state of ind ian n on -ty re m anufacturing ind...

State of Indian Non-Tyre Manufacturing Industry

India Rubber Meet

March 2016

Vinod Simon

Chairman, RSDC

Rubber Skill Development Council

NON-TYRE RUBBER INDUSTRY


Current Status

Concerns

What Industry Can Achieve

How We Can Achieve

Current Status of the Indian Non-Tyre Industry


MAJOR CLASSIFICATION


Non-Tyre

Rubber

Segments (19)

Cables

Sports

Goods

Foam

Products

Footwear

Extruded

Products Rubberized

Coir, Jute &

Woolen

Products

Surgical &

Pharma

Products

Moulded

Products

Sheeting

Tread

Rubber

Rubberized

Fabric

Products

Beltings

Adhesives

Dipped

Goods Hoses

Rubber

Covered

Rollers Mats

Tubes

Auto &

Cycle

Parts

INDIAN NON-TYRE INDUSTRY


Around 6000 manufacturing units

Thousands of unregistered units

Production units across 24 states and four UTs in the

country

Highest number of rubber product manufacturing units in

Kerala

Large number of manufacturing units: Moulded goods,

tread rubber products, footwear, dipped goods and

adhesives

Majorly constituted by the Micro, Small and Medium

Enterprises (MSME ) Sector

GEOGRAPHICAL COVERAGE


Non-Tyre Rubber Products

Manufacturing Units:

24 States and 4UTs

High (More than 300)

Medium (50 to 300)

Low (5 to 50)

Himachal Pradesh (29)

Assam (7)

Chhattisgarh (7)

Orissa (12)

Punjab (402)

Haryana

(598) Delhi (283)

Rajasthan (159)

Madhya Pradesh (61)

Maharashtra (598)

Gujarat (613)

Kerala (853 Tamil

Nadu

(606)

Pondicherry (20)

Karnataka (206)

Goa (11)

Jharkhand (24)

West

Bengal (591)

Uttar

Pradesh (710)

Andhra Pradesh &

Telangana (177)

Dadra & Nagar

Haveli (12)

Daman & Diu

(8)

Less than 5

Jammu & Kashmir

(4)

Bihar (1)

Tripura (4)

Meghalaya (1)

SECTOR AL SNAPSHOT


Others include rubberized fabric, tubing, cables, adhesive tapes, ebonite products, leather board, modified forms of rubber

and latex thread.

MAIN CENTRES OF PRODUCTION–RUBBER PRODUCTS


State City Main Product Segment

Kerala Ernakulam Tread Rubber Products

Kottayam Tread Rubber, Rubber and Coir Mats, Footwear,

Dipped Goods, Foam Products

Alapuzha Rubberized Coir Mats

Thrissur Tread Rubber Products

Tamil Nadu Chennai Moulded Rubber products

Coimbatore Dipped goods, Moulded Rubber Products

Madurai Beltings, Moulded Rubber Products, Sports

Goods, Tyre, Tube and Flaps

Maharashtra Mumbai Moulded Rubber Products, Extruded Rubber

Products

Pune Moulded Rubber Products, Auto and Cycle Parts

Thane Dipped Goods, Moulded Rubber Products, Auto

and Cycle Parts

Punjab Jalandhar Sports Goods, Footwear

Ludhiana Tyre, Tube and Flaps; Auto and Cycle Parts

MAIN CENTRES OF PRODUCTION –RUBBER PRODUCTS


State City Main Product Segment

Uttar Pradesh Kanpur Footwear, Adhesives and Other Rubber Products

Meerut Sports Goods

Agra Footwear, Adhesives, Sheeting, Moulded Rubber

Products

West Bengal Kolkata Footwear, Moulded Rubber Products, Adhesives

Howrah Moulded Rubber Products

Hoogly Dipped Goods

Gujarat Ahmedabad Moulded Rubber Products, Sheeting, Rollers

Valsad Dipped Goods, Moulded Rubber Products

Haryana Sonepat Rubber products

Panipat Rubberized coir, jute and woolen products

Gurgaon Moulded Rubber Products, Auto and Cycle Parts

Faridabad Moulded Rubber Products, Extruded Rubber

Products, Auto and Cycle Parts

INDIAN NON-TYRE INDUSTRY


Turnover : 32,000 crores

(2014-15)

