Apr 01 2024, 07:15
India's anti-dumping policy: Safeguarding industries or stifling growth?
Section of industry says it is time to look at the country's anti-dumping strategy with a fresh lens. The duties sometimes favour large firms and severely impact MSMEs, choking industrial growth.
India's anti-dumping duties are not fulfilling their stated goal of safeguarding the domestic industry, but are throttling the growth of various businesses, say industry stakeholders. Moreover, these trade barriers are being applied in segments that have growth potential, they say, demanding a holistic review of policy.
Such steep duties burden small firms and traders in downstream manufacturing value chains of multiple industries, as they claim that these duties were reportedly imposed without seeking their input.
Shridhar Uppin, founder & CEO of Belgaum- based engineering company Positron, which makes heat exchangers, says his business has been affected by the ADD. Uppin says a Gujarat-based company has a monopoly in LMWCMs and these are expensive machines, putting them out of reach of small businesses. "The Chinese LMWCMs are not only cost- effective but are far better in quality, too. These (ADD) moves put our goal of making world- class products on Indian soil on shaky grounds," says Uppin, a member of the Karnataka Small-Scale Industries Association (KASSIA).
India tops the list of developing countries using anti-dumping measures. The world's fifth-largest economy has filed roughly 20% of all global antidumping cases, disproportionate to its share of global imports of 2%, studies show. According to the Ministry of Commerce, the major sectors in which India has imposed anti-dumping measures are chemicals & petrochemical products (42% of all ADDs); glass and glassware (14%); rubber or plastic products (12%); textiles and articles (9%); steel or other metal products (7%) and other consumer goods (16% of all ADDs).
They use the example of the chemical sector, where India is the 6th largest producer; it contributes 7% to India's GDP. A big problem is China dumping isopropyl alcohol (IPA), used as a cleaning solvent in pharmaceuticals, chemicals, paints & coatings, and cosmetics, among others. Industry observers say the domestic industry has to pay high duties to import IPA, and use these to manufacture and export products.
Satish Wagh, vice-chairman at industry body Chemexcil, says one company and its subsidiary - Deepak Fertilisers and Deepak Nitrite overwhelmingly controlled this segment. According to a recent report by ChemAnalyst (a platform monitoring chemical and petrochemical data), these companies have capacities of about 140-145 million tonnes (mt). But India's approximate consumption is around 210 mt, says Wagh, who is also the CMD of Supriya Life Sciences.
Based on the recommendation of domestic IPA manufacturers, certain quantity restrictions were imposed on IPA imports. This, Wagh points, inflated the prices of the input to Rs 150 a kg from Rs 50-70 a kg. The prices are expected to go up further.
source:et
Apr 01 2024, 07:22
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