US tariff-hit Kolkata leather units eye UK, EU markets

Across four floors of a Kolkata leather factory, about 380 workers stitch and assemble handbags and wallets at a steady tempo.

- ISHITA AYAN DUTT

The pieces, many bearing the unmistakable 'Boss' logo, are neatly stacked in rows ready to move to the next table for another task — the rhythm of work seemingly untouched by the US tariff-led disruption.

The United States (US) — Crescent Exports' biggest market — has raised tariffs to 50 per cent, a blow that has slowed the flow of orders. But for now, the bustle of the manufacturing unit spread across 85,000 square feet masks the uncertainty of shrinking margins and potential impact on employment.

"We had strong orders from the US, but the additional 25 per cent tariff imposed by the US has really shaken us," M Azhar, managing director of Crescent Exports Syndicate, said. About 60 per cent of Azhar's business is US-focused, where orders are now on hold.

The firm runs three units out of the Calcutta Leather Complex — a vast 1,100-acre hub at Bantala on Kolkata's eastern fringes. Spread out like a self-contained complex, it brings together tanneries, processing and manufacturing units even as pockets of manufacturing still linger in the old Tangra, Topsia and Tiljala neighbourhoods — the original base of leather trade in Kolkata. The tanneries shifted here in the early 2000s following a Supreme Court order.

When the additional 25 per cent penalty for buying Russian oil landed, it caught the units doing business with the US completely off guard. This was over and above the 25 per cent reciprocal tariff announced by the US on August 1 and implemented on August 7. The Russian penalty applied to shipments after 21 days — from August 27 onwards — and most exporters made good of the window.