Exports of leather and leather products declined significantly in the first 10 months (July–April) of the current financial year 2017–18 as most of the tanneries that have shifted to the Savar Tannery Complex from Hazaribagh are not fully functional yet. According to the Export Promotion Bureau (EPB), the sector registered a slightly negative growth rate of 10.02 per cent, resulting in earnings of USD 916.74 million. This figure was USD 1,018.86 million during the same period of the 2016–17 fiscal year.Bangladesh Tanners’ Association (BTA) chairman and Kohinoor Tanneries Ltd managing director Shaheen Ahmed told The Independent that exports fell significantly after quite some time because of three main reasons.The first is that of approximately 222 tanneries, only 155 tanneries have been shifted to the Savar Tannery Complex, and most of the factories there are not compliant. That is why foreign investors are not willing to invest in the Savar Leather Industrial Park.Secondly, only around 75 to 80 factories have gone into operation at the Savar Leather Industrial Park. Moreover, the solid waste disposal system there is not functioning, he added.Finally, infrastructure services there are not up to the mark. Roads go under water if there is just a sprinkling of rain. “The effluent treatment plant (ETP) in the Savar Leather Industrial Park is not fully functional and the dumping system does not work as well,” he also said.The owner of Salma Tannery, Shakawat Ullah, mentioned another obstacle. He told The Independent that the Bangladesh Small and Cottage Industries Corporation (BSCIC) is yet to complete registration of land for plot-owners. Because of this, plot-owners are unable to take loans from the banks because they are unable to show registration certificates to the banks.Mentioning another reason, Shakawat said: “Some of the European buyers have stopped purchasing products from us because the ETPs in the Savar Leather Industrial Park are not fully functional. They have cancelled their orders.” “We processed both crust and finished leather of about 5–6 lakh sq. feet per month,” said Shakawat.Ahmed said import duties on chemicals used to protect raw hide have been hiked, which influences the exports of crust leather. Crust leather has experienced a negative growth rate of 27.10 per cent in the current fiscal year (2017–18). The managing director of Kohinoor Tanneries Ltd said: “Around 70,000–80,000 people used to work in the tanneries in Hazaribagh before we shifted all the factories to Savar. Many have lost their jobs. This has hit the exports of leather goods.”Describing the opportunities for this sector, Ahmed said since raw materials are available, 350 million sq. ft of leather are produced annually in Bangladesh. Of this quantity, 20–25 per cent goes to meet domestic demand, while the rest is exported. There is a huge domestic demand for leather goods in Bangladesh, he noted.Regarding future prospects, Ahmed further said: “Leather was declared the ‘Product of the Year’ last year. The industry is now coming out of the shadows and has become an important contributor to the country’s export basket. We need government policy support and infrastructure facilities to achieve the target of USD 5 billion by 2021.”Only leather footwear registered slightly a positive growth rate of 6.60 per cent, resulting in earnings of USD 460.14 million. This figure was USD 431.65 million during the same period of the 2016–17 financial year.
