The export incentive scheme for natural rubber should continue during the Tenth Plan period for maintaining demand-supply balance in the country and for ensuring international price parity, according to Upasi chairman J K Thomas.
India's natural rubber export of 55,000 tonnes in 2002-03 could not have been possible without the incentive as the world market is unfamiliar with Indian natural rubber, he said.
The export of natural rubber in 2002-03 had helped to deplete the huge stocks of rubber that had piled up in the country. During the April-November period of 2003, exports of natural rubber were placed at 39,045 tonnes compared to 33,490 tonnes reported in the corresponding period of the previous year.
By exporting a small quantity of natural rubber in 2002-03, India has gained recognition as a supplier of good quality rubber. The challenge now is to sustain this trend of high exports, he said.
The rubber consuming segment, especially the tyre sector, has taken the stand that the incentive for natural rubber exports should be scrapped. In this context, Mr Thomas pointed out that Indian exports of natural rubber, accounting for just 1% of the global natural rubber exports and spread across more than 30 countries would not in any way affect the competitiveness of domestic tyre manufacturers vis-a-vis global counterparts.
The Upasi chairman also pointed out that the export incentive schemes available for natural rubber exports is WTO-compatible as these are given to the exporters to meet their costs for packaging, handling and transportation.
He said that the import figures of natural rubber show that the quantum imported into the country defies any economic logic of demand and supply. It appears that imports are effected as a "ploy to depress the domestic prices," he said.