Sharp rise in rubber prices and lesser availability has forced 20% of the non-tyre rubber consuming industries to shut shop, All India Rubber Industries Association, president KT Thomas said. The association represents non-tyre rubber consumers who use 45% of the natural rubber produced in the country.
?Prices of natural rubber have grown alarmingly in the last 3-4 years. High import duty and anti-dumping duty on synthetic rubber and rubber chemicals have pushed up the operational expenses,? Thomas said. He said that more than 1,000 firms have closed down from the total 5,000 and many more have cut down production. The worst affected region has been
Jalandhar, which is home to several SMEs and tiny units manufacturing rubber based components. ?The rubber footwear manufacturing industry has been the worst hit with demand also dropping down due to competition from cheaper plastic based footwears,? said Thomas. ?Production has dropped down by almost 50% from its highest level,? he said. The association recommends ?cluster approach? for rubber manufacturers to stay competitive. ?Common facilities for mixing and other capital intensive process helps in cutting down expenses,? he said. Rubber prices are expected to stay firm as the availability of quality rubber is a serious issue, Thomas said. Tyre manufacturers import rubber to overcome the difficulty of bulk procurement. The industry is demanding lowering of import duty to facilitate expansion of the manufacturing sector. The global rubber manufacturing industry is shifting its base to Asian countries with
China cornering bulk of the investment. ?But quality of the products and process confers on India an advantage that has to be exploited with conscious effort of the entrepreneurs and government,? he said.