‘Death of an industry’: Why are tanners looking beyond Kanpur?

Already, 40 leather industrialists have rented or bought tanneries in Kolkata. Some have entered into partnerships in Vietnam, Turkey, and some European countries for finished cow leather

Amid what insiders describe as the biggest slump in the famed leather industry here, the tanners of Kanpur are moving to West Bengal, Bangladesh and to other greener pastures to stay afloat. Their departure is triggered by the infrastructure curbs imposed because of tighter pollution control norms, a big jump in the cost of treatment of tannery waste and orders drying up in the midst of the lack of availability of cow leather due to a ban on cow slaughter in Uttar Pradesh, those in the trade say.

In 2020, the tanneries were told to operate at 50% of capacity 15 days a month on a rotation basis failing which a penalty called environment compensation of ₹12,500 per day would be levied. (REPRESENTATIVE IMAGE )

Already, 40 leather industrialists have rented or bought tanneries in Kolkata. Some have entered into partnerships in Vietnam, Turkey, and some European countries for finished cow leather, they say.

Moreover, nearly 100 have taken land to start tanneries in Bantala, where the West Bengal government is providing plots at ₹2,865 per sq metre to tanners from Uttar Pradesh.

Nayyar Jamal, president of Jajmau Tanners’ Association, admits to the shift. “Of the 402 listed tanneries, only 215 small and big are operational now. These, too, function with a lot of riders that have made business next to impossible,” he says.

“Still people are pulling through in the hope that the situation will improve someday,” Jamal adds. Trouble began at the fag-end of 2017 when the Central and State Pollution Control Boards asked the tanneries to cut down their infrastructure by half. It meant, for example, that a tannery with 10 drums used to process leather would be reduced to five.

“I had a unit with five drums, which all were taken out and fresh were installed in line with the order,” says Jamal.

The boards had made it clear that the tanneries would be shut down in case of non-compliance. This order was followed with prolonged closure of tanneries for Kumbh and Magh Melas. Another key factor is that Kanpur has been tanning a minuscule quantity of cow leather for which only skin of the dead animals is available since cow slaughtering is banned in Uttar Pradesh.

As doing business became difficult, a businessman in his early 50s and fourth generation into leather tanning trade hurriedly set off to Kolkata in 1918 to rent a small but closed tannery, once in the use of the Chinese community.

The deal went through, and with little investment the tannery was made operational. Five years down the line, the tannery has become the mainstay in keeping his leather business afloat. “I have bought this tannery in Kolkata; doing business from Kanpur has become extremely tough. I am not supposed to run my Kanpur unit at more than 25% capacity,” says this businessman, now setting up his second unit in Kolkata’s Bantala. At least two big groups that were recently raided by the GST, are setting up shops in Bangladesh—one of them has completed a big unit and the other was on the cusp of doing so in Chittagong. Another major group has already acquired land but has not started work yet.

The situation has arisen even though, in the last two decades, the global leather industry has been surging ahead in all segments, particularly in export of finished buffalo leather for upholstery and harnesses for saddlery. At one time, Kanpur was exporting 56% of buffalo leather and meeting the harness needs of the saddlery industry.

“Now we are importing harnesses from Argentina. Sad, for an industry that has a share of 80% in global saddlery market. Saddlery is unique to Kanpur,” says an industrialist, adding that exports and domestic sales both have seen an annual drop of 10% on an average.

“The confidence of buyers is shaken in us; the orders are drying up. The buyers have started looking elsewhere for hassle-free delivery of orders. That is why people are moving out of Kanpur or at least setting up a parallel unit in other states and countries,” says an industrialist importing wet-blue (semi-processed leather).

“We do not get good quality leather especially the cow one, so we import to meet the need for a top class finished leather.”

“Cow leather mostly is processed in Chennai and Kolkata where there is no such ban; we import the wet blue from outside India because animal is of superior quality and skinned in a way the hyde carries less cuts,” he says.

In 2020, the tanneries were told to operate at 50% of capacity 15 days a month on a rotation basis failing which a penalty called environment compensation of ₹12,500 per day would be levied.

Meanwhile, the cost of treatment of tannery waste went up from ₹2 per hide to ₹22 per hide in 2022. The tanneries pay for treatment of effluents going to common treatment plant (CTP) managed by the Jal Nigam from primary treatment plants (PTPs) in tanneries.

“The cost per hide today is ₹88 as tanneries are technically running merely at 25% of capacity. Small and medium players have already moved out of the system,” says a top businessman, adding that in 2014, the Prime Minister had given a push to the leather sector by placing it in Make in India while the chief minister had done so by naming it in One District One Product (ODOP).