Government of India has approved import of 40,000 tonnes of natural rubber at the concessional import duty of 7.5 per cent.
According to notification dated 17 January from the office of the Director General of Foreign Trade the approval is a follow up on the earlier Customs notification issued on December 22, 2010 in this regard.
As per the notification, 40,000 mt of natural rubber could be imported under Tariff Rate Quota (TRQ) scheme by actual users and their quota would be decided on the basis of their actual consumption during 2009-2010. The import under TRQ would have to be completed before March 31. The last date to submit application for TRQ allocation is 24 January.
Meanwhile, rubber prices continued to rule at the record Rs.225 per kg ($ 496.69 per 100 kg) in Kottayam market for the second day on Tuesday. According to Mr George Valy, president of Indian Rubber Dealers’ Federation (IRDF) the flow into the internal market has been affected severely pointing to hoarding by producers.
Mr Valy pointed out that the farmers who hold the produce are fully aware of the international situation and the only way to bring more rubber into the market was establishment of parity with the international prices. As on Tuesday, NR prices at Bangkok remained at Rs.252.5 a kg ($ 554.45 per 100 kg).
The relaxation of the import duty will not have any negative impact on the buoyant market conditions, according to Mr Valy. Under the present situation, the Indian prices are far lower than the international prices and manufacturers can get NR at a landed cost of Rs.240 per kg including VAT and transportation charges. However, the the imported NR may cost as high as Rs.275 a kg even under reduced import duty regime, after providing for transportation and taxes.
However, a sudden spurt in inflow of NR on account of the psychological impact of the news during the next two or three days cannot be ruled out, he said. With the lean season expected to set in during the next month the scenario may get even grimmer Mr Valy said and added that this year might witness an extended tapping season as farmers might continue their tapping well into the lean season in view of the spiraling prices rice for their produce.
