West Asia Crisis: Leather and Footwear Industry Seeks Duty Exemptions on Critical Inputs

The leather and footwear industry has sought duty exemptions on a number of critical inputs such as synthetic leather, metal accessories, machinery, threads, moulds, and certain chemicals as the ongoing West Asia crisis has pushed input costs up by up to 60 per cent, an official said.

The industry has recently flagged the matter with the commerce and industry ministry.

The industry official said that the exporters have suggested the government for early implementation of the proposed FLOAT (Footwear and leather oriented transformation) scheme covering the entire product range, raw materials, machinery and inputs.

They have also urged for duty-free import of crust and finished leathers to boost domestic manufacturing.

"The industry is facing a sharp increase in raw material and input costs - rising by 40-60 per cent - due to the West Asia crisis.

"In view of this, we have urged the government to provide import duty exemptions on critical inputs such as synthetic leather (PU-coated fabrics), footwear components, metal accessories, leather and footwear machinery, threads, moulds, toe puffs, eyelets, certain leather chemicals and packaging materials," the official said.

Certain rubber chemicals, PU leather, adhesives, plastics, and shoe soles are components derived from petroleum products, and the West Asia crisis has impacted the movement of oil and gas ships due to the closure of the Strait of Hormuz by Iran.

Certain other inputs are imported by the domestic industry from countries like China, Korea, Indonesia and Japan. The country's imports in this sector dipped 4.49 per cent year-on-year to USD 938 million.

The country's leather and leather products exports dipped by 2.36 per cent year-on-year to USD 4.26 billion in 2025-26. However, as per the industry, with the export of non leather goods (whose data is awaited), the export is expected to reach USD 5.6 billion.

The total exports from the sector, which would include finished leather, leather footwear, footwear components, leather garments, leather goods, saddlery and harness, non-leather footwear, non-leather goods, and fur and fur products, stood at USD 5.57 billion in 2024-25 as compared to USD 5.38 billion in 2023-24 and USD 6 billion in 2022-23.