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Coronavirus
LOW Source: covid.gov.pk
Pakistan Deaths
28,280
1124hr
Pakistan Cases
1,265,047
66324hr
1.66% positivity
Sindh
465,819
Punjab
437,974
Balochistan
33,128
Islamabad
106,469
KPK
176,886

Leather exports have been climbing and the PBS export data shows that exports including leather garments, leather gloves, and other leather products (excluding footwear) for the first two months of FY22 (2MFY22) were up by 8.2 percent year-on-year. Leather footwear for the same period was up by 20 percent year-on-year, while tanned leather exports, which are in the unprocessed form were also up by 44 percent year-on-year. In August 2021, leather manufacturer’s exports grew by a meagre 3.4 percent year-on-year, whereas the footwear and tanned leather exports were up by 38 and 49 percent year-on-year, respectively.

Although, leather exports rebounded in FY21, total leather exports dropped by 9.36 percent year-on-year in FY20 that included first 4-5 months of the pandemic during nationwide and global lockdowns. According to a mapping study with the financial support of the European Union on Pakistan’s leather products, shipment data showed that Pakistan’s leather and leather goods sector took a hit as the exports of all leather products took a dive in 2020 due to the pandemic. However, unlike FY20, total exports of the leather industry including tanned leather, leather apparel, leather gloves, leather footwear, and their leather manufactures witnessed 8.9 percent growth year on year in FY21 despite the pandemic and restrictions.

The resumption of growth in Pakistan's leather exports is a good sign, but it must be noted that growth witnessed did not come from resumption of global demand but came from decline in exports from India. Share of leather exports in the country’s total exports has fallen from 4.9 percent in FY16 to 3.6 percent in FY20, and a major concern is the need for skilled and trained manpower.

In a conversation with BR Research, (‘Huge potential to increase exports of value-added leather goods), Fawad Ijaz Khan - the founder chairman of Pakistan Leather Garments Manufacturers and Exporters Association (PLGMEA) highlighted that leather is a labor-intensive industry that requires expertise and skills rather than technical knowhow because of very basic machinery.

There is a lack of skilled labor force in the country, which is a key inhibiting factor for the growth of the sector - such as lack of sufficient vocational training institutes, leather fashion, and designing institutes focusing on highly skilled workers for the industry.

However, that’s not all; the country also suffers from low level of value addition in the product-mix relative to regional peers. Out of all the finished leather used across the globe, highest percentage is for footwear followed by leather goods, which is where the sector’s labor intensity must focus. Also, strict tannery effluent and discharge management, and global requirements also result in very few internationally recognized brands of leather products in Pakistan. Bringing efficiency and environmental sustainability in the sector will not only help the sector improve export revenue but also play a role in fight against climate change.

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