Bihar Woos Leather Investors With Subsidies, Infra, Policy Support

Armed with abundant resources and robust infrastructure, Bihar touted its investor friendly policy that offers incentives ranging from capital subsidy to interest subvention on loans as it wooed investments in burgeoning leather industry in the state.

The Bihar Leather Investors' Meet was hosted in Kanpur on November 18 together with industry leaders, policymakers, and investors to showcase Bihar's emerging role as a global leather industry hub. The event, under Bihar Business Connect 2024, showcased the state's abundant resources, advanced infrastructure, and progressive policies aimed at fostering sustainable growth and innovation in the sector, officials and a press statement said.

At the meet, the state unveiled a comprehensive policy framework and modern infrastructure to attract global leather industry investments. Bihar's Textile & Leather Policy provides a supportive framework for investments. Key incentives include capital subsidies, State-GST reimbursements, interest subventions, employment generation, and power tariff subsidies. Export-oriented units receive additional support under the state's Export Promotion Policy.

Presenting the state's vision, Alok Ranjan Ghosh, Director of Industries at the Department of Industries, Government of Bihar, said, "Textiles and leather are high-priority sectors for Bihar due to their immense potential for employment generation. This initiative will create job opportunities for locals, including those currently working remotely or in other locations." The state conducted a study in Kanpur to replicate its success in Bihar, while leveraging incentives, such as a 30 per cent capital subsidy, he said.

"Additionally, we will ensure the availability of a large pool of semi-skilled and skilled workers, access to a vast market, excellent connectivity, and 24x7 water and power supply." A key highlight of the meeting was the discussion on the recent exposure visit to prominent leather and footwear manufacturers in Kanpur. This visit provided crucial insights into industry challenges, infrastructure needs, and environmental requirements, enabling the Government of Bihar to refine its strategies for promoting a thriving leather industry.

"Our proactive governance will provide dedicated support for investors through comprehensive assistance. This investor meeting has already resulted in four investment intents, reflecting confidence in Bihar's policies and our commitment to building a robust industrial ecosystem," Ghosh said.

Arshad Iraqi, Regional Chairman (Central) of the Council for Leather Exports, commended the initiative, saying, "The Bihar government's efforts to promote the leather industry are commendable and have significant growth potential. Bihar offers the land, connectivity, and robust infrastructure needed for expansion in the northern region. With environmentally compliant tanneries, Bihar could emerge as a prime alternative to Kanpur and Unnao." "We aim to increase exports from $20 million to $50 million by 2027, and expanding operations in Bihar is key to achieving this," he said.

Bihar's policy is complemented by modern infrastructure, including plug-and-play sheds spanning 24 lakh square feet at affordable rates of Rs 4-6 per sq ft per month, a 1,600-acre land bank with allotments processed within seven days, a Leather Product Park in Muzaffarpur, and being strategically located near major transport nodes.

To streamline business operations, the state provides all necessary NOCs and clearances through an online single-window system, ensuring ease of doing business. The government also promotes convergence with schemes such as the startup and purchase preference policy, creating an enabling ecosystem for established players and new entrants. Gaurav Kumar from Competence Shoes, said, "We've successfully established a footwear manufacturing unit in Bihar, thanks to the substantial government support.

The ease of accessing online incentives has been instrumental in our growth. Our facility in Hajipur caters to both domestic markets and exports to Russia, including manufacturing for the Russian army and fashion industry".

Mohammad Faisal from Star International expressed optimism: "I'm deeply impressed by the Bihar government's vision and mission. For the first time, I see a proactive approach to industrial development".

Provisions for common facility centres, including CETP and ZLD, are available on a case-by-case basis, supporting environmentally sustainable practices. This approach ensures that the sector can grow responsibly while meeting global environmental standards. This collaborative engagement marks a pivotal step in Bihar's mission to build a world-class leather industry. The Government of Bihar is inviting entrepreneurs worldwide for Bihar Business Connect 2024, scheduled for December 19-20th in Patna.

This event will provide a platform for further engagement and exploration of investment opportunities in the state's burgeoning leather industry. These collective efforts aim to position Bihar as a competitive destination for the leather industry while ensuring sustainable and inclusive growth, the statement said. Gaurav Kumar of Competence Exports Pvt Ltd said his footwear factory exports to Russia as well as caters to the domestic market. It manufactures for the Russian army and fashion industry shows.

"The government facilities are excellent, better than in other states, such as the 30 per cent capital subsidy, which is easily available. We also receive logistics incentives, which are very supportive". Iraqi said there is immense potential for the leather industry in Bihar.

"For expanding our business in the north, we need good land, connectivity, and infrastructure." "We've set a target to increase exports from $20 million to $50 million by 2027. To achieve this, further expansion is necessary. With limited options for tannery expansion in Kanpur and Unnao, Bihar is a viable alternative." The government is also improving road networks, creating corridors, airports, railways, and dry ports, all of which are advantageous for the industry, he said.