Executive Summary:
The Ministry of Commerce and Industry addressed concerns regarding the export of leather products in response to Lok Sabha Question No. 369 on July 22, 2025. While no PLI scheme exists for toys, leather, and footwear, a new scheme for the footwear and leather sector was announced in the Union Budget speech for the financial year 2025-2026 and the toy sector was also addressed. The response details Tamil Nadu's contribution to leather exports and outlines support through the Indian Footwear and Leather Development Programme (IFLDP).
Key Points / Main Content:
Schemes and Initiatives:
* No PLI scheme is currently in place for toys, leather, and footwear products.
* A new scheme for the footwear and leather sector was announced in the Union Budget speech for the financial year 2025-2026, focusing on productivity, quality, and competitiveness.
* A new scheme for the toy sector aims to establish India as a global hub for toys through cluster development, skills enhancement, and manufacturing ecosystem support.
Tamil Nadu's Export Contribution (2024-2025):
* Tamil Nadu contributed 35.17% to India's total export of leather, leather products, and footwear.
* Key product categories and their export values from Tamil Nadu include:
* Finished Leather: 217.44 Mn USD (48.83% of India's total)
* Leather Goods: 233.48 Mn USD (17.69% of India's total)
* Leather Garments: 98.05 Mn USD (27.71% of India's total)
* Footwear of Leather: 915.37 Mn USD (45.59% of India's total)
* Leather Footwear: 166.31 Mn USD (68.11% of India's total)
* Component, Saddlery, and Harness: 5.48 Mn USD (2.67% of India's total)
* Non-Leather Footwear: 62.45 Mn USD (24.69% of India's total)
* Total exports from Tamil Nadu amounted to 1698.59 Mn USD out of India's total of 4828.97 Mn USD.
Indian Footwear and Leather Development Programme (IFLDP):
* The Central Sector Scheme IFLDP, approved for 2021-26 with a total outlay of Rs. 1700 Cr, supports modernization, capacity expansion, and technology upgrades.
* Under the IDLS sub-scheme, financial assistance is provided for plant and machinery costs, with higher assistance for MSMEs and units in North Eastern Areas.
* An additional 5% financial assistance is available for domestically manufactured machinery.
* Till date, 73 applications have been approved with the total Government of India GoI assistance of Rs.30.50 crore in the state of Tamil Nadu.
* The STEP sub-scheme offers financial aid for upgrading Common Effluent Treatment Plants (CETPs) in leather clusters.
* Assistance of up to 80% of the total project cost for North Eastern Areas and 70% for other areas, capped at Rs. 200 crore, is provided.
CETP Upgradation in Tamil Nadu:
* Project proposals for 7 CETPs in Tamil Nadu's leather tannery sector have been approved for upgradation.
* The combined total project cost is Rs. 202.64 crore, with a GoI grant of Rs. 141.84 crore.
* Specific CETPs and their respective project costs and grants are detailed in the document.
Impact Analysis
Tamil Nadu Leather Manufacturers:
* Impact: Benefit from technology upgradation support through the IFLDP scheme, particularly the IDLS and STEP sub-schemes.
* Action Required: Explore opportunities to apply for financial assistance for modernization, capacity expansion, technology upgrades, and CETP improvements.
Leather Clusters in Tamil Nadu:
* Impact: Potential to enhance sustainability and meet pollution control norms through STEP sub-scheme support for CETP upgrades.
* Action Required: Collaborate on project proposals for CETP upgrades to secure financial assistance.
Central Government:
* Impact: Overseeing the implementation of the IFLDP scheme and monitoring its impact on the leather sector in Tamil Nadu.
* Action Required: Continue to process applications for financial assistance and ensure timely disbursement of funds.
Key Entities Referenced
PLI Scheme: Proposed Production-Linked Incentive scheme for toys, leather, and footwear products, although the response clarifies there is no such scheme specifically, but schemes were announced for the footwear/leather and toy sectors in the Union Budget speech for the financial year 2025-2026.
Tamil Nadu: A state in India, specifically mentioned in relation to its contribution to leather exports and potential benefits from government schemes.
Union Budget 2025-2026: The financial plan of the government of India, during which a new scheme was announced for the footwear and leather sectors.
Indian Footwear and Leather Development Programme (IFLDP): A Central Sector Scheme with a total outlay of Rs. 1700 Cr for the period 2021-26, aimed at modernization, capacity expansion, and technological upgrades in the footwear and leather sector.
Integrated Development of Leather Sector (IDLS): A sub-scheme of IFLDP providing financial assistance for plant and machinery costs to Micro, Small & Medium Enterprises (MSMEs) and other units.
Sustainable Technology Environmental Promotion (STEP): A sub-scheme of IFLDP providing financial assistance to leather clusters for establishment, expansion, and upgradation of Common Effluent Treatment Plants (CETPs).
PERTEC, Pernambut, Tamil Nadu: A Common Effluent Treatment Plant (CETP) located in Pernambut, Tamil Nadu, that has been approved for upgradation under the STEP sub-scheme.
Central Sector Scheme: A scheme funded and implemented by the Central Government.
GOVERNMENT OF INDIA
MINISTRY OF COMMERCE & INDUSTRY
DEPARTMENT FOR PROMOTION OF INDUSTRY AND INTERNAL TRADE
LOK SABHA
UNSTARRED QUESTION NO. 369.