Employment : 3.70 lakh

Demand Growth: 8 percent

per annum (2009-2015)

Consumption of all types of

rubber : Natural, Synthetic

and Reclaim

One third rubber

consumption by the non-

tyre industry

Auto tyres

& tubes

66%

Cycle

tyres &

tubes

8%

Camel

Back

5%

Footwears

6%

Belts and

Hoses

4%

Latex

Foam

2%

Dipped

goods

3%

Others

6%

Consumption of Rubber

INDUSTRY TURNOVER


13.6 %

5.5%

10%

6.9% 3.2%

EMPLOYMENT*


Majority of the rubber products manufacturing firms

hire less than 50 employees.

A large proportion of the total employed workforce in the

sector is hired on roll basis.

Low level of attrition is reported by majority of the firms

in the rubber sector.

The key job roles for recruitment clearly shows that the

main roles for employment in rubber industry are related

to helper and operator level.

A mixed trend is observed for recruiting workers from

within and outside state by the rubber products

manufacturing firms.

*Survey based skill gap analysis for Delhi, Haryana, UP, Gujarat and West Bengal

CONSUMPTION SHARE –INDIA


Auto

tyre

sector

67%

General

rubber

goods

sector

33%

Natural Rubber (NR)

Auto

tyre

sector

69%

General

rubber

goods

sector

31%

Synthetic Rubber (SR)

Source: Rubber Board

CONSUMPTION TREND (NR):INDIA


NR consumption in non-tyre industry has registered a

decline in recent years from the peak attained in 2007-08.


CONSUMPTION TREND (SR):INDIA


A consistent increase in SR consumption in non-tyre

rubber industry in India


CONSUMPTION TREND (NR+SR): INDIA



TILT TOWARDS SR

Consumption of SR witnessed a consistent increase in

the last 15 years

Consumption of NR has shown fluctuations over the

period

In the last 15 years, SR consumption increased by more

than 100 percent.

Faster growth in SR’s consumption (25 percent) during the year 2014-15 in the general rubber goods sector is

largely attributed to its

increased domestic availability

lower prices relative to NR

IMPORT-ANT ITEMS (NON-TYRE)


HS

Code

Product 2010-

11

2011-

12

2012

-13

2013-

14

2014-

15

Growth

(%)

Avg

Annual

Growth

(%)

40169990 Articles Of

Vulcanised

Rubber &

Inflatable

Articles

813 946 1102 1177 1209 48.7 12.2

40169390 Gaskets Washers

& Other Seal 265 343 423 406 430 62.3 15.6

40169330 Rubber Seals 229 289 317 386 378 65.1 16.3

40169340 Gaskets 152 246 280 253 259 70.4 17.6

40094200 Tubes, pipes and

hoses with

fittings

122 191 229 189 250 104.9 26.2

40169320 Rubber Ring (o-

ring) 161 187 204 236 244 51.6 12.9

Rs. crore

Source: DGFT

IMPORT-ANT ITEMS (NON-TYRE)


HS

Code

Product 2010-

11

2011-

12

2012

-13

2013-

14

2014-

15

Growth

(%)

Avg

Annual

Growth

(%)

40103999 Transmission

Belts/Belting

Other Than Flat

Belt/Ply Belt

139 175 227 244 244 75.5 18.9

40169980 Stoppers

49 87 112 189 197 302.0 75.5

40151900 Other Gloves,

mittens & Mitts 72 60 106 124 177 145.8 36.5

40094100 Tubes, Pipes &

Hoses without

fittings

73 106 147 164 133 82.2 20.5

40151100 Surgical Gloves,

Mittens & Mitts 27 84 95 124 125 363.0 90.7

Rs. crore

Source: DGFT

LEADING IMPORTING COUNTRIES FOR RUBBER

PRODUCTS


Year

2014-15

Articles of

Vulcanized

Rubber &

Inflatable

Articles

Gasket

Washers &

Other Seals

Rubber

Seals

Gaskets Tubes,

Pipes and

Hoses Top

Countries

1 Germany

(13%)

Germany

(19%)

Japan

(17%)

USA

(17%)

Japan

(18%)

2 Japan

(13%)

USA

(14%)

