NEW DELHI: India has initiated a probe to ascertain if a spurt in imports of Ferro Molybdenum, which is used in steel, nickel, and cobalt alloys, from South Korea is hitting the domestic producers.
According to a notification issued by the Directorate General of Trade Remedies (DGTR), The Indian Ferro Alloy Producer's Association together with Boon Metal &Alloy Corporation, Premier Alloys & Chemicals Pvt Ltd, and Team Ferro Alloys Pvt Ltd have filed an application that an increase in imports of the product is causing serious injury to the domestic producers.
The application was filed under the bilateral safeguard measures rules of the India-Korea free trade agreement. Under the pact, India has given customs duties concession on this product.
The applicants have claimed that the import of the product has increased in absolute terms and in relation to the production and consumption in India.
The notification stated that there is a sudden, sharp and significant increase in imports between 2018-19 and 2021-22.
It is seen that there is a significant increase in the imports before and after the tariff concessions started and due to the jump, the performance of the domestic industry has declined in respect of parameters such as production, capacity utilisation, sales and profits, it said.
The DGTR has said there is prima facie evidence that the imports have increased in absolute and relative terms, causing serious injury to the domestic producers.
"The director general considers it appropriate to initiate the (bilateral safeguard) investigation," it said.
In the probe, it would determine whether the imports of the product from Korea constitute increased imports and whether that has caused or is threatening to cause serious injury to the domestic industry.
In the probe, if it was established that the increase in imports has impacted domestic players, the directorate would recommend the imposition of a safeguard duty on the imports.
The finance ministry will take the final call to impose the duty. The duty helps in providing a level-playing field to the domestic industry in terms of pricing of the chemical in the domestic market.
Pricing is a key component of the quality of products in any market. The bilateral trade between the two countries increased to USD 21.5 billion in 2018-19 from USD 20.1 billion in 2017-18. It has increased to USD 25.6 billion in 2021-22. The trade balance is highly in favour of Korea.