Indian crackdown hits shoe exports
A government crackdown on Muslim-dominated abattoirs and the trade of cattle dragged down India’s exports of leather shoes more than 13% in June, as leading global brands secured supplies elsewhere.
A government crackdown on Muslim-dominated abattoirs and the trade of cattle dragged down India’s exports of leather shoes by more than 13% in June, as leading global brands turned to China, Bangladesh, Indonesia and Pakistan to secure supplies.
The drop in exports of shoes and leather garments is a setback for Prime Minister Narendra Modi, who is seeking to create millions of jobs by more than doubling the leather industry’s revenues to $27bn by 2020.
Emboldened by the victory of Modi’s Bharatiya Janata Party (BJP) in the 2014 general election, Hindu hardliners, who consider cows sacred, became more assertive in their calls for a clampdown on the meat and leather industries, run by Muslims, who make up 14% of India’s 1.3-billion people.
“The writing was already on the wall,” said Nazir Ahmed, CEO of shoemaker Park Exports. “We have killed the goose that laid the golden egg.”
India, the world’s secondbiggest supplier of shoes and leather garments, exports nearly half its leather goods, with overseas sales estimated at $5.7bn in the 2016-17 fiscal year to March, down 3.2% from a year earlier. Footwear exports fell more than 4% in April-June, to $674m.
INFORMAL SECTOR
In March, after being appointed chief minister of Uttar Pradesh, India’s most populous state and a leading leather exporter, Yogi Adityanath, a Hindu monk, ordered a closure of abattoirs operating without licences.
Slaughterhouse owners complain that much of India’s meat and leather trade takes place in the informal sector and it is hard to get licences, especially for smaller units.
In May, citing cruelty to animals, the federal government banned the trade of cattle for slaughter and restricted livestock sales only for agricultural purposes such as ploughing and dairy production.
But the country’s top court overturned that order, citing the hardship the ban had caused. That has not brought relief as attacks on trucks carrying cattle still rankle the leather trade.
“The Supreme Court has allowed the resumption of trade for cattle, but the ground reality is that cow vigilante groups continue to be active and no one wants to risk his life by transporting cattle,” Ahmed said.
Deterred by a clutch of measures that squeezed the supply of leather, brands such as H&M, Inditex-owned Zara and Clarks, cut back their orders to India, said M Rafeeque Ahmed, a shoe exporter from Chennai.
“We lost orders because our buyers were sceptical of our ability to meet their requirements. Instead, most buyers moved to rival suppliers in Asia and Southeast Asia.”