India on Tuesday slapped definitive anti-dumping duty on certain steel products imported from China, South Korea and Vietnam after a probe found that these items caused injury to domestic producers.
The revenue department said in an order that flat rolled product of steel coated with alloy of aluminium and zinc was exported from these countries below their normal value, resulting in dumping and causing injury to domestic producers. The rate of duty imposed varies from country to country and from exporter to exporter with the highest rate applicable on exports from China at $128.9 per tonne. Provisional anti-dumping duty imposed on the product in October 2019 had expired in April this year and the definitive duty imposed on Tuesday is applicable for five years starting from last October, said the order.
The imposition of antidumping duty on exports from China comes at a time India is having a raging border dispute with China resulting in the death of at least 20 Indian soldiers in clashes with Chinese forces earlier this month.
Mahesh Jaising, partner at Deloitte India said that the Directorate General of Trade Remedies had in its detailed investigation concluded that import of these goods from the subject countries has led to deterioration in performance of the domestic industry in terms of profits, cash flow and return on investments.
While low cost imports edge out competing local producers from the market, they enable those industries using these imports as raw materials to become competitive. This competing interest among primary and secondary producers is pronounced in the domestic steel industry where producers of finished goods prefer low cost imports. Policy makers weigh the competing interests of the entire value chain while deciding on tax policy.