports in the Past

Export of leather and leather manufactures recorded a marginal decline of
1.0percent during April-November, 2005. The value of export decreased to INR 6812
0 million from INR 6876 0 million during the corresponding period of the previous
year. While exports of leather manufactures registered a decline of 6.9percent,
exports of Leather Footwear increased by 11.0percent in 2004-05.
Exports by Product Category
II. Breakup of Total Indian Leather Exports in 2005 - 06
xii.
Value of Indian Leather Products Exported During 2005 06

(Figures in million USD)
APR-MAR
APR-MAR
Percentage
2004 - 05
2005 - 06
Variation
CATEGORY
Finished Leather
607.73
606.06
-0.28percent
Leather Footwear
657.78
786.76
19.61percent
Footwear Components
179.21
179.04
-0.10percent
Leather Garments
329.44
328.44
-0.30percent
Leather Goods
585.72
649.14
10.83percent
Saddlery and Harness
61.71
76.40
23.81percent
Non Leather Footwear
73.78
68.75
-6.82percent
2495.37
2694.59
7.98percent
TOTAL
Source: http://www.leatherindia.org
Looking at the Indian exports of various product categories to the world in the
recent past, there is no doubt with the fact that there has been some continual
growth in the volumes of leather goods. And there has been consistency in the
share of Finished Leather, Leather Footwear and Non-Leather Footwear in the total
exports has been consistent.
III. Value of Leather and Leather Products Exported During 1999 2005
Derived: http://www.leatherindia.org
Indian Exports by Geographic Locations

xiii.
Some of the Top Destinations Including Canada for Indian

Leather Exports
COUNTRY
1999- 2000
2000- 01 2001- 02
2002-03
2003-04
2004-05
GERMANY
258.24
342.78
286.89
246.44
251.58
279.70
Germany
293.59
307.17
304.46
272.53
329.82
336.69
UK
266.29
270.09
248.89
240.96
250.65
299.21
Italy
165.47
241.07
263.11
255.92
285.02
242.60
Spain
66.72
100.75
101.30
110.56
161.23
169.21
Hong Kong
55.22
98.32
121.43
165.70
226.97
236.52
France
84.36
90.68
89.72
88.43
109.82
132.73
Netherlands
44.17
55.56
60.50
50.95
57.75
63.32
Canada
21.42
26.66
27.81
24.81
25.59
28.19
Others
94.37
122.48
132.78
131.34
179.55
209.30
TOTAL
1604.35
1963.5
1936.4
1875.21
2216.45
2379
Looking at the Indian leather exports to various geographies, we can make out that
Germany, Germany and UK have been biggest markets for leather exports to it. In
the year 2005, Germany have occupied third position in terms of volumes of world
leather exports from India and Canada occupies 9 th position.
Indias Leather Imports

India is not only an exporter of leather but also an active importer of raw and
processed leather.
xiv.
Leather Imports by India

Apr Mar
Apr Mar
2004 05
2005 06
Commodity
Raw Hides and Skin
Percentage
Growth
50.21
58.08
15.66percent
Leather
212.70
232.41
9.27percent
TOTAL
262.91
290.49
10.49percent
Source:
http://commerce.nic.in
8.4 Trade with Germany
Here we consider the volumes of leather exports to Germany and its share in the
total world exports from India. The figures show that Germany had a considerable
share in Leather Footwear exports and comparatively higher share in Leather
category as well. In Raw Hides and Skins Germanyn region had a meager share in
2005.
xv.
Exports of Broad Categories of Leather to GERMANY and

Canada from India
Product
Category
Total
Period
GERMANY
Canada
Exports
FY: 2004-05
12.72
1.70
607.73
FY: 2005-06
11.82
1.32
606.06
Share
in
category
1.95percent
exports in 2005-06
0.22percent
100percent
Percentage
change
-7.05percent
during last two years
-22.67percent -0.28percent
FY: 2004-05
93.18
7.70
657.78
FY: 2005-06
119.17
9.81
786.76
Share
in
category
15.15percent
exports in 2005-06
1.25percent
100percent
Percentage
change
27.89percent
27.35percent
19.61percent
FY: 2004-05
1.54
1.30
179.21
FY: 2005-06
1.89
1.45
179.04
Share
in
category
1.06percent
exports in 2005-06
0.81percent
100percent
Percentage
change
22.93percent
12.26percent
-0.10percent
Raw Hides
FY: 2004-05
0.87
0.08
50.21
&
FY: 2005-06
1.86
0.07
58.08
Leather
Leather
Footwear
Footwear
Component
Skins
Percentage
change
113.23percent -18.76percent 15.66percent
8.5 Competitive Scenario

