India’s trade defence body Directorate General of Trade Remedies (DGTR) has recommended imposition of provisional anti-dumping duty of up to $339 per metric tonne on imports of PVC suspension resin from seven countries, including China and US.
PVC suspension resin is the main raw material for rigid and flexible plastics. It is widely used for making pipes, packaging material, bottles, footwear and cable insulation. The industries for which it is a major input include automotive, construction, medical and shoemaking.
In 2023-24, the total imports of the key industrial input were worth $1.8 billion, down from around $ 2 billion in the previous year. China is the biggest exporter of the commodity to India. Last year, it exported $580 million worth of PVC suspension resin to India, followed by Japan $267 million, Taiwan $ 290 million and South Korea $234 million, and the US $198 million.
Japan, South Korea, Taiwan, Thailand and Indonesia are the other countries whose PVC resin exports will attract anti-dumping duty.
The order of the DGTR came after investigations following complaints by DCM Shriram Ltd, DCW Ltd and Chemplast Cuddalore. The applicants had said that because of below-cost imports their growth and margins have suffered.
The anti-dumping investigation was done from October 2022 to September 2023. The injury investigation period was from April 2020 to March 2023.
Following investigation, the DGTR found that imports in relation to production and consumption have increased over the injury period, with the effect that the imports account for more than the majority of the consumption during the period of investigation. The demand in India has increased by 49% in the period of investigation as compared to the base year, while the subject imports have increased by 126% over the same period. Thus, the subject imports have increased at a pace higher than the increase in demand.
It also found that profitability of the domestic industry has declined significantly over the injury period. While the domestic industry was earning profits in 2020-21 and 2021-22, it incurred financial losses in 2022- 23 and the period of investigation. While the sales of the domestic industry have increased, the total losses of the domestic industry have also increased because of pressure of competing with imports. Thus, with additional volume of sales, the losses of the domestic industry are growing.
Since the price of the subject imports is lower than the selling price of the domestic industry, the same has created a strain on the prices of the domestic industry. This has forced the domestic industry to sell at prices below their cost, resulting in financial and cash losses. The imports have prevented price increases, which otherwise would have occurred. Therefore, the imports are impacting the prices of the domestic industry, DGTR said in its findings.
Before publishing final findings, the DGTR will give a time of 30 days to the interested parties to comment on them.
From: financialexpress
Financial News
