India firmly placed on the global buyers’ radar: CLE's Vikas Mahtani

Global Manufacturing’s Great Realignment

As geopolitical tensions in West Asia continue to disrupt traditional trade routes, the global manufacturing landscape is undergoing a deeper reconfiguration. Amid this shift, the domestic industry stands at a crucial crossroads, caught between unprecedented global demand and deep-seated structural challenges.

For an industry heavily reliant on specialized labour and complex supply chains, this global realignment presents a decisive window of opportunity for India’s leather and footwear sector, said Vikas Mahtani, Regional Chairman, the Council for Leather Exports (CLE), Western Region, and Director, Kavis Fashions Pvt. Ltd. “India’s leather industry is uniquely positioned to benefit from this shift due to its requirement for highly skilled labour and the resulting relative inelasticity of moving manufacturing hubs,” said Mahtani in an interview.

As the third-largest producer of footwear globally, India is firmly on the radar of international buyers. Global brands are actively accelerating their supply chain diversification, shifting away from heavily concentrated manufacturing geographies. According to Mahtani, it is only a matter of time before these brands examine India through a different lens in their sourcing playbooks, particularly as government-backed initiatives like ‘Make in India’ provide significant domestic tailwinds. However, he lamented that despite possessing abundant raw materials and a vast workforce, the nation has historically underperformed relative to its true potential.

Fragmented Manufacturing

A primary barrier to capturing a larger share of the global market is the fragmented nature of Indian manufacturing. While India boasts thousands of capable manufacturers, the majority operate at a significantly smaller scale compared to their competitors in China, Vietnam, and Indonesia. This fragmentation becomes a critical impediment when international buyers demand partners capable of executing massive volumes with speed, strict compliance, and unwavering consistency.

“India’s leather sector must be transformed from the current contract hub to design destination.”

Integration of Manufacturing

To overcome this competitive disadvantage, the industry must shift toward integrated manufacturing ecosystems. In Mahtani's view, the solution lies in developing dedicated leather and footwear clusters equipped with common infrastructure, plug-and-play facilities, testing laboratories, and robust logistics support. Furthermore, businesses must be provided with accessible growth capital to scale their operations effectively. Scale, he clarified, must not be viewed merely at the factory level, but rather at the ecosystem level, ensuring that the entire supply chain is equipped to handle global volume demands.

Bridging Skill Gap Collectively

Beyond physical bottlenecks, the sector is grappling with a widening skills gap. While this industry remains fundamentally labour-intensive, the pipeline of trained operators, supervisors, pattern engineers, and technical personnel is shrinking. With subsequent generations increasingly turning away from traditional family trades and a lack of adequate training infrastructure, workforce availability has become a critical bottleneck.

Addressing this issue requires a synchronized effort between industry, educational institutions, and government bodies. According to Mahtani, stakeholders must collaborate to revitalize vocational training and improve the overall attractiveness of manufacturing careers through technology adoption and better working conditions.

Shedding Low-Cost Image; Becoming Design Hub

Simultaneously, India must shed its historical reputation as merely a low-cost production hub. The emergence of heavily subsidized, low-wage manufacturing centres in parts of Africa and Southeast Asia has steadily eroded India's traditional cost advantage.

To survive and thrive in this shifting landscape, the industry must execute a decisive shift that requires moving away from contract manufacturing to establish India as a full-scale design and development hub . Buyers must visit India not to source copies of existing trends, but to discover original and innovative designs.

Achieving this dynamic shift requires heavy investment in education. Mahtani stated that the government should explore public-private joint ventures to establish international design schools domestically. He cautioned against viewing education merely as a cost centre, stating that stakeholders must look at education as an investment that creates future employment and value addition for the industry—especially given that current premier institutes often charge exorbitant fees while failing to build the necessary infrastructure.

Overcoming Logistics, Compliance Hurdles

Perhaps the most formidable obstacle to India's export competitiveness is the glaring inefficiency in logistics and the broader ease of doing business. In the fast-paced world of fashion and footwear, lead times directly dictate sourcing decisions. Every day lost to procurement delays, customs clearance, or documentation tangles directly erodes India's global standing. Discussing the current domestic supply network, Mahtani noted that the ecosystem of suppliers in India often struggles with competence, matching deadlines, or ensuring efficiency, which forces manufacturers to fight a daily battle for survival.

Incentive for FDI, Investing in Multi-Modal Logistics

To remedy this, Mahtani suggests India needs to aggressively incentivize foreign direct investment (FDI) to build a robust industrial ecosystem, a strategy that has been successfully deployed by other developing nations. This aggressive FDI incentivization must be coupled with continuous investments in multi-modal logistics, port infrastructure, and digitization.

Adopting Sustainable Practices

Furthermore, as global brands elevate their expectations regarding environmental responsibility, traceability, and carbon accountability, sustainability can no longer be treated as a compliance burden. Instead, the broad adoption of sustainable practices must be leveraged as a distinct competitive advantage for Indian suppliers.

Capitalizing on Trade Pacts

Notwithstanding these hurdles, the avenues for tremendous growth are clearly extant. The ongoing diversification of global supply chains represents the single largest macroeconomic opportunity, provided the central government, state governments, and private industry can coordinate their execution capabilities. Additionally, the prospect of zero tariff barriers with the forthcoming operationalisation of the India–UK Free Trade Agreement from 15th July offers a massive competitive edge in a crucial consumer market.

However, Mahtani observed that the prolonged delay in ratification and operationalization of such agreements severely impacts trade predictability. He noted that exporters and importers in the UK had begun planning their business models around the FTA, but nearly a year was lost due to minor disagreements, causing substantial trade loss.

Leveraging Domestic Demand

At home, India’s rapidly expanding middle class presents a lucrative domestic market, allowing manufacturers to build robust domestic brands and insulate themselves from volatile export cycles. However, capturing this domestic demand requires a highly agile and cost-conscious supply chain, as the Indian consumer market remains exceptionally price-sensitive.

Innovation: The Critical Differentiator

Moving forward, according to Mahtani, the true differentiator will be innovation—particularly in areas such as 3D design, AI-assisted forecasting, and advanced materials. The fundamental question, he underlined, is no longer whether India possesses the ingredients to become a global manufacturing hub for leather and footwear products, but whether the nation can move quickly enough to liberalize its views on investments, modernize its educational framework, and overhaul its supply chains to capture this unprecedented opportunity in the decade ahead.