THIRUVANANTHAPURAM: Dr K N Harilal, who had predicted the plantation crisis in a seminal work published in 2010, terms the Price Stabilisation Scheme announced by finance minister K M Mani for rubber cultivators as "noble but pointless".
“It is nice to compensate farmers but it will soon be revealed that the support is too insignificant and that the money will be sucked into a bottomless pit,” Dr Harilal said. “No amount of subsidy will work unless the import policy is altered, which of course is an impossibility,” he added.
Harilal in his study ‘ASEAN-India Free Trade Area: Voices of Dissent From the South’ had noted that it was nothing short of a blunder on the part of the UPA government to have agreed to the removal of the wall of high bound rates, which according to him was perhaps the only arrangement left to check the adverse consequences of transient fluctuations.
“The higher upper limits in the form of bound rates could be switched into service when emergencies reared its head and also served as a guarantee of protection against the vagaries of the market as well as the possible speculative attacks,’’ Dr Harilal said.
He said that import duty of natural rubber products like gloves, gaskets, mattings, erasers, belts and dampeners was tending towards zero.
“And by signing the ASEAN trade agreement we have forfeited the right to increase the import tariff beyond 25 percent,” he said.
Dr Harilal also said that there was an international conspiracy to increase production of natural rubber.
“Even the most ambitious stabilisation scheme stands no chance in a situation where there is a glut of natural rubber in the international market and free trade,” Dr Harilal said.
The Rs 300-crore Price Stabilisation Scheme is implemented jointly by the state government and Rubber Board of India. The objective is to sustain the price of rubber at least at Rs 150 per kg.
Under the scheme, the difference between Rs 150 and the daily price of rubber would be granted as subsidy to the farmer. Around 10 lakh small and medium rubber farmers will get the benefit of the scheme.
