Tyre manufacturers in India are set to lose competitiveness in global markets amid fears of a spurt in the price of locally available natural rubber, due to import restrictions imposed on this key raw material by the government.
In a recent notification, the Directorate General of Foreign Trade (DGFT) said that facility for importing natural rubber under advance authorisation issued or revalidated on or after January 21 will not be available until March 31. A similar notification, dated a day earlier, allowed import of natural rubber of all varieties only through sea ports of Chennai and JNPT.
Restrictions on import of natural rubber - the crucial raw material on which India is import-reliant up to 52 per cent of the country?s overall consumption - is likely to raise its prices resulting into proportionate increase in the cost of production. Since Indian exporters have been facing huge competition from countries like China and Vietnam, further escalation in the production cost would push India out of the export markets.