KOCHI: The surge in imports of finished rubber products has seen Indian rubber MSMEs facing dumping charges and demanding an increase in import duty on finished rubber products to 30%. Currently, the import duty on finished rubber products is 0% to 10%.

All India Rubber Industries Association All India Rubber Industries Association (AIRIA) According to statistics, the total imports of rubber products in India increased from Rs. 418 billion to Rs. 9202 billion during the 4-year period of 2015-16, an increase of 120%.

“India has one of the highest tariffs on raw materials and lowest tariffs on finished rubber products. This reverse tariff structure has led to an 80-90% surge in imports of industrial products. Finished products can be avoided as the domestic rubber production facilities are able to meet the demand, but different imports are taking place, especially in the context of lower import tariffs on rubber products under free trade agreements.” AIRIA K Kamal, President said said.

According to AIRIA, import tariffs on rubber products range from 0% to 10% and import tariffs on raw materials for the rubber industry range from 5% to 70%, making it easy to import finished products. Not only the high import duty on raw materials, but also the tariffs imposed on non-domestic raw materials increase the cost of production in India.

Finished products made of natural rubber are imported duty-free from Asian countries such as China and Sri Lanka, while natural rubber imports are subject to a tax of 25% or Rs 30/kg, whichever is lower. China, Sri Lanka and other Asian countries have an import duty of 8% on balloons, gloves and dipped products made of latex rubber and 70% on latex rubber, AIIA said.

India has the lowest import tariffs on finished rubber products as compared to other rubber consuming countries, which helps India to import goods. For example, pipes, ducts and hoses are subjected to more than 10% import duty in China, whereas in India the import duty on these products is 6%. Rubberized sausage meal, widely used in rice mills across the country, can be imported duty-free from India, but Chinese tariffs are as high as 80%.