USA

(16%)

China

(14%)

Thailand

(12%)

3 China

(12%)

Japan

(14%)

Germany

(14%)

Germany

(10%)

Germany

(12%)

4 Korea

(11%)

China

(11%)

Italy

(9%)

Japan

(9%)

Korea

(10%)

5 USA

(10%)

UK

(6%)

China

(7%)

Korea

(9%)

China

(9%)

Source: DGFT

LEADING IMPORTING COUNTRIES FOR RUBBER

PRODUCTS


Year

2014-15

Rubber Ring Beltings

Stoppers Surgical

Gloves,

Mittens &

Mitts Top Countries

1 Italy

(17%)

China

(23%)

Belgium

(30%)

Malaysia

(60%)

2 Germany

(16%)

Germany

(14%)

Singapore

(29%)

Srilanka

(25%)

3 USA

(15%)

Japan

(12%)

USA

(15%)

Thailand

(11%)

4 Japan

(14%)

Italy

(9%)

France

(9%)

Indonesia

(4%)

5 Korea

(6%)

USA

(7%)

China

(4%)

China

(1%)

Source: DGFT

IMPORT OF RUBBER PRODUCTS


IMPORT IMPACT


Closure of Manufacturing Units

Losing opportunity to establish new units

Employment Loss

Foreign Exchange Loss

Decrease in contribution to national product

Loss of skill developed

Instead of importing the products, the production of rubber

products can be encouraged through removing the limitations

relating to rubber products which are mainly produced in

MSME sector in the country.

A CASE TO STUDY


Employment loss for 30000

persons

Closure of around 1500 units

Imports affecting domestic

production

EXPORT


Exports has grown manifold in the last five years

Value of exports for beltings; tubes, pipes and hoses; floor

coverings and mats has increased more than 100 percent in

the last five years

Indian rubber products exported to over 100 countries in

the world

USA is the top export market

High growth in export implies the proven capability of

manufacturing the right quality of products which are

accepted globally

India has the potential to become leading non-tyre rubber

products producer in the world

EXPORT OF RUBBER PRODUCTS


Products 2010-11 2011-12 2012-13 2013-14 2014-15 Growth

(%)

Avg

Annual

(%)

Beltings 350

(77)

533

(111)

659

(121)

725

(120)

704

(115) 101 25.3

Tubes, Pipes

and Hoses

240

(53)

346

(72)

370

(68)

444

(73)

555

(91) 131 32.8

Gloves,

Mittens &

Mitts

112

(28)

181

(38)

191

(35)

216

(36)

217

(36) 94 23.4

Floor Coverings

& Mats

192

(42)

235

(49)

275

(51)

365

(60)

389

(63) 103 25.7

Gasket Washers

& Other Seals

228

(50)

316

(66)

328

(60)

380

(63)

413

(68) 81 20.3

Rs. Crore (US $Million)

Note: Growth calculations based on value in Rs. crore

Source: DGFT

EXPORT ITEMS


Rs. crore

Source: DGFT

HS

Code

Product 2010-

11

2011-

12

2012-

13

2013-

14

2014-

15

Growth

(%)

Avg

Annual

Growth

(%)

40169990 Articles Of

Vulcanised

Rubber & Other

Inflatable Articles

401 711 980 1122 1274 218 54

40101290 Conveyor

Belt/Belting

reinforced With

Textile Materials

221 305 378 474 455 106 26

40051000 Rubber

Compounded

With Carbon

Blacks/Silica

6 9 10 12 402 6600 1650

40169100 Floor Coverings

and Mats 192 235 275 365 389 103 26

EXPORT ITEMS (CONT….)


