The commerce ministry has turned down the plea of tyre makers to cut import duty on natural rubber to 7.5 per cent from the current 20 per cent according to the Rubber Board.
"Union minister for commerce and industry Anand Sharma has ruled out any cut in import duty of rubber from the present 20 per cent," Rubber Board chairman Sajen Peter said in a statement released yesterday.
In March, the steep rise in natural rubber prices had led the Automotive Tyre Manufacturers Association urge prime minister Manmohan Singh to allow duty-free import of at least 2,00,000 tonne of raw material and reduce import duty to 7.5 per cent or double the customs duty on imported tyre to 20 per cent to help domestic manufacturers.
However, rubber growers feared the reduction in import duty would lead to cheap natural rubber being dumped from ASEAN countries which could trigger a cascading effect on the prices of natural rubber and a consequent a drastic fall in prices in the domestic market.
According to the Rubber Board statement, the commerce minister made his views clear to MPs from Kerala who had called on him yesterday morning according to the Rubber Board statement.
"In the case of import duty, the government would be implementing the recommendation of the expert panel constituted under the directive of Delhi High Court to look into the demands raised in a petition by rubber consuming organisations," Sharma was quoted as saying in the statement.