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How India’s Covid-19 crisis is slamming its economy

India’s government locked down the country last year to avoid an out-of-control Covid-19 outbreak that so many of the world’s countries had endured. The plan was largely successful, but it crippled India’s economy in the process.

Now India is facing its own devastating Covid-19 crisis, and Prime Minister Narendra Modi is reluctant to put his economy through another round of turmoil.

India’s economy may get crushed again regardless.

That’s beginning to play out in India’s leather industry.

India is a major global exporter of leather and leather goods. The country is the second-largest exporter of leather garments and fourth-largest exporter of leather goods in the world, according to the Indian Council for Leather Exports (a division of India’s Ministry of Commerce & Industry). It is also a major producer of footwear after China, producing nearly 3 billion pairs of shoes annually.

Last year, the pandemic dealt a serious blow to India’s leather industry. Leather exports slumped a steep 29.1% last year over the prior year, as the industry lost almost $1.4 billion in exports. That’s because shoppers in the United States, European Union and United Kingdom held off on purchases during their own lockdowns, according to Aqeel Panaruna, chairman of the Council for Leather Exports.

One industry expert, who didn’t want to be identified and is also infected with the coronavirus, said leather producers have suffered from a cumulative knock-on effect of a protracted shutdown last year. He’s worried that a worsening second wave could set the industry back once again.

Much of that worry is fueled by the dynamics of the industry’s workforce.

“The majority of the workforce is in the 18 to 45 years of age and have not been vaccinated as yet,” noted Sanjay Leekha, vice chairman of CLE.

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