New Delhi: The commerce ministry has recommended the continuation of 18.95 percent countervailing duty (CVD ) on certain flat-rolled steel products imported from China for five years to guard domestic manufacturers against subsidised imports. The duty was recommended by the ministry's investigation arm Directorate General of Trade Remedies (DGTR) after conducting a sunset review investigation on imports of 'hot rolled and cold rolled stainless steel flat products' imported from China.
Jindal Stainless Ltd and Jindal Stainless (Hisar) Ltd had jointly filed an application before the DGTR for initiation of this probe. They had sought the continuation of the countervailing duty on the imports, according to a notification of the directorate. According to the applicants, the expiry of the existing duty was likely to result in the continuation/recurrence of subsidised imports of these goods from China, and that impact the domestic industry.
The imports have increased to 3,43,893 (annualised) metric tonnes (MT) in April-September 2022, and 4,42,058 MT (annualised) in October-December 2022, thus showing a continuous increase. The directorate in its findings has concluded that the Chinese imports are undercutting the domestic prices and there is a likelihood of continuation of subsidisation on the products by China if the existing CVD was discontinued in the light of the surplus capacities maintained by the Chinese producers.
"The Authority considers it appropriate and necessary to recommend continuation of definitive duty for a period of five years on all imports of the subject goods from the subject country," it said. While the DGTR recommends the duty, the finance ministry takes the final decision to impose the same.
Under the global trade rules of the World Trade Organisation (WTO), a member country is allowed to impose anti-subsidy to countervailing duty if a product is subsidised by the government of its trading partner. These duties are trade remedies to protect domestic industry. Subsidy on a product makes it competitive in price terms in other markets.
Countries provide this to boost their exports. India and China are members of the WTO. China is a major trading partner of India.
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