Cheap tyre imports pose threat to domestic tyre mkt: AITDF

New Delhi, May 2 (UNI) Rupee appreciation in the last eight weeks and a five per cent cut in the custom duty in this year's Budget has affected the domestic tyre producers largely with tyre imports getting cheaper by four to five per cent during March-April.

''The six to seven per cent appreciation in Indian Rupee against the US dollar in March-April'07) has come as a shot in arm to the domestic tyre market. Also, the cut in custom duty in the Union Budget impacted the tyre market leading to a reduction of Rs 650-Rs 800 in the import bill on tyres,'' All India Tyre Dealers Federation (AITDF) said here today.

Last year, the average monthly import of radial truck and bus tyres was a meager 15,000 units which has increased to a whopping 45,000 tyres per month this year.

This has, in addition to an increase in the supply of such tyres, also lead to the reduction in the selling price of the pair of truck and bus tyre from Rs 21,500 to Rs 20,700.

The imported truck radial today captures 75 per cent of the Indian market as against 25 per cent share enjoyed by the domestic tyre makers.

''After several years, there seem to be some indications of loosening in of oligopolistic stranglehold of domestic tyre majors,''AITDF added.

''The government should take urgent practical measure in instantaneously removing 16 per cent countervailing duty (CVD) on import of truck/bus radial tyres. This will also help to contain the inflation because tyres constitute 35 per cent of the operating cost of a truck operator,'' said the AITDF.

UNI