In the budget for 2016-2017 presented on Monday, Finance Minister Arun Jaitley did not impose an anti-dumping duty on the import of truck and bus radial tyres (TBRs) from China or raise the basic customs duty from the existing 10 percent.
The Indian tyre industry had sought both, claiming that the cheap TBR imports from China were impacting their sales.
The combined sales of MRF, Apollo Tyres, JK Tyre and Ceat dropped about 4 percent to Rs 28,230 crore for the nine-month period ended December 2015 from Rs 29,466 crore in the corresponding period last fiscal, as gleaned from their regulatory filings to the stock exchanges.
In its pre-budget analysis, brokerage Angel Broking had said: "We expect the government to re-impose the anti-dumping duty on commercial vehicle radial tyre imports from China. We expect an anti-dumping duty rate of USD25/tyre."
Import of TBRs from China rose 65 percent to $123.22 million in the first ten months (April to December 2015) of the current fiscal from $75.53 million during the corresponding period last fiscal, according to statistics released by the union ministry of commerce and industry.
Industry body Automotive Tyre Manufacturers' Association (ATMA) had claimed in January this year that dumping tyres in the country was impacting investments in the Indian tyre industry.
"In view of the unhindered growth of cheap imports, the future investments in tyre manufacturing will be discouraged. While India is seeking new investments, existing and ongoing investments are seriously threatened in view of dumping tyres in the country," PTI reported, citing the ATMS.
The Rs 50,000 crore industry (2014-2015 sales as estimated by ATMA) had also unsuccessfully lobbied with the government to raise import duty from 10 percent to 30 percent.
"As a corrective measure, customs duty on tyres need to be increased from 10 percent to 30 percent with a view to correct inverted duty between tyres and natural rubber," the ATMA said.
In December last year, Union Commerce and Industry Minister Nirmala Sitharaman had informed the Lok Sabha that the government was "looking at anti- dumping and anti-subsidy investigations on imports of bus and truck radial tyres from China to protect domestic manufacturers," the Economic Times reported.
