The United Planters Association of Southern India (Upasi), the apex body of south Indian planters, on Friday requested the Centre for an immediate moratorium on natural rubber (NR) import for a minimum period of two years to help the 1.32 million rubber growers. In a letter to the Union commerce and industry and railway minister Piyush Goyal, AL RM Nagappan, president of Upasi, stated the current status of NR farmers who have been going through a severe crisis due to the steep fall in prices for the past eight years.
The prices have been far below the cost of production and the main reason being unrestricted surge of cheap imports into the country from Southeast Asian origins. The spread of Covid-19 pandemic and the consequent lockdown implemented turned out to be a double whammy as the NR production came to a grinding halt and the current situation is threatening the very existence of the sector.
The opening stock of NR as on April 1, 2020, in the country estimated at 3.4 lakh tonne, roughly translates to six months of production, which further reiterates the need to declare import moratorium, Upasi sources said.
Stating that NR import has increased from 77,762 tonne in 2008-09 to 5,82,351 tonne during 2018-19, he said imports as a percentage of production had increased from 9% in 2008-09 to 89.5% in 2018-19, while imports as a percentage of consumption increased from 8.9% to 48.1% during the corresponding period.
Nagappan requested the government to introduce safeguard duty on NR imports for a period of three years post-removal of NR import suspension. This, he said, will give additional time for the domestic natural rubber Industry to recover from the damage caused by imports and enable the growing sector to stand on its feet.
NR import from Indonesia, Vietnam, Malaysia and Thailand accounted for 42.2%, 19.7%, 10.7% and 9.8%, respectively, and together made up 82.4% of the total imports during 2018-19. These NR import facts provide a very strong case for imposing safeguard duty by the government, suo motto, he added.
He also mentioned that given the magnitude of crisis it has become extremely important on the part of the government to take a bold decision in declaring moratorium on NR imports to protect the domestic NR sector which provides livelihood to 1.3 million growers and also prevent the foreign exchange outgo which was `6,127.7 crore in the year 2018-19.