A taste of leather for India and China

Is a purported crackdown on polluting tanneries in China good news for India?

By Andrew Leonard
Published February 20, 2007 7:16PM (EST)

An article in the Economic Times is making the confusing claim that a clampdown on polluting tanneries in China is increasing European interest in sourcing leather products in India. (Thanks to China Digital Times for the link.) Confusing because, according to the article, China specializes in cheap leather goods, while India targets a more middle-priced sector. But why would a reduction in the availability of cheap leather goods in one country lead to a boom in more expensive goods in another? A more logical conclusion would be that the European buyers would operate according to the "pollution haven" thesis, and simply move on to the next developing country willing to overlook the awful toxic impacts of unregulated tannery operation. Though some critics have argued that the "pollution haven" thesis isn't backed up by data, I'm not sure that anyone is suggesting that tighter environmental regulations in one country lead foreign companies to specifically search out higher priced suppliers in another.

I also wasn't able to confirm that China has been shutting down tanneries. If one is to believe the very smart Isabel Hilton, writing in the U.K. Guardian, China's tough talk on beefing up environmental enforcement isn't being matched by action. And even if China has closed a few tanneries, it's is difficult to imagine that such action is already shifting the dynamics of trade for a country that manufactures 7 billion pairs of shoes for export in a single year.

Maybe the most interesting thing about the story is not whether it's solidly grounded in facts, but in its implied zero-sum thesis that as China moves to address the environmental impacts of its runaway economic growth, India can benefit by boosting its profile as a source of manufactured goods. Up until now, the division of global economic labor has been a complementary setup in which India provides the high tech services and China the factory space, and the two nations are not necessarily seen as direct competitors with each other. But as both economies mature, that could change.

If workers in the already-industrialized world think globalization means increased competition and pressure on their livelihoods, imagine what it will be like if India starts competing with China as a producer of shoes and semiconductors.

Andrew Leonard

Andrew Leonard is a staff writer at Salon. On Twitter, @koxinga21.

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China Environment Globalization How The World Works India