Government initiates probe into dumping of a chemical by China

India has initiated a probe into alleged dumping of a chemical, used in semiconductors and fertilisers, by China following complaints by domestic players.

The Commerce Ministry's designated authority, the Directorate General of Anti-Dumping and Allied Duties (DGAD), has begun an investigation into alleged dumping of "Red Phosphorous".

Tamil Nadu-based Metal Powder Company Ltd and Mumbai-based United Phosphorus Ltd had filed the application for investigation.

In a notification, the DGAD has said the petitioners have provided sufficient evidence that the normal value of the chemical in China is significantly higher than the net export price.

The evidences have prima-facie indicated that the product is being dumped from the neighbouring country, it said.

"The Authority (DGAD) considers that there is sufficient evidence of injury being suffered by the petitioners caused by dumped imports from the subject country (China) to justify initiation of an anti-dumping investigation," it said.

The period of investigation is from April 2011 to March 2012. However, for the purpose of analysing injury, the data of previous three years of 2008-2009, 2009-2010 and 2010-2011 would also be considered, it added.

After completion of the probe, the DGAD, if needed, would recommend the duty and the finance ministry would impose it.

Countries initiate an anti-dumping probe to determine whether their domestic industries have been hurt because of surge in cheap imports of any product. As a counter-measure, they impose duties under the multilateral regime of the WTO.

The duty is aimed at ensuring fair trading practices and creating a level-playing field for domestic producers vis-a- vis foreign producers and exporters resorting to dumping.

Unlike the safeguard duty, which is levied in a uniform way, anti-dumping duty varies from product to product and country to country.

India has initiated 275 anti-dumping investigations between 1992 and March 2012, involving 42 countries.

The countries prominently figuring in anti-dumping investigations are China, Korea and Singapore and the major product categories on which anti-dumping duty has been levied are chemicals and petrochemicals, pharmaceutical, steel and consumer goods.