The Hindu Business Line : `Withdraw CVD on imported tyres'

The All India Tyre Dealers Federation (AITDF) on Tuesday demanded withdrawal of 16 per cent countervailing duty (CVD) on imported tyres. The total incidence of duty, including CVD on imports, is currently 37.5 per cent.

In a submission before the Union Commerce Ministry, the federation has stated that withdrawal of the CVD would pep up competition in the tyre sector in the country, resulting in a likely check on prices. The tyre sector has witnessed a substantial degree of consolidation in the last few years, resulting in a drop in the number of players.

APOLLO Tyres to hike prices

Meanwhile, a day after JK Tyre announced its plan to enhance prices by up to eight per cent to counter input cost increases, Apollo Tyres Ltd on Tuesdayintimated its dealer network a 4-6 per cent price increase beginning first week of June.

According to the AITDF, the rest of the tyre industry has already given broad hints that they may soon follow suit. MRF Ltd effected a price increase on light commercial vehicle tyres recently.

Mr S.P. Singh, Convenor of AITDF, told Business Line that while there was no denying that rubber prices had shot up from Rs 55 to Rs 100 a kg during the last two years, the Government had also reduced the excise duty from 32 per cent to 16 per cent during the same period.

"However, tyre makers did not pass on the benefit of reduction in excise duty to the customer. Moreover, prices were increased by 19 per cent over the benefit of excise duty," he said, adding that tyre makers have a track record of effecting a hike in price whenever rubber prices go up.

More Stories on : Tyres | Exports & Imports | Excise and Customs

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page