US tariffs hit India leather, GST cuts soften blow
Indian leather exporters are facing a 10 to 12 percent drop in sales this fiscal year due to American tariffs. The sector brought in 56,000 crore rupees last year, with foreign shipments making up 70 percent of total business. Credit ratings firm CRISIL said profit margins could shrink by 150 to 200 basis points despite stronger home market activity from tax reductions and steady prices.
The government cut taxes on intermediate leather goods to 5 percent from 12 percent and reduced levies on finished products to 12 percent from 18 percent. A trade agreement with Britain and efforts to shift exports toward European and other markets may limit revenue losses. Lower borrowing costs and income tax benefits should encourage domestic buyers to spend more on premium leather items.
