Kottayam: The sharp rise in the import of compound rubber has raised concerns for local rubber farmers, as it threatens to undercut prices and disrupt the domestic market. Between April and August of this year, India imported a total of 93,000 tonnes of compound rubber, marking a massive increase compared to the 63,000 tonnes imported during the same period last year.

Falling prices due to increased imports

The surge in compound rubber imports has led to a fall in the price of RSS 4-grade rubber sheets, a major product for farmers. The price of these sheets has dropped from Rs 255 per kg in August to just Rs 170 per kg. As a result, many farmers have reduced their rubber tapping activities, leading to a shortage of the product in local markets.

ASEAN imports fuel the surge

A major portion of the compound rubber imported into India comes from ASEAN countries (Association of Southeast Asian Nations), which contribute about 70 percent of the total imports. The current import duty system benefits rubber imports from ASEAN countries, as no duty is imposed on these goods. In contrast, imports from other countries are subject to a 25 percent import duty. 

Rubber Board's recommendation for change

In response to the surge in compound rubber imports, the Rubber Board has recommended to the Union Ministry of Commerce and Industry that a 25 percent import duty be levied on compound rubber from ASEAN countries. The Board argues that this move would help protect the interests of domestic farmers and stabilise the rubber market in India.

Heavy rains in rubber-producing countries have caused a slight dip in global production, leading to a modest rise in prices as well.