The proposed ban on cow slaughter will severely impact the export of leather goods from the country.
According to a conservative estimate, exports from India could fall more than 30 per cent if the law banning slaughter of cows was passed by Parliament and imposed across the country without giving state governments the freedom to decide on the issue in respective states.
In 2002-3, export of leather goods from India stood at close to $2 billion. The ban will deprive the leather goods industry hides worth $700 million of exportable goods.
"The advantages of India were cheap raw material and low labour cost. However, in high value items, where cow skin is mainly used, raw material represented 70 per cent of input cost. If that is taken away, we will be in serious difficulties," S S Kumar, chairman, Council for Leather Export, said.
Cow skin was used to manufacture footwear, garments and goods like bags and wallets. Industrial gloves also used cow leather, albeit of inferior quality. The main export market for these items were the United States, Germany, France and Italy.
West Bengal would be the most affected as north Indian cow skin was widely considered to be the best. Major states producing cow hides were Uttar Pradesh, Himachal Pradesh and Haryana.
A leather goods manufacturer said import would not be a viable alternative if the cow slaughter was banned. It would only lead to surge in smuggling of cows to Bangladesh where they would be slaughtered and their hides sold by Bangladeshi entrepreneurs for their benefit.
Mukund Kulkarni, president of Indian Leather Products Association, said leather cost would go up by 30-35 per cent, making Indian exports uncompetitive in the market.
In India, 60 per cent of raw hide and skin was collected from slaughter and 30 per cent from dead animals while 10 per cent was imported. Industry analysts said the ban would force producers to depend on dead animals but such carcasses produce skin of inferior quality.
"At present, a cow was slaughtered after it stopped producing milk at the average age of 13 and the animal lives on till it reaches the age of 20 years or so. However, the quality and softness of the skin deteriorates with age and skin from old animals cannot be used to produce value added products like garments and bags," an expert said.
Proponents favouring ban on cow slaughter have argued that death of old animals would ensure that supply of skin would remain stable. However, the industry's efforts are to move up the value chain by producing fine items using superior cow hide from younger and healthier animals.
The ban will also have a major environmental impact, as more grazing land will be required for keeping aged animals alive. Jobs at abattoirs would be lost as well.