The Hindu Business Line : ‘Allow duty-free import of 1 lakh tonnes rubber’

Kolkata Jan. 11 The All India Rubber Industries Association (AIRIA), citing heavy shortage of natural rubber (NR), has pleaded for the duty-free import of 1 lakh tonnes of rubber through a designated agency for distribution to the domestic sector. This is because 49,800 tonnes of NR, as imported under Duty Exemption Entitlement Certificate licence, are meant for export production with no relevance to domestic demand.

The president of AIRIA, Mr M.F. Vohra, said the rubber goods sector needed to be unshackled from many controls that were holding back the industry’s growth. He told Business Line that while opportunities exist across all sectors of the rubber industry, key constraints like uncertain supply situation, volatility of NR prices, high import duties on NR and latex, and the extra cost burden owing to anti-dumping duties (on items like EPDM rubber) need to be eliminated without any further delay.

The rubber goods sector comprising some 6,000 units (large scale, medium and tiny sector) and commanding an annual turnover of nearly Rs 29,000 crore, employs close to four lakh persons.

Citing high input costs and NR availability as the two main constraints currently facing the Indian rubber industry, Mr Vohra said the consumption of NR may well outstrip production, especially after the NR production loss in the last few months owing to chikunguniya and excess rains. The shortfall could amount to around 1 lakh tonnes, and may also lead to a further spurt in NR prices, it is feared.

Pointing out that an inverted duty structure on rubber and latex has been allowed to continue throughout the year, Mr Vohra said while duties on finished rubber products had been brought down to 10 per cent, duties on NR and latex had remained unaltered at 20 per cent and 70 per cent respectively.

Commenting on the Association’s plea to the Government to remove NR from the commodity list of futures trading, he said it had benefited neither the planters nor the consumers of NR. Citing manipulation in prices through futures trading, AIRIA is of the view that quite a few traders and fly-by-night operators involved in futures trading were still not registered with the Rubber Board. He lamented that there were still no concerted efforts being made to regulate such traders.

Mr Vohra said though port restriction on NR import has been lifted, the time-consuming compulsory inspection of imported NR through quality checks by the Rubber Board personnel was still continuing, much to the chagrin of the industry. This was said to result in the holding up of export consignments at the port and thrust additional detention/demurrage charges affecting the export trade.

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

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