Inadequate manpower may come in the way of the Indian leather sector, including the footwear segment, to optimise the emerging growth potential.
According to Mr Shankar Dawn, President, Indian Leather Products Association (ILPA), crippled by labour shortages, the sector would require a fresh addition of over one lakh people across the country for tapping the increase in demand.
Leather goods export stood at $3.87 billion (Rs 19,350 crore) in 2010-11 and is expected to grow to $4.5 billion (Rs 22,500 crore) this fiscal.
A recent study by Assocham suggests that the footwear sector is estimated to grow by 15 per cent to Rs 38,700 crore by 2015.
Dominated primarily by the unorganised sector, the leather industry employs nearly 25 lakh people annually, of which, 80 per cent are engaged in footwear manufacturing.
According to Mr Dawn, West Bengal would require nearly 55,000 people in the coming three years, followed by the other major leather manufacturing centres such as Kanpur (UP), Agra (UP) and Jalandhar (Punjab).
“We are already facing an acute shortage of labour because of lower rural-urban migration,” he said.
Lack of interest amongst labourers, particularly from Bihar and Uttar Pradesh, because of increasing job opportunities under the Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA) is being cited as one of the key reasons for such labour shortages.
To overcome the problem, ILPA has suggested to some footwear and leather goods makers to relocate their manufacturing facilities closer to the rural areas.
“Manufacturing facilities being closer to rural areas would make it easier for the companies to tap talents locally as well as reduce their costs,” he added.