Leather eyes huge growth in the future

The leather industry has established itself on a firm footing. It is now the second largest industrial sector from which the country earns around USD 1.3 billion in foreign exchange every year.In fact, the country can expect export earnings of USD 5 billion  from this sector within a couple of years. No, this is not a sweet dream, but only the real picture. This achievement has been possible due to a number of reasons including product diversification and state-of-the-art technology.Tanneries of the Hazaribagh area have been shifted to a modern environment-friendly tannery estate in Savar. Tanners have now the option to build their industrial unit by applying modern concepts. They can add updated hydraulic and pneumatic machines, apply latest production processes, and use technology upgrades.Recently, product diversification and rapid extension of modern footwear and leather product units have added extra enthusiasm to both entrepreneurs and the government.But under every source of light lies a shadow. The leather sector too has not been able to weed out all the longstanding problems despite its tremendous improvement. Most of these, however, are only man-made problems and can be overcome with a little bit of initiatives from all stakeholders.The post-qurbani period is the prime time for the tanners to collect the best rawhides and skins for quality leather production. The quality of qurbani collection is much better than the collection throughout other periods of the year.From statistics, it is clear that its rare to find a 100 per cent raw material-based industry, except the tannery sector, in Bangladesh. The main raw materials for this industry are rawhides and skins. The country gets all the raw hides and skins for its tanneries from its own resources:The table shows the total raw input and production output for the country’s tannery sector. Here around five to seven lakh cattle have been included by keeping in mind the qurbani season when they enter the country through legal/illegal border trade.According to statistics, the tannery sector receives half of the total collection of rawhides and skins during qurbani. It is obvious that the quality of these raw materials gathered during qurbani is better than that of the collections during other periods of the year. But of late, some unsavoury situations have taken place in terms of hide collection and curing. Such situations should be avoided at all costs. The following table describes the availability of rawhides and skins  and the related economics:Around 155 tanneries  are now being relocated to the Savar tannery estate. Around 40 small tanneries could not afford such relocation and stopped their operations. Big tanneries, however, grabbed the opportunity to build their enterprises with enhanced production capacities by including additional machinery and technology. In Hazaribagh, the installed capacity of these cluster was around 280 million sft, but these tanneries have set up a target of 450 million sft of production capacity a year in Savar.In the early 1980s, the prime body for the tanners’ chamber of industry was Bangladesh Tanners Association (BTA). Later, it regrouped into two or more bodies to look into their ancestral interests. Small producers keep themselves with the old banner of BTA, but the bigger and modernised units are under the banner of the Bangladesh Finished Leather, Leather goods, and Footwear Exporters’ Association (BFLLFEA). There is another trade body called the Leather Goods and Footwear Manufacturing and Expoters’ Association.There is another group in the tanning industry. This has been formed at the heart of the tannery sector. It comprises around 150–200 people, who do not own a tannery, but have money, technology and trade capability. They made the tanneries live by the job-work system.Currently, around 40 per cent of the tanneries in Savar has been continuing their productivity through this rent system. Most of the involved tanneries have lost their credibility to run their own units. But this job-work system is keeping them alive. Even some of the big tanneries are creating an extra earning opportunity for themselves through this system by lending their modern machinery and technology to members of this influential group.The leather sector is an age-old industry in Bangladesh. But tanneries inside the city posed serious pollution-related problems. Residents of the Hazaribagh area had regularly made complaints about the pollution from local tanneries. The idea of relocating tanneries from this area was first considered in the early 1980s. But, at that time, it was eventually decided that the tanneries would remain in Hazaribagh area with adequate environmental measures. A project—Regional Programme for Pollution Control in the Tannery Industries in South East Asia—was undertaken by the United Nation Industrial Development Organization (UNIDO) in this respect.Later, the process to relocate these tanneries was announced in 2003. The industry ministry undertook this task and assigned the job to its sister concern, the Bangladesh Small and Cottage Industries Corporation (BSCIC) as the implementing agency. The job of land acquisition, land development, plotting and all the related work was completed by 2006. The plot allotment to the tanners had also been completed by 2007. Meanwhile, UNIDO took a preparatory assistace programme for relocation of Hazaribagh tanneries to the new site under SIDA’s finance in 2006. The work was undergoing accordingly and there was some clear indication of the Swedish International Development Agency’s (SIDA’s) finance for CETP (common effluent treatment plant) installation. But the change of government and some other activities of BSCIC and MOI suddenly changed the whole scenario.Other than financing the installation of CETP through SIDA, the BSCIC had been trying to call a tender for CETP construction. In September 2007, it suddenly transpired that a company has been awarded the job through the government’s highest purchased authority. After knowing about the procurement decision, SIDA became annoyed and quit the whole process.It usually takes two to three years to finish the construction of CETP, which was to have a 20,000 cubic meter wastewater treatment capacity every year. But a long time has already been lost. The tanners have been forced to shift their tanneries to Savar a year ago through legal action. But the infrastructure of the Savar tannery estate is not conducive to running a tannery. The CETP constructed by a Chinese company does not fulfil the standards set by the international norm. The chrome recovery units can be seen, but they have no capacity or capability or even the standard to coup up the chrome recovery process.There is another snag in the whole process. The tannery cluster, as a whole, discharges around 220–240 tons of solid wastes every day. But since its relocation to the new site, there has been no arrangement to dump or demolish the huge quantity of solid wastes being generated by the tanneries. As a result, chaotic/obnoxious situations are emerging at the Savar tannery estate, hampering the whole process.Besides, water is the prime component for tannery productivity. To make it environment-friendly and to minimise the water consumption, the project has been designed in keeping with a central water supply system with its control through a metering system. A reputed company has been assigned to do the job for the whole process. Accordingly, it has been given separate space and authority within the tannery area to install deep tube-wells to maintain continuous water supply to the tanneries at the estate. But most of the tanneries have been installing deep tube-wells individually, depleting the groundwater table in the process. It is an alarming trend that destroys the local eco-system.The whole process can be handled in a disciplined and systematic way if the public and private bodies sit together to ensure a smooth relocation process.

