Asean pact not to hit Kerala’s products – Rubber traders’ body : Is it true?

Asean pact not to hit Kerala’s products: Rubber traders’ body

Kochi, Aug. 25 The Cochin Rubber Merchants Association said that most of Kerala’s products are well protected under the recently concluded India-Asean agreement, which is expected to boost the trade between India and the member countries to $50 billion within a year.

Mr N. Radhakrishnan, President of the Association, said in a statement that an impartial assessment of the entire structure will show that Kerala need not be unduly worried about the Asean Agreement.

Kerala must try to maximise the market share among the Asean countries by taking advantage of its natural resources, technology and skilled manpower. The promotional measures adopted by countries such as Vietnam in the agri field are worth emulating.

There is concern in Kerala about the implications of the agreement on the State’s agricultural and marine products. However, a closer look at the aspects of the agreement relevant to Kerala’s economy shows that the apprehensions are unfounded.

He pointed out that coconut, rubber, cardamom, turmeric, vegetables, vanilla, ginger, cashew kernels and black tea are placed under Exclusion List and the existing duty on these items will not be reduced until India agrees with the member countries. He said that tariffs on items under the Exclusion List shall be reviewed each year by the member countries with a view to improving market access. Coconut is placed under Exclusion List with a 70 per cent duty, which will not change till 2019.

Rubber is placed under the Exclusion List with a 70 per cent duty on latex and 20 per cent on others with no change till 2019. Duty on rubber can be reduced only if India opts for it, which is quite unlikely.

Cardamom is placed under the Exclusion List with a 70 per cent duty with no change till 2019. Ginger and turmeric are also placed under the Exclusion List with 30 per cent duty each with no change till 2019.

Tea is placed under Special Products with existing duty of 100 per cent which will be regressively reduced to 45 per cent by 2019. Kerala’s share of production is only 6 per cent.

Coir Yarn and Coir Products are placed under the Normal Track with a duty of 10 per cent which will be reduced to zero within five years. Our major exports of these products are to countries outside Asean, he said. Already there is an acute shortage for coir fibre due to the heavy fall in production of coconuts in Kerala. Import of coir fibre from Asean nations for reprocessing, value addition and exports will generate more employment in the State and also give a fillip to the coir industry.

Courtesy : thehindubusinessline

Remarks:

India is self sufficient in production of Natural Rubber compared with  consumption. Now near about 98%  of imports are on ZERO percent import duty which is more than 80,000 Tonnes per year. When the rubber market is with  surplus  stock, the market prices will come down far below International prices. The joint venture of bulk dealers  & manufacturers are harmful to farmers. Many of the bulk dealers are co-operative societies who don’t want share the profits to Govt. treasury. The fluctuations of market price only will hit on farmers income. Now ASEAN agreement is not reflecting on rubber prices, because prices are  higher than International from few months continuously. In future ASEAN will be harmful on reduced price at  Kerala market under the pretext of ASEAN on 20% duty of small quantity can keep away the Indian manufacturers  from Indian market with the maximum benefits of ZERO percent import duty.

Kerala is  increasingly depends on other States for edible products. The vast cultivation of Natural Rubber will effect on more areas of fields like rice, vegetable, coconut, bananas etc.