1、1,A Study of Ecolables in India and European Union and Their Impact on Export of Leather Products From India Ghayur Alam,2,Objectives-To study:The performance of Ecomark in India.The factors which affect the popularity of Ecomark.What can be done to increase the popularity and impact of Ecomark.EUs
2、Ecolable.The impact of EUs Ecolable on export of leatherfootwear from India.Linkages between sustainable developmentand export from developing countries.,3,The focus of the study is on leather products.It is based on more than 50 interviews with: Indian exporters; Importers in EU countries; Trade As
3、sociations in India and EU countries; Agencies in India and EU Responsible for administering Ecolable; NGOs and Consumer groups.,4,Ecolables-brief introductionmarket-based instruments increase consumer awareness shift consumer choice in favour of environmentally friendly products induce industry to
4、manufacture environmentallyfriendly products.,5,Ecolabel-criteria i) product related. Limited to environmental impactof products use and its disposal. ii) process and production method (PPM). PPM based criteria Requires Life Cycle Assessment. They are more relevant for the promotion of sustainable d
5、evelopmentA number of Ecolables are in use. These include Indias Ecomark, Germanys Blue Angel, Nordic White Swan and EUs green flower,6,Ecomark-India Introduced in 1991 Available to consumer goods only Similar to schemes in other countries Life cycle based criteria One major difference-linked to qua
6、lity Bureau of Indian Standards is involved Available for 17 products, including leather,7,Ecomark-India ImpactOnly 4 companies with Ecomark Three for paper. One for detergents None being used No impact,8,Leather: Focus of the study Why leather? Important source of employment and export employs more
7、 than 2.5 million people export more than US$ 1800 million Highly Polluting pollution load include salt, chromeinefficient use of resources, including waterand energy air emission,9,Ecomark for leather Introduced in 1991 Criteria i. The manufacturer must have consent from the Pollution Control Board
8、 ii. Must conform with the maximum limits of harmful substances. ii. The material used for product packaging shall be recyclable or reusable or biodegradable. Not linked to quality characteristics Impact no leather product with Ecomark no impact; no contribution to environmentalperformance,10,Why Ec
9、omark has not been effective? general reasons Lack of promotional efforts. Little consumer demand Industry not interested-do not see advantagein the market place-concerned about brand dilution complaints of procedural complexities, leading to cost and delays leather specific reasons a majority of fi
10、rms use old and inefficient technologieshighly pollutinga majority do not have consent from SPCBs. Noteligible for Ecomark. (This implies that even if the leather producers were interested in getting Ecomark, most of them would find it very difficult to meet its criteria.),11,Ecomark should be seen
11、as part of efforts to promote sustainable production. It would be effective only when there is an awareness and demand for environmentally friendly products and processes.,12,EUs Ecolable-Introduction Established: 1992 Criteria based on cradle-to-grave approach- take into account all aspects of a pr
12、oducts life, from its production and use to its eventual disposal. Popularity limited to a small number of productsand countries.Countries: most popular in Italy, Denmark and France. Products: most popular in textile and paints/varnishes,13,Number of ecolable according to countriesCountry Year 2001
13、2002 2003 Sweden 9 8 11 Greece 9 9 11 Spain 12 12 13 France 17 26 30 Denmark 18 23 31 Italy 13 23 34 Others 10 20 Total 88 101 150 Source: Flower News, various issues available at http:/europa.eu.int/comm/environment/ecolabel/news/flowernews_en.htm,14,Reasons for low popularitySimilar to the reasons
14、 for the low popularity of Ecomark in India Low Environmental consciousness among consumers lack of awareness of ecolable poor response from industry,15,EUs Ecolabel and Its Impact on exports from IndiaTwo views: 1. Ecolables can discriminate against imports from developing countries. Lack of transp
15、arency pressure from local stakeholders criteria based on life cycle analysis need for new and costly technology to meet EUEcolable norms2. Developing countries can set up Sustainable Production facilities, Take ecolable and increase export to developed countries,16,EUs Ecolable and export of leathe
16、r footwear from IndiaEU Ecolable Criteria (footwear)significant reduction in COD (Chemical Oxygen Demand) and chromium in effluent; non use of hazardous chemicals (azo dyes,PCP, TCP etc.) use of recycled material for packaging.,17,Impact on Indias export would depends on:how important ecolables are
17、in EU markets of leather footwear i. Will Indian firms be able to get Ecolable? Evidence from India and EU: ecolables are not important in footwear market in EU ecolables have no impact on export from India environmental issues, in general, play small roleimporters are mainly concerned with banned c
18、hemicals-not interested in the sustainability of production processsocial issues (working conditions, minimum wages, child labour etc.) play greater role. Many large importershave their own social norms. Small importers not concerned,18,Future Scenariosituation may change-Ecolables may become import
19、ant in footwear market as:EU companies adopting ESTssteps being taken to promote Ecolablelarge Indian exporters are beginning to focus on higher end of the marketif Ecolables become important, How would export from India be affected?,19,Can Indian firms increase their exports by obtainingEUs Ecolabl
20、e? All Indian exporters already comply with the ban onhazardous chemicals All exporters can use recycled material for packaging Main problem: high pollutant load in effluent (high COD, chromium). Most firms lack technologicaland financial resources to upgradeNot eligible for EUs Ecolable and Indias
21、Ecomark.Large firms have the capacity to meet the Ecolable criteria if they see business advantagesmall firms are unlikely to take this route. They will continue tocater to the lower end of the market, which is largely price driven.Sustainable production in not likely to emerge as an importantimpetu
22、s to export from developing countries. Even if environmental considerations acquire greater importance in the EU market, only a handful of large firms will be in a position to take advantage.,20,Conclusionsare Ecolables effective instruments to promote sustainable development?not very effective-espe
23、cially in developingcountries such as India Many reasons- general lack of concern for environment.Low awareness of Ecolable schemes, such as Ecomark in Indiaconsumers not prepared to pay more for productswith ecolable-companies not prepared to investin new technology lax enforcement of regulations,2
24、1,Would adoption of sustainable production methodspromote Indias export of leather goods to EU?Present situation: environmental issues play little rolein consumer choice of leather footwear-price of primary importance. Little link between sustainable production and export potential.Future scenario:
25、role of environmental issues, and ecolables, may increase. Will this benefit exports from India and other developing countries?,22,Large exporters- yes (May be). Large Indian firms have technical and financial resources. If it makes business sense, they may invest in sustainable production technolog
26、ies, take ecolable and try to increase their exports . Small exporters-no. Unlikely to meet the conditions to get Ecomark and Ecolabels. Lack technical, managerial and financial resources to set up sustainable production facilities. Their exports are likely to remain restricted to the lower end of t
27、he market.,23,To conclude:Ecolables have not been effective instruments to promotesustainable development.Presently, there is little link between sustainable productionand export to EU market.If the situation changes and environmental issues begin toplay greater role in the market, Ecolable, could a
28、lso become important. The potential of sustainable production as a way of increasing export to developed countries is small. A small number of large Indian firms may benefit by meetingEU criteria and taking Ecolables. Small firms, however, do not have resources to do this. The overall potential of using sustainable production to increase exports is limited.,
