Rubber consuming industries have opposed any move to raise import duties on natural rubber and contested Kerala Finance Minister KM Mani’s figures on production-consumption gap.
Gap much higher
The industries say that the gap between domestic production and consumption of natural rubber is much wider than being popularly perceived.
They quoted the Kerala minister’s call for hike in customs duty on natural on the grounds that the gap between domestic production and consumption was only 60,000 tonnes while imports were much higher.
Automotive Tyre Manufacturers Association said in a communication to the Union Minister for Commerce and Industry that the gap between was six times more than what has been stated by the Kerala Minister.
Quoting from Rubber Board data, they said production was 6.55 lakh tonnes (lt) and consumption of 10.19 lt in 2014-15. The domestic production-consumption gap was 3.63 lt and not 60,000 tonnes.
“Domestic production is woefully inadequate to meet the requirements of consuming industries. Imports are therefore inevitable,” said Raghupati Singhania, Chairman of the association.
Prices not hit
Any hike in duty will result in serious damage to the user industries which have been facing adverse consequences of slowdown and sharp and significant rise in import of cheap finished goods including tyres.
User industries rejected the charge that imports have suppressed domestic prices of natural rubber. In fact, they have ruled much higher than international prices in the years that have seen the maximum import. This corroborates the fact that there is no correlation between imports and domestic pricing, said Mohinder Gupta, President, All-India Rubber Industries Association.
“Already rubber MSMEs are at the receiving end of large-scale import of cheap finished goods, he said. – The Hindu