The Hindu Business Line : Tyre cos planning more rubber imports

TYRE companies in the country are planning to substantially increase their quantum of natural rubber imports. The move to contract more imports is aimed at containing the current flare-up in the prices of RSS 4.

"ATMA member companies are looking at contracting another 30,000 tonnes of natural rubber import before the end of March next year. In the first half of the current fiscal, about 12,000 tonnes have been imported," the Director General of the Automotive Tyre Manufacturers Association (ATMA), Mr D. Ravindran, told Business Line here.

RSS 4 prices touched a five-year high on Thursday at Rs 43 per kg. "Today (Friday) the price has touched Rs 45 per kg when the international prices are at Rs 39.50 per kg. Despite various restrictions on imports, tyre companies will go ahead and import, even though they will be duty paid imports," Mr Ravindran said.

Tyre companies are hopeful that the facility of zero-duty imports under advance licence will be restored by February next year. ATMA has also petitioned the Government, in its pre-Budget memorandum, to bring down the basic customs duty on natural rubber from 25 per cent to 10 per cent in the next year's Budget.

ATMA has, in its pre-Budget memorandum, suggested that the roadmap for reduction in customs duty, announced in the Finance Minister's Budget speech for 2002-03, should be advanced from 2004-05 to 2003-04 in respect of natural rubber.

The Finance Minister had stated that by the year 2004-05, there would be only two basic rates of customs duties, namely 10 per cent covering raw materials, intermediates and components and 20 per cent generally covering final products.

Mr Ravindran said that ATMA would once again petition the Commerce Ministry for removing the current "port restrictions" which essentially permitted imports of natural rubber only through two ports of the country.

According to industry estimates, total imports of natural rubber during 2001-02 stood at 49,767 tonnes. While imports of natural rubber (sheet) stood at 17,757 tonnes, imports of natural rubber (TSNR-block) stood at 12,477 tonnes. Total imports of natural rubber during 2000-01 stood at 8,969 tonnes (lower import as STC scheme was in operation).

While domestic production of natural rubber was estimated at 6,31,000 tonnes during 2001-02, the consumption level was about 6,38,000 tonnes.

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