The Economic Rise of the Footwear Industry in India (2018) - BizVibe

The footwear industry in India has long been one of the most important components in the country’s prestigious textile and garment market, contributing significantly to not just the employment within the country but also the export earnings and overall economic growth in India as well. In 2018, India has evolved to become the second largest footwear producer (behind China), and one of the top footwear exporters in the world. Combining the facts that India’s economic performance continues to grow, the Indian government continues to provide strong support, while the global footwear demand continues to rise, the Indian footwear industry is forecasted to flourish going forward, so do the business opportunities with top shoe companies in India.

 

Overview of the Footwear Industry in India

 

According to a recent Indian footwear industry report, footwear production is over 22 billion pairs annually, accounting for approximately 9.6% of the total global footwear output per year. The footwear industry in India employs over 1.1 million workers, making it one of the top employment sources in the country. Due to the fact that India is also the world’s third-largest footwear consumer after China and the USA, about 90% of the footwear made in India is consumed by the domestic market and the rest is exported.

 

The footwear market in India is now dominated by men’s footwear which contributes close to 58% of the total Indian footwear retail market and is expected grow at a CAGR of 10% by 2020. The women’s footwear segment, however, is projected to grow at a much faster CAGR of 20%. In term of product type, casual footwear is the largest product segment in India’s footwear market that contributes approximately 67% of the total footwear retail market. Moreover, Non-leather footwear accounts for 56% of the overall footwear market in India. While the industry is currently dominated by the unorganized domestic SME footwear manufacturers, but with changing consumer behavior and modern lifestyle, the footwear products made by those medium and large brands are likely to witness a bigger sales in the near future.

 

Currently, some of the largest footwear manufacturers in India include Bata India Limited, Liberty Shoes Limited, Paragon Group, Relaxo Footwears Limited, Adidas AG, PUMA, Geox S.p.A., Skechers USA, Incorporation, Nike Incorporation, and Under Armour Inc. While the major footwear producing states in India are: Tamil Nadu, New Delhi, Uttar Pradesh, Punjab, Haryana, Maharashtra, West Bengal, Rajashtan, and Kerala.

 

Exports of Footwear Industry in India

 

Unlike its export-orientated readymade garment industry, the footwear industry in India is mainly catering to its domestic market at the present — only about 10% of the footwear production is shipped overseas every year. However, with growing foreign direct investment in the country’s footwear manufacturing sector and constant government support with beneficial policies, India is increasing its market share in the global footwear exports year after year. Many international footwear and fashion companies, such as Nike, Adidas, Zara, and H&M are also manufacturing footwear products in India and ship them aboard.

 


Must Read: Top 10 Leading Garment Manufacturers in India (2018)


 

According to recent trading data from International Trade Centre, India exported over US$ 2.7 billion worth of the footwear products to the global market in 2016, registering an impressive annual growth rate of 8% over the last five years. Today, India is already among the world’s top 10 largest footwear exporters, and its share is still growing. Some of the largest importers from the Indian footwear industry include the USA, UK, Germany, France, Italy, and UAE. Industry experts believe that the exports of India’s footwear products will witness further growth in regions like North America, Europe, and the Middle East over the next few years.

 

The Future Development of Footwear Industry in India

 

As a traditionally labor-intensive sector, the footwear industry in India is currently transforming towards a more technological and innovative driven sector, with increasing number of small and big footwear manufacturers focusing more on developing newer technologies and introducing better products. Today, India’s footwear industry has evolved into a highly specialized industry, where machine production with a systematic labor flow is facilitating the industry to an international level.

 

The government support is another crucial factor for the future development of India’s footwear industry. The Indian government has recently announced a Rs2,600cr special package for fuelling the leather and footwear industry. The special package includes the implementation of the central sector scheme ‘Indian Footwear, Leather & Accessories Development Programme (IFLADP)’. Under the scheme, a further 300,000 workers will be trained and 20-30% subsidy/grant will be offered to MSMEs on the capital expenditure for building a plant and buying machinery.

 

The Indian footwear market is likely to drive more by the rising fashion consciousness among the young generation and growing consumers preference to their lifestyles. Moreover, the improvement in the footwear retail sector, as well as the growing e-commerce market in India are also expected to further boost the performance of India’s footwear industry in future.

 


 

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