KARACHI: The formal footwear industry has weathered a turbulent year as its production plunged in 2020-21, mainly due to Covid-induced lockdowns and restricted timings of markets.

The footwear production in the first 11 months (July-May) of the outgoing year dipped 35 per cent to 23,350,000 pairs from 36,032,000 pairs in July-May 2019-20, showed data of Pakistan Bureau of Statistics (PBS).

Service Global Footwear Ltd chief executive officer Hassan Javed told Dawn from Lahore that the organised sector’s market share has grown to 30pc after entry of new players from 18pc some eight to 10 years ago when only three major companies were operating in the formal sector.

“At present most of the shoes produced in Pakistan for the local market are not in the organised sector, so data for the same is not available,” he said.

Mr Hassan, a former chairman of Pakistan Footwear Manufacturers Association (PFMA), said the first half of the FY21 was down due to reduction in footwear demand in the market. The second half had seen an improvement and all local producers have had a better second half amid coronavirus cases and market lockdowns.

He said the online sales have played a very important role during the pandemic and there was a phenomenal growth in them during Covid-19. The online sales, which used to a hold negligible share of 2-3pc prior to Covid-19 period, have swelled to 8-10pc of total footwear sales.

The lockdown does have a great effect on the sales, in fact the 8:00pm restriction also reduces the sales to quite an extent. “If the same situation persists, there will be increase in online sales,” he predicted.

Mr Hassan said footwear price has increased over the years and it varies differently category and article wise. The main reason for price hike has been the costly raw materials due to soaring dollar rate. Also rising wages over the years have also been pushing up the costs as it is a labour-intensive industry. High energy costs have also played a major role, he added.

On declining footwear life owing to use of various raw materials in a bid to keep prices affordable, he said the materials have been changing over the years and have reduced the quality of the product.

He said footwear exports rose to 16,609,000 pairs fetching $131 million in FY21 from 13,611,000 pairs valuing $126m in FY20. The government has given decent incentives as there is a great potential for the exports to boost further in coming years.

Footwear exports will grow substantially as Covid situation has improved in Europe, which is the main destination for Pakistan’s footwear, he said, adding now new regions are also coming and seeing Pakistan as a supplier of footwear.

Published in Dawn, August 8th, 2021