Leading foreign footwear brands are staring at a revenue loss of ₹1,000 crore and delay in planned expansion due to the prolonged delay in getting Bureau of Indian Standards certification for tapping the Indian markets.
The government has made it mandatory for footwear companies to obtain BIS certification for 27 footwear products, including luxury and sports brands.
The Ministry of Commerce and Industry notified BIS certification for footwear makers in 2020. After several extensions, it was made mandatory for large and medium sized units from last July and smaller businesses were given time till August.
Interestingly, BIS has not certified several foreign footwear factories abroad. The delay in certification has left foreign brands in quandary with the industry expecting the government to implement quality norms strictly from January.
Representing the woes of foreign footwear sellers in a letter to the Prime Minister’s Office, K Narasimhan, Senior Advocate, Madras High Court, said the certification process for global footwear brands manufacturing products abroad has encountered significant delays, which is now causing widespread concern across the industry.
To date, he said BIS has not issued licences to several foreign brands whose products are manufactured outside India.
Serious threat
While some of these brands have stock to last through the first quarter of 2025, the failure to certify their overseas production facilities poses a serious threat to their continued presence in the India and the repercussions will only deepen over time, he said.
Delays in certifying foreign factories have the potential to impact both foreign investment and India’s standing as a reliable partner for international business, he said.
While the foreign companies may lose ₹1,000 crore in revenue, retailers may face penal action for selling foreign branded shoes without ISI mark, said a leading footwear retailer.
With the growing consumer affluence, foreign players account for 40 per cent of Indian footwear market and play a significant role in sports, lifestyle and casual footwears.
footwear market
Growing at a CAGR of 13 per cent, the Indian footwear market is expected to touch $45 billion by 2031 from $17.05 billion in 2023.
Tamil Nadu, which has key production hubs in Chennai and Ambur, has emerged the leading producer of footwear among southern States.
Suggesting BIS to certify factories of foreign brands in Indonesia, Vietnam and Cambodia to maintain supply continuity till next September, he said to mitigate immediate market disruption with a grace period for retailers to continue selling uncertified stock while the certification process is underway.
The ongoing certification delays have raised uncertainties, discouraging foreign companies from committing further investments or increasing their production capabilities in India, he said.