The second largest industry in regard to exports is the Leather Industry. Contributing more than $800 million in 2009 to the foreign exchange in Pakistan, this industry has the potential of delivering more and providing a large number of jobs by diversifying product range and improving quality.
The leather industry in Pakistan is as old as the history of the country. During the colonial era just a few number of tanneries were working in large cities such as Karachi, Lahore, New Delhi etc. In the 1950s the number of well-equipped tanneries increased in Karachi, Lahore and other major industrial cities. This number continued to rise for due to increase in demand of finished products as well as raw material in the national and international market. There are as much as 800 Tanneries in the country engaged in producing best quality finished leather of Cow, Buffalo, and Sheep & Goat skins.. Leather manufacturers & exporters are determined to increase export of quality finished leather and leather products.. Leather is one of a prolific contributor to the country's GDP and foreign exchange earnings, The Leather Industry of Pakistan is employing more than 500,000 people directly or indirectly at this time of age
Leather industry's core products in Pakistan are leather garments, gloves, tanned leather and footwear. In the 50s and 60s most of the tanned leather was exported in raw form but soon after the local tanning industry making semi-finished leather made rapid progress in making finished products due to availability of raw material, labor and growing demand in the foreign market.
More than 450 units of leather garment manufacturers in Pakistan are producing approximately 5 million pieces against the production capacity of exceeding 7.5 million pieces. Similarly a key sector in leather industry is the leather footwear industry which is capable of producing 200 million pairs annually and its current production is just 100 million pairs. Pakistan's share in the global skin and hides production is around 7% annually which can be doubled with just the right amount of time and effort. One can assess that these statistics show the industry's capabilities which are highly under-utilized.