Here is a brief overview of the process of for relocation of Hazaribagh tanneries:

1. A case is filed against tanners of Hazaribagh for not participating in the relocation process. It says the estate is fully ready to receive the tanneries. The tanners, on their part, point at the incomplete situation of CETP construction.
2. At the time of final decision to cut off the utility services of Hazaribagh tanneries, the status of CETP construction in Savar is 50 per cent. But the project office misguides the court by saying that it is ready to receive the discharged effluents from the tanneries. The tanners side cannot defend this unlawful statement.
3. Now the Savar situation is still critical. The CETP is yet to maintain the standards set up by the environment regulation. All other related components have not been completed. The overall civic situation is pathetic. The technological situation is also below par. Before their relocation, the leather sector earned USD 1.3 billion. It has declined to below USD 1 billion at present.

So, how the situation needs to be handled? How this crisis can be overcome?

1. A through SWAT analysis is needed for the overall situation.
2. The project office needs to be empowered through direct supervision of the PM Office.
3. A mother body in the name of ‘Leather Council’ needs to be formed immediately to look after the overall situation of the leather sector.
4. For CETP operations and its future maintenance, an internationally reputed and technologically strong organisation, such as UNIDO, should be invited to look into the matter.
5. BUET is a reputed and respected academic body in Bangladesh. But it never interfered in the tannery situation. Time has come to re-fix the local consultancy team on a need basis.
6. The tanner’s body needs to be united under a common banner of either BTA or the BFLLFEA for smooth and unified action.
7. Marketing and commercial pockets of the tanners need to be strengthened either individually or collectively.
8. The government needs to uphold the tanners’ community by providing both financial and policy support.