THRISSUR: The spiralling cost of rubber and tyre in the domestic market is forcing automobile customers in the state to go for used tyres, imported from foreign countries, as a viable alternative to brand new tyres.Cheap and quality product makes used tyre industry more attractive here --- a move that triggered largescale import of used tyre to Kerala and other states from Japan, Dubai, Kuwait, Thailand, Taiwan, Korea, Indonesia, Brazil and Morocco. This new industry is gaining momentum in the state at the cost of traditional tyre manufacturers here. Unofficially, there are around 100 major firms importing used-tyres from various countries. If you have a sedan-model vehicle, you have to pay around `4000 for a new tyre here. But if you make your way into a used tyre shop, you may get it in the price range of `1500- 2000 and it will last almost 3.5-4 years, a little less than the life of brand new piece, says Jith Uralath, manager of Tyre Park, a shop which sells imported used tyre at Irinjalakuda. Similarly, one will get almost all sizes of tyres here for less than half the price of brand new ones that will last for almost the same duration of a fresh piece, he says. Although Kerala produces 92 per cent of the total 9,00,000 tonnes of rubber produced in India, there are a large number of firms in Kerala importing used tyres from abroad. Tuticorin Port, New Mangalore Port, Kandla Port (Gujarat) and Chenai Port are some of their favourite destinations. As per the policy of the DGFT, the import of used tyres is restricted to some places in India as part of protecting local rubber growers’ interest in India. In Kerala, it is very tough to get the licence of Directorate General of Foreign Trade (DGFT) for importing used tyres, John Varghese, senior council, Central Board of Excise and Customs, said. So firms in Kerala are operating through the ports in neighbouring states with the help of shipping and customs clearance agents, he said.In Kerala, there is a huge demand for imported used tyres of Bridge Stone, Firestone, Falken, Yokohama (all from Japan), Michelin (France), Swallow (Indonesia) along with some Indian companies like Apollo, MRF, JK and CEAT, Jith says. “While an average heavy duty radial tyre costs around `16,000-17,000 per one piece, an imported used-tyre costs only `6000-8000. And it will run up to 50,000 - 65,000 km, says K S Rajan, owner of Ayyappa (Amma) Travels, Thrissur. Delaying TacticsBut the firms that importing used tyres have another story to tell. They have to pay `1.5 lakh for receiving a single consignment in the Tuticorin Port as duty and it will normally take one week to get the customs clearance. If it takes more than one week, firms have to pay an additional $ 35 for each day as penalty. “Sometimes, we have to wait more than two months to get the customs clearance. On such occasions, we are affected badly,” says Jith, adding that last time (2011 March), he had to pay around `4.5 lakh due to the delaying tactics of the Customs Department officials in Tuticorin. This was mainly because of the nexus between customs officials and tyre manufacturing companies, he alleges. “Normally they don’t have the right to withhold our consignments unnecessarily. We are doing this in accordance with the law but they will delay it due to the pressure of tyre companies. We are small firms and we don’t have the strength to take on them. If it is delayed, obviously it will end up in huge loss to us. that’s what they want,” he says. Abroad, big transporting companies like the Kharafi National and the Kuwait Public Transport Company are used to auction used tyres in three-four months due to strict guidelines of the Department of Motor Vehicles in Kuwait. These tyres are imported to India. The Indian Rubber Growers Association (IRGA) recently urged the Central Government to enhance the import duty on used tyres to 20 per cent, at par with the import duty on natural rubber. Currently the import duty is 10 per cent for the used tyre. This alternate market is hampering the business prospects of rubber growers and tyre manufactures in the state. Hence the import duty on used tyres should be hiked, says Sibi J Monippally, general secretary, IRGA.
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