The rubber industry will urge the Centre to look into the possibility of floating rubber bonds to encourage higher acreage under cultivation as the industry fears shortage of domestic natural rubber production in the wake of a likely increase of 30% in tyre production by 2010.
The natural rubber production in India increased from 98,884 tonne in 1971 to 6,28,940 tonne in 2000-01, and 8,53,290 tonne in 2006-07. The production touched nearly 8,25,000 tonne in 2007-08. Import of natural rubber also increased from 383 tonne in 1971 to 9,855 tonne in 2000 and 48,312 tonne in 2006.
Meanwhile, the cumulative growth of the passenger vehicles segment during 2007-08 was 12.17%. TK Mukherjee, vice-president of the All India Rubber Industries Association (AIRIA), said the Centre might look into floating rubber bonds to encourage higher acreage, as production grew by merely 25,000 tonne per year in the last couple of years. The demand for rubber in the tyre and non-tyre segments is likely to increase by almost 2 lakh tonne by 2010.
Sawar Dhanania, chairman of the All India Rubber Industries Association (eastern region), said the small car segment would add to the consumption to a large extent. Tyre production units consume about 55% of total rubber production in India. Production of tyre grew from 62.9 lakh units in November 2006 to 65.40 lakh in November 2007, a growth of 5%. Average monthly production also increased from 60.73 lakh units in 2006-07 to 66.11 lakh in 2007-08, up 9%. The area under cultivation grew from 5,66,555 hectare in 2000-01 to 6,15,200ha in 2006-07. “This will not be sufficient as future projections of auto companies are much bigger,” Dhanania said.
Passenger cars, light commercial vehicles, tractors and two-wheeler segments, apart from increase in industrial usage, have attributed to the growth. The average monthly production of passenger car tyres grew from 11.61 lakh units in 2006-07 to 13.31 lakh in 2007-08. The average monthly production was 5.65 lakh in 2000-01.