KOCHI, December 23: The Cochin Rubber Merchants' Association has lashed out at the Rubber Marketing Federation for making allegations that rubber dealers and the state government colluded to pass on price advantage to the rubber industry.

N Radhakrishnan of the Rubber Merchants' Association said here on Monday that the allegations of a conspiracy to pass on price advantage to the industry was "unsubstantiated" and is the result of the state government giving preference to the Rubber Marketing Federation over the merchants.

He alleged that the federation had been availing of loans from cooperative banks at cheap rates and buying rubber to be sold to the industry for a profit. This year too the federation did the same but could not sell off the rubber because of the low price.

In a bid to arrest the fall of natural rubber price, the state government had allowed the federation to purchase rubber from the market at Rs 2 per kg above the prevailing rates and at the same time, allowed a tax relief of Rs 5 per kg. Radhakrishnan said repeated appeals to the government to grant tax relief to the merchants fell on deaf ears.

Despite these advantages, the federation was able to buy only 4,512 tonnes of rubber thus depriving the rubber planters their due. "It is very doubtful whether the growers benefitted from the scheme," said Radhakrishnan regarding the government attempt to arrest the fall of natural rubber. The State Trading Corporation was ready to buy about 10,000 tonnes of rubber. But according to Radhakrishnan, the federation could supply only less than 4,000 tonnes till November though the new arrival of rubber in the state during the three months was over 1,50,000 tonnes.

"It is even doubtful whether the Rs 2 allowed on STC supplies by the government will be passed on to the rubber-growers," Radhakrishnan said.

The federation has been "selling rubber to select tyre firms for their existence" said Radhakrishnan. He also said that the federation had failed because it lacks a big base outside Kerala.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.