It appears the leather industry’s blatant disregard for environmental concerns and the government’s failure to impose regulations played a major part in the debacle the leather industry faces today.
In spite of repeated urgings from international buyers to construct effluent treatment plants in tanneries, the authorities concerned did not take effective steps in this regard.
As a result, over 100 international buyers, including the two of the biggest buyers, moved out of the country during the last three years.
Bangladesh’s export of leather goods also fell by about 20 percent in the last two years.
The two biggest buyers of Bangladeshi tannery products -- the US based Johnstone & Murphy and the Italian Johnstone Company -- have stopped purchasing from Bangladesh since 2018 and 2017 respectively.
Bangladesh would export tannery products worth over Tk3,000 crore to the Johnstone & Murphy and more than Tk2,000 crore to the Johnstone Company.
All these firms have moved to India and China as an alternative market, on an allegation of environmental damage by Bangladeshi factories and their non-compliance to the international norms.
“As European buyers have stopped purchasing from Bangladesh, tannery owners are compelled to stock 40 to 50 percent of the collected rawhides. Though China was chosen as an alternative market, they have lowered the leather price due to the ongoing US-China trade war.”
Meanwhile, the central effluent treatment plant (CETP) of the newly developed Savar Leather Industrial Park has not been completed.
In 2012, the government gave the responsibility of setting up of the CETP to Chinese Jingsu Lingzhi Environmental Protection Ltd.
As the CETP is still under construction, local factories therefore are not getting a world standard certificate, causing foreign firms to move back from Bangladesh.
Besides, from the Savar tannery industries, around 25,000 tonnes of untreated waste is being dumped daily into the Dhaleshwari River and nearby open spaces, critically exposing locals to health vulnerabilities.
Besides, around 12-15 thousand workers in different factories are suffering from different diseases owing to unhealthy work environment, according to a number of studies.
Syeda Rizwana Hasan, executive director of Bangladesh Environment Lawyers Association (BELA), said tannery industries are still damaging the environment immensely even though they have been finally shifted from Hazaribagh.
“Alongside environmental harms, mismanagement in the government level is also responsible for the collapse of the industry. The government did not take any effective step to ensure environment compliance even though foreign buyers time and again emphasised the issue,” she said.
Due to this maladministration, tannery owners have been compelled to preserve a big portion of leather in their factories for the last two years, resulting in huge losses for them, say people involved with the sector.
They think tannery owners’ cautious stance, this year, to protect themselves from further losses was behind the dumping of a large amount of rawhides this Eid and ultimately the recent crisis in the sector.
The government also admitted that mismanagement and environment issues remain behind the instability in the sector.
Commerce Secretary Mofizul Islam said, “Mismanagement by Bangladesh Small and Cottage Industries (BSCIC) is responsible for delay in the leather industrial city. The project work started in 2003, but it is sad that the ETP has not been completed yet.”
The BSCIC, in this respect, said the problem related to the leather industrial city is going to be solved soon.
“We will complete the CETP work by this December. Before that, all problems including handing over the plots to tannery owners will be solved,” said BSCIC Chairman Mustaq Hasan.
Sources said, at present, the number of tannery industries having a membership of Bangladesh Tanners’ Association stands at 188. Of those, only 123 have set up factories at Savar so far.
Except for the Apex, no other local firms have obtained a world standard certificate due to failure to ensure environmental compliance.
The pre-condition of getting a “Standard Certificate” from the Leather Working Group (LWG) is setting up an ETP.
As the local footwear exporters do not have an LWG certificate, they are using imported raw materials to manufacture shoes.
In the last fiscal year, they imported leather products worth Tk945 crore. As a result, Bangladeshi tannery owners saw a decline in exports and also in sales in the local market.
Earlier, the government took a project in 2003 to shift the tannery industry from Hazaribagh to Savar, due to repeated pressure from foreign buyers and environmentalists.
Accordingly, it took an initiative to complete building an environment-friendly leather industrial park there by 2010. But the project is yet to be completed.
Although an industrial city has been set up at Savar at a cost of more than Tk1,000 crore, cent percent tannery industries were in operation at Hazaribagh till 2017, due to the government’s mismanagement and lack of good intention of owners.
Following a High Court order later, the owners were compelled to shut all factories at Hazaribagh in that year.