TO BE ANSWERED ON TUESDAY, THE 22ND JULY, 2025.
EXPORT OF LEATHER PRODUCTS
369. DR. RANI SRIKUMAR:
Will the Minister of COMMERCE AND INDUSTRY be pleased to state:
वाणिज्य एवं उद्योग मंत्री
(a) the details of the current status of the proposed PLI scheme for toys, leather,
and footwear products announced by the Government for implementation;
(b) the details of Tamil Nadu's current contribution to India's leather and leather
products exports and the target enhancement under the proposed incentive
scheme;
(c) the proposed scheme benefit Tamil Nadu's traditional leather manufacturing
clusters in Tamil Nadu;
(d) whether the technology upgradation support is being planned to help Tamil
Nadu's leather manufacturers adopt sustainable production processes under
the Government schemes, if so, the details thereof; and
(e) the expected timeline for finalizing the leather and footwear incentive scheme
and the anticipated budgetary allocation for Tamil Nadu-based manufacturers?
ANSWER
वाणिज्य एवं उद्योग मंत्रालय में राज्य मंत्री (श्री णिणिन प्रसाद)
THE MINISTER OF STATE IN THE MINISTRY OF COMMERCE & INDUSTRY
(SHRI JITIN PRASADA)
(a): It is to state that, there is no PLI Scheme for the toys, leather, and footwear
products and as such there is no action ongoing/pending in this regard.
However, in the Union Budget speech for the financial year 2025-2026, new
scheme has been announced for footwear and leather sector aiming to
enhance its productivity, quality and competitiveness of India’s footwear and
leather sector through support to design capacity, component manufacturing,
and machinery required for production of non-leather quality footwear, besides
the support for leather footwear and products.
Similarly, new scheme for toy sector has been announced in the speech aiming
to make India a global hub for toys by focusing on development of clusters,
skills, and a manufacturing ecosystem that will create high-quality, unique,
innovative, and sustainable toys.(b) to (e): Tamil Nadu (TN) contributed a share of 35.17% in total export of leather, leather
products and footwear from India during the year 2024-25, as detailed below.
Product Export from TN Export from India % share of TN
Mn USD Mn USD
FINISHED LEATHER 217.44 445.32 48.83%
LEATHER GOODS 233.48 1319.6 17.69%
LEATHER GARMENTS 98.05 353.82 27.71%
FOOTWEAR OF LEATHER 915.37 2007.76 45.59%
LEATHER FOOTWEAR 166.31 244.17 68.11%
COMPONENT
SADDLERY AND HARNESS 5.48 205.39 2.67%
NON LEATHER FOOTWEAR 62.45 252.91 24.69%
TOTAL 1698.59 4828.97 35.17%
Source : DGCI & S
The Central Government has approved the Central Sector Scheme ‘Indian
Footwear and Leather Development Programme’ (IFLDP) for the period 2021-
26 with a total outlay of Rs. 1700 Cr. through six sub-schemes which provide
support for modernization, capacity expansion and technological up- gradation
of production units or setting-up of new units in the footwear and leather sector.
Under Integrated Development of Leather Sector (IDLS) sub- scheme of IFLDP
, financial assistance to the extent of 40% of cost of Plant and Machinery is
provided to the Micro, Small & Medium Enterprises (MSMEs) units and 30% of
cost of Plant and Machinery to other units established in North Eastern Areas;
and the financial assistance is 30% of cost of plant and machinery to Micro,
Small & Medium Enterprises (MSMEs) units of other areas and 20% of cost of
Plant and Machinery to other units, subject to a ceiling of Rs.15 crore. In
addition to this, 5% additional financial assistance of the cost of plant and
machinery is provided for the domestically manufactured machinery. Till date,
73 applications have been approved with the total Government of India (GoI)
assistance of Rs.30.50 crore in the state of Tamil Nadu.
Under Sustainable Technology & Environmental Promotion (STEP) sub-
scheme of IFLDP, financial assistance is provided to leather clusters for
establishment / expansion / up gradation of CETPs to meet the prescribed
pollution control discharge norms, including techniques for hazardous waste
management. Under this sub-scheme, assistance upto 80% of the total project
cost for North Eastern Areas and 70% of the total project cost for other areas
subject to a limit of Rs.200 crore is provided. As on date, project proposals of
the 7 Common Effluent Treatment Plants (CETPs) operating in the leather
tannery sector in Tamil Nadu have been approved for upgradation of the plants,
involving combined total project cost of Rs.202.64 crore and GoI grant is
Rs.141.84 crore. The details are as below:
S. CETPs Total Project Cost GOI Grant
No (Rs. Crore) Approved
(Rs. Crore)
1 PERTEC, Pernambut, Tamil Nadu 9.75 6.82
2 THUTHIPET, Ambur, Tamil Nadu 8.49 5.94
3 MALIGAITHOPE, Ambur, Tamil Nadu 5.30 3.71
4 RANITEC, Ranipet, Tamil Nadu 52.68 36.88
5 VANITEC, Vaniyambadi, Tamil Nadu 14.22 9.95
6 SIDCO Phase-I, Ranipet, Tamil Nadu 59.58 41.71
7 PALLAVARAM, Nagalkeni, Tamil Nadu 52.62 36.83
Total 202.64 141.84
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