As per Pakistan Bureau of Statistics (PBS) figures major leather export categories have shown lacklustre growth in this fiscal year. Export of leather gloves and leather footwear registered growth of 1.8 and 12 per cent respectively. However, leather garments which account for the bulk of leather exports went down 7 per cent on a year-on-year basis.
On monthly basis leather gloves and leather garments recorded growth of 40 and 20 per cent respectively. Growth has mostly been volume based whereas prices have seen a downward trend. This could be explained by the depreciation of the rupee whereas the rebates awarded under the government incentive package might also have played a part in boosting quantities.
The high cost of production has hampered growth in leather exports say stakeholders. Smuggling of live animals to Afghanistan has also created problems and put pressure on supply of hides and skins to leather manufacturers. There has also been a dearth of investment in balancing, modernisation and replacement (BMR) by most local players which have argued against the imposition of 4 per cent custom and 17 per cent sales tax on import of machinery.