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Dumping duty on yarn from Nepal

Our Bureau

NEW DELHI, Sept. 26

THE Designated Authority in the Commerce Ministry has recommended imposition of preliminary anti-dumping duty on acrylic yarn imported from Nepal.

In its findings, the Authority held that acrylic yarn had been exported to India from Nepal below its normal value and the Indian industry had suffered material injury and was being threatened with further injury.

As such, it was deemed necessary to impose an anti-dumping duty provisionally, pending final determination on all imports of acrylic yarn from Nepal in order to remove the injury to indigenous industry. It was considered to recommend the amount of anti-d umping duty equal to the margin of dumping.

Accordingly, the Authority recommended provisional anti-dumping duty of $0.69 per kg on Reliance Spinning Mills Ltd, Nepal, and $0.84 per kg on all other exporters/ producers of Nepal.

The Authority had received petitions from Punjab Fibers Ltd, Nawan Sahar, Punjab, Vardhman Spinning and General Mills Ltd, Ludhiana, Sportking India Ltd, Ludhiana, and Malwa Cotton Spinning Ltd, Ludhiana, on behalf of the domestic industry.

As per own admission of the exporters, producers in Nepal have cost advantage of at least Rs 15-20 per kg. The petitioners said that even by giving a benefit of Rs 17.50 (average of the claim of exporter), the exports by the Nepalese producers are at a price much lower than this difference of Rs 17.50 per kg.

The petitioners' contention is that the exporters in Nepal did not recover their cost of production and that there is suppression of vital information filed by the exporters.

The production of the four petitioners has been 20,309 tonnes in 1998-99, 22,300 tonnes in 1999-2000 and 22,594 tonnes during the period of investigation (PoI) which is April 2000 to March 2001. Though there has been a slight increase in the total produc tion, their share in the market has come down from 32.7 per cent in 1999-2000 to 30 per cent in PoI due to increase in imports in absolute terms.

Thus, the share of imports from Nepal increased from 6.5 per cent in 1998-99 to 12.8 per cent during the PoI. There was an increase in imports from Nepal in absolute terms by 27 per cent during PoI.

Further, the Authority noted that the production of the domestic industry has stagnated in the face of significant increase in imports from Nepal. As the domestic industry was not able to realise a fair selling price to recover its cost of production and a reasonable profit, the industry was prevented from augmenting its production.

A slight growth in the volume of production of the domestic industry does not signify that there is an absence of injury, the Authority noted adding that ``rather the industry has been forced to produce below its optimum capacity''.

Moreover, due to dumped imports, the industry was unable to increase its selling price to a level to recover the cost of production and to give a fair return on the investment. The injury on account of the non-realisation of a fair selling price has been the most severe affecting the profitability of the domestic industry, the Authority ruled.