India's rubber sector MSMEs are facing mounting pressure as natural rubber prices have surged 35-40 percent amid geopolitical tensions and war-related uncertainty, the All India Rubber Industries Association (AIRIA) said. Small Manufacturers Struggle With Rising Costs AIRIA President Anay Gupta said small manufacturers are struggling with rising raw material costs, shrinking profit margins, delayed payments and higher freight charges. He noted that unlike larger companies, MSMEs do not have the financial capacity to maintain large inventories or absorb sudden price volatility in key raw materials.

The sharp rise in natural rubber prices has significantly increased production costs for small rubber product manufacturers, many of whom operate on thin margins and limited working capital. Industry Warns Of Competitiveness Risks Industry players warned that prolonged price volatility could disrupt production cycles, weaken competitiveness and put additional stress on smaller firms already dealing with payment delays.

AIRIA urged policymakers to closely monitor the situation and consider measures to stabilize raw material availability and protect smaller manufacturers from prolonged financial distress. Global Supply Disruptions Add To Uncertainty The rubber industry, which includes thousands of MSMEs engaged in tyres, footwear, auto components and industrial products, remains particularly vulnerable to global commodity disruptions. With geopolitical uncertainty continuing to impact global supply chains, industry stakeholders fear further cost escalation in the coming months.