Rubber Board Chairman, A. Jayathilak, has urged the industry to participate actively in the discussions on anti-dumping and safeguard measures organised by the Government.
In his inaugural address at the national rubber conference organised by the All India Rubber Industries’ Association (AIRIA) at New Delhi, the Chairman said the influx of cheap imports from China is hurting the rubber MSME sector.
The tariff concessions offered under Free Trade Agreements could be leading to a surge in imports. The dumping of finished rubber products also could not be ruled out, which is causing distress, especially for the MSME rubber sector, he said.
Jayathilak said the Rubber Board places equal importance on the development of both natural rubber producing and consuming interests.
According to Mohinder Gupta, President AIRIA, the domestic production of natural rubber and some of the synthetic rubber is far less than consumption. In the last fiscal, the production of natural rubber in India was about 50 per cent less than domestic consumption. Not only was the availability of natural rubber in short supply, domestic rubber prices were ruling 20 per cent higher than international prices.
The import duty on raw materials of the rubber industry were much higher than the duty on finished products. Finished rubber products could easily be imported as the import duty on rubber products was between 0 to 10 per cent, while the duty on natural rubber was 25 per cent and the import duty on latex was 70 per cent.
This inverted duty structure has forced many rubber product manufacturers to turn traders of Chinese rubber goods and stop manufacturing, leading to shutting of plants and job losses. Especially, moulded rubber goods, rubber compounds, rubber rice rollers and balloon manufacturers have been severely impacted, he said.
AIRIA has reiterated its demand for a separate Rubber Export Promotion Council (Rubexil) to maximise the export potential of the industry.
He said India’s share in the international rubber exports market was a paltry 1.48 per cent while that of China was 11 per cent. The country’s share could easily be enhanced to 5 per cent in the next 5-7 years and India’s ranking could rise to fifth from the current 19th if the government addresses the problems faced by the rubber sector, he said.