Lawmakers have warned that new technical barriers on imported tyres could hand an unearned windfall to one or two dominant local manufacturers, after officials conceded they had gazetted the rules without studying market shares or domestic production capacity.
The Committee on Public Finance questioned officials over Gazette No. 2508/27, which makes SLS certification mandatory on imported car and three-wheeler tyres from January 2027, EconomyNext reported.
What the ministry could not answer
The Ministry of Industry told the committee that 18 tyre manufacturers are registered with it, but only 8 actually manufacture new pneumatic tyres — the rest rebuild and retread.
Installed capacity for car tyres is 2.398 million units a year, against actual output of 1.259 million in 2023 and 1.339 million in 2024 — roughly 56 per cent utilisation.
Officials were unable to provide firm-level production figures or individual market shares. The Consumer Affairs Authority told the committee that while it examines competition in selected essential commodities, it had carried out no Herfindahl-Hirschman Index study or market concentration assessment on the tyre industry before the rule was gazetted.
The cartel argument
Opposition MP Shanakiyan Rasamanickam said the regulation, combined with the absence of state testing facilities, risked rewarding dominant producers under cover of quality control.
“If one single company supplies the bulk of the market while the other firms produce very little, changing the law creates an unfair monopoly windfall for a single entity,” he said.
Committee chairman Harsha de Silva drew the comparison to the overnight ceramic tile import ban imposed under the previous administration. “The exact same thing happened in the tile industry, turning it into a protected duopoly. We cannot allow policy to be made without analyzing domestic market concentration first.”
The committee directed the Ministry of Industry and the Consumer Affairs Authority to submit a joint report within two weeks, covering domestic demand, firm-by-firm production and an evaluation of market competition.
Context
The gazette amends the Imports and Exports (Control) Regulations No. 08 of 2026 and was approved by Cabinet on 20 October, requiring passenger car tyres to meet SLS 1212 and three-wheeler tyres SLS 1347, as first set out in early October. The government presented the measure as consumer protection and a fair footing for local manufacturers; the committee’s objection is not to the standards but to their having been set before anyone measured the market they reshape.
Not reported
The filing does not name the dominant manufacturers, say whether the January 2027 date will be deferred pending the report, or record any ministry response to the cronyism charge. It does not state whether the committee has withheld approval of the regulations, which require parliamentary sign-off. No other verified newsroom had carried the proceedings at the time of writing.