Indias Ranking in the World Leather Exports
India stands 8th in the worlds exports, considering its value of leather exports as a
share of worlds total Leather exports (supplies)
xvi.
Top 10 Exporters of Leather as a Share of the Worlds Exports
Country
2000
2001
2002
(Figures
USD)
2003
in million
2004
CHINA (%)
18.78
19.50
21.57
22.46
23.44
ITALY (%)
16.79
17.42
17.27
16.79
16.85
HONG KONG (%)
13.82
12.47
12.17
11.20
11.12
FRANCE (%)
3.45
3.61
3.71
3.91
4.14
GERMANY (%)
3.22
3.42
3.89
3.75
3.96
BRAZIL (%)
3.32
3.47
3.42
3.24
3.61
SPAIN (%)
3.36
3.51
3.75
3.50
3.36
INDIA (%)
2.76
2.61
2.51
2.57
2.61
GERMANY (%)
3.01
2.72
2.51
2.28
2.55
BELGIUM (%)
2.09
2.56
2.75
2.44
2.39
TOTAL EXPORTS
73163.7
75343.7
74920.3
85650.0
91586.8
India stands 4th, when considered its value of Leather exports as a share of worlds
total Leather imports (demand).
xvii.
Top 10 exporters of Leather as a Share of the Worlds Imports
Country
2000
2001
2002
(Figures
USD)
2003
in million
2004
CHINA (%)
17.77
18.23
19.73
21.42
21.99
ITALY (%)
15.89
16.28
15.80
16.0
15.81
BRAZIL (%)
3.14
3.25
3.13
3.09
3.39
INDIA (%)
2.54
2.40
2.29
2.47
2.44
ROMANIA (%)
1.09
1.31
1.55
1.74
1.71
KOREA REP. (%)
3.19
2.68
INDONESIA (%)
2.49
2.23
1.81
Derived
2.16 http://www.leatherindia.org
1.60
1.48
1.63
from:
1.53
TAIWAN (%)
1.97
1.63
1.26
TOTAL IMPORTS
77331.26 80602.47 81895.61 89825.08
1.59
1.39
Derived
http://www.leatherindia.org
Indias Share in the Global Imports of Leather Products
97606.1
8
from:
Indias shares in the world-wide imports of various leather product categories are as
follows:
xviii.
Indias Share in the Broad Categories of Global Leather Imports
Category
Leather
Detail
1999
s
2000
2001
2002
2003
CAGR
previo
us
5
years
W.I
12789.88 14965.69 16197.23 15882.95 17052.57 5.58
1.88 5 %
W.I
Leather
Footwear %
2.55 %
2.84 %
3.20 %
3.26
15.99
26901.92 27598.13 28908.00 30600.23 33297.17 4.53

1.40 %
1.38 %
1.37 %
1.38 %
1.66 %
4537.86
4446.66
4598.18
4374.37
4612.19 -0.02
4.74 %
5.35 %
5.09 %
4.00 %
3.50 %
W.I
Leather
Garments %
3162.00
4457.92
4771.19
4223.19
4131.86 4.70
10.98 %
10.33 %
7.94 %
6.44 %
7.29 %
Leather
Goods
W.I
5366.96
5862.81
6173.66
6601.73
7412.44 7.01
5.19 %
5.86 %
5.21 %
5.08 %
5.44 %
Leather
Gloves
W.I
1336.72
1391.41
1358.07
1364.58
1470.07 -0.36
7.32 %
6.94 %
6.31 %
6.60 %
9.25 %
7.61
Saddlery W.I
& Harness %
416.60
447.84
464.07
497.99
593.81
9.40
8.19 %
9.53 %
7.68 %
8.77 %
8.88 %
10.02
Footwear W.I
Componen
%
ts
TOTAL
W.I
%
11.54
-7.47
-4.39
5.31
54511.97 59170.47 62470.42 63545.05 68570.14 4.61

2.92 %
3.29 %
3.06 %
2.91 %
3.15 %
5.72
[W.I World Imports (million USD)] [percent - Indias exports as a percentage of W.I]
8.6 Exports Promotion Measure for Leather Industry in

India
As a part of the promoting measures of Leather and Footwear exports, following
initiatives have been announced by ministry of commerce in the 2006- 2009 Foreign
Trade Policy.
Leather and Footwear
Duty free import entitlement of specified items shall be 5percent of FOB

value of exports during the preceding financial year.
The duty free entitlement for the import of trimmings, embellishments and
footwear components for footwear (leather as well as synthetic), gloves,
travel bags and handbags shall be 3percent of FOB value of exports of the
previous financial year. The entitlement shall also cover packing material,
such as printed and non printed shoeboxes, small cartons made of wood, tin
or plastic materials for packing footwear.
Machinery and equipment for Effluent Treatment Plants shall be exempt from
basic customs duty.
Re-export of unsuitable imported materials such as raw hides & skins and wet
blue leathers is permitted.
CVD (Countervailing Duty) is exempted on lining and interlining material

