Adidas, Nike maker to set up manufacturing plant in Tamil Nadu

Taiwan’s Pou Chen Corporation, which makes shoes for popular global brands like Nike and Adidas, on Monday pledged to invest Rs 2,302 crore to up a massive manufacturing unit in Kallakurichi district providing jobs to over 20,000 people, in a shot in the arm for Tamil Nadu government which aims to emerge as a hub for non-leather footwear sector.

High Glory Footwear India Pvt Ltd, a subsidiary of Pou Chen, will invest the said amount over a period of 12 years to set up a major non-leather footwear manufacturing unit in SIPCOT Industrial Park in Ulundurpet, a backward region located on the Chennai-Kanyakumari National Highway.

A Memorandum of Understanding (MoU) was signed between S Krishnan, Additional Chief Secretary (Industries), Tamil Nadu government and George Liu, Vice President, Pou Chen Group in the presence of Chief Minister M K Stalin.

Tamil Nadu is already a major hub for leather footwear manufacturing in India, accounting for 45 per cent of exports in the sector, and the state now wants to focus on the non-leather footwear sector. The government also signed a MoU with the Taiwan Footwear Manufacturers Association in a bid to attract investments in the sector from Taiwanese companies.

Though several leather footwear manufacturers in the state have already set their eyes on the burgeoning non-leather footwear sector, the MoU with Pou Chen is significant as Tamil Nadu will now be part of the global supply chain for brands like Nike, Asics, Adidas, Timberland, New Balance, and Salomon.

“We hope this would be the first of many investments to come (in India)," George Liu said. The company, which has plants in Bangladesh, Myanmar, Cambodia, and Vietnam, had shipped over 272 million pairs of shoes globally in 2022-2023.

The investment comes months after the Tamil Nadu government launched an exclusive policy for leather and footwear products which aims at attracting nearly Rs 20,000 crore in investments in the sector, especially in non-leather, by 2025 which could help generate jobs for 2 lakh people.

V Vishnu, Managing Director & CEO, Guidance Tamil Nadu, told DH that the investment from Pou Chen is a result of continuous follow-up and aggressive pitching by the state government after it realised that non-leather footwear manufacturers were looking for favourable destinations outside China and Vietnam.

“The exclusive policy framework for the footwear industry helped us in getting this huge investment. Getting Pou Chen to Ulundurpet is part of our plans to diversify from Chennai and create large-scale employment for people in rural areas. We don’t look just at the quantum of investment but also the employment potential of it,” Vishnu added.

Pou Chen’s major investment pledge also comes close on the heels of another major player in the field Feng Tay signing a MoU with the Tamil Nadu government to invest Rs 1,000 crore for manufacturing athletic footwear in Bargur (Krishnagiri), Cheyyar (Tiruvannamalai), and Tindivanam (Villupuram) providing jobs to another 20,000 people.

Kothari-Phoenix Group and its component manufacturers have also signed an MoU with the Tamil Nadu government to invest Rs 2,740 crore in the non-leather footwear sector creating about 39,500 jobs.

Industry trackers feel the strong manufacturing base that the state built in the leather goods sector over the decades has ensured that there are enough highly skilled workers.

“The success in the leather footwear industry gave confidence to the manufacturers to use their expertise and resources in replicating the same success in the non-leather footwear segment,” an insider told DH.