A two-pronged strategy has been worked out by the government to increase the processing of natural rubber produced in the State from the existing 11% to 40% by 2030 and to make the State a hub for latex-based products.
A CIAL model company ‘Kerala Rubber Limited (KRL)’ and ‘Amul’ model cooperative for procurement of the natural rubber from farmers figure in the flagship programme being launched with long-term vision.
Facilitating land and industrial infrastructure at affordable price to private investors to set up projects aimed at producing high Manufacturing Value-Added (MVA) Natural rubber-based products and direct government intervention for value addition in tyre industries are the two-pronged strategy.
The company that will have 26% equity participation by the government will strive to make strategic investments with the support of the private sector. It will also ensure better price realisation for farmers, develop world class manufacturing infrastructure to promote investment, ensure seamless linkage with proposed Amul-model cooperative for procurement, operate in PPP mode and ensure good returns to stakeholders.
A Rubber Park will be set up in 100 to 300 acres of land in Kottayam for facilitating private investment in high MVA products using RRS sheets and another one in 300 to 500 acres for latex products.
Taking into consideration the growth rate, consumption of natural rubber, scope of exports and high operating margin, two value-added products namely — Off-The-Road (OTR) Tyres and Heat Resistant Latex Thread (HRLT) — have been identified to be directly manufactured and traded by KRL.
A tyre research, testing and certification facility as a joint venture between the KSIDC and Rubber Research Institute of India or Indian Rubber Manufacturers Research Association has been proposed.
The supply chain for procurement as well as processing of natural rubber will be done by the cooperative society, which will have a pre-defined shareholding in KRL.
The total investment is ₹1,050 crore and the investment planned in Phase-1 is ₹360 crore.
M.G. Rajamanickam, Managing Director, KSIDC, who is also Managing Director of KRL, told The Hindu that the value of land would be treated as equity contribution of government in KRL which will be retained at 26% through appropriate equity structuring. The remaining 74% will be held by private entities.
Chief Minister Pinarayi Vijayan, who chaired an investor stakeholder meeting through video conferencing on Tuesday and attended by E.P. Jayarajan, Minister for Industries, reiterated the steadfast support being extended to the investor fraternity and the intention to create a vibrant ecosystem for the rubber sector.
A core advisory committee, consisting of prominent representatives of the stakeholders, would be set up for finalising the road map.
