The government has decided not to impose anti-dumping duty on Chinese metal cutter wheels as the finance ministry has not accepted the recommendations of the Directorate General of Trade Remedies (DGTR) for imposing the levy.
The commerce ministry‘s investigation arm DGTR had conducted a probe into the alleged dumping of “Resin Bonded Thin Wheels” from China, and in September it recommended the imposition of the duty. The product is used in various sectors ranging from welding, cutting, foundry to primary metal markets for nagging and cutting ferrous and non-ferrous materials.
“The central government, after considering the final findings of the designated authority (DGTR), has decided not to accept the … recommendations,” an office memorandum of the Department of Revenue said. While the Directorate General of Trade Remedies (DGTR) recommends the duty, the Department of Revenue takes the final decision to impose it.
In international trade parlance, dumping happens when a country or a firm exports an item at a price lower than the price of that product in its domestic market. Dumping impacts the price of that product in the importing country, hitting the margins and profits of manufacturing firms.
According to global trade norms, a country is allowed to impose tariffs on such dumped products to provide a level-playing field to domestic manufacturers. The duty is imposed only after a thorough investigation by a quasi-judicial body, such as DGTR, in India. The duty is aimed at ensuring fair trading practices and creating a level-playing field for domestic producers vis-a-vis foreign producers and exporters.