Import duty on hide, skin further increases crisis of leather sector

6 August 2014

News - Pakistan

Leather sector stakeholders in Karachi criticised a recent anti-leather industry move by the government to impose duty on import of hides and skins.

Leather and leather garment exporters expressed shocked over the move and chairman of the Pakistan Tanners Association south zone Fawad Jawed wrote in a letter to the Prime Minister and Federal Minister of Finance that despite the leather sector facing critical mass, the imposition of duty on raw-materials without justification will result in Pakistan's leather sector collapsing.

He further said that despite negative growth, the government has imposed this without considering that the leather sector has been severely hit by water and gas shortages and the rising cost of electricity. As a result, Pakistan has lost mush of its market share to India.

Skin and hide shortages have been a major concern due to unabated export and livestock smuggling.

He also emphasised that despite repeated assurances by the government for more vigilant checks on livestock smuggling, no steps have been taken and livestock populations continue to diminish.

From a global perspective He highlighted that Pakistan was lagging in that China's export stood at just over $28 billion in 2007-08, and those of India stood at nearly $5 billion in same period, while Pakistan's exports stood at $1.2 billion. And in 2012-13, Chinese exports stood at $42.4 billion, India at just under $6 billion, Pakistan at $1.1 billion with a negative growth of -6.39%.

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