Growing output-usage gap in raw goods forces imports

Our Bureau

Kolkata, Nov. 23

Members of the All-India Rubber Industries Association (AIRIA), forced to meet their full requirement of all four types of synthetic rubbers through imports, have sought a review of all anti-dumping cases, and withdrawal wherever justified, to protect competitiveness of Indian rubber products overseas.

AIRIA has particularly sought an immediate review of duty on SBR-1900, which is not locally produced anymore.

Briefing newspersons here on Wednesday, after the association's managing committee meeting, Mr K.T. Thomas, President of AIRIA and Managing Director of Paragon Rubber Industries, said the huge gap between indigenous production and consumption of synthetic rubbers was now covered by imports. (During 2005-06, against a consumption of 2,37,495 tonnes, production was a mere 97,634 tonnes.)

According to the AIRIA president, the Indian rubber products sector on Thursday consumes on average 70 per cent natural rubber, 21 per cent synthetic rubber and nine per cent reclaim rubber.

Explaining further, he said out of the four types of synthetic rubbers as made in India, (SBR-1900, HSR, NBR and EPDM), antidumping duties are levied on three of them.

Mr Thomas said anti-dumping duty was levied on SBR-1900 at the instance of Synthetics and Chemicals Ltd, and the company was wound up some seven years ago, though the levy still continues. It is learnt that while levy on SBR-1500 and 1700 has been withdrawn, that on SBR-1900 still continues.

Asked on EPDM, anti-dumping duty on which was imposed from July 2006 on an application by Unimers India Ltd, the sole manufacturer in the country, Mr Thomas said the quality of the indigenous variety was not up to the standard and supplies to consumers too were quite erratic. He said the availability was just 5,000 tonnes per annum against the industry requirement of around 16,000 tonnes.

The Unimers India plant is now said to be out of operation owing to a devastating fire at the factory premises recently, and that the anti-dumping authority has assured suspension of levy of anti-dumping duty till such time as Unimers is able to commence full production.

Pointing out that anti-dumping duty has been levied on NBR, for which there was only a single manufacturer in the country, who under any case does not make all the grades, he said the association has also pleaded for cut in import duty on natural rubber and NR Latex to a maximum of five per cent. He said this would enable Indian manufacturers of rubber goods to outsource the raw material whenever necessary so that the pace of development remains uninterrupted.

Mr Thomas, quoting Rubber Board estimates, said the future annual production growth of NR would be three per cent against the estimated consumption growth of 5.5 per cent, and coupled with the expected rubber industry growth from eight per cent to 10 per cent and projected higher exports, NR production in India may well lag behind consumption in the coming years.

(This article was published in the Business Line print edition dated November 24, 2006)
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