ATMA seeks temporary duty-free rubber quota as prices reach ₹300 per kg

The Automotive Tyre Manufacturers’ Association (ATMA) has urged the Union government to permit temporary duty-free natural rubber imports, citing domestic shortages and prices reaching ₹300 per kg. In a representation to Commerce and Industry Minister Piyush Goyal, the association requested a tariff rate quota limited to the assessed gap between domestic production and consumption.

Announcing its request on 6 November 2026, ATMA said the arrangement should remain in place until supply and market conditions normalise. The proposal seeks relief for tyre manufacturers facing higher procurement costs while maintaining protection for domestic growers.

Why are tyre manufacturers seeking import relief?

ATMA said domestic rubber prices had risen approximately 62% from the November 2025 average of ₹186 per kg. Supplies were inadequate even during the period manufacturers normally depend on to replenish stocks.

Association chairman Arun Mammen said a temporary quota tied to the supply shortfall would help maintain production while safeguarding growers’ interests.

The industry is also facing higher costs for synthetic rubber, carbon black and other petroleum-derived inputs. ATMA attributed additional pressure on crude oil, freight and logistics costs to the West Asia crisis.

How large is India’s natural rubber supply gap?

India produced 905,000 tonnes of natural rubber in 2025–26 against consumption of 1.427 million tonnes, according to figures presented by Rubber Board executive director M. Vasanthagesan in October.

The difference was 522,000 tonnes, equivalent to approximately 37% of consumption. Production had increased from 875,000 tonnes in 2024–25, but remained substantially below domestic requirements. Consumption also rose from 1.410 million tonnes.

The figures show that the current price pressure comes against a longstanding production-consumption imbalance, rather than a shortage confined to the latest purchasing season.

The All India Rubber Industries Association has highlighted similar concerns across the wider rubber-products sector. It reported natural rubber imports of approximately 551,000 tonnes in 2024–25, compared with 493,000 tonnes a year earlier.

Beyond tyres, manufacturers of hoses, belts, seals, footwear and moulded components also depend on reliable raw-material availability. Smaller enterprises in these segments face particular exposure to procurement costs and price volatility.

What duty relief is being proposed?

ATMA’s request is for a quantity-limited exemption through a tariff rate quota, rather than unrestricted duty-free imports.

The association cited the prevailing basic customs duty on natural rubber of 25% or ₹30 per kg, whichever is lower.

The government introduced that structure for dry natural rubber in April 2015, raising the percentage component from 20% while retaining the ₹30-per-kg ceiling. Its stated purpose was to regulate imports and support demand for domestically produced rubber.

The current request therefore brings two policy objectives into focus: protecting growers’ market access and ensuring manufacturers can obtain sufficient raw material at competitive costs.

How are growers responding to higher prices?

The price increase has also improved returns for rubber growers. Grade-four ribbed smoked sheet rubber reached ₹300 per kg in the Rubber Board’s daily price report on 2 November.

Rubber Board deputy director Binoi Kurian attributed the rise to domestic supply constraints and stronger international markets. Reporting from Kerala also indicated renewed activity in plantations that had remained untapped for years.

This provides an important counterpoint to manufacturers’ concerns: higher prices increase industrial input costs but can encourage harvesting and improve plantation incomes.

For importers and manufacturers, the immediate issue is whether the government will approve the requested quota and specify its volume, duration and allocation process. The announcement establishes an industry request, not an approved customs exemption.