Sunday, 13 December 2015

Chennai floods spell havoc for Agra footwear exports

The footwear industry of Agra looks at a bleak future, as floods in Tamil Nadu have drastically hit supply of leather here. Nearly 60% of the leather used by the industry here comes from Chennai itself. Manufacturers said production has been delayed by a month now and the fresh spell of rainfall in Chennai earlier this week has once again put a question mark on future supply.

Manufacturers pointed out that humidity is bad for leather products, and in Chennai it is hovering at around 93%. Loss to the industry due to delay in exporting goods to foreign countries could stand at around Rs 150-200 crore. There are 100-odd exporters in the city who together make up 28% of India's total footwear exports at present.

Exporters said that the calamity could not have come at a worse time for the industry, already suffering losses of around 15% compared to previous years due to slowdown in European economies. "The floods have not only affected Chennai residents, but also the clusters of tanneries in and around Agra. Exports, being time-bound are the worst hit. Many exporters will have to shell out extra money to dispatch deliveries by air. In case of failure of timely deliveries, there are chances of entire consignments being cancelled," said Puran Dawar, president, Agra Footwear Manufacturers and Exporters Chamber (AFMEC), talking to TOI. "The present scenario is a big blow to recovery measures and efforts being made in line with the 'Make in India' initiative," he added.

Capt AS Rana of Rana Overseas, former president of AFMEC, said, "Supply of leather has been erratic due to train and truck movement coming to a standstill. A large quantity of leather is also lying at tanneries and has not been dried properly. This will further delay supply of finished goods. We have already started apprising our customers about the prospective delay in supplies. Our finances are all tied up because of this." Rana added that customers would insist on supply by air. On an average, a manufacturer will incur Rs 200-300 per pair on supply through air, compared to around Rs 50-60 per pair through ship.

Shahroo Mohsin, owner of Young Style Overseas, said the present disaster would have a cascading effect next year. "The delay this year will make the customers apprehensive about the deliveries next year as well. There is a high probability that they will move to other markets like China. We are ourselves uncertain about when things will improve, so we are not able to give our customers proper information."

Subash Kapoor, vice-chairman of Council for Leather exports, said "Around 80% of leather production in the country is from Tamil Nadu. Not just Agra, but Delhi and other places have suffered huge losses. Tanneries will take another month to start functioning normally. We will seek more time from buyers. "
http://timesofindia.indiatimes.com/city/agra/Chennai-floods-spell-havoc-for-Agra-footwear-exports/articleshow/50143488.cms

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