Rubber industry poised for growth, faces skill shortage
The industry growing at healthy pace of 10% is set to reach Rs 80,000 crore soon
MUMBAI, 22nd August 2017 (GPN) : Recent data from CAPEXIL indicates the exports of rubber products increased by 5%, boosted by non-tyre rubber products. This is noteworthy as the sector has witnessed dwindling growth rates during the last three fiscals, and indicates the large potential for growth if proper policies are in place. The rubber industry in India manufactures around 35,000 different rubber productsthat find use across critical sectors likeAuto, Defense, Healthcare, Agriculture and other niche areas. The rubber products industry in India, the size of which is currently estimated at Rs 75,000 crore, is dominated by the small-scale sector. Around 90% of the 6,000-plus rubber products manufacturing units in the country are micro, small and medium enterprises (MSMEs), and they account for 40% of the rubber products exports.
India is the 3rd largest producer and 2nd largest consumer of rubber in the world. Estimates suggest over two million peopleare employed in the rubber industry including tyre units, and another one million in the plantation sector across the country.
“Rubber is a sunrise sector in India and fits perfectly with the government’s Make in India and Skill India initiatives, but also suffers from the shortage of skilled labor and abnormality in the duty structure which is unfair to domestic manufacturers,The growth in the industry has dwindled in the last three years and can be revived if proper policies are put in place. With the government opening up sourcing for most defence and infrastructure projects, it should ensure that the opportunity is not taken away by international companies,” says, Mr. Vikram Makar – Sr. Vice-President, All India Rubber Industries Association (AIRIA)– the not-for-profit body serving the rubber products industry and trade with the objectives of safeguarding and promoting interests of the Rubber Products Industry, especially the MSMEs. The association, established in 1945, has over 1300 members at present.
Vinod Patkotwar, CEO, Crown Rubber Products, said the collation of data on imports is a herculean task as many of the rubber products are clubbed with other items during import. For instance, he said conveyor belts used in the mining sector are imported 12-15 per cent cheaper from China along with other implements.
The per capita consumption of rubber in India is estimated to be very low, in the range of 0.8 – 1 kg, against a global average of 3.2 kg, and as high as 12 to 14 kg in Japan, Europe and the US. Even China has per capita consumption of 8 kg. On the export front, India has a paltry share of 1.48% against China’s 11%. AIRIA maintains that India’s share of export of rubber products can be easily enhanced to 5% in the next 5-7 years to take the country to the top 5 exporters in this sector. “This gives us an idea of growth potential and we are working towards this objective,” adds Mr. Makar.
For encouragement of exports of rubber products, AIRIA has asked the centralgovernment for a separate ‘Rubber Export Promotion Council (Rubexil)’ with a view to maximize the export potential of the rubber products industry. At the same time it is also promoting use of newer technologies in the sector, both in terms of newer formulations and increased automation in line with the rest of the industry, which is now adopting the concepts of Industry 4.0 globally.
The rubber products industry in India also suffers from skills shortage in the absence of proper and organised training facilities, as the workforce is basically trained on the job. As against the need for 7 lakh skilled personnel at present, the industry has only about 5 lakh, with a shortage of 2 lakh skilled candidates. To address this need,Rubber Skill Development Council (RSDC)has been constituted under the aegis of National Skill Development Corporation (NSDC), in collaboration with AIRIA and Automotive Tyre Manufacturers Association (ATMA), with the aim to identify and fulfill skill development needs in the rubber sector. The RSDC encourages the industry to employ skilled and certified manpower, and to meet the demand conducts various training programmes across the country covering rubber tappersat one end of the spectrum, andtechnicians working at the manufacturing units, at the other.
“As a vital component of ‘Make in India’ drive to build things here and sell everywhere, India’s Rubber Products Industry is well poised,” mentioned Mr. Vikram Makar in conclusion.