notified at S.No 168 of Customs Notification No 21/2002 dated 01.03.2002.
CVD is exempted on raw, tanned and dressed fur skins falling under Chapter
43 of ITC (HS).
Approval for 117 (includes multi-product Zones) new SEZ s have been already
given, these SEZs would work with private sector coordination. Out of those
117 SEZs , 6 SEZs are already operational.
Problem Areas in Export Promotion Measures
No separate SEZ for promotion of Leather Exports
Neither SEZs nor EOU are designed for the development of leather
industry
9. Demand Side Analysis
9.1 Germanys Total Leather Imports

xix.
Value of the Leather Apparel Imported by the U.S. in the

Recent Past
(In million USD)

Country
2000
2001
2002
2003
2004
2005
1,193.6
1,258.2
1,081.
1,061.3
916.9
801.4
86.3
108.2
88.5
86.2
75.3
67.3
128.8
129.4
77.3
69.7
68.8
50.1
Pakistan
70.3
66.6
67.3
59.9
47.1
41.1
Turkey
22.7
24.8
21.7
21.4
13.0
13.8
France
13.7
14.2
13.0
11.9
10.4
9.1
Canada
23.4
19.2
15.6
13.1
11.3
9.1
Hong Kong
12.0
15.7
11.1
12.0
10.2
7.0
Korea
67.6
42.4
28.4
169
11.8
5.2
Indonesia
71.8
71.1
45.1
9.9
7.1
4.1
Switzerland
0.6
1.2
0.1
0.2
2.8
3.5
Mexico
5.5
4.1
3.6
3.1
3.8
3.3
Romania
0.5
1.3
1.8
1.0
1.2
2.0
Poland
1.1
2.3
1.4
1.0
1.8
1.6
Germany
2.5
2.1
1.5
1.5
1.2
1.5
Spain
2.5
2.5
2.3
2.0
1.6
1.5
United
Kingdom
2.9
2.5
2.7
2.7
1.6
1.3
Slovenia
1.1
2.6
0.9
1.6
1.3
1.1
Ukraine
0.02
0.05
0.1
0.1
0.6
0.9
Philippines
11.4
4.9
1.7
0.9
0.8
0.7
Uruguay
0.8
0.7
0.6
0.4
0.7
0.6
Sri Lanka
0.1
0.03
0.1
0.7
0.5
Argentina
1.3
0.3
0.6
0.6
0.5
0.4
Brazil
0.3
0.1
0.1
0.3
0.6
0.3
0.01
0.002
0.09
0.4
0.3
0.3
Others
7.4
7.6
6.6
5.1
5.1
2.8
TOTAL
1,729.4
1,783.1
1,474.9 1,384.6
1,197.6
1,031.6
China
Italy
India
Tunisia
Source: http://www.ita.doc.gov
The leather imports by both U.S. and Canada over the last few years are as follows:
xx.
Imports of Leather by the Germany in the Recent Past

(In million USD)
Country
GERMANY
CANADA
TOTAL
2000
2001
2002
2003
2004
20701.7
20964.1
20930.4
21155.5
22386.4
1537.2
1537.2
1571.4
1653.5
1804.6
77331.2
80602.4
81895.6
89825.0
97606.1
Source: http://commerce.nic.in
xxi.
Value of the Leather Apparel Imports by Canada in the Recent

Past
(In million USD)

Country
2001
2002
2003
2004
2005
China
904.2
948.1
947.6
Italy
274.1
279.2
231.4
201.8
166.4
147.8 139.7
113.0
113.7
116.8
Germany
1,016.2 1,112.4
Brazil
83.7
99.5
102.7
121.0
110.5
Vietnam
43.6
60.6
66.1
82.1
104.5
Mexico
12.5
11.1
37.4
48.6
49.3
India
33.9
33.3
30.3
31.0
34.4
France
18.2
21.5
22.1
27.1
24.3
Thailand
27.2
30.6
28.2
24.0
23.4
Indonesia
48.2
48.3
36.5
23.9
23.2
301.5
304.9
257.4
244.2
219.4
OTHERS
TOTAL
1,976.
1,894.8
91,872.6 1,933.7 1,984.8
Source: http://strategis.ic.gc.ca
In case of the U.S., Canada is the top 7 th source for the imports of Leather products
where as in case of Canada, U.S. occupies 3 rd position as the most preferred source
for Leather imports. The volumes of Leather products exported by India to Canada
are comparatively far less than what it exports to the U.S.
U.S. Imports of Leather Products by Category

