| Date: |
03-03-2015 |
| Subject: |
Budget 2015 fails to erase rubber sector's woes |
KOCHI: With none of its grievances redressed in the Union Budget, the country's rubber sector is now back to square one — reeling under a price crash that has made survival for small plantations difficult. The finished rubber products segment, including tyre companies, was expecting a few duty reliefs to face the increasing threat of importing products, especially from China.
Natural rubber producers were looking for a hike in the import duty, from the present 20%, in the Budget. Last year, natural rubber imports touched a high of 3,25,190 tonne and this year, till the end of January, the imports have shown a 14%-increase and is likely to touch 400,000 tonne by the year-end.
"Our plea to raise the import duty has not been addressed in the Budget. On the other hand, the 2%-surcharge will be a burden for us this year as we have not been doing well because of the price crisis. The relief from phased reduction of corporate tax reduction will happen only from next year," said C Vinayaraghavan, chief executive of Harrisons Malayalam.
The producers are getting much less than the official rates published by the Rubber Board, around Rs 140 per kg, and it would be difficult to carry on in the current circumstances unless there are some relief measures, added Vinayaraghavan, who is also the chairman of Association of Planters of Kerala.
The United Planters' Association of Southern India president Vijayan Rajes said: "There were several representations from various segments of the plantation sector, including the state governments' involvement and we were expecting an enhancement of the import tariff from the existing 20% and there were positive indications from the central government to that effect."
He hoped that corrective measures will be incorporated to safeguard the rubber growers before the Budget is passed. Though the tyre industry is happy at the measures to expand roads, its demand for increasing import duty on tyres has not been considered. The sector had argued against demand of rubber producers to increase duty on rubber saying it should be brought down further to help the industry.
"Given the government's emphasis on manufacturing, we were confident of correction in inverted duty structure. We hope the government will consider our submission for correction in inverted duty by either reducing import duty on natural rubber or by increasing duty on tyres," said Raghupati Singhania, chairman of Automotive Tyre Manufacturers' Association (ATMA).
Source : economictimes.indiatimes.com
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