The global market value of the leather goods and footwear industry is estimated at USD 400 Billion in 2021.

The global leather goods and footwear market is projected to grow at a CAGR of 6%, to attain a total market value of USD 550 Billion by 2026. The footwear industry accounts for more than 80% of the total market size. However, the leather goods sector, however, is expected to growth at a higher rate of ~8%.

Of the USD 400 Billion leather goods and footwear market, ~50% is catered through imports

Leather goods and footwear are traded under HS code chapter 42 and 64. Globally, footwear sector contributes ~60% of the total value being imported. The global imports of leather goods and footwear have increased from USD 165 Bn in 2016 to USD 195 Bn in 2019. Leather bags, suitcases, leather footwear and footwear made-up of leather soles accounts for approximately 90% of the global imports of the sector Leather goods imports (other than footwear) have grown at a CAGR of 5.8%, from USD 69 Bn in 2016 to USD 82 Bn in 2019. The key product being imported under HS 42 (leather goods & accessories, other than footwear) is Leather bags, suitcases and similar container. Under HS 64 (footwear), footwear with both uppers & soles of leather and footwear made up with soles of leather & uppers of other material are the key products being imported. A detailed list of products being imported globally is elaborated in annexure 01.

US, Germany, France and Japan are the key import markets accounting for more than 42% of global imports of leather goods and footwear.

Other key markets with appreciable share in leather goods and footwear imports are Spain, UK, Italy, China, Netherlands, and Belgium. Other mid-size import markets with a high rate of growth of imports are Russia, Canada, Saudi Arabia, Australia, UAE and a few European countries like, Poland, Slovakia, Czech Republic, Romania, Mexico Portugal, etc.

Leather goods and footwear exports from Uttar Pradesh increased from USD 1,194 Mn in 2016 to USD 1,288 Mn in 2018, growing at a CAGR of ~3.9% in the period.

Leather goods and footwear is one of the key sectors contributing to Uttar Pradesh’s exports. The sector experienced a 50% drop owing to COVID induced disruptions. However, the sector has showcased strong rebound to pre-COVID levels in 2021, with an export value of USD 1,253 Mn. Uttar Pradesh’s contribution in India’s leather goods and footwear exports increased from 23% in 2016 to 27% in 2021.

Amongst the products categorized under HS code chapter 64 & 42, leather footwear with uppers of leather and soles of rubber, plastics or composition leather accounts for ~45% of the sector’s exports from the state.
Select 5 products that account for ~ 76% of state’s average exports of leather goods and footwear are illustrated in the figure below: (all figures in USD Mn, 3-year average) A detailed list of products being exported from Uttar Pradesh is attached in Annexure 02.

US, Germany, and UK are the key export destination for leather goods and footwear exported from Uttar Pradesh, followed by France, Netherlands and Spain. US, Germany, and UK together account for 44% of Leather goods and footwear exports from Uttar Pradesh

Select 10 markets account for 79% of UP’s Leather goods and footwear exports globally. The key markets served by Leather goods and footwear exporters from Uttar Pradesh are USA, UK, Germany, France, Netherlands, Spain, Italy, Poland, Australia and UAE. UP’s exports have also showcased appreciable diversification to markets like Denmark, Belgium, Sweden, Russia, Canada, Saudi Arab, South Africa, Japan, Chile, Israel, Malaysia, Portugal, Indonesia, etc. with a high rate of growth during the last 3 years. The heatmap below illustrates the distribution of Uttar Pradesh’s Leather goods and footwear exports across the globe.

Key export opportunities are identified for leather goods and footwear exporters of Uttar Pradesh in terms of potential for scaling up of exports and export diversification opportunities as shown in figure 8. For scaling up of exports, the markets being catered by UP’s exporters at present (contributing ~66% of UP’s exports or top 10 markets) are identified. For export diversification, market opportunities are identified based on their share in global imports. At a market level, existing products and new products are identified for scaling up and diversification of exports. A comprehensive list of product level opportunities in the identified target markets is detailed in annexure 4.

Leather goods is one of the key sectors contributing to exports from Uttar Pradesh. Agra, Kanpur and Unnao are the key districts that are actively involved in leather goods manufacturing and exports in Uttar Pradesh.
As per Uttar Pradesh ASI 2017-18 report, the leather goods manufacturing units in Uttar Pradesh produced a total manufacturing output of INR 5210 Crore, with a GVA of INR 894 Crore. Approximately 90% of this manufacturing output is generated from Kanpur Nagar, Agra and Unnao cluster. G.B. Nagar also contributes to ~8% of the state’s manufacturing output of this sector. The leather goods manufacturing sector also generated employment opportunities for 37 lakh workers in the state. Agra and Kanpur are also identified as the ODOP districts for Leather products. The Agra cluster is largely focused on manufacturing of footwear and leather accessories, like, belts, bags and leather footwear. The Kanpur-Unnao cluster specializes in tanning & dressing of leather, production of leather goods and leather saddlery. The Kanpur cluster is one of the key hubs of leather product exports in India. The key products being manufactured in the city are saddles & harness, leather garments, accessories, purse, belt, bags, etc. The saddlery products being manufactured in Kanpur have also been registered as a GI product.

Leather Goods and Footwear manufacturing districts in Uttar Pradesh

List of key institutions supporting leather goods and footwear manufacturers and exporters

The central government incentivizes leather goods manufacturers and exporters through continuation of the ‘Indian Footwear and Leather Development Programme (IFLDP)’, with an approved budget of INR 1700 Crore till 31 March 2026 or till further review, whichever is earlier.
The central government has also decided to constitute an empowered committee, a steering committee and an advisory committee to ensure effective implementation of the scheme. The table below describes the incentives provided under the 6 sub-schemes under IFLDP:

Export oriented incentives offered by the Government of Uttar Pradesh under Marketing Development Assistance and Gateway port subsidy