The commerce ministry is likely to tweak laws on anti-dumping and safeguard duties in order to protect the domestic sector from dumping of goods.
“There was a long-pending demand to increase trade tariffs, such as safeguard duty and anti-dumping duty. Currently, the Indian duty structure is much lower than the global standard,” said a senior official in the ministry.
According to official sources, the changes will include removing lesser duty rules (LDR), which will pave the way for Indian investigating authorities to impose anti-dumping and countervailing duty to the full extent of dumping and subsidy margins, respectively.
Also, the officials suggested that a tariff-rate quota would be introduced in the safeguard rules, which will provide greater flexibility to the government in operating and administering the safeguard mechanism.
The draft proposal also suggests that an anti-circumvention provision will be introduced in the CVD (countervailing duty) rules to address the issue of circumvention by foreign producers or exporters availing of subsidy.
These are trade remedy measures provided under the global trade norms of the World Trade Organization to protect the domestic industry in case of dumping of goods, a significant jump in imports, and subsidised imports.
The rule, once approved, will assume significance amid apprehension among government departments and the industry that a trade deal on current terms will lead to China dumping goods in India. The ministries of steel, agriculture and chemicals, and industries such as dairy, steel, aluminium, engineering, pharmaceuticals, leather and food have expressed reservations in this regard.
Earlier this month, commerce minister Piyush Goyal had said that India will align its anti-dumping rules with global best practices in the next few days to allow such duties to be used to their full extent. “We have a lesser duty rule because of which we can’t levy duties to their fullest extent. The EU and many other countries, however, do not follow this rule,” Goyal had said.
The public consultation has already been done.