The Hindu Business Line : Leather industry seeks 75% grant from Centre

Call for help
Excessive focus on green issues discouraging existing, potential investors
Total dissolved solids norm is being insisted upon only in Tamil Nadu.
O&M cost will be higher if entire cost of ZLD system is to be borne by the tanners.

New Delhi June 11 With the deadline for meeting the directive of the Tamil Nadu Pollution Control Board (TNPCB) that all the Common Effluent Treatment Plants (CETPs) in leather sector should put in place a Zero Liquid Discharge (ZLD) system in tanning sector by the end of this month, the leather industry is looking up to the Centre for 75 per cent grant for 10 CETPs, estimated to cost Rs 120 crore.

Industry sources told Business Line here that a delegation led by the All India Skin and Hide Tanners and Merchants' Association President, Mr M. Rafeeque Ahmed, is meeting the Union Finance Minister, Mr P. Chidmabaram, to plead the case of 526 tanneries which are connected to the 10 CETPS.

Tanners' investment

The sources said that following the closure of tanneries by the Supreme Court order in 1996, the tanners of Tamil Nadu have invested over Rs 150 crore towards establishment of 14 CETPs and 150 individual effluent treatment plants which are in operation today, meeting all norms of discharge of TNPCB, except for total dissolved solids.

Besides, the tanners in deference to the directive of the Loss of Ecology Authority, set up under the apex court order, have disbursed Rs 34 crore as compensation to farmers affected due to discharge of untreated wastewater.

The industry contends that the leather sector in the State has been in the doldrums during the last decade as excessive focus on environmental issues has made the industry vulnerable, discouraging existing and potential investors from expanding or fostering new capacities.

They said that total dissolved solids are a need-based norm set by the TNPCB, and insisted only in Tamil Nadu. It is not being followed anywhere else in the country or in any other major competing countries such as China, Vietnam, Indonesia or Europe and in the US.

As the choice of dilution of tannery waste water high in total dissolved solids with domestic sewerage is not available to many clusters of Tamil Nadu, the alternative prescribed by the TNPCB to tackle the total dissolved solids was to install ZLD by adopting reverse osmosis technology and evaporation of the reject to recover salt in solid form and its disposal.

The installation of ZLD system not only requires large investment but also substantial expenditure in operation and maintenance (O&M). They argue that O&M in all the CETPs, when they reach Zero Liquid Discharge status, would be of the order Rs 55 crore per annum, as against Rs 20 crore now if 75 per cent grant were given and would escalate to Rs 75 crore if no grant were extended.

Capital investment

Stating that if 75 per cent of capital investment were to come as grant and 25 per cent as tanners' contribution, its impact on O&M cost would range between Rs 0.55 to Rs 0.65 per sq.ft. of leather, the industry said the burden would be higher if the entire investment were to come from tanners.

This would not only add to the cost of leather, but the cost of various leather products would also go up, eroding India's global competitiveness of the $3-billion export industry that is poised to achieve export turnover of $7 billion by 2011.

Hence the crucial importance of the grant of 75 per cent amounting to Rs 90 crore to help small and medium tanners of Tamil Nadu which account for 65 per cent of the country's tanning capacity.

When contacted about the demands of the leather industry to meet its environmental onus, the Minister of State for Commerce, Mr Jairam Ramesh, said that the Department of Commerce has taken up this matter with the Government.

Besides, this proposal also figured in the memorandum forwarded by the Tamil Nadu Chief Minister, Mr M. Karunanidhi, to the Prime Minister, Dr Manmohan Singh, he said.

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