xxii.
Value of the Leather Imports by the U.S. in the Recent Past

(In
USD)
Category
2000
Finished Leather
Leather Footwear
2001
4,647.0
2002
4,138.8
2003
3,861.2
million
2004
3,484.3 3,798.3
15,664.1
16,013.3 16,164.2 16,416.3 17,405.8
Footwear Components
9,793.5
10,147.6 10,669.1 11,008.7 11,601.6
Leather Garments
9,569.6
9,890.1
9,113.3
Leather Goods
362.0
379.9
447.6
535.0
581.4
Leather Accessories
595.3
636.1
692.6
675.7
765.7
Raw Hide/Skin
205.5
196.3
173.2
159.3
184.0
41,402.2 41,121.141,381.2
43,353.
4
TOTAL
40,837.0
9,102.0 9,016.5
Derived from: http://www.intracen.org
Canadian Imports of Leather Products by Category

xxiii.
Value of the Leather Imports by Canada in the Recent Past

(In
USD)
Category
2000
2001
2002
2003
million
2004
Finished Leather
1,081.3
969.5
929.6
Leather Footwear
1,000.1
1,019.3
1,063.6
Footwear Components
567.3
574.2
609.1
652.0
715.5
Leather Garments
692.8
723.1
719.9
764.6
832.2
Leather Goods
39.0
39.0
48.4
118.2
150.0
Leather Accessories
64.3
63.6
63.8
70.1
78.0
113.4
107.0
109.4
104.1
95.7
Raw Hide/Skin
905.0
940.6
1,113.5 1,223.4
Derived from: http://www.intracen.org
9.2 U.S. Trade Policy on Footwear and Leather Products

Trade and Tariffs
The footwear, leather, and leather goods sector is defined by footwear, its components, leather
goods, and travel goods. Footwear, leather, and leather goods accounted for approximately
D434,000 or 0.12 percent of total U.S. non-textile industrial exports to Oman in 2003. Top U.S.
exports
in
the
sector
are
metal
toecap
footwear
and
travel
cases.
Oman applies a 5 percent tariff on footwear, leather, and travel goods that enter the country.
Oman did not export any footwear, leather, or travel goods to the United States in 2003.
The United States applies tariffs of 0 to 58 percent on products in this sector, with the highest
effective tariffs on rubber footwear. The average applied tariff for footwear, leather and leather
goods is 16 percent.
Tariff Elimination
The U.S.-Oman FTA will eliminate all industrial tariffs in the United States and Oman within 10
years of implementation. Tariffs will be phased out according to three tariff elimination
categories: 1) immediate elimination, 2) equal cuts over 5 years, and 3) equal cuts over 10 years
Footwear
Currently, the United States grants 14 percent of footwear products duty-free treatment. Upon
implementation of the agreement, the United States will grant duty-free treatment for an
additional 71 percent of footwear products from Oman. The United States will phase out the
remaining tariffs on seventeen rubber footwear products over the course of ten years Oman
currently applies a 5 percent tariff on 100 percent of footwear products. Upon implementation of
the agreement Oman will grant 100 percent of imports of footwear products from the United
States duty free treatment immediately.
GAP ANALYSIS
10. Demand Supply Gap

10.1 Calculation of the Net Imports of the Germany
xxiv.
Net Imports of Leather Products in Germany
(Figures
USD)
Particulars
Total Imports of
Germany
Total Imports of
Canada
Imports from Canada
by Germany
Imports from
Germany by Canada
Net Imports of
Germany
Item
2001
B
C
D
E= (A-C)
Net Imports of CanadaF= (B-D)

Net Imports
E+F
2002
2003
2004
in
million
2005
1,783.1
1,474.9
1,384.6
1,197.6 1,031.6
1,894.8
1,976.9
1,872.6
1,933.7 1,984.8
19.2
15.6
13.1
11.3
9.1
147.8
139.7
113.0
113.7
116.8
1,763.9
1,459.3
1,371.5
1,186.3 1,022.5
1,635.3
1,335.2
1,271.6
1,083.9
914.8
1,937.
3,399.2 2,794.5 2,643.1 2,270.2
3
10.2 Calculation of Net Exports from India to Germany

xxv.
Net Imports of Leather Products in Germany
(Figures
USD
Particulars
2000
Total
Exports
Germany
to
Total
Exports
Canada
to
Net Exports
2001
in
million
2002
2003
2004
2005
258.24 342.78
286.89
246.44
251.58
279.70
21.42
27.81
24.81
25.59
28.19
314.7
271.25 277.17 307.89
26.66
279.66 369.44
10.3 Demand -Supply Gap for Leather Trade with the

