New Delhi: India has initiated a countervailing duty investigation into imports of polyvinyl chloride (PVC) suspension resins—used to make pipes, fittings, cables and other plastic products—from China.
The move follows complaints by domestic manufacturers alleging that Chinese exporters benefited from a wide range of subsidies granted by Chinese government and its provincial authorities, hurting India's local industry.
According to an official order reviewed by Mint, the Directorate General of Trade Remedies (DGTR) under the Union commerce ministry issued an initiation notification on 26 February, starting a probe into alleged subsidization of PVC suspension resins originating in or exported from China.
The investigation has been launched on an application filed by Chemplast Cuddalore Vinyls Ltd, DCM Shriram Ltd and DCW Ltd.
The order stated that the complainants account for a significant share of domestic production of the product under investigation, and therefore qualify as the “domestic industry” under trade remedy rules. The complainants also noted that Finolex Industries and Reliance Industries Ltd (RIL) are the other domestic producers, while Mundra Petrochem and Indian Oil Corp. are setting up their capacities to manufacture PVC suspension resins. The order also recorded that Finolex and RIL regularly imported the product and brought in substantial volumes during the investigation period of 1 October 2024 to 30 September 2025.
Queries sent to all the companies mentioned in the copy and to the spokesperson of the commerce ministry were not immediately answered.
PVC suspension resin is a key raw material widely used in pipes and fittings, flexible hoses, films and sheets, bottles, profiles, wires and cables, and footwear.
India’s total imports of the PVC resin from China stood at $985.8 million in calendar year 2022, $2.1 billion in 2023, and $2.2 billion in 2024, according to United Nations (UN) Comtrade data.
The product under consideration covers suspension-grade PVC with K-Value above 55 and up to 77 and falls primarily under customs classification 3904. The K-Value refers to the molecular weight of the resin, which determines its strength and processing properties.
The move assumes significance as China has challenged India’s electric vehicle (EV) and renewable energy subsidy schemes at the World Trade Organization (WTO). The WTO has agreed to set up an expert panel to examine China’s complaint, which alleges that incentives for advanced chemistry cell batteries, automobiles and electric vehicles discriminate against goods of Chinese origin.
As per the DGTR intimation, the domestic industry has alleged that Chinese producers and exporters benefit from multiple subsidy programmes, including provision of land, water, electricity, steam coal, caustic soda and chlorine at less than adequate remuneration, tax exemptions and value added tax (VAT) refunds, preferential loans and export financing, as well as various grants at central, provincial and municipal levels.
According to the order, these schemes involve financial contributions by Chinese authorities and confer benefits that are specific and countervailable under Indian law.
Jaijit Bhattacharya, founder and president of the Centre for Digital Economy Policy Research (C-DEP), said that the investigation is a positive step toward ensuring fair competition in India’s industrial ecosystem.
“Given that trade remedies on PVC resin such as anti-dumping duty and QCO (quality control order) were not applied in November of last year, while Indian manufacturers were facing serious injury due to highly subsidized PVC resin imports from China, it is imperative that India provides relief to its PVC resin industry. PVC powers 29% of India’s economy and, hence, safeguarding this industry is critical. Such a step strengthens investor confidence and supports long-term manufacturing growth,” Bhattacharya said.
The investigation was initiated after the DGTR held consultations with representatives of the Chinese government on 20 January 2026, as required under WTO rules. The authority said that the comments received from China have been placed on record and will be examined during the course of the investigation.
The complainants have argued that subsidized imports from China have increased both in absolute and relative terms during the period of investigation and have led to price suppression and price depression in the domestic market.
They have claimed that the domestic industry’s cash profits, profit before interest and tax (PBIT) and return on capital employed have turned negative, inventories have risen, and the industry is on the verge of shutdown, it said.
The DGTR has taken note of the prima facie evidence of subsidization and injury, and has formally initiated the investigation under Section 9 of the Customs Tariff Act read with the CVD Rules, 1995.
The period of investigation is from 1 October 2024 to 30 September 2025, while injury analysis will cover the previous three financial years—FY2022-23, FY2023-24 and FY2024-25.
Significantly, the applicants have sought retrospective imposition of countervailing duty, arguing that imports surged in a short period and that the damage to the domestic industry would be difficult to repair.
Retrospective imposition of countervailing duty means levying the anti-subsidy duty on imports that entered the country before the final decision, usually from the date the investigation was initiated.
The DGTR has stated that it will examine the claim for retrospective duty and has recommended provisional assessment of imports pending the outcome of the investigation. Interested parties have been given 37 days to file submissions through the DGTR’s SETU portal.
SETU, or Secure Electronic Transmission Utility, is an online platform for electronic filing and communication in trade remedy cases.
Chemplast Sanmar pioneered the manufacture of specialty paste PVC in India. It is today the country’s largest manufacturer of specialty paste PVC resin with two plants—one each in Tamil Nadu's Mettur and Cuddalore with a total capacity of 107,000 tonnes per annum.