DGAD Recommends Anti-Dumping Duty on Jute

Directorate General of Anti-Dumping and Allied Duties (DGAD) has recommended anti-dumping duty of 5-20 per cent on jute and jute products to protect the domestic industry.

The recommendations of DGAD would require Finance Ministry’s nod before the anti-dumping duty is imposed.

The DGAD had last year initiated anti-dumping investigation against imports of products comprising jute yarn/twine, hessian fabrics, jute sacking bags from Nepal and Bangladesh on the request of Indian Jute Mills Association (IJMA).

Dumping of jute products is causing huge financial losses to the country’s jute sector. Almost 16-18 jute mills have shut, rendering job losses to the tune of 30,000 and industry production is down by 20 per cent due to rampant imports at subsidised rates from Nepal and Bangladesh.

West Bengal is a major player in the jute industry, with 3.5-4 lakh people employed in the sector.

About Anti-Dumping Duties in India:

Anti dumping and anti subsidies & countervailing measures in India are administered by the Directorate General of Anti dumping and Allied Duties (DGAD) functioning in the Dept. of Commerce in the Ministry of Commerce and Industry and the same is headed by the “Designated Authority”.

The Designated Authority’s function, however, is only to conduct the anti dumping/anti subsidy & countervailing duty investigation and make recommendation to the Government for imposition of anti dumping or anti subsidy measures.

Such duty is finally imposed/levied by a Notification of the Ministry of Finance. Thus, while the Department of Commerce recommends the Anti-dumping duty, it is the Ministry of Finance, which levies such duty.

Safeguard measures, on the other hand, are administered by another Authority namely, Director General (Safeguard), which functions under the Dept. of Revenue, Ministry of Finance.

The Standing Board of Safeguards (chaired by the Commerce Secretary) considers the recommendations of the DG (Safeguards) and then recommends the impositions of the Safeguard Duty as it deems fit, to the Ministry of Finance which levies the duty.

Objectives of Anti-Dumping Duty:

The purpose of anti dumping duties, in general, is to eliminate dumping which is causing injury to the domestic industry and to re-establish a situation of open and fair competition in the Indian market, which is in the general interest of the country.

The imposition of anti dumping duty might affect the price levels of the products manufactured using the subject goods. However, fair competition in the Indian market will not be reduced by the anti dumping measures.

On the contrary, imposition of anti dumping duty would remove the unfair advantages gained by the overseas exporters through their dumping