Indian Footwear Industry Poised for a $90 Billion Leap by 2030: Report Predicts

The Indian footwear industry is poised for a remarkable transformation, with projections indicating exponential growth, surging from the current $26 billion to a promising $90 billion by the decade's end.

These projections, unveiled by the Global Trade Research Initiative (GTRI), emphasize key factors and strategic measures vital for industry augmentation.

Evolution of the Footwear Market

A significant transformation awaits the Indian footwear market, envisaging a shift from the prevailing dynamics. Forecasts highlight a drastic rise in demand for non-leather footwear, projecting a surge from 25% to a commanding 75% market share by 2030.

Additionally, this phase envisions the migration of leather shoe production from smaller, traditional setups to larger corporate entities.

Strategic Recommendations for Industry Elevation

The Global Trade Research Initiative (GTRI) report presents an array of strategic suggestions, emphasizing the imperative actions necessary for reshaping the sector:

Local Production Boost: The report underlines the need to intensify domestic shoe manufacturing by urging the cessation of finished shoe imports and encouraging local production supported by policy modifications.

Production-Linked Incentives: Advocating the implementation of the PLI scheme, the report highlights the criticality of incentivizing inputs essential for crafting premium shoes, addressing the scarcity of crucial materials currently imported, which inflate production costs.

Import Policies and Industry Protection: The report urges the implementation of customs duties and minimum import pricing to safeguard the domestic industry, especially focusing on footwear imports priced below $3 per pair.

Shift towards Non-Leather Footwear and Quality Focus

The study emphasizes India's potential in enhancing its non-leather shoe segment, crucial for global competitiveness. It suggests a focus on enhancing quality and curbing reliance on imported inputs, advocating quality benchmarks through measures like Quality Co-tool Orders (QCO).

Attracting Global Manufacturers: Taiwanese Contract Influence

Highlighting the dominance of Taiwanese contract manufacturers in the industry, the report recommends attracting more of these manufacturers to set up operations in India. Focused efforts by states like Uttar Pradesh and Haryana could position India as a hub for footwear manufacturing.

India's Position in Global Footwear Production

India's significant role in the global footwear landscape is underscored, as it stands as the second-largest producer after China, contributing 13% to global production and aiming for enhanced exports and diversified product offerings.

Actionable Insights for a Thriving Industry at a glance 

To unlock this $90 billion potential, the report proposes eight key actions:

• Boost Local Production: Encourage domestic and multinational firms to manufacture shoes within India, reducing reliance on imports and creating jobs.

• Incentivize Premium Production: Introduce a production-linked incentive (PLI) scheme for critical inputs like outsoles and adhesives, currently imported and significantly inflating costs.

• Protect Domestic Players: Implement a 35% customs duty on cheap footwear imports (below $3 per pair) and set a minimum import price of $5 per pair to shield domestic manufacturers.

• Simplify Quality Control: Exempt leather shoes from the QCO (quality co-tool order) application, as they face minimal quality concerns and constitute a significant export segment.

• Attract Global Expertise: Actively court Taiwanese contract manufacturers, known for their expertise in producing major footwear brands, to set up operations in India.

• Develop Regional Hubs: States like Uttar Pradesh and Haryana, alongside established hubs like Tamil Nadu, can be nurtured as footwear manufacturing powerhouses.

• Embrace Global Trends: Invest in research and development to cater to the growing demand for trendy and comfortable footwear designs.

• Promote Skill Development: Equip the workforce with relevant skills and knowledge to excel in the evolving footwear industry.

India's Export Strength and Potential

India's prowess in leather shoe exports is highlighted, showcasing its capability in delivering high-quality products to discerning markets like the EU, the US, the UK, and Japan, contributing significantly to the country's export revenue.

The Indian footwear industry is at the cusp of a substantial transformation, eyeing a staggering growth trajectory supported by strategic interventions and policy recalibrations. With a focus on quality enhancement, local production, and global collaborations, India aims to fortify its position in the global footwear market.