CHENNAI: In a first major boost for India’s manufacturing sector after the signing of India-European Union (EU) FTA on Tuesday, the country’s leading manufacturer Kothari Industrial Corporation Ltd (KICL) said that it is in talks with French footwear brand Kickers to set up plants and make footwear.
The recent reduction of tariff in the proposed FTA from 17% to 0% on footwear export from India to China has initiated the discussion from the iconic brand.
Kickers is a brand of Kickers BBV which is owned by another French group named Groupe Royer.
The KICL received licence to make Kickers footwear in 2024. The KICL has opened four shops across India, including in Delhi and Chennai. The fifth shop will be opened in Moti Bagh area of New Delhi.
Jinnah Rafiq Ahmed, Executive Chairman of KICL, said, “After FTA was signed, the Royer Group owner called me to hold a strategic equity stake in the Kickers BBV. We are yet to decide on having a stake in Kickers BBV as it is a lengthy process.”
He further added that during the call, the Royer Group also discussed the options of moving out footwear plant in China to India. “As the footwear export tariff has been dropped from 17% to 0% under the proposed FTA, the company is exploring options to move out manufacturing plant in China to India. The exporting of Kickers footwear will be cheaper for them because of the reduced tariffs.”
The current tariff from China to Europe is 8% for leather shoes and 17% for non-leather to Europe.
Ahmed further said, “As this plant would be supply footwear for world needs, the manufacturing of pairs would be millions. I have received letters from different Chief Ministers, requesting me to set up plants in their respective States.”
The KICL has signed a 30-year agreement with the Kickers BBV which is automatically renewed in every 10 years. The agreement gives licensing to the KICL to export and distribute Kickers footwear in India, Qatar, the UAE, Saudi Arabia, Nepal, Sri Lanka, Bhutan and Bangladesh. Kickers shop is already operational in Qatar.
He further added that because of the US tariffs, the footwear industry has been badly affected as it has to bear over 50% tariff on the export. The US has levied 50% tariff on footwear export from of India. “Now, with the EU FTA, we can mitigate the losses that we have incurred due to the tariffs and take leverage as the entire Europe comprises of 25% of global GDP.”
The KICL has partnered with Taiwan-based Evervan-Shoe Town Group for manufacturing brands like Crocs and Adidas. The partnership is named Phoenix Kothari Footwear. The joint venture is producing Crocs brand from Tamil Nadu’s Perambalur district on a 1 million sq ft and manufacture 6 million pairs of footwear, with a capacity to produce 40 million pairs. Another plant is Karur for Adidas will be inaugurated in the next two months. In both these plant, the company has invested Rs 2500 crore each.