Leather Industry Performance and Trade

The recent developments in Pakistan’s leather industry demonstrate a concerted effort by the Pakistan Tanners Association (PTA) to boost both domestic and international trade, while also addressing the sector’s regulatory and operational challenges. Here’s a breakdown of the key points:

Industry Performance and Trade

1. Increased Hide Collection: After Eid-ul-Adha 2025, the collection of animal skins and hides rose to over 7.4 million, marking a 1.4% increase from the previous year. This boost is largely due to a reduction in wastage, signaling better resource management within the industry.
2. International Trade Promotion: The PTA’s initiative to strengthen trade relations is evident with their recent meeting with the Malaysian Consul General. The proposal for a B2B e-commerce platform could help expand the reach of Pakistan’s leather products, potentially attracting more global buyers.
3. Export Market Focus: The PTA continues to target high-end markets, particularly the EU, US, and Germany, for leather exports. This reflects an ongoing strategy to cater to premium consumers in these lucrative markets.

Government Advocacy and Policy

1. Import/Export Regulations: The removal of the health certificate requirement for specific leather HS codes is a significant victory for the PTA, simplifying the export process for certain types of leather and reducing bureaucratic hurdles.
2. Tariffs and Duties: The PTA’s push for a reduction in import duties on essential chemicals reflects a desire to lower production costs and make Pakistani leather products more competitive on the global market. Additionally, the call to reinstate the Fixed Tax Regime (FTR) for the leather sector could help streamline taxation and support business growth.
3. Gas Prices and Power Plants: The PTA is actively lobbying to prevent further increases in gas prices, citing concerns over the industry’s global competitiveness. The potential disconnection of gas supplies to captive power plants is also a significant concern, as it could disrupt production and negatively impact the industry’s output.

Events and Operations

1. Pakistan Mega Leather Show: The PTA is gearing up for the annual Pakistan Mega Leather Show in Lahore from January 26-28, 2025. This event is expected to showcase the latest trends in the leather industry and provide a platform for networking and business development.
2. Infrastructure Improvement: The Sindh government’s commitment to improving infrastructure in the Korangi Industrial Area is a positive development for the leather industry, as it will enhance the operational efficiency of tanneries in the region.
3. New Leadership: The election of Hamid Arshad Zahur as the new Central Chairman of the PTA marks a new leadership phase for the association, likely bringing fresh perspectives and strategies for the 2024-2026 term.

Overall, the PTA is making strides in increasing the leather sector’s international presence, advocating for beneficial policy changes, and improving the industry’s infrastructure. These efforts, if successful, could boost the competitiveness of Pakistan’s leather exports and drive growth in the sector.