LAHORE - Pakistan is swiftly losing its share of world leather market to regional countries because of higher cost of production, as the leather exports have declined by 18 percent on average in 2015-16.

Pakistan Tanners Association North Zone Chairman Azam Malik lamented that Pakistan’s share of leather and leather products export is limited to just 0.5 percent in world market for the last many years despite having fourth largest livestock population with over 180 million cattle in the world.

Comparing Pakistan’s meager share in leather export market with other regional countries, he said that China’s share is 19 percent, Italy’s 9 percent, Vietnam’s 4 percent and India’s 2.5 percent. While addressing a meeting, the chairman vowed to promote the association to new heights. He thanked the members for reposing confidence on him to lead the association in north zone. He said that the outgoing body had been actively promoting the interests of the leather industry throughout 2015-16.

Malik, who is also a renowned philanthropist, vowed to continue his efforts for the promotion and protection of the leather industry. “His top priority would be uninterrupted energy supply to the leather sector, resolution of tax related issues, and a favourable environment for the promotion of leather industry in Pakistan especially in Punjab,” he added.

“It’s unfortunate that Pakistan’s export registered decline but in contrast, Bangladesh leather export increased by 100 percent, China’s by 20 percent and India’s by 63 percent. Malik looked very upset over the extra load on the industry in the shape of high utility tariffs, taxes and levies. The chairman, who is an expert on leather industry, said that leather industry contributes around 2.6 percent to GDP, about 5 percent to country’s total exports, providing jobs to over one million skilled and semi-skilled workers.

The association had been constantly informing the government and the Commerce Ministry about this situation. He said that businesses associated with leather exports were in need of urgent help. He said that duty drawback rates should be re-notified as requested by the association. He said the Federal Board of Revenue (FBR) abolished this facility without taking the sector into confidence. The chairman demanded that customs duty on import of raw hides and skin should be abolished totally because all imported skins and hides are re-exported with lots of value-addition. Hence, the government is imposing penalty on value-addition of raw material, he added.

He said the leather industry was facing difficulties due to the changes taking place globally. It is not only competing with the developing countries; it has to compete with the developed world too.

Despite gloomy export performance, Malik is still hopeful of a turnaround in the leather sector, as the country is producing best quality of raw material of raw skin and leather but stocks were not increasing due to decline in livestock owing to high smuggling rate.