Bangladesh is aiming for better leather goods exports. The country has raw leather but needs to import almost all other raw materials for final products. By law, imports have to be done in phases and so it takes time to produce the finished goods and export. So the leather and footwear sector is playing second fiddle to the garment sector.

Presently, Bangladesh has around 165 footwear and leather factories and they could bring in bigger export receipts were they compliant and using modern technologies. There are about 60 companies in Bangladesh which export footwear and leather goods. The destinations are mainly Japan, Europe and the US to some extent. Bangladesh produces 400 million sq ft of finished leather annually. But the country can use only 30 per cent of its finished leather. The remaining 70 per cent is exported, mostly to China. Bangladesh can earn three times more from exports of leather goods if all the finished leather produced locally is utilised. Finished leather exports fetch less than a third of a footwear item.

Chinese companies are keen to invest in Bangladesh’s leather and footwear sector and relocate their manufacturing units to the country to avoid extra tariffs that emerged from the US-China trade war.