Rs. crore

Source: DGFT

HS

Code

Product 2010-

11

2011-

12

2012-

13

2013-

14

2014-

15

Growth

(%)

Avg

Annual

Growth

(%)

40092100 Tubes, pipes And

Hoses Without

Fittings 84 159 208 225 284 238 60

40141010 Rubber

Contraceptives

Male (condoms) 276 126 217 250 279 1 0.3

40082190 Plates, sheets,

strips Of Non-

Cellular Rubber 146 199 208 260 255 75 19

40132000 Inner Tubes Of

Rubber Used On

Bicycles 189 284 245 243 243 29 7

40151100 Surgical Gloves,

Mittens And

Mitts 99 165 167 176 173 75 19

LEADING EXPORT MARKET FOR INDIAN MANUFACTURED

RUBBER PRODUCTS


Year

2014-15

Beltings Tubes,

Pipes and

Hoses

Floor

Coverings

& Mats

Gasket

Washers

& Other

Seals

Other

Articles of

Vulcanized

Rubber Top

Countries

1 USA

(15%)

USA

(25%)

USA

(27%)

USA

(20%)

USA

(14%)

2 Russia

(7%)

UK

(10%)

UK

(16%)

UK

(15%)

Germany

(12%)

3 Saudi Arab

(6%)

Germany

(7%)

Netherland

(6%)

Germany

(7%)

Australia

(6%)

4 Italy

(5%)

Italy

(6%)

Russia

(6%)

UAE

(5%)

UK

(5%)

5 South Africa

(5%)

UAE

(5%)

Ireland

(6%)

Saudi Arab

(4%)

Poland

(5%)

Source: DGFT

LEADING EXPORT MARKET FOR INDIAN MANUFACTURED

RUBBER PRODUCTS


Year

2014-15

Rubber

Compound

ed with

carbon

black/silica

Rubber

Contracep

tives

Inner

tubes

(Bicycle)

Surgical

Gloves,

Mitten &

Mitts

Gaskets

Top

Countries

1 South Africa

(97%)

Brazil

(23%)

Mexico

(14%)

France

(7%)

UK

(26%)

2 Sri Lanka

(1%)

South Africa

(15

Tanzania

(13%)

Poland

(7%)

USA

(21%)

3 Korea

(0.4%)

USA

(14%)

Burkina Faso

(12%)

Spain

(6%)

China

(7%)

4 UAE

(0.4%)

Nigeria

(7%)

Kenya

(7%)

Italy

(6%)

UAE

(5%)

5 Chile

(0.2%)

UK

(5%)

Uganda

(5%)

Mexico

(4%)

Mexico

(5%)

Source: DGFT

Concerns of the Non-Tyre Industry


CONCERN


Around 7 percent of the units have closed their

operations*

Closure of the units : footwear, gloves, adhesives, beltings,

tread rubber, rollers, moulded and extruded products,

foam products, etc.

Units closing their manufacturing operations belong

mainly to tiny, small and medium scale category.

A loss of annual turnover of at least 2000 crores

Considering that each unit recruit 20 employees, there is a

loss of 8000 job positions in the industry.

*Estimate based on data collected for surveyed states in Skill Gap Analysis

.

SURVEY OF RUBBER PRODUCT MANUFACTURERS


Source: RSDC

State Total Units Closed Units Share (%)

Kerala 853 55 6.4

Punjab 402 20 5.0

Tamil Nadu 606 58 9.6

Maharashtra 598 54 9.0

Haryana 598 33 5.5

UP 710 34 4.8

West Bengal 591 48 8.1

Delhi 283 17 6.0

Gujarat 613 44 7.2

Total 5254 363 6.9

SURVEY OF RUBBER PRODUCT MANUFACTURERS


Source: RSDC

State Total Units

Production

Stopped/Info not Found Share (%)

Kerala 853 281 33

Punjab 402 149 37

Tamil Nadu 606 202 33

Maharashtra 598 161 27

Haryana 598 100 17

UP 710 185 26

West Bengal 591 171 29

Delhi 283 71 25

Gujarat 613 84 14

Total 5254 1404 27

PROBLEM AREAS

35

Imports from Other Countries

Lack of Skilled Manpower

Lack of Adoption of New Technology

Inverted Duty Structure

Raw Material Price Volatility

SKILL GAP*


Majority of the workforce’s education level is less than Xth

standard.

Very low percentage of highly qualified and vocationally

educated personnel

Majority of workers are provided on the job training

No separate training department in the firms

Technical skill gap is the main concern

No trend witnessed in the industry to hire skilled workforce

from technical institutes

*Survey based skill gap analysis for Delhi, Haryana, UP, Gujarat and West Bengal

What Industry Can Achieve


TURNOVER


Annual turnover of the non-tyre industry in the country witnessed an

average annual growth of 7.6 percent during 2009-2015. Given the

performance of the industry in last six years, it is estimated to

achieve 68,000 crore industry turnover by 2025.

