Tuesday, 29 October 2013 01:11
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KOCHI: With natural rubber prices falling to Rs. 159 a kilogram (RSS-4 grade), from around Rs. 240 this time last year, farmers organisations and political parties in Kerala have demanded a ban on the import of rubber.
The Opposition Left Democratic Front (LDF) has called for a hartal on 30 October in Kottayam district, the rubber heartland, to press the Union Government for a ban on the import of natural rubber.
Earlier this week, the farmers wing of the Kerala Congress (Mani), which is a partner of the ruling United Democratic Front (UDF), took out a march to the Raj Bhavan in Thiruvananthapuram seeking an end to rubber imports.
“We want the Centre to stop import of rubber altogether for now,” M.T. Joseph, the Kottayam district convenor of the LDF, told Business Line. “When the domestic price crosses Rs. 200 a kilogram, the government could consider limited imports.”
He said that the Centre had, back in February, made a decision to impose 20% import duty on rubber, but that had been put in cold storage.
The rubber price has always been a sensitive political issue in Kerala because of its importance in the State’s economy and the clout of the socio-religious groups associated with rubber cultivation and trade. And, the rubber price level to a large extent determines the consumption pattern of a significant section of people; a decline in the price easily gets reflected in the sale of consumer durables and white goods.
Rain and drought
The long rainy season this year, preceded by a long spell of drought, coupled with the price downfall has exasperated the economic condition of the smallholders who make up the huge majority of rubber farmers in Kerala, who produce close to 90% of India’s rubber.
International prices of rubber have fallen too, in the wake of the global slowdown, especially in the automobile industry. Since the international prices have been ruling lower than the domestic prices (around Rs. 156 a kilogram now), Indian tyre manufacturers prefer imports.
In the past eight months, 170,000 tons were imported. In August, imports shot up to a record monthly high of 42,500 tons.
“If the imports continue at this rate, the domestic prices will tumble,” said Joseph. “The only way to arrest the price fall is a total ban on imports.”
He said that though the Government had decided to impose 20% customs duty on rubber imports in February, following the constant pressures by the Kerala Government and political parties, the Finance Ministry had not notified it. (The Hindu Business Line)