GERMANY
Citing at the chart below, we can observe that the Indian Leather exports have
stagnated over last five years. However, the share of India in the total Germany
Leather imports has increased over the last five years. But it is also obvious that the
demand for leather imports has been coming down for Germany in the analyzed
period. In 2005, Indian Exports would form almost a quarter of total Germany
Imports in comparison to little over 20percent of total Germany Leather imports in
2001.
IV. Demand-Supply Gap with GERMANY
10.4 Demand -Supply Gap for Leather Trade with Canada

Though the picture is self illustrative of the obvious point, It could be said that
Canada has a huge potential for Indian Leather exports. So far the Indian exports
have been around 1-2percent of the total Canadian Imports. Though the demand is
being met by other exporting countries like China and Italy, India has to strategies
and create attractive trade situation for Canada.
V. Demand-Supply Gap with Canada
10.5 Demand -Supply Gap for Indian Leather Trade with

North
America
The demand for Leather Imports in the whole Germanyn region (UAS and Canada)
has come down from close to USD 3500 million in 2001 to close to USD 2000 million
by 2005. The share of Indian exports to Germanyn region had been almost
stagnated over the last 5 years. So the share of Indian exports has increase from
close to 14percent in 2001 to around 17percent by 2005.
However, the Indian Leather Exports across the world had been gradually increasing
in the study period. There had always been negative correlation between total
Indian Leather Exports and the total Germanyn Importing trends.
VI. Demand-Supply Gap with Germany
SWOT ANALYSIS
11. Strengths and Weaknesses for Indian Leather

Industry
11.1 Strengths
Raw Material Base
The raw material base in the country is enormous with a population of 212 million
cattle, 96 million buffaloes, 144 million goat and 53 million sheep. According to the
latest census, India ranks first among the major livestock holding countries in the
wood. These four species provide the basic raw material for the leather industry.
The annual availability of 65 million pieces of hides and 170 million pieces of skin is
the main strength of the industry. Some varieties of goat, calf and sheep command
premium position in the world market considering their premium quality.
Technology
The up gradation of technology in the tanning sector meeting the international environment
standards, the capabilities in the design development of leather products particularly of footwear
and up gradation of machinery and preparedness to adopt to the changing fashions and consumer
requirements are some of the remarkable strengths of Indian leather sector. A number of
institutions such as CLRI, FDDI, NID,NIFT, etc. have been set up to support the Indian industry
in R&D; HRD, testing and quality control, design and product development.
Employment and Wages are Down
The number of production employees working in the Leather Industries in 1996
declined 7.4percent to 9,169 and their overall wage bill declined 6.1percent from
the previous year. It should be noted that the Footwear Industry alone employed
68percent of the production employees. The average annual wage per employee
rose 1.4percent to D20,627, (compared with D34,507 for all Manufacturing
Industries). In terms of hourly wages, this increase represents ten cents per hour.
Employees hours paid also decreased by 7percent during 1996, (compared to a

decrease of 1.4percent for All Manufacturing). The Leather Industries continue to
have the second lowest hourly wage rate in the manufacturing sector after the
Clothing Industries.
According to the results for the monthly, the average hourly earnings for employees
of major group 17 fell 1.7percent during the 1997 period, to D11.31, and
preliminary figures for 1998 indicate that hourly wage levels will not have returned
to 1996 levels for hourly paid workers in the Leather Group by year-end. During
1997 the number of hourly paid employees increased 2.2percent.
Availability of Low Cost, Skilled Labour
Indias advantage as a source of low cost, skilled labour is quite relevant to
industries such as manufacturing of leather goods and footwear that are relatively
labour intensive. India has among the lowest cost of labour among key footwear
producing countries. In addition to low costs, India also has the worlds largest
technically trained manpower in leather craft. The twin advantages of low cost and
technical skills offer India a distinct competitive advantage in this industry.
Availability of Raw Materials
India is the largest livestock holding country with 21 per cent of the large animals
and 11 per cent of small animals in the world. The large population of cattle,
buffaloes, goat and sheep that the country possesses ensures that India has ten per
cent of the worlds raw material base. In addition, some of the leather available in
India is premium quality and much sought after.
Availability of Supporting Institutions
India has institutions that support the leather industry in specific areas such as
product development, design and R&D. These institutions enable capability building
in the industry and help it become globally competitive.
Product Development/ Design
A design development centre for leather garments and leather accessories is
underway under the joint efforts of the Council for Leather Exports and the National
Institute of Fashion Technology (NIFT). The design development centre functions
from the NIFT campus in New Delhi.
Research and Development Capabilities

