Anti-Dumping Duty on Steel Imports from China

• 24 Feb 2021

Why in News

Recently, the Directorate General of Trade Remedies (DGTR) has initiated a probe to review the need for continuing imposition of anti-dumping duty on certain types of steel products imported from China, following complaints from domestic industry.

• The duty on the certain steel products was first imposed in February 2017 and is set to expire on 16th May 2021.

Directorate General of Trade Remedies

• It is the apex national authority under the Ministry of Commerce and Industry for administering all trade remedial measures including anti-dumping, countervailing duties and safeguard measures.
• It provides trade defence support to the domestic industry and exporters in dealing with increasing instances of trade remedy investigations instituted against them by other countries.

Key Points

• About:
  
  • Some of the major private domestic producers of steel have filed an application before the DGTR for a sunset review of anti-dumping duty imposed on imports of seamless tubes, pipes and hollow profiles of iron, alloy or non-alloy steel from China.
  • The applicants have alleged that dumping of these products from China has continued even after imposition of anti-dumping duty, and there has been a significant increase in the volume of imports.
  • DGTR would review the need for continued imposition of the duties in force and examine whether the expiry of existing duties is likely to lead to continuation or recurrence of dumping and impact the domestic industry.
• Anti Dumping Duty:
  
  • About Dumping:
    
    • Dumping is said to occur when the goods are exported by a country to another country at a price lower than the price it normally charges in its own home market.
    • This is an unfair trade practice which can have a distortive effect on international trade.
  • Objective:
    
    • Imposition of Anti-dumping duty is a measure to rectify the situation arising out of the dumping of goods and its trade distortive effect.
      
      • In the long-term, anti-dumping duties can reduce the international competition of domestic companies producing similar goods.
    • It is a protectionist tariff that a domestic government imposes on foreign imports that it believes are priced below fair market value.
    • The use of anti-dumping measures as an instrument of fair competition is permitted by the World Trade Organisation.
  • Different From Countervailing Duties:
    
    • An Anti-Dumping Duty (ADD) is a customs duty on imports providing a protection against the dumping of goods at prices substantially lower than the normal value whereas Countervailing duty is a customs duty on goods that have received government subsidies in the originating or exporting country.
• WTO's Provisions Related to Anti-Dumping Duty:
  
  • Validity: An anti-dumping duty is valid for a period of five years from the date of imposition unless revoked earlier.
  • Sunset Review: It can be extended for a further period of five years through a sunset or expiry review investigation.
    
    • A Sunset review/ expiry review is an evaluation of the need for the continued existence of a program or an agency. It allows for an assessment of the effectiveness and performance of the program or agency.
    • Such a review can be initiated suo moto or on the basis of a duly substantiated request received from or on behalf of the domestic industry.

Source:TH