Application of Time Series Modelling for Predicting the Export Potential of Indian Leather Footwear

Abstract

Indian leather industry plays a vital role in contributing towards Indian economy. Also it is the core strength of the Indian footwear industry.  According to the Indian leather industry about 37% of the total leather export value is from leather footwear. This shows the importance of studying the trends in leather footwear export, to assist in decision making process. This article proposes a time series model based on monthly export values of leather footwear from India during January, 1999 to March, 2013. In this article based on the information criterion, we identified ARIMA (1, 1, 1) (1, 2, 2) model as a reasonable model to predict the export values of leather footwear from India. This proposed model is used to forecast the export values of leather footwear for the year 2013 – 2014.

Keywords: AIC, BIC, leather footwear export, forecast, SARIMA model, time series