Indian leathermakers are targeting buyers from France, the CIS countries and in particular the US, in an attempt to increase India’s leather exports by 10% during 2003-2004.

India currently has only a 1.39% ($400 million) share of the world market for footwear which last year totalled $28 billion. Indian traders hope to increase their share to 3% over the next one to two years, with the US, which accounts for 43% of the global market, being a key target.

The Indian Council for Leather Exports (CLE) has enlisted the help of the Footwear Consulting Group (FCG) to identify US companies which could be potential investors. The FCG claims it will link Indian companies with at least ten potential buyers and said it will soon bring a team of at least 24 top-buying executives to India for a one week visit.

In August, the CLE will take a delegation of Indian companies to Las Vegas for a series of buyer-seller meetings with at least 70 leading US representatives.

Current data for the world market shows that exports of Indian footwear components and garments are in decline and demand for shoe uppers for conversion into full shoes is vanishing. This is attributed to the increased cost of making shoes with imported components and due to rising competition from China and Vietnam.

Meanwhile, the Calcutta Leather Complex (CLC) project in Bantala, India has been hit by a fresh round of rising costs and delays. The company behind the project, ML Dalmiya & Co, has raised its building expenditure from Rs2.5 billion ($53.7 million) to Rs3.4 billion ($73 million).

The complex was scheduled for opening on or before October 2002. To date only 50-60% of the tannery relocation programme has been completed and two units of the project’s common effluent treatment plant remain unfinished.

ML Dalmiya & Co is seeking a Rs750 million ($16.1 million) loan to replace its high interest Rs500 million ($10.7 million) loan. The company has defaulted the payment of its existing finance with the State Bank of India (SBI), Indian Oversees Bank (IOB) and SIDBI.

Besides raising fresh loans, the firm is also looking for a fresh equity funding of Rs65 million ($1.4 million). The public sector Union Bank of India has shown interest in becoming a new equity partner and said it will invest Rs25 million ($537,230).

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