Commerce Ministry asks FinMin to cut rubber duty

With a view to help domestic tyre manufacturers, the Commerce Ministry has sought the reduction of import duty on natural rubber.

In a communique to the Finance Ministry, the Commerce Ministry has suggested that import duty on natural rubber should be lowered to either Rs20.46 a kg, or 20 per cent of the consignment, whichever is lower. “The objective is to harmonise the domestic and international prices," a Commerce Ministry official said.

According to the Rubber Board, prices of natural rubber, are at Rs169 a kg in the domestic market, as against Rs163 a kg in the global market. At present, imports of raw rubber attract about 20 per cent duty, whereas the import duty on tyres is 10 per cent. According to Automotive Tyre Manufacturers Association estimates, the industry imports about 150,000 tonnes of natural rubber every year. Imports of finished tyres for trucks and buses stands at about 125,000 tonnes a month, while passenger car tyres account for 250,000 tonnes a month.