The Hindu Business Line : Rs 400-cr modernisation fund to be set up for leather industry

THE Centre plans to allocate Rs 400 crore modernisation fund for the leather products and tanneries, according to Mr Rafeeque Ahmed, Chairman, Council for Leather Exports (CLE).

Mr Ahmed was addressing a press conference here on Sunday to announce the inauguration of the 20th India International Leather Fair in Chennai on Monday.

The fund is likely to be allocated in the next few weeks, he said. With the Europe and the US moving leather products manufacturing to the east, capacity utilisation is on the increase and there is a need to increase production facilities. The 17 per cent growth achieved in leather sector is likely to improve to over 20 per cent in the coming year, Mr Ahmed said.

Mr Habib Hussain, Regional Chairman - South, CLE, said that the flow of manufacturing capacities from the west to the east is likely to continue for the next year and half, and the leather industry in the South hopes to garner at least 50 per cent of the capacity.

Mr S. Audiseshiah, Executive Director, CLE, said that the Government and the private sector have taken a comprehensive view of developing the industry. Investments were going not only into production facilities but also on infrastructure for environment conservation, a key issue.

The industry has made a representation to the Planning Commission to allocate funds for upgrading effluent treatment plants and the common effluent treatment plants. The Tamil Nadu Government has granted over Rs 12 crore for upgrading the treatment plants in the State, he said.

According to official statistics, in the first six months of 2004-05, the export to the US has grown by 20.49 per cent, to Spain by 33 per cent and to France by 16 per cent. Overall exports have touched $1,159 million, representing a 17 per cent growth over the previous period and are likely to reach $2,284 million by March.

The four-day India International Leather Fair will showcase not just Indian products but also that of major leather products manufacturers in the SAARC region such as Pakistan and Bangladesh.

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