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Monday, May 4, 2009
Leather is one of the prominent sectors in Indian economy generating employment opportunities for 2.5 million workers, contributing US$6 billion worth of manufactured goods. Majority of this output is contributed by the SMEs clustered in 5 to 6 major locations. To enhance the competitiveness of the SME clusters and aid their performance, SIDBI launched a programme to strengthen the Business Development Services (BDS). This project, was launched in 2006, and is being co-funded by Department for International Development (DFID) of UK and GTZ of Germany.
Kanpur Leather Cluster- The Origin
History of this cluster dates back to 150 years ago, when the British set up factories for production of shoes and saddler items to meet military requirements. During World War I, the existing capacity was inadequate to meet the increasing demands. Local entrepreneurs were encouraged to set up manufacturing facilities for these items. World War II further motivated the growth of these industries, and in due course of time Kanpur became a prominent centre of production of leather & leather products.
The industry experienced a major turning point during the 60s when some entrepreneurs started exporting raw hides, semi finished/finished leather and other items. Soaring labor costs and environmental concerns led to the closure of units in developed countries, shifting of production base and resourcing to developing countries. This gave a defining moment for the Kanpur cluster, thus making it a major exporting centre for leather products.
The Industry Paradigm
The industry has a concentration of units producing semi finished, and finished leather footwear, saddler & harness items. A few units have started making leather garments and leather goods as well. Majority of the tanning units are situated in Jajmau, 10 kms from Kanpur, and a few units are located at Unnao and Banthar Industrial area in Unnao district. There are 1600 units engaged in the production of leather products generating a business of about Rs.2, 900 crores.
Achievements
The cluster contributes Rs.2, 900 crores of production per annum. Kanpur cluster has created a niche for processing buffalo leather and owns the credit of being the only center in the country producing saddler items and safety shoes for foreign markets. It is also a global player in upholstery leather, footwear and leather goods. With motivated performance, their exports have doubled over the last 5 years from Rs.1068 crores in 2000-01 to Rs.2039 crores in 2005-06.
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