Rubber industry sets up RSSC

National Skill Development Corporation (NSDC) and All India Rubber Industries Association (AIRIA) have formed a Section 25 company - Rubber Industries Sector Skill Council (RSSC) for the development of labour intensive rubber industry. Under the RSSC project, the number of trainees to be certified over a period of 10 years will be close to 700,000 with another 300,000 in-service personnel.

An MoU has been signed between NSCD and a partnership formed between AIRIA and Automotive Tyre Manufacturers Association (ATMA) to jointly promote RSSC. The MoU was signed by chief executive officer and managing director of NSDC - Dilip Chenoy and AIRIA president - Vinod Simon, in the presence of Rubber Board chairperson - Sheela Thomas and ATMA vice chairman - Anant Goenka. AIRIA and ATMA will jointly infuse equity in RSSC. NSDC has agreed to fund the formation and operations of the RSSC through a combination of grant and loan.

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TOCOM indicating upward trend

Natural rubber in the international market showed a mixed trend because of uncertainty over demand from China, Thai rubber intervention plan, which is scheduled to start from 22^nd March and lean production season in major natural rubber producing countries. Natural rubber supply in Thailand is expected to fall as rubber trees will stop producing latex during the dry season.

There is an indication that China's auto sales this year may not be able to reach 5% growth because of the difficult macroeconomic situation, which in turn will dampen auto demand. China Rubber Industry Association (CRIA) has urged government authorities to call off customs duties for imported rubber to protect domestic tyre industry.

Natural rubber in the Indian market continued to rise. Today, RSS4 grade closed at `198 a kg at Kottayam and RSS3 grade closed at `199.45 from `200.52 a kg at Bangkok. In futures, the April series were trading at `200.32, May at `204.99, June at `208.40, July at `207.54, August at `205.98 and September at `204 a kg on NMCE. The March futures for the grade closed at ¥314, April at ¥315.2, May at ¥319.7, June at ¥324.5, July at ¥328.5 and August at ¥332.4 on the Tokyo Commodity Exchange.

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Union Budget 2012-13

Budget 2012-13 Highlights

It will be a normal Budget

Indian Finance Minister Pranab Mukherjee will present the Budget 2012 on Friday against a backdrop of slowing economic growth. The government will have to do a balancing act, by raising taxes on some items and give incentives to boost industries confidence.

The government may look at increasing its revenue by way of rolling back stimulus provided during the 2008-09 crises, by increasing excise duty on certain items and service tax net could be broadened and also may increase customs duty on selected import items to boost local industry. The finance ministry may also announce incentives to encourage higher spending on research and development.

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AIRIA seeks removal of anti-dumping duties

In a pre-Budget submission to the finance ministry, the All India Rubber Industries Association (AIRIA) has said the levy of duties has made the raw materials expensive in comparison to imported finished products. High interest cost and energy rates had led to many of the SME units shut down their operations. Hence, the industry has called for the removal anti-dumping duties on import of raw materials like rubber chemicals and carbon black. It also demanded an immediate import of 1 lakh tonnes of natural rubber to bridge the supply-demand gap, as the consumption of natural and synthetic rubber is constantly increasing as against production.

The rubber products are being imported into the country at normal rate of duty without any anti-dumping provision. With over 15,000 rubber products, it is difficult to prove the dumping charges and most of the manufacturers are in the small scale category that does not have the resources to initiate the anti-dumping procedures as per law, said Vinod Simon, president of AIRIA.

According to AIRIA, the import of even those raw materials which are not indigenously produced is subjected to high rate of custom duty, making it difficult for the rubber industry to survive and to compete against import of finished products. The association has asked for waiver of customs duty on raw materials not manufactured domestically like butyl rubber, SBR grade 1500/1700 and other hi-tech synthetic rubbers, EPDM and polyester tyre cord.

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Estimated natural rubber scenario

Indian economy recorded a growth of 6.1% in the third quarter of 2011-12. Natural rubber in the Indian markets seems to be on a consolidation mode. RSS4 grade rubber in the spot market have been trading firmly between Rs.187-Rs.188.50 per kg during the previous week. Higher stock estimates and imports, consistent rise in natural rubber production and lackluster demand from the major rubber consumers may keep markets under pressure and it seems that the price may touch Rs. 183 per kg mark during the week.

Amid lean production season, rise in natural rubber prices in the international market probably may lead to a recovery in the local markets after the dip. RSS4 grade rubber currently being on a discount to Bangkok RSS3 grade and difference in prices prevailing in the local and international market may open up possibilities of exports.

The estimated natural rubber scenario for 2011-12 according to Rubber4U would be as given below:

Period	NR Prod.	Import	NR Cons.	Export
April-January 2011-12	784400	157000	799980	24150
February 2012	60800	12000	78700	1650
March 2012	57800	6800	81000	2700
Total (2011-12)	903000	175800	959680	28500

Natural rubber may advance in the next two months because of a seasonal reduction in output and increasing demand from China and India.

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