The demand of the Automotive Tyre Manufacturers Association (ATMA) for duty-free import of natural rubber is unreasonable and unwarranted, according to the Indian Rubber Growers Association.
Mr Siby J. Monippally, General Secretary of the association and Member of Rubber Board, said natural rubber has been included in the negative list consciously by taking into account the socio-economic significance of the commodity in India.
DEPB ROUTE
The consuming industry could avail the channel of advance licence channel (Duty Entitlement Pass Book) to meet the domestic shortage, he said.
The ATMA demand must be seen against the background of a recent initiative by all stakeholders — producers, processors and consumers — to enhance the quality of rubber produced and to achieve the target of 15 lakh metric tonnes (mt) by 2020. Here, stakeholder interests compliment each other. Also, a unique initiative of linking rubber growers directly to the consuming industry is also in the making.
Mr Monippally said the consuming industry also should seek to commit new investments in the sector to become globally competitive.
The domestic tyre industry must also ensure every support it needs to restrict the liberalised import of used and inferior quality tyres. Import duty of used tyres should be enhanced to 20 per cent.
Rubber is the only crop that provides inclusive growth to growers and sustainable development to areas where it is grown.
It has changed the socio-economic life of people in the traditional growing areas of Kerala and Tamil Nadu as well as the non-traditional Tripura, Assam, Meghalaya and Karnataka.
The rubber sector has been instrumental to a large extent in containing insurgency in Tripura and the rest of the growing areas in the Northeast India.
Growers are satisfied with the reasonable price of the commodity now, which encourages them to go for new plantation and re-plantation.
ADVERSE IMPACT
Any change in the present scenario will adversely affect the confidence of the small rubber growers who constitute 90 per cent of the growers and who produces 92 per cent of natural rubber.
Natural rubber market all over the world is now integrated and domestic rubber prices are always in conformity with the international price.
Rubber growers have taken care to ensure continuous and uninterrupted supply of natural rubber to the consuming industry.
The consuming industry imported a little more than 1.14 lakh mt of natural rubber during 2010-11 through duty-free channel, which was more than the requirement. The production was 8.61 lakh mt and the consumption 9.47 lakh mt.
The projections for production and consumption during 2012-13 are 9.42 lakh mt and 10 lakh mt respectively. The shortage will be 64,000 mt, which could be easily made good through the duty free channel of imports.
The industry will be entitled to import 1.3 lakh mt without import duty on the strength of its exports achieved. An opening stock of 2.3 lakh mt will be available by April.
Till now this year, total imports were to the tune of 1.59 lakh mt, of which 70 per cent was routed through advance licence channel.
The industry imported only 19,000 mt at 7.5 per cent concessional duty, where they are legally entitle to import 40,000 mt until March 31, 2012. vinson@thehindu.co.in