Why Louis Vuitton and Dior can’t bring their shoes to India

Footwear imports by these brands and others have faced hurdles after the government’s quality rules mandating the application of BIS standards for imported footwear, including embossing ISI marks on all footwear sold in India took effect in July 2023, three people aware of the matter said. Under the quality control order (QCO) on footwear, no company can manufacture, import, distribute, sell, hire, lease, store or exhibit any product in the country without the ISI mark. The rules, which were issued in June 2022, took effect in July last year.

In order to import footwear, these global brands may have to meet Indian standards in their European factories. According to one of the three people cited above, who holds the Indian franchise for six international luxury brands, this is a cumbersome affair.

“Each time, the sample must be sent, and for every new material used in the shoe, whether it has the same design or not, will have to go for retesting before being exported to India. I don’t know how this will be achieved, especially in the women’s shoes category,” the person said on condition of anonymity.

Developed by the Bureau of Indian Standards (BIS), the embossed ISI logo is seen domestically as a marker of quality, something the government wants to extend to imported goods as well. However, embossing luxury brands with ISI stamps can significantly lower their value, the persons cited above said. Smaller firms will also struggle to meet the increased compliance burden.

“Most of these shoes are handmade luxury products and they can’t just be delivered in one go. We don’t have anyone to consult with or talk to. Facilities and labs are also not always available. We will be allowed to sell what is already imported, but the new season’s stock is in question. A lot of us just tried to import most of our products during December 2023,” the person cited above added.

In January 2023, Union minister for commerce and consumer affairs Piyush Goyal had asked the local footwear industry to focus on quality and reduce import dependence to gain a larger share in the international market. Goyal said BIS standards need to be followed for better quality and larger production, which eventually leads to good quality products for the consumers.

“This might be an attempt to prevent counterfeiting. However, the government should consider a threshold price for products being imported and ideally luxury goods imported from or made in European countries should be left out of this. If at all it needs to do this, it should go in for a batch certification. Ideally luxury companies should not at all be required to do this because post the implementation of GST there has been a certain relief to sellers and no under billing now happens,” said Abhay Gupta, founder & CEO of Luxury Connect LLP, a consultancy based out of the capital.

The French luxury brands has asked the government for relief on the ground that their factories already meet tighter global quality standards, the second person added. However, the consumer affairs ministry rejected these requests, an official said.

“The government has also asked them to set up their manufacturing units in India as per Indian standards and export to other parts of the globe, besides selling them in Indian markets,” the official said on condition of anonymity.

The quality order does not apply to goods or articles meant for export.

“We have given enough time to all footwear manufactures. They (French shoemakers) claim to make shoes of global standards. If they are so sure about the quality of goods, they should not shy away from adopting Indian standards,” the official added.

Queries emailed to the French companies, consumer affairs ministry and the director-general of BIS, remained unanswered.

India’s luxury goods market is among the fastest-growing in the world, with sales expected to reach $8.5 billion in 2023 according to Euromonitor International. This growth is being driven by a number of factors, including rising incomes, increasing urbanization, and a growing awareness of luxury brands.

While Christian Dior and Louis Vuitton are two of the most popular luxury brands in India, others are also entering the Indian market. In December 2023, Aditya Birla Fashion and Retail Ltd announced a joint venture with Christian Louboutin. Several other brands, including Dolce & Gabbana, Golden Goose, Balenciaga, and Jacquemus are also planning to enter the Indian market in 2024.