In recent years, the Indian tire industry is in a golden period of rapid expansion. A large number of tire factories have sprung up in industrial zones such as Gujarat and Chennai, and production lines are running around the clock.
In just two years from 2025 to 2026, the total investment by India’s leading tire companies in expanding production exceeded 16.2 billion yuan: local giant JK Tire invested US$530 million to increase radial tire production capacity by 24%, and Apollo Tire invested more than 4 billion yuan to increase passenger car, truck and bus tire production capacity by 20% within three years.
At present, India has 67 large-scale tire factories, ranking second in the world in terms of total number of factories. The production spree at downstream terminals once created the illusion that India is about to join the first echelon of global tire manufacturing.
But beneath the surface of prosperity, the Indian tire industry hides a fatal upstream weakness: the core chemical additives that determine the wear resistance and strength of tires-sulfenamide rubber vulcanization accelerators, India’s local production capacity is seriously insufficient.
Although this additive, known as “industrial monosodium glutamate”, is used in very small amounts in tires, it is an indispensable core raw material for the rubber vulcanization reaction. Without it, tires produced cannot meet the performance requirements for road driving.
At present, the annual production capacity of this type of additives in India is only 12,000-15,000 tons, and the scale of imports from China alone will reach 16,000 tons in 2023. The faster the expansion of downstream production capacity, the higher the risk of upstream raw materials getting stuck.
In order to solve the dilemma of dependence on raw materials and force Chinese companies, which control more than 70% of the world’s production capacity of such additives, to build factories in India and transfer core technologies, the Indian Ministry of Finance officially issued a notice on June 19, 2026, announcing a five-year anti-dumping tax on sulfenamide rubber vulcanization accelerators originating in China, the United States, and the European Union.
It is not difficult to see its directional intention towards China from the tax rate setting: Chinese companies regardless of size are levied a heavy tax of US$974/ton, while American companies only charge US$75-192/ton. Although the EU has a higher book tax rate, its local similar production capacity has already shrunk significantly due to environmental protection and cost factors, and it has almost no share in the Indian market. The US and Europe are just to pretend to be compliant under WTO rules.
India’s wishful thinking did not come true as expected. First of all, the technical gap in the field of fine chemicals cannot be bridged in the short term: the production of sulfenamide accelerators requires extremely high engineering experience in reaction temperature control, catalyst ratio, and waste liquid closed-loop treatment. After 20 years of experience, China’s leading companies
After years of technology iteration, product yield, performance stability, and cost control have reached the world’s leading level. However, India’s local production capacity has large batch quality differences, low high-end model qualification rates, and high environmental costs. Even top local consortiums such as Reliance and Tata will not be able to fill the technology gap in the short term.
Secondly, high tariffs directly backfire on India’s local industry: Since local production capacity cannot meet the raw material needs of 67 tire factories, Indian tire companies can only continue to import Chinese additives at high prices. The additional tariff costs are directly allocated to each finished tire, which greatly weakens the price advantage of Indian tires in the international market.
In order to control costs, many Indian vehicle manufacturers have even given up purchasing local tires and instead directly imported finished overseas tires, which has further impacted India’s local tire industry chain.
Faced with India’s pressure, Chinese companies generally choose the strategy of “sell the goods as they are, and avoid negotiations on building factories”: on the one hand, the lessons learned from the asset freezes and equity dilutions that many overseas companies have encountered in India are still there, and Chinese companies generally adhere to the strategy of “never leaving their hands on technology and never reinvesting their assets.”
The bottom line; on the other hand, China’s tire and related additive product exports cover more than 200 countries and regions around the world. The annual tire export volume in 2024 will reach 164.5 billion yuan. India’s market share is extremely low, which will not shake the global market fundamentals of Chinese companies at all.
After the current anti-dumping duties are implemented, Indian tire companies waiting for raw materials to start production are in a dilemma.
