Government Invests Rs.1700 Crore In Leather Sector Subsidy Scheme: Golden Opportunity for Tannery, Footwear & Leather Goods Units

India's substantial investment in the leather sector aims to propel tanneries, footwear, and leather goods units forward with enhanced subsidies and growth prospects.
Government Invests Rs.1700 Crore In Leather Sector Subsidy Scheme: Golden Opportunity for Tannery, Footwear & Leather Goods Units

The IDLS scheme, under the larger Indian Footwear & Leather Development Programme (IFLDP) 2021-2026, was launched on March 3, 2022, with a substantial allocation of ₹1700 crore/US$ 200 Million. This program is designed to foster the growth and development of India’s leather and footwear sector. DPIIT ensures the smooth execution of the sub-schemes through collaboration with various ministries and departments connected to the leather and footwear industries.

The Council of Scientific and Industrial Research – Central Leather Research Institute (CSIR-CLRI) is now serving as the Project Implementation Unit (PIU) for the central government’s subsidy scheme aimed at tannery units that have procured new machinery post-January 1, 2020. This initiative, part of the Integrated Development of Leather Sector (IDLS) scheme, is overseen by the Department for Promotion of Industry and Internal Trade (DPIIT), Government of India.

Sub-Schemes under IFLDP

The IFLDP encompasses several targeted sub-schemes, each with a specific budget and implementing agency:

Sub-SchemeScheme OutlayProject Implementing Unit (PIU)
Sustainable Technology and Environmental Promotion (STEP)₹500 crore (approx US$60 Million)CSIR-CLRI
Integrated Development of Leather Sector (IDLS)₹500 crore (approx US$60 Million)CSIR-CLRI for tanneries and Footwear Design & Development Institute (FDDI) for footwear and related products
Mega Leather, Footwear and Accessories Cluster Development (MLFACD)₹300 crore (approx US$36 Million)National Productivity Council (NPC)
Establishment of Institutional Facilities₹200 crore (approx US$23 Million)Footwear Design & Development Institute (FDDI) and Department for Promotion of Industry and Internal Trade (DPIIT)
Brand Promotion of Indian Brands in Leather and Footwear Sector₹100 crore (approx US$12 Million)Indian Institute of Foreign Trade (IIFT) and National Institute of Design (NID)

Objectives of IFLDP

The primary aims of the IFLDP include:

  1. Developing infrastructure tailored to the leather and footwear sectors.
  2. Addressing environmental challenges specific to these industries.
  3. Encouraging additional investments in the sector.
  4. Generating employment opportunities.
  5. Boosting production capacities.

Key Features of the IDLS Scheme

The IDLS scheme specifically provides financial assistance for the modernization, capacity expansion, and technological advancement of existing units in the leather sector, including tanneries, leather goods, saddlery, and both leather and non-leather footwear and components.

Financial Assistance Highlights:

  • 30% subsidy for Micro, Small, and Medium Enterprises (MSME) units.
  • 20% subsidy for other units.
  • 40% subsidy for MSMEs and 30% subsidy for other units located in the North-East Region.
  • An additional 5% subsidy for procuring indigenous machinery.
  • An extra 10% subsidy for machinery procured from the North-East Region.
  • The maximum subsidy cap is set at ₹15 crore (approx US$1.8 Million) per unit.
  • Subsidies cover the purchase value excluding tax, and also apply to installation, transportation, and insurance costs.

Eligibility and Application Process

The IDLS scheme targets all manufacturers within the leather and leather products sector. Eligible items include all tannery, footwear, product machines, and Effluent Treatment Plant (ETP) equipment. However, second-hand machines, fabricated machines, spare parts, and solar panels are excluded.

For detailed scheme information, eligibility criteria, document requirements, and the application process, potential beneficiaries can refer to the following resources:

Important Contacts:

  • CLRI, Chennai: +91-44-2443-7419
  • CLRI, Regional Centre, Kanpur: +91 512 298 6936
  • CLRI, Regional Centre, Kolkata: +91-33-23292381
  • CLRI, Regional Centre, Jalandhar: +91-181-265130

For assistance and more information, contact the Nodal Officer,
Shri V. Karthik, Senior Scientist,
+91-9840144136 or
Via email at karthikv@clri.res.in, idls@clri.res.in, or idlsclri@gmail.com.

In conclusion, the IDLS scheme under the IFLDP represents a significant effort by the Government of India to boast the leather and footwear industries through modernization, environmental sustainability, and increased productivity. By providing substantial financial assistance and support for new machinery procurement, the scheme aims to enhance the global competitiveness of Indian leather and footwear products. Manufacturers and other stakeholders in the sector are encouraged to leverage these opportunities for growth and development.

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