32000 crore

($ 4.8 bn)

46000 crore

($6.8 bn)

68,000 crore

($10 bn)

2014-15

2020-21

2024-25

IMPORT FORECAST


Given the pace of an average annual growth of 19.4 percent (2010-15)

in the present scenario of losing competiveness in manufacturing

rubber products on domestic front, the import of major categories of

non-tyre rubber products may reach 23000 crore by 2025.

5400 crore

($ 821mn)

11000 crore

($ 1.6bn)

23,000 crore

($ 3.4bn)

2014-15

2020-21

2024-25

REMOVE BOTTLENECKS :ACHIEVE HIGHER GROWTH


Industry can grow at a faster pace if the existing problems are

resolved. Annual turnover of the non-tyre industry in the

country can cross one lakh crore turnover by 2025.

32000 crore ($4.8 bn)

59000 crore

($8.8 bn)

1,00,000 crore

($15 bn)

2014-15

2020-21

2024-25

ADDITIONAL HUMAN RESOURCE REQUIREMENT*


*Source: RSDC, Skill Gap Analysis for the period 2010-15

State By the year 2018

Kerala 7898

Punjab 9906

Tamil Nadu 10715

Maharashtra 9319

Haryana 6351

UP 13428

West Bengal 2825

Delhi 1202

Gujarat 4950

Total 66,594

EMPLOYMENT


•Excluding raw material segments

Source: Primary Interaction by Tata Strategic

How We Can Achieve


ACTIONS TO BE TAKEN


ADOPTION OF NEW TECHNOLOGY


Adopt latest technology to remain competitive in the domestic

and international market space.

It can become a reality given:

Awareness about the technological developments in the

related field of operation

Availability of latest machinery, tools and equipments

Availability of capital at lower rate of interest

Focus on innovation

Facilitating Research and Development Centres

RUBBER SKILL DEVELOPMENT COUNCIL (RSDC) MANDATE

provide employment opportunities to youth across the nation, create career paths in roles existing within the unorganized and organized segments of the manufacturing & plantation sector of the rubber industry and ensure active participation of the industry in absorption of skilled manpower generated through RSDC.

Reskilling of the entire workforce.

46

ABOUT RSDC

Was constituted in 2012 under the aegis of National Skill Development

Corporation (NSDC), and promoted by All India Rubber Industries

Association (AIRIA) and Automotive Tyre Manufacturers Association

(ATMA)

To identify and fulfill skill development needs in the Rubber sector

is managed by a Governing Council of 12 members representing ATMA,

AIRIA, Rubber Board, IRI, ICRTMA, IRMRA & NSDC

ROLE OF RSDC


1. TRAINING

NEED ANALYSIS

2. CURRICULUM

DEVELOPMENT

3. ROLLOUT

OF

TRAINING

4. ASSESSMENT

AND

CERTIFICATION

National Occupational Standards

(NOS) drives the process

1.Create Occupational

Standards And

Competency Levels

for Job Roles (NVEQF)

2. LMIS

3. Skill Gap Study

4.Accreditation of

Training Institutes

5. Academies Of

Excellence

6.Training Of

Trainers

7 & 8*. Guidelines

and Participate In

Assessments and

Certification of

Trainers

and Trainees

DUTY STRUCTURE


Duties affect the competitiveness of products produced

domestically vis-a-vis its availability from other countries through

imports.

For rubber industry, it is important to check:

The higher rate of duty applicable on import of raw material

used in rubber product manufacturing.

The lower rate of duty imposed on finished rubber products

available in the market from other countries.

TAKE ADVANTAGE : GOVERNMENT PROGRAMMES


Non-tyre rubber industry can focus on the latest programmes

introduced by the government to reach a new height .

INDIA CAN BECOME A LEADER IF………


Improving competitiveness of small scale units through

Access to capital

Accelerated adoption of latest technology

Skill development

Marketing on global platform

Innovation

Research &Development

Revival of inverted duty structure and Free Trade Agreements

(FTAs)

Change in mindset

Raw material availability at globally competitive prices

GROWTH POTENTIAL


(4.8)

(6.8)

(8.8)

(10)

(15)

THANK YOU

52


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