Joint Venture With Chinese Enterprises To Help The Development Of Pakistan's Leather Industry

In an interview with WealthPK, Khalid Waleed, an advisor at the Pakistan Tannery Association (PTA), said that the leather industry is one of the major export-oriented industries in Pakistan and the second most dynamic industry after the textile industry.

In recent years, despite Pakistan's efforts to keep up with its South Asian neighbours, its competitive position in the leather export trade has declined significantly. Pakistan is the only country in the region to experience negative growth in leather exports. This trend highlights a major problem in the leather industry in Pakistan.

China is a major producer and exporter of leather and leather products. Its leather industry produces more than 4 billion square feet of leather annually, more than twice as much as Brazil.

China, as a major global market, offers huge opportunities for Pakistani leather products. Through CPEC, Pakistani businesses can capitalize on China's growing demand and gain market access through improved infrastructure and trade routes.

The Pakistan Tannery Association official further stated, "One of the main reasons for this lag is the lack of development of the leather goods sub-sector. Although Pakistan has a strong rawhide and leather garment industry, the production and export of value-added leather goods such as handbags, wallets, suitcases, key chains, and belts is still underdeveloped.

"This underdevelopment means that Pakistan is not taking full advantage of the high value and high demand for finished leather products in the international market. As a result, these leather goods and footwear contribute relatively little to Pakistan's overall leather exports, which limits its ability to compete with its neighbors who have more advanced leather goods industries. "

"Joint ventures between Pakistani and Chinese companies can facilitate the establishment of new businesses or the expansion of existing ones. This may involve the establishment of manufacturing plants, tanneries, R&D centers focused on leather product innovation, etc. "

According to the Pakistan Economic Survey report, the growth of the Large Manufacturing Sector (LSM) between July 2023 and March 2024 was -0.1%, compared to -7.0% in the same period last year.

Between July and December 2023, Pakistan's leather garment exports fell by 9.71 percent year-on-year. Leather clothing and gloves both declined.