Branding hartals, Kerala style

Indian Rubber Dealers' Federation's call for a Rubber Hartal, which is now withdrawn, is another step in a new trend - branding hartals.

Called Rubber Hartal, the protest was apparently against the Centre's decision to allow imports by reducing the duty considerably.

Rubber Dealers' Federation president George Valy had asked all dealers and growers - numbering about 10 lakh (1 million) rubber farmers and 8,000-odd dealers - to paralyse the market activities on April 16.  Kerala accounts for 85 per cent of the natural rubber production in the country.

Kerala's never ending saga of hartal has just got another boost by this branding. But not everyone was happy with the call as several farmers and Rubber Producers Societies expressed surprise over the federation's move.

According to Varghese P Mani, a highly educated rubber grower in Kerala's Kothamangalam area, the global prices of natural rubber is higher than the domestic rates and imports will be costlier for dealers now. In this situation, rubber imports are unlikely to happen.

Moreover, according to analysts, natural rubber prices will stay high this year as political tension in Thailand and unfavorable weather in Southeast Asia could disrupt supply and China's demand rises.

Supply from Thailand, the world's largest producer, has been disrupted this year partly by racial problems.

Again, natural rubber prices in Tokyo Commodity Exchange has been ruling above Rs 101 per kg for quite sometime now which is higher than the present domestic price of Rs 91.50 per kg for RSS-4 (on April 13).

A Rubber Producers' Society president, on condition of anonymity, said rubber import is not feasible at the present global rates, which is at least Rs 10

higher. The hartal call, right from the beginning,  was an uncalled-for move by the federation, he said. Anyway, good sense prevailed and the federation has now withdrawn the call, he added.

The federation's decision to launch the protest was prompted by Union commerce minister Kamal Nath's offer to Thailand government to allow lower import tariff for rubber.

The minister said India hopes to conclude a free trade agreement with Thailand by the end of June which will boost two-way business by an annual 30 per cent.

"We are looking at the end of June to finalise it," Kamal Nath said. "It should be our efforts to conclude the trade deal with Thailand much before we do it with ASEAN," Nath said referring to ongoing talks with the 10-nation Association of South East Asian Nations.

New Delhi wants lower duties on Indian steel wires and meat. Bangkok is seeking greater market access for its rubber.

India and Thailand are discussing ways of cutting duties and increasing market access for each other's products, and raising investment flows.