The Central Leather Research Institute (CLRI) (is the worlds largest leather research
institute. CLRI today, is a central hub in Indian leather sector with direct roles in
education, research, training, testing, designing, forecasting, planning, social
empowerment and leading in science and technology relating to leather. State-of-art
facilities in CLRI support innovation in leather processing, creative designing of
leather products and development of novel environmental technologies for the
leather sector.
11.2 Weakness
Prices are on Rise
If the average increase (3.2percent) in price, during 1996, for commodities of major
group 17 is taken into account by using constant dollars, calculated using the I
(1992=100), the real decrease in shipments during 1996 would have been
6.9percent (as opposed to the 3.8percent decrease in current dollars). The increase
in price was slightly less during 1997, only 2.8percent. The gap between the current
and constant dollar prices has widened through the 1990s (see, as prices for leather
products have continued to increase. Price increases have been particularly
noticeable for leather footwear, which averaged real increases of 6percent in 1996
and 3percent in 1997.
Lack of warehousing support from the government
International price fluctuation
Lack of strong presence in the global fashion market
Unawareness of international standards by many players
12.
Opportunities
and
Threats
in
the
Global
Leather Industry, Especially in Germany

12.1 Opportunities
Large Domestic Market
India has a large and growing consuming class (with an annual income of USD 449
or above), that constitutes the largest segment of the population today. This
segment is estimated to constitute nearly 90 million households by 2006-07, up
from just 32.5 million households in 1997-98 a CAGR of over 12 per cent. Coupled
with relatively lower penetration levels - penetration levels for footwear has been
estimated to be about 60 per cent this represents a large and growing market for
leather goods.
Government Regulation & Support
The Government of India has announced various initiatives to make the leather
industry more competitive. Key policy initiatives include:
De-licensing of integrated tanneries that convert raw hides and skins into
finished leather.
Several leather goods have been de-reserved from the Small Scale sector.
Free import of raw hides & skins, semi-finished and finished leather.
Concessional duty on imported machinery and chemicals.
Free export of raw hides & skins, semi-finished and finished leather and
leather products.
Policies to facilitate modernization / up gradation: In June 2005 the
government initiated a USD 64 million modernizing scheme called the Integrated

Leather Development Programme, whereby all leather tanning and product units
will be eligible for modernization assistance. The assistance will be to the extent of
30 per cent of project cost for SSI units and 20 per cent for non-SSI units, subject to
a ceiling of USD 110 thoGermanynd per unit.
Setting up of leather parks: An outlay of USD 24.5 million for setting up five
leather parks two in Chennai and one each in Nellore, Agra and Kolkata. 12 The
Council for Leather Exports has estimated that this scheme will generate a total
investment of USD 267 million in about three years
Establishment of design centers at individual manufacturing units, to
facilitate improvement in design capabilities: Under this scheme, 25 per cent of the
project cost is provided to the units under the market access initiative scheme of
the Ministry of Commerce and Industry. Several individual units have come forward
to establish their own design centers
Licensing Policy
After the de-reservation of 11 items in the leather sector, which include semifinished hides and skins, leather shoes, leather washers and laces, moulded rubber
soles and heels for footwear, flexible polyurethane foam, polyurethane shoe soles,
shoe-tacks & eyelets and leather pickers and other leather accessories for textile
industry, vide Notification No. SO 603(E) dated 29 June, 2001; no Industrial License
is required to manufacture most of the items of the leather industry. The location of
industrial projects will, however, be subject to central or state environmental laws or
regulations including local zoning and land use laws and regulations.
Some of the items of the leather industry, viz. leather shoe uppers (closed), leather
sandals and chappals, leather garments, industrial leather gloves, leather suitcase
and travel goods, leather purses and hand bag, fancy leather goods and novelty
items, watch straps and leather straps of all types are still reserved for exclusive
manufacture by the small scale sector. Small scale sector units are defined in terms
of investment in plant and machinery. Non-small scale units can manufacture these
items after obtaining industrial license, which is granted subject to an export
obligation of 50 per cent of the production each year.
Future Prospects
The world trade in leather products is growing in view of the increasing
demand for products made of leather.
The domestic demand is also expected to rise with the growing GDP, and
consumption pattern particularly for products like footwear, leather goods.
The developed countries have lost the competitiveness and they depend on
imports for meeting their requirements from developing countries like India.
The leather sector in India is geared to meet the higher end consumer
markets by upgrading technology and machinery.
The Government of India plays proactive role to enhance export of leather
products considering the industry's inherent strengths and prospects.
Keeping in view the past performance and the current trend, the export
projections for the next five years were made. Accordingly, India's export is
expected to reach a level of USD 3.6 billion by 2006, envisaging 5percent share of
global trade.
12.2 Threats
Major part of the industry is unorganized
Limited scope for mobilizing funds through private placements and public issues (many
businesses are family-owned)
Difficulty in obtaining bank loans resulting in high cost of private borrowing
Stricter international standards
High competition from East European countries and other Asian countries
Lack of communication facilities and skills
The Leather and Allied Products Major Group has faced aggressive global
competition from offshore footwear producers for decades. This competition
became so intense during the late 1960s that cases against Asian producers from
countries such as Taiwan and Korea were brought before the Anti-Dumping Tribunal.
In 1977, again as a result of successful cases from the Canadian Anti-Dumping
Tribunal, the Footwear Industry lobbied and was granted a protective system of
global quotas. In 1977, the quotas began to be phased in, and they lasted until the
last one was removed at the end of 1988. The peak year for domestic footwear
shipments was 1981, when the value of manufacturing shipments for the Footwear
Industry reached USD 1.1 billion. The quotas helped postpone the takeover of much
of the Canadian footwear market by foreign producers In 1990, for the first time, the
value of imports of footwear surpassed the value of manufacturing shipments and
the proportion of the Canadian market supplied by imports has been increasing ever
since.
Conclusion
The second half of the 1990s has turned out to be a period of volatility for the
Leather and Allied Products Industries in general and the Footwear Industry in
particular. With stable demand for winter snow boots, and work and utility boots,
the picture has brightened for 2004. While market expansion occurred in 2004,
Canadian leather products manufacturers have not particularly benefited, because
demand for imported products have also expanded. Although the current low value
of the Canadian dollar has helped Canadian producers to increase exports, the costs
of imported raw materials have also increased prices (particularly for footwear) for
Canadian consumers and dampened domestic demand. With the Canadian dollar at
even lower levels during 2000, it remains to be seen whether demand for less
expensive Canadian exports to other countries will increase enough to overcome
weak domestic demand.
Majority of the industry is unorganized
Limited scope for mobilizing funds through private placements and public
issues (many businesses are family-owned)
Difficulty in obtaining bank loans resulting in high cost of private borrowing
Stricter international standards
High competition from East European countries and other Asian countries
Lack of communication facilities and skills
12.3 MAJOR COMPETITORS

