Will the government increase import duty?

The natural rubber prices in the domestic market have fallen nearly 20% since 2nd January 2012, when price of RSS4 grade was at `.195.50 per kg, due to slowdown in economy and also on sluggish demand, it is currently trading at `.157 per kg. The current import duty is `.20 per kg, or 20%, whichever is lower.

Rubber growers from Kerala, accounting for about 90% of the rubber produced in India, have asked the government to increase the import duty to protect the growers interests. Now, there is a possibility that government could increase import duties on natural rubber in order to support falling natural rubber prices. 

Commerce and Industry Minister Anand Sharma said there is a need to review the existing duty structure on import of natural rubber. We have sent our recommendations to the Department of Revenue and now it is the job of the Finance Ministry to take a final view on the issue.