Can leather, textile sectors cater to rising export demand?

After two tough years, the leather and textile sectors are hoping for better exports this fiscal as the global economy recovers and newer markets are discovered. While this will go a long way in helping the government tame the trade deficit, a severe manpower shortage in these sectors, though, may play spoilsport.

Also read: See capital goods, electronics as big export themes: Kotak

P Chidambaram, finance minister had said, "If exports could be increased in the coming seven months it would be possible to contain the trade deficit..."

One way of doing this would be through leather and textile clusters which contribute 13.20% to India's total exports. As the global economy recovers from recession the leather sector is hoping export of leather and leather products will reach USD 5.75 billion in FY 14 while the textile sector is optimistic of meeting India's apparel exports target of USD 17 billion for the current fiscal.

But all this, provided these labour intensive sectors are able to solve a big challenge they are currently facing - shortage of manpower.

With the industry facing tough times over the last few years, a lot of jobs were axed and now that demand is returning, the sectors need more workers once again.

M Rafeeque Ahmed, president, All India Skin & Hide Tanners & Merchants Association (AISHTMA) says, "If you increase 1 billion dollar export units you need about 200,000 to 300,000 employment. It is happening this year"

A Sakthivel, chairman, Apparel Export Promotion Council adds, "'There is a shortage of man-power especially in Tamil Nadu, because all the Government schemes are well working because free rice, free TV and this NRGA. So to get workers from Tamil Nadu is tough."

To address the problem textile exporters are now aiming to set up 250 apparel training and designing centers across the country in order to source workers from other states like Orissa, Bihar and UP.

"We have started about 185 centers. We already trained about 100,000 workers. So this five year plan, we want to complete 260,000 workers in 250 centers. So we are doing our level best & also Government has now asked us to start a sector skill council for apparel & made ups," Sakthivel adds.

There are a few reasons behind exports looking up - one of course is the global recovery. But, the emergence of new markets, as well Chinese manufacturing costs shooting up and prompting more companies to look at India insteadhave also attributed to the overall pick up.

And at a time like this, export oriented sectors like leather and textile need to move quickly to address internal challenges and meet growing demand.