The blame, according to him lies mainly on the producers and consumers (manufacturers). They appear to have totally ignored the quality aspect of the export market. They have limited themselves to the domestic market, mainly because they were under a belief that this market would not impose quality standards, he added.

But `globalisation is an inexorable march and cannot be reversed'. Umpteen challenges become manifest. Developing countries have to compete with the developed ones, who have to rise to the occasion and not except free aid.

Indian producers have to meet global quality standards, even if it is for domestic consumption or export. They cannot cut corners on quality and reap huge profits.

`Tan Sri Shekhar', born in Malaysia, has been in the rubber world for the last 35 years and had played a major role in the modernisation of the rubber industry in Malaysia. He has held a major position in international rubber organisations like the International Natural Rubber Agreement, International Rubber Study Group, International Rubber Research and Development Board.

Price, according to Mr Shekhar, is not determined by supply-demand balance in a free commodity market. "Speculation, hedging and subjective trading prices, such as paper rubber have a more influential role in determining prices in the world NR commodity market. Both producers and consumers (manufacturers) of NR are helpless in the face of manipulations."

He pointed to the case of tyre manufacturers and said that a Rs 15-25 change in rubber prices, will have little impact on the tyre cost. In the prevailing condition, the intrinsic value of natural rubber to the naufacturer can be as high as Rs 70 to Rs 80 per kg. But the tyre manufacturer will be influenced by his competitor and will pay nothing more than the competitor pays. In contrast to this under-valuing of NR, he cited the case of carbon black where tyre manufacturers pay a high price. NR producers should learn from carbon black producers as to how the product should be marketed, Mr Shekhar felt.

NR producers should realise their strength and know that `the wheels of the world's industries in transportation and engineering will grind to a halt without NR'. A welcome move on these lines was being made by Malaysia, Thailand and Indonesia, to form a cartel and determine a price at which rubber will be sold. He says that they should sit with tyre manufacturers and fix the price. Though the cartel has said it would not sell rubber at less that a dollar for a kg, he felt that they along with the tyre manufacturers could settle for something of a shade lower.

In the Kerala context, he said the globalised world presents Kerala some very attractive avenues of approach to viability and prosperity. Have only one grade of standard latex for concentrate and raw rubber, both designed for the export market. Let domestic consumers compete for the domestic material, or else import. The production and export of specialised rubbers commanding lucrative premiums for export. The production of value-added compounds and semi-manufacturers for the domestic market.

The establishment of a solution SBR plant to produce attractive SR (synthetic rubber)-NR blends for the world markets. As raw materials are available here itself, Kerala should go in for rubber-based manufacture.

However, the state should realise that there should be labour productivity and stability matching world standards. He said that this was being emphasised as Kerala `has a particular problem in this regard'.

Also, Kerala has a great chunk of of small holders. For this there should be a socio-economic enterprise. This enterprise should have private participation. But around 30-40 per cent of the profit should be set aside for socio-economic benefits of the small holders.