Local natural rubber growers in India aim to raise production

August 25, 2017

rubberWith the imposition of anti-dumping duties against Chinese tyres by the Indian central government, local natural rubber (NR) growers are looking to increase their rubber production.

It is pointed out that the import of 100,000tyres is equivalent to the consumption of almost 3,000 tonnes of rubber in a month. If tyre companies turn to the domestic market to source rubber, this would benefit growers, thereby making production more remunerative, said George Valy, President of the Kottayam Rubber Dealers Association.

A subsidy scheme for NR production announced by the Kerala government, and the revival of the monsoon, would help production exceed the 60,000-tonne mark in August. Rubber Board data have also cited a 7.5% rise in production till July.

Satish Sharma, Chairman, Automotive Tyre Manufacturers Association (ATMA) said any step to prevent dumping of tyres would help the entire value-chain of the sector, including a million-odd rubber growers. An indiscriminate surge in the import of Truck & Bus Radial (TBR) tyres from China has been a lose-lose proposition for the stakeholders both in rubber and tyre sector.

Quoting a study, Sharma said the increase in import and dumping of TBR tyres had led to an indirect import of 46,219 tonnes of rubber in the FY17. In fact, such import of rubber through imported TBR has been on the rise in the last three years.

From 23,000 tonnes in FY15, the indirect import of rubber through imported TBR has doubled to more than 46,000 tonnes in FY17. More than 100,000tonnes of rubber have landed in India in the last three years through TBR import.

However, PC Cyriac, Working President of the Indian Farmers Movement (Infam) was of the view that either anti-dumping duty or safeguard duty should be levied on all other cheap products being imported from China to help the local industry survive.

However, the government has chosen to levy this duty only on tyre imports, purportedly to please the tyre industry. At the same time, natural rubber is continuously being imported into the country in huge quantities, at a low import duty. These huge imports have ruined the small rubber growers and the indigenous production of natural rubber has fallen from 900,000 tonnes to 600,000tonnes.

The Centre can levy safeguard duty on the imported rubber and thus save the small rubber growers. But while levying additional duty on tyre imports, the government has not taxed additional duty on rubber imports. The requests made by the small rubber growers for levying the safeguard duty on rubber imports are kept pending by the Commerce Ministry for more than a year without any action.

“Obviously the government is keen to make the tyre industry more profitable, is not willing to save the small rubber growers who are sinking,” he added.

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International Rubber Prices
(as of 15, September 2017)

Monthly The prices shown above do not include VAT @4% on purchase and expenses towards packing, transportation, warehousing  and other incidentals


Source: India Rubber Board

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