Back to Growth: Interview with S.K. Verma, Executive Director, Indian Footwear Components Manufacturers Association (IFCOMA)
1. How do you see the major trends that you witnessed during Covid19, in the leather and footwear sector, pan out in 2021?
The global economy has entered the year 2021 at a subdued growth rate and is likely to accelerate to a brisk pace probably in the second half. The government of India has taken an unprecedented approach and initiative to combat Covid-19 with the indigenously developed vaccine. Gradually the vaccine drive will allay the fears of common man including the industry so that we are able to recover on lost ground.
In the times to come, we are likely to see the emergence of new trends on designs and colors concept for the footwear industry. As the market demand picks up, it is expected that the industry will spread its wings on innovation recovery and enhancing production capacities. We are quite hopeful that industry will accelerate in second half to pick up the pre-Covid trends and growth.
2. Where do you see the sector going ahead in 2021?
2021 is going to be year of revival and survival. We see major changes in the ensuing year as the demand pattern is likely to make a paradigm shift owing to the hunger for new creations the world over. We expect that Europe and US will be able to stabilize on political and recovery on pandemic issues. This will pave the way for improving the demand and supply for the sector.
3. What potential do you see in the sector for job creation in the coming period?
Footwear sector has been a labour-intensive Industry right from the beginning when we used to produce handmade shoes. After the mechanization of their plants, the footwear manufacturers still promise a great deal as far as the employment generation is concerned. But the component sector has its own limitations due to use of sophisticated machines focused towards the product's finish, quality and minimum human intervention. That is how the pattern follows globally.
Certainly the expansion process that we aim for will create avenues for new job requirements. We have approached the DPIIT permit survey of the component industry. This will give us a fair amount of ideas to strategies building up of the sectoral growth. Forging of ties and joint ventures will give rise to FDI and expansion processes and generate substantial skilled employment.
4. What is the scope and future of the components industry in India? What should the strategy be like for 2021?
As mentioned above, the growth is now linked to expansion by way of JVs on some of the critical components. We will surely take a quantum jump once the above process is in place. Besides, the expected export growth in industry will give a fillip to our sector as well, which is primarily driven by the demand from European and US markets. Our sector is also exploring markets like South Africa, Ethiopia, Poland and Egypt as new prospects continue to build up the volumes.
India has been the hub of resources whether it is to do with work force, with over a billion population or with dynamic entrepreneurs and startups taking up the challenge to build better quality products. In 2021, manufacturing will see a fundamental shift in how its leaders view progressive change. As a result, an industry that's nimbler and more flexible will emerge and find better place under the sun.
Sustainability shall be the key word in 2021.
Manufacturing has long been one of the most significant contributors to environmental pollution. With the current state of affairs that prioritizes science and the environment, expect efforts to make manufacturing more sustainable through more efficient factories that will focus on creating green jobs and reducing the industry's high volume of waste. A distributed network of smaller, local, and energy-efficient factories can reduce energy consumption by shortening transportation routes to customers, decreasing waste from fewer defective parts, and lowering the industry's overall carbon footprint.
Ultimately, manufacturing is an industry in a state of constant evolution, though historically, much of that change has been of the "slow and steady" variety. With the forcing function of 2020, in 2021, we'll begin to see the evolution of an industry that's more responsive and adaptive to both markets and consumers, leaving us with a better sector than we had pre-2020. This agility is poised to be a rising tide that lifts all ships.
5. Going ahead, what are the 3 most important things that you would want in the budget 2021 for the sector?
The International Monetary Fund recently forecasted that the global economy could shrink 4.4 per cent in 2020, before bouncing back to 5.2 per cent growth in 2021. The IMF said in October that the world economy has started to recover, but warned the return to pre-pandemic levels will be “long, uneven, and uncertain.”
The future holds the digital era as a new strategy. Hence, taking the cautious approach in post-pandemic times will support our endeavors. We will see more small businesses embrace digital commerce, changing the point of sale and/or moving from physical to online sales completely or in part. SME units have to give enormous attention to upgrade themselves and sustain production. Consumer sentiment plays a major role in reviving an economy.
* The views and opinions expressed above are solely of the interviewee. The content does not reflect Invest India's position or opinion and Invest India bears no responsibility for the same.