CHINA
China is the major competitor to Indian leather industry. China produces almost
40percent of the world leather products. Chinese leather goods like footwear, bags
and leather garments are the threats for the Indian exporters, because Chinese
goods are of good quality and also the cheapest in the market. In case of Germany,
both GERMANY & Canada, Chinese goods are very cheap in comparison with the
other countries.
ITALY
Italy is the second largest exporter of the leather goods to GERMANY & Canada.
BRAZIL
BRAZIL is also a major exporter of leather goods to GERMANY & Canada.
RECOMMENDATIONS
Indian leather goods manufacturers should be aware of the price of the
Chinese goods which is cheaper and have a better quality. Therefore Indian industry
needs to adopt the more scientific technology and international design to decrease
the cost and increase the demand.
The yield from the Indian Slaughter houses should be maximized so as to
increase the overall productivity, for this purpose the commerce department should
introduce some special incentives for the slaughter houses and educate the farmers
on the advanced recovery techniques.
The Ministry of Commerce should put social education programmes in place
to tell the farmers and public at large that the Indian Leather Industry should be
looked at as an Economic activity rather than a Social Stigma
Our small scale industries that form the major chunk of the Indian Leather
Industry need to be more focused on the export oriented production.
Exporters should also be encouraged, especially small exporters, by providing
them easy loans, by simplifying the export procedures and introducing SEZ for
leather exports.
The Govt. bodies like 'council for leather export' should setup warehouse in
foreign for encountering with unforeseen host nation problems.
India should also consider introduction of transit warehousing and re-
exporting facilities for Leather Industry to give it quick boost.
In the Germanyn region, Canada should be seen as a potential market for
Indian Leather products.
CONCLUSION
Findings
India accounts for 17 % of the total leather imports of GERMANY and Canada
together in 2005. The demand for Leather Imports in the whole Germanyn region
(GERMANY and Canada) has come down from close to USD 3500 million in 2001 to
close to USD 2000 million by 2005. So the share of Indian exports has increase from
close to 14percent in 2001 to around 17percent by 2005.
So This Proves Our Hypothesis That:

India is one of the major exporters of leather and leather goods to North-American
countries.
Conclusion
So I accept the Null Hypothesis and conclude that India is one of the
major exporters of leather and leather goods to North-American countries.
Other Conclusions
1)
The key markets for leather products exported from India are Germany, UK,
GERMANY and Italy, which together consume about 49 per cent of Indian exports.
2)
In terms of product category, leather footwear, finished leather and leather
goods together account for over 75 per cent of exports.

