The Hindu Business Line : CLE's market focus programme for Russia in final stages

THE Council for Leather Exports (CLE) is now putting the final touches to a market focus programme for Russia, which is likely to be implemented in 2004-05.

The plan, which will be similar to the one in the US, will be part of the market development plan for the next fiscal year, the CLE sources said.

As part of the 2004-05 plans, the CLE, a Union Commerce Ministry-sponsored body, will participate in 14 international fairs outside the country, besides organising exclusive business meetings in 13 countries.

"All these events will be accompanied by necessary preparatory work including publicity and tie-ups with overseas industry associations", a CLE source said.

The CLE also has plans to meet with prospective investors in certain countries such as Spain, Italy, Portugal and France.

This action plan comes amid a degree of uncertainty in the industry as well as the CLE, regarding the achievement of the targeted $2-billion mark set for exports in the current fiscal.

Sources said that according to official statistics, in the first eight months of 2004-05, exports stood at $1,300 million.

Sectors that performed well were footwear, garments, leather goods, saddlery and harness and of course non-leather footwear — a segment that showed a 138.5 per cent growth in dollar terms in this period.

Footwear components, which lost much of their overseas market due to the closure of footwear units, suffered a negative growth rate, as did finished leather.

In rupee terms, exports were valued at Rs 6,009.4 crore compared to Rs 6,185.9 crore in the same period in 2002-03.

Referring to the proposed programme on Russia, which is emerging as a major market for the leather industry, the sources said the council had taken a small delegation to Russia earlier this year as part of its programme to develop new markets.

According to available estimates, Russia imports about $400-million worth of leather items.

However, actual imports are estimated at $1,000 million including the grey market, a survey had revealed.

"CLE is not targeting that market. Indian exporters now have a negligible presence of about 4.93 per cent — in the Russian market", sources said, adding that the market is dominated by China and Italy.

Germany and Poland are also players in this market.

As a follow-up to the Russian visit, the CLE appointed a Moscow-based marketing agency to act as its consultants for penetrating this market.

Referring to its market development programme for the US, sources said developing this market is a thrust area for CLE as India has a `rather unimpressive share' in most of the product categories although the US is the largest market for leather and leather products.

The council launched its efforts to tap this market in three phases, which culminated in the visit of a team of executives from the US companies to explore the opportunities of sourcing their exports from India in November last year.

This has met with success as some of the department stores have decided to `try out India', according to CLE sources.

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