Now India is facing its own devastating Covid-19 crisis and Prime Minister Narendra Modi is reluctant to stir its economy again.
India’s economy could still come under pressure again.
This is beginning to show in the Indian leather industry.
India is a major global exporter of leather and leather goods. The country is the second largest exporter of leather clothing and the fourth largest exporter of leather goods in the world, according to the Indian Council on Leather Exports (a division of India’s Ministry of Trade and Industry). It is also a major shoe manufacturer after China, producing nearly three billion pairs of shoes annually.
Last year the pandemic dealt a heavy blow to the Indian leather industry. Leather exports slumped a whopping 29.1% year over year as the industry lost nearly $ 1.4 billion in exports. According to Aqeel Panaruna, chairman of the Leather Exports Council, buyers in the US, European Union and the UK have withheld their purchases during their own lockdown.
An industry expert who did not want to be identified and is currently also infected with the coronavirus said leather manufacturers had suffered the cumulative knock-on effect of a protracted shutdown last year. He fears that a deteriorating second wave could set the industry back again.
Much of these concerns are fueled by the dynamism of the industry workforce.
“The majority of the workforce is between 18 and 45 years old and has not yet been vaccinated,” said Sanjay Leekha, vice chairman of CLE.
“We now rely on God”
Shashi Kashyap is a senior manager at the Indian leather manufacturer, a manufacturer and exporter of leather products based in New Delhi. The 30-year-old family business operates three production sites in the city that are currently affected by a worsening health crisis.
Kashyup said he had Covid, his older father was infected as well as other members of his family.
“We’re relying on God right now to see this through,” he said. “There is no place to be tested, no place in hospitals to be admitted. People die on the street.”
As he grapples with his personal reality, the company he works for is also in dire straits.
The Indian leather manufacturer employs more than 500 people and produces leather goods – jackets, bags, boots, belts, equestrian products – for customers in the USA, Europe and other countries.
“We only receive orders for 5,000 to 10,000 jackets from one customer,” said Kashyap. “We can’t name our overseas customers, but they are in the luxury segment,” he said.
2020 was a devastating year for business. “All three of our facilities were closed for the first part of the year. Everything came to a standstill,” he said. When business picked up again in the fall, India saw a more deadly second wave.
“We only operated for two months last year and now we’re closed again,” said Kashyup.
Kashyup said it was a situation that is playing out in India’s main leather industry.
“I would say 50% of the factories in our industry closed in the last year,” he said. Kashyup said his company is struggling to keep its skilled craftsmen.
“We have to find a way to pay them on this shutdown as well because if we don’t we know they just can’t survive. If it’s not Covid, it’s because they have no money from that they can live. ” “”
Raw material stocks are “a problem”
Some of its own and licensed brands include Levi’s, Calvin Klein, Cole Haan, and Haggar Clothing Co.
“In accessories, most of our raw material for Indian production (leather) comes from the north and is suffering from understandable and significant delays,” said David J. Katz, EVP and Chief Marketing Officer of Randa Apparel & Accessories.
“Our local raw material supplies are becoming an issue as the demand for belts and wallets increases in the US. However, our main factories, suppliers and new joint ventures in India are in the Chennai area, which is less affected by the pandemic, and we hope so It stays that way. Production mostly went on schedule. Our deliveries from India have been somewhat delayed due to transport and logistics backlogs. “