Inditex and H&M running away, Exports drastically decrease, competitors celebrating: Indian leather ruined by the government

Government imposed restrictions on illegal slaughtering of animals by tanneries has had an immediate and dramatic effect on leather exports. “H&M and Inditex (Zara) have reduced orders’ amount, as they fear our factories will have difficulties in getting the materials”, said M. Rafeeque Ahmed, one of the main shoe-makers in Chennai to the local press. He continues: “large brands went back to China or have taken the path that leads to Bangladesh, Indonesia and Pakistan”. If Indian exports declined by 3.2% in 2016 (worsened by a -15% performance of the tanning sector), that of the footwear industry has decreased, in the period going from April to June (CLIA data), by 4% (674 million USD). This is a situation, for example, that caused Nazir Ahmed, Ceo of shoe-making brand Park Exports (Agra), to tell Reuters: “We have killed the golden egg goose”. The statement made by Ahmed is in reference to the controversial law that has, since March, forced slaughterhouses with no permits to close. “The Supreme Court reinstated permission to trade bovines – explains Ahmed – but the reality is that ‘hindu vigilantes’ continue to be active and nobody wants to risk their lives to move animals to a different location”. According to Reuters, which listened to six different shoe-factories and 2 tanners, 1/3 of workers employed in the sector (mostly Muslim), lost their job: “I have no more hides – says one of them keeping his name out of the paper – some import them, but that means reducing the margins to zero”.


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