Animal sacrifice big boost to dying leather industry

A fair number of Pakistanis who collectively slaughtered 5 million goats and 2 million cows on Eid ul Adha last year remained unable to perform the ritual this time due to increased poverty, surging inflation and high cost of living. According to surveys, this year witnessed 25-30 per cent decline in the number of slaughtered animals as compared to last year.
The flip side is that the leather industry which is struggling due to shortage of raw material in the local market is upset due to lower figures of animals slaughtered on Eid which provides the biggest quantity of animal hides to the industry. It is unfortunate that the yield of animal hides which is the only raw material for leather industry is declining year by year. The value added exports of leather market that have amounted to more than one billion dollars has significantly decreased since the last three years. During fiscal year 2007-08, the country’s export of leather goods stood at $1.15 billion, during 2008-09 at $943 million and during 2009-10 Pakistan’s leather goods exports witnessed a further decline to $860 million. The declining trend in the exports of leather products is alarming but the bitter fact that is more alarming is that we are losing to our competitors in the global markets. For example, in 2009-10 the sector faced a sharp decline of 28 per cent in leather goods export, while on the other hand Indian exports of the same commodity witnessed a 26 per cent increase during the same period.
According to a Federal Bureau of Statistics report, Pakistan’s second biggest export-earning segment, leather and leather goods, witnessed an 18 per cent fall during July-June 2009-10, as against the same period last year. During 2009-10 the country’s leather exports went down by about 7.57 per cent, leather garments exports declined by 12.53 per cent, exports of leather gloves fell by 37 per cent and exports of other leather-based goods declined by about 31.60 per cent.
The leather industry has a long-standing demand to ban live animal export to Afghanistan and Iran, saying that this causes acute shortage of skins – a basic raw material of the leather industry. The ministry of commerce issued a notification in August which said that the government had placed a ban on the export of live animals along with meat exports. But, after a gap of five hours, the ministry issued another notification saying that it was just a proposal and the final decision will be taken by the Economic Coordination Committee (ECC). The leather industry wants a complete ban on export of livestock. Contrary to the leather industry’s interests, there are also a significant number of businessmen who hope to make a living in the livestock and meat export business. Which industry will get its wishes fulfilled is anybody’s guess as the ministry of commerce has sent the proposal of banning live animal exports to the ECC. Pakistan Tanners Association (PTA) says that the government should immediately ban live animal export to western and neighbouring countries. The tanners are not against the export of meat as this has little impact on the availability of skins which remain in the country. The leather goods exporters are unanimous that the leather industry is primarily hurt by the exports of live animals and not by growing meat exports.
Analysts say that when we export a live animal, it means we are giving away the animal hide for free which has pushed the local leather industry to the verge of collapse. It is pertinent to note that we can double the amount of foreign exchange by prudent export strategy through the export of mutton and finished leather. The prime benefit of this policy is to create employment for thousands of skilled workers in value added industry dealing with tanning and leather product manufacturing.
There is yet a bigger challenge faced by our leather industry that is more serious than animal export. The smuggling of animals to Iran and Afghanistan has increased manifolds due to laxity of law enforcement agencies. Government authorities have acknowledged that huge numbers of live animals are being smuggled to Afghanistan and Iran. According to statistics, Pakistan exported over $53 million of meat and meat preparations during the year 2011. This is the tip of an iceberg as compared to the illegal money earned from the smuggling of animals. According to rough estimates, live animals worth over $500 million are smuggled out of Pakistan every year which is 10 times of our meat exports.
Pakistan is now earning huge foreign exchange from its packaged meat exports to Middle East region due to its geographical proximity to the Arab world. This industry should be encouraged so that we can grow our market share in growing Middle Eastern markets. The promotion of mutton export automatically means the promotion of local leather industry due to increased supply of raw material.
Leather industry is solely dependent on local raw material and according to careful estimates currently there are over 1,000 registered and unregistered leather units in Pakistan mostly located in Lahore, Kasur and Multan. Giving the reasons behind declining trend in the export of leather products, the leather stakeholders say that shortage of raw material is mainly due to smuggling of at least 100 trucks loaded with livestock/cattle to Afghanistan and Iran every month. In addition to that hundreds of animals are also reportedly sent to Middle East by boats. Moreover, thousands of animals have perished during two major floods in Pakistan which has aggravated the shortage.
Eid ul Adha is a good opportunity to resuscitate the dying leather industry owing to an inflow of 5 million cow skins and 2 million goat skins during Eid to the raw material market of the leather industry. Leather market sources say that an average price of a goat skin is Rs500/ whereas a cow skin fetches around Rs4,500/.