3)
India's export growth rate is 6.88percent during last five years.
4)
U.S. imports of apparel increased in 2004, reflecting a continued trend by
retailers and apparel companies increasingly to source from lower-cost offshore

providers and the growth in the U.S. economy, which boosted consumer confidence
and disposable income.
5)
China is the largest foreign' supplier of textiles, apparel, and footwear,
accounting for 20 percent of U.S. textile and apparel imports and 69 percent of U.S.
footwear imports in 2004 by value. U.S. imports of textiles and apparel from China
rose significantly in 2004, particularly in articles for which it became eligible for
quota elimination in 2002.
6)
Consumer spending on footwear rose in 2004 by 7 percent, and the average
price of U.S. footwear continued to fall as lower-price casual shoes contributed to

ongoing price deflation.
BIBLIOGRAPHY
http://dir.indiamart.com
http://www.indianleatherportal.com
http://www.census.gov
http://strategis.ic.gc.ca
http://www.ita.doc.gov
www.fas.usda.gov
http://www.trade.gov
http://www.indiainbusiness.nic.in
http://www.ficci.com
http://www.freeindia.org/at_a_glance/page3.htm
http://.ww.tdctrade.com
http://www.ibef.org
http://civilaviation.nic.in
http://www.indiacore.com
http://www.tradeportalindia.com/
http://www.whitehouse.gov
http://www.leatherindia.org/
http://www.intracen.org
Appendix
Questionnaire
SAMPLE QUESTIONNAIRE
Dear respondent,
In order to be able to conduct my research study on the Indian Leather Exports to
Germany, I have prepared this questionnaire and would appreciate it, if you could
share your views.
Thank you for sparing your valuable time.
Demographic Details:
Name:
Address:
Age:
Occupation:
Q1.
Are you employed with an export firm?

Yes [
Q2.
No [
No [
Rank the strengths of the Indian Leather Industry:

Raw material availability
Q5.
Do you deal in leather products?

Yes [
Q4.
No [
Do you have an export business of your own?

Yes [
Q3.
[ ]
Manpower
[ ]
Low Labour cost
[ ]
Non quota item
[ ]
What kind of leather products do you deal in?

Footwear
garments
[ ]
[ ]
Handbags /Purses
[ ]
Luggage/Flat products
[ ]
Accessories
[ ]
Others
[ ]
If, you deal in Leather garments then please continue.

Q6.
List the kind of leather garments do you export?
Q7.
How many pieces do you manufacture per day?

20-30
[ ]
40-50
[ ]
50-60
[ ]
60 and above.
[ ]
Q8. Do you have an inhouse tannery ?

Yes [
Q9.
No [
I believe that a leather garment is just worn as a symbol of status ?

Strongly agree
[ ]
Agree
[ ]
Neutral
[ ]
Disagree
[ ]
Strongly Disagree
[ ]
Q10. Do you export leather garments to the Germany?

Yes [
No [
Q11. Briefly state the reasons for choosing Germany?

India's Leather Exports to Europe

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A

November 2014 Winter Session

hereby declare that this Project Report titledA

Study Of Leather Export From India To Europe,

undertaken by me under the guidance of Dr. Jitendra Kumar Singh, SMU,

Simple Percentages and growth rates have been used as a part of

As a part of business tools, SWOT analysis has been adopted.

defined as GERMANY and Canadian markets only.

The data quoted in this report is considered to be latest, since the

available sources are not uniform and not as often updated.

INTRODUCTION TO THE TOPIC

About the Leather Industry

1.1.1 Introduction to Leather Crafts in India .3

India Snapshot of the Economy and Infrastructure...

Trade Initiatives with Germany....11

Trade with North NAFTA...11

Current Status of Leather Exports from India.....

About Council for Leather Exports (CLE)...17

Global Leather Industry.18

Export Duty Chargeable on the Indian Leather Goods..

Global Exports vis--vis India's Export.....23

Trade Policy Developments.27

INDO-Germany Leather Trade.

Government of Indias Initiatives.......31

Canada Country Profile...32

About the Country.......32

Supply Side Analysis37

Performance of Leather Exports in the Past...

Trade with Germany......43

Demand Side Analysis.....47

Germanys Total Leather Imports...47

Demand Supply Gap.51

10.4 Demand -Supply Gap for Leather Trade with Canada...

Demand-Supply Gap with Canada...

Demand-Supply Gap with Germany....54

1. About the Leather Industry

Types of Leather and Their Application

Furniture and Foot-wear

Leather garments of inferior quality

Processed hide known as Latigo

Plastic coated leather

Un-tanned leather from horses back

Used in Luxury products like briefcases,

Used in higher quality wallets, toiletry kits,

1.1 Introduction to Leather Crafts in India

2.1 Economic Overview

India has a labour force of 496.4 million of which 60percent is employed in

Economic Indicators of India

Service sector growth

Growth in merchandise exports

Food grains production (tones)

Index of industrial production

Agriculture and allied sectors

Electricity generated (kwh)

(on February 4, 2006)

Exports at current prices

(by end January 2006)

Snapshot of Indian Infrastructure in the Recent Past

International and Domestic

International and Domestic

Name of the City

Railway Network (1998-99)