Tyre dealers, manufacturers spar over imports

The tyre dealers have opposed demand raised by the manufacturers to restrict imports of  the radial tyres, claiming that the import will give impetus to the use of high-capacity radial tyres in India.

By Sai Nikesh D

The tyre dealers and manufacturers are at loggerheads over the imports of truck and bus tyres into the country.

The tyre dealers have opposed demand raised by the manufacturers to restrict imports of  the radial tyres. The All India Tyre Dealers’ Federation (AITDF) has reportedly written a letter to the Commerce Ministry, saying that the import will give impetus to the use of high-capacity radial tyres in India and ultimately reduce the freight charges of transporters.

The AITDF is reported to have said that radialisation for truck and bus tyres in India cannot be left to the domestic tyre manufacturers ‘who believe in curbing free and fair play of market forces’.

The tyre manufacturers have claimed that the cheap imports from China pose a major threat to the domestic industry.

“The immediate challenge being faced by the Indian tyre industry is the large scale import of cheaper/dumped Chinese radial truck and bus tyres into the country,” Rajiv Budhraja, Director General, Automotive Tyre Manufacturers’ Association (ATMA), said.

Responding to a query on tyre dealers’ concern, he said, “If the so-called Indian tyre dealers are opposing curbs on tyre imports, it only re-affirms their hidden interest and agenda of representing the vested interests of tyre importers.”

According to ATMA, the volume of imports increased by 60% in 2014-15 compared to 2013-14.It further went up by 65% in the current fiscal during April-July from the same period last year.

Budhraja informed that China has a huge surplus capacity (over 2.5 -3 times its own domestic requirement) and with the ongoing slowdown situation in Chinese market, the excess and surplus production is ready to be exported (rather dumped) to markets, including India, which has shown positive growth in demand.

Several countries including US, Brazil and South Africa have taken effective steps of imposing tariffs and duties (anti dumping, safeguard, anti subsidy etc.) against Chinese tyres to minimize market disruptions in their respective domestic markets, he added.

“Indian tyre industry has made huge investments in capacity creation to manufacture state of the art TBR tyres,” he said, adding that the import of cheaper and dumped tyres, often by way of unfair trade practices, create unwarranted disruptions in the domestic market.

This article was published in The Dollar Business on August 07, 2015

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