Eidul-Azha generates huge trade of sacrificial animals and provides an impetus to the skin, hides and leather goods business worth billions of rupees.

According to the Pakistan Tanners Association (PTA), some 5.75 million animals were sacrificed this year as compared to 5.5 millions last year. The number of cows/calves slaughtered reached 1.55 million — 27 per cent of the total slaughtered animals, said a PTA official.

The tanneries can give an exact number of animals sacrificed by aggregating the number of hides they receive, he added. “Eid, it is estimated, contributes 20-30 per cent of the total annual needs of the country’s leather industry,” says a leather trader.

However, the rate of skins fell during this Eid.

“The unofficial cartel of buyers kept their rates in the range of Rs3,000 per skin of calf or cow, and Rs600 for sheep or goat skin,” they said. Last year, they recalled that prices per piece were Rs4,000 and Rs800 respectively.

While the leather industry consists of units of various sizes, most of them fall in the medium scale category. Around 2,500 tanneries spread all over the country provide direct employment to around quarter of a million workers, of which a negligible 0.2 per cent is formally trained and the rest is unskilled,” said an industrialist.

The industry produces leather garments, footwear, leather shoe uppers, leather gloves, purses, handbags, key-holders, file covers, briefcases, wallets, sports goods and accessories. Leather garments have a distinctive place in the world market.

The industry, according to an official of the Trade Development Authority Pakistan (TDAP), is the second biggest export-oriented manufacturing sector and ranks third in overall exports.

Giving statistics, he said, “The value of leather goods exported during July-September 2012-13 was $265 million against $289 million during the same period last fiscal, down by eight per cent.

“But in terms of volume, the decline was higher due to escalation in prices of value- added leather goods worldwide and rupee depreciation,” he added.

“Unfortunately, neither has any well thought-out effort been made in the past nor has the importance of the sector been recognised by policymakers despite the fact it absorbs a large number of the redundant urban labour force,” says a PTA office-bearer.

“Owing to absence of the required enabling environment, Pakistan is losing its market share gradually to its competitors — India, Bangladesh and China. Pakistan faced 34 per cent decline in its leather goods exports last year alone, while India witnessed 20 per cent rise during the same period”, said Shahid Khan who is associated with the industry.

“We are unable to compete in the global market mostly because the cost of electricity in Pakistan which is twice that of prices in India, Bangladesh, China and Turkey.

In these countries the duty drawback and incentives allowed to industry are also much higher than in Pakistan.

“Leather manufacturing is an uninterrupted process that requires a continuous supply of gas. In Pakistan supply of gas to industries remains suspended three to four days a week.”

“Due to these stumbling blocks, tanneries are producing only 60 million square feet tanned leather per year against their capacity of 90 million square feet.”

Though Pakistan excels in quality leather and leather goods production, its global share is a mere three per cent, while its neighbours are benefiting from larger investments due to better law and order situation.

“China’s leather industry is enhancing its competitiveness by transforming its growth pattern. In next 10-20 years, China will change from a big leather producing country into a real brand titan,” writes the Beijing Times Magazine.

Some 461 leather garment/apparel-making units produce annually five million pieces against installed capacity of seven millions. The 524 footwear units are making 100 million pairs against capacity of 200 million pairs, while 348 leather glove units are producing only five million pairs against a capacity of 10 million pairs.

The export of value-added leather goods earned more than one billion dollars a year at one point.

In the year 2007- 08, these exports stood at $1.15 billion but declined to $860 million in 2009 -2010. There was some respite the following year and, according to TDAP, exports of sports goods and leather products went up by 8.34 per cent and 17.84 per cent respectively.

The industry has huge potential to boost export volumes with further improvement in quality and diversification in different range of products, specially garments and footwear. But the industry needs government’s support and incentives”, says an exporter.