The US has won the WTO zeroing dispute against Mexico, which is a setback to India’s sustained campaign against the American method of calculating the anti-dumping duties on imports.

The WTO panel ruling in favour of the Americans has emboldened USTR Susan Schwab to say that the zeroing method of calculating anti-dumping duties should form the basis for Doha Round Rules negotiations.

“This underscores the US view that WTO members need to address this issue in the Doha Round Rules negotiations and adopt clear, precise rules in the Anti-dumping Agreement expressly permitting the use of zeroing,” she said in a statement.

India, which is backed by at least 15 other countries, has gone to the extent of saying that “with ‘zeroing’ there will be no Doha Round agreement.” Both Commerce & Industry Minister Kamal Nath and Secretary in his Ministry

G K Pillai have put out

India’s strong resentment over the WTO panel on Rules succumbing to the US pressure. “We are opposed to the process of zeroing and will always oppose it,” Mr Kamal Nath had recently said.

Anti-dumping duty is imposed by an importing country when it is found that the normal price of a product in the exporting country is higher that its export price. The duty imposed depends on damage suffered by the domestic industry due to the imported product.

Average margin

India finds the US argument as ‘pocketing’ the gains while charging the disadvantages on the exporting countries. When the US Department of Commerce calculates a weighted average dumping margin for a given company, it typically takes into account numerous comparisons between sales in the United States and sales in the home market or third-country market (or costs in the home market).

“It is not uncommon for the Commerce Department to find that some comparisons reveal dumping (e.g the price in the United States is lower than the home market price), while others reveal no dumping (e.g the price in the US is higher than the home market price),” the USTR statement said.