Govt to unveil Rs.2,600 cr package for leather sector to boost exports
The Dollar Business Bureau
The Government is likely to announce soon an incentive package of Rs.2,600 crore for the leather and footwear sector in order to boost the exports and creation of jobs in the sector, according to sources.
The Expenditure Finance Committee (EFC) has already cleared the incentive package and a draft note has been sent to various ministries seeking their views, reported PTI, citing the sources.
The proposal has been suggested by the Commerce Ministry, which is seeking tax incentives for the Indian Leather, Footwear and Accessories Development programme.
In addition, support has been asked to increase tax incentives for generating employment in the sector.
The package comprises both tax and non-tax benefits and was drafted in line with the measures announced for textiles sector last year, said the sources.
The leather and footwear sector assumes importance as it is a driving segment under the ‘Make in India’ programme.
According to industry experts, an investment of Rs.1 crore in the sector leads to job creation for around 250 people. Presently, there are around 30 lakh people, who are directly engaged in the sector.
Globally, India’s leather manufacturers are facing a tough competition from China, in terms of pricing.
The government has set a target to increase exports from the sector to $15 billion by 2020 from the present $7 billion.
The leather and footwear industry in India is primarily dominated with products manufactured from synthetic leather. The industry accounts for around 90% of the overall leather manufacturing in in India.