Leather Sector

The leather sector has massive potential for employment, output growth, and exports. In India, it is one of the top foreign exchange-earners. Bihar has a huge potential for investment in the leather sector.

Due to the large raw material base (in terms of hides and skins produced in the state), plenty of cheap, skilled, and semi-skilled labor, and a huge domestic consumption market, it offers a prospective investor a comparative and competitive advantage in this sector.

Our strategic advantages in this sector across factors of production are:

Key FactorsOur Strategic Advantage
Availability of Raw hides and skins(A) Bihar has approximately 8% of the country’s total bovine population. According to the 2012 livestock census, the total livestock population in Bihar was 329.38 lakh. The cow population was 122.31 lakh, and that of buffalo was approximately 75.67 lakh. The goat population stood at 121.53 lakh. Bihar accounts for nearly 12% of the country’s total goat population, ranking third in the country. These figures will improve when a new census takes place in 2017.
(B) According to a recent survey conducted by the Central Leather Research Institute (CLRI), Chennai, Bihar, annually produces 2.64 million bovine hides and 5.09 million bovine skins. The state is known for best quality goat skins, cow hides, and buffalo calf skins. Goat skins are smaller in size and the best material for the production of glazed kid’s leather products, which are mostly exported.
(C) According to a rough estimate, 3 trucks loaded with 7-8 thousand pieces of goat skins and 2-3 thousand pieces of cowhides are transported from Muzaffarpur to other destinations daily. The leather units in the state export raw materials to Kolkata, Kanpur, and Chennai, depriving Bihar of the benefits.
Availability of Labour(A) Leather industry is a highly labour intensive industry. The small-scale, cottage, and artisan sectors account for over 75% of the total production from this industry, and a majority of them belong to the unorganized sector. The main strength of these unorganized small cottage units has been the availability of cheap labor, mostly from the weaker sections of society. Women’s employment is predominant in the leather industry, with about 30% share.
(B) Bihar, on account of its large, growing population, is one of the largest labor bases in the country.
(C) At present, there are pockets in the state, in the districts of Patna, Gaya, Nalanda/ Biharsharif, Muzaffarpur, etc., where artisans are involved in the production of leather footwear. Thus, skilled labor is readily available in leather units.
Availability of Domestic MarketAlmost all the goods produced by the leather sector are daily-use items. Thus, the consumption rate of these products is very high. The large population of Bihar, comprising a growing middle class in both urban and rural areas, creates a significant local demand for the products. A leather unit established in the immediate neighborhood of such big markets would, therefore, enjoy both the advantage of scale and cost cuttings.

The leather industry mainly includes units that are involved in the production of finished or semi-finished leather and the manufacturing of various kinds of leather goods. The state govt has a clear focus on promoting all the facilities in the value chain, from raw material processing to finished-goods manufacturing.

The following kinds of facilities/ units would be considered under the priority sectors:

SectorsInvestment Opportunities
Manufacturing of Leather products(a) Manufacturing of leather shoes, leather chappals, and other footwear items of leather
(b) Manufacturing of leather footwear components
(c) Manufacturing of leather garments
(d) Leather for upholstery
(e) Manufacturing of leather goods (e.g. labels, tags, belts, bags, purses hand gloves& other accessories, and fashion items)
(f) Manufacturing of upholstery for automobiles (cars, etc.) &furniture;
(g) Manufacturing of saddlery and harness items
Storage / WarehousingModern warehouses for storage of raw hides and skins with or without temperature control/ refrigeration arrangements, finished and semi-finished leather and other leather goods
Business Development ServicesR&D; facilities, design studios/ facilities for prototyping, quality testing, labs, etc.

Apart from these, the Government of Bihar would strive for the promotion of rural technologies developed by CSIR-CLRI. Units using these technologies would be treated as a priority sector for incentivizing purposes.

Note: The above list is only indicative, and the State Government may make a suitable decision with regard to the inclusion of any other kind of technology in the list.

Following is the list of important rural technologies developed by the CSIR-CLRI –

  • Leather Mojari/Jooti footwear
  • Leather Kolhapuri footwear
  • General footwear (shoes)
  • Leather footwear (sandals/chappals)
  • Leather puppets manufacturing
  • Leather goods
  • Leather board
  • Collection of fallen carcasses and their utilization