KOCHI: The new Rs 300-crore subsidy scheme currently being implemented by the Kerala government to provide succour to the smallscale rubber farmers may encourage them to increase the production. Rubber production has been dropping for nearly a year as the low level of prices discouraged many farmers to continue tapping. Under the new scheme, the government will buy a maximum of 150 kg per hectare per month at a price of Rs 150 per kg , which is Rs 25 higher than current prices, from a grower. The difference is paid as the subsidy.
Unlike earlier schemes, the payment is made online directly to the farmers. The benefit is available to farmers having up to two hectares. At present, the farmers who are eligible for the subsidy are getting their names registered through rubber production societies which will certify the facts.
“There is quite a lot of interest among the farmers for registration. Our field officers are also helping out to complete the formalities,” said a Rubber Board officer. There are around 10 lakh rubber farmers in the small-scale category.
The scheme is expected to spur the farmers to raise the level of tapping to increase production. Last year, the natural rubber production slumped 15 per cent to 6.55 lakh tonnes. This fiscal the April-May months saw 9-11 per cent drop in production. As a result the tyre companies, who are the principal consumers, are still depending more on imports to bridge the supply-demand gap. Last year, the total natural rubber imports touched a record of over 4 lakh tonnes.
But some of the growers and traders are still skeptical about the success of the scheme. “When we sell, the dealers may find some fault and take it as a lower grade rubber. For instance RSS 4 is of good quality and commands the best price. In case the quality is not up to the market, they can qualify it as RSS 5 and pay less,” said a rubber grower Babu Joseph.
In the last scheme, implemented by the state government, the 5 per cent VAT was waived so as to help the tyre companies buy rubber from local market at the landed price of the imports. Though the scheme was in existence for over three months, the growers were not benefitted much from it as it was alleged that dealers cornered all the gains. So the government has eliminated the intermediaries and is making payment online directly to the growers’ account. “But ever since the scheme was announced, the local rubber prices have fallen by Rs 5 to Rs 125 per kg in tandem with the global prices.
This means the difference the government has to pay has increased from Rs 20 to 25. And the prices are likely to fall again. Again there is no guarantee that the tyre companies will buy the procured quantity as the global prices are cheaper,” said G P Goyal, president of theCochin Rubber Merchants Association.
– India Times
