The Indian Automotive Tyre Manufacturers Association (ATMA) has concerns over the domestic rubber scenario as production reaches historically lower levels. Such low production levels in the range of 55,000 metric tons per month even during the height of the peak season are a matter of grave concern to the industry, ATMA said in a communication to the Commerce Ministry. Notwithstanding the fact that rubber prices in India are ruling 20 percent higher than international prices. the production is showing constant fall. The issue needs to be addressed urgently, it said.
From more than 9 lakh metric tons in 2012-13. the production in India has slipped down to less than 5 lakh metric tons in the first 10 months of the current fiscal year. Such a level of production was witnessed in 1998-99 when the production stood just above 6 lakh metric tons. Given the steep fall in NR production. ATMA said that imports are a must to meet the growing demand of tires from auto and transport sectors. However, the government has continued to put curbs on rubber imports, making it difficult for the industry to source this key raw material at competitive prices. The export obligation period in lieu of duty free import has been reduced to six months and port restrictions have been put in place. High import duties on rubber and much lower duties on finished tires is leading to an indiscriminate surge in import and dumping of tires in India. The latest statistics on tire import for the period April-December 2015 show more than one lakh truck and bus radial (TBR) tires are being imported in India each month. This accounts for 40 percent of the replacement demand for TBRs in India. Close to 90 percent of the import of TBR is from China. the Association said.