Proposal for Establishment of an Integrated Leather
Cluster in Hubballi
1. Executive Summary
This proposal seeks government's support in the form of land allocation and funding to
establish a world-class Leather Cluster in Hubballi, North Karnataka. The proposed cluster will
integrate the entire leather value chain-- from raw leather processing (cow, buffalo,
vegetable-tanned, and synthetic leather) to manufacturing of leather goods (footwear, apparel,
accessories), domestic and international marketing, and allied community infrastructure.
This cluster aims to transform Hubballi into a one-stop destination for leather and
footwear manufacturers and traders in the region and beyond, positioning it as a major hub of the
leather industry in South India.
2. Overview of the Leather Industry
2.1 Global Landscape
The global leather industry is valued at over USD 400 billion, with the demand for
finished leather goods—especially footwear, fashion accessories, automotive upholstery, and
garments—continuing to rise. Countries like Italy, China, Vietnam, and Brazil dominate both raw
material processing and finished product exports.
2.2 Leather Industry in India
India is the second-largest producer of footwear and one of the top exporters of leather
goods globally. The industry contributes significantly to India’s export earnings, generating
employment for over 4 million people, predominantly from underprivileged and rural
communities, specially Chammars and Samagars.
India has a rich tradition of leather craftsmanship, supported by an abundant availability
of raw materials, skilled labor, and a growing domestic market. Key clusters currently exist in
Kanpur, Agra, Chennai, Kolkata, and Ambur.
2.3 Karnataka’s Potential
Karnataka, though not traditionally a leather hub, has immense untapped potential. Cities
like Bengaluru have seen the rise of niche leather brands, while North Karnataka, with its
agrarian economy and availability of livestock, is strategically positioned to support leather raw
material procurement and processing. Athani, Nippani and Sankeshwar towns in Belagavi district
are the major centres for the production of Kolhapuri-Chappals. The Kolhapuri-Chappals,
which are known for their unique design and light-weight, are footwears made from pure leather
and are good for health. These GI-Tagged Chappals are famous all over the world.
3. Why Hubballi?
3.1 Strategic Location & Connectivity
Hubballi-Dharwad is the commercial capital of North Karnataka, well-connected by:
Rail: Major junction connecting Mumbai, Bengaluru, Hyderabad, and Goa
Road: NH-4 and NH-63 pass through Hubballi
Air: Hubballi airport connects to major Indian metros
Proximity to Ports: Access to ports like Karwar, Mangalore, and Goa facilitates exports
3.2 Economic and Industrial Base
Hubballi is already home to multiple small-scale industries and is part of the
Delhi-Mumbai Industrial Corridor (DMIC). The city has:
An active trading community
A growing MSME ecosystem
Availability of industrial land through KIADB
Skilled and semi-skilled workforce
Existing educational and training institutes that can support skill development in the leather
sector
3.3 Favorable Climate & Livestock Resources
The semi-arid climate of the region is favorable for leather curing and drying processes.
With a strong livestock base in the surrounding districts, the cluster can source raw hides and
skins locally, reducing procurement costs and supporting local farmers.
4. Proposed Leather Cluster Components
The Hubballi Leather Cluster will be a comprehensive, integrated ecosystem consisting
of:
4.1 Core Industrial Units
Leather Tanning & Processing Units (Cow, Buffalo, Vegetable-tanned, Synthetic)
Grading and Finishing Units
Footwear and Leather Goods Manufacturing Units
Artisan Workshops for Handmade and Traditional Goods
Packaging and Logistics Units
4.2 Supporting Infrastructure
Common Facility Center (CFC): Machinery, testing labs, R&D, training
Effluent Treatment Plant (ETP): Environmentally compliant waste disposal
Power and Water Supply Systems
Cold Storage and Warehousing
Design & Innovation Centre
4.3 Marketing & Trade Facilities
Leather Showroom and Exhibition Centre
E-commerce Fulfillment Hub
Export Facilitation Office
Training Centre for Export Compliance & Certifications
4.4 Township and Social Infrastructure
Worker Housing Township
Schools and Crèches for Families
Community Hall and Convention Centre
Recreational Spaces (Parks, Sports Facilities)
Hotels and Guest Houses for Visitors and Buyers
5. Employment & Socio-Economic Impact
The cluster is expected to generate:
Direct employment for 10,000+ people
Indirect employment for another 30,000+ through logistics, raw materials, services
Empowerment of women and artisans
Strengthening of livelihoods in rural and peri-urban areas
Export revenue generation, enhancing Karnataka’s industrial profile
6. Sustainability and Compliance
Green Leather Processing: Adoption of eco-friendly vegetable tanning methods
Circular Economy: Waste leather converted into utility items
Zero Liquid Discharge (ZLD): Compliant with environmental norms
Skill Development: Collaboration with Leather Sector Skill Council (LSSC)
7. Investment & Funding Requirements
Estimated Land Requirement: 100-120 acres (in or around Hubballi, preferably near
KIADB industrial areas)
Total Project Cost Estimate: ₹500–₹550 Crore
Funding Request from Government:
Land allocation at subsidized rates
Capital subsidy for infrastructure development
Grants under schemes such as PM Mega Integrated Textile Region and Apparel (PM
MITRA), Leather Cluster Development Scheme (LCDS), or Karnataka’s Industrial Policy
Single-window clearance for environmental and industrial approvals
8. Conclusion
The establishment of the Hubballi Leather Cluster will mark a transformative step for
North Karnataka's economy. With its strategic location, industrial base, and socio-economic need
for employment and inclusive growth, Hubballi can emerge as a new-age leather hub--
sustainable, export-driven, and community-centered.
We seek the government’s active support to bring this vision to life and build a model
leather cluster that becomes a benchmark for industrial clusters across India.
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