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India's rubber industries have raised the prices of their products by 7% as of May 1, in response to spiraling production costs, according to Anay Gupta, president of the All India Rubber Industries Association. The increase is a direct result of a 15% rise in production costs over the last three months, largely due to the U.S.-Israel-Iran war.
The prices of natural and synthetic rubber have seen significant increases, with natural rubber prices rising by 40% and synthetic rubber by 70%. This has affected the production of various products, including those for the automobile, pharmaceutical, and sports sectors, which rely on a blend of synthetic and natural rubber.
The industry is currently facing a 15% shortage of synthetic rubber and a 15% decline in production at MSME units, despite ongoing high demand. Anay Gupta stated, “However, the demand is still high. We just want some stability in prices.”
The All India Rubber Industries Association has appealed to the government to allow duty-free import of natural rubber for six months, given the current 25% import duty or ₹30 a kg, whichever is higher. The industry will reassess prices in two months and may consider another hike if raw material prices do not stabilize. The government's response to the Association's appeal and the industry's next steps will be closely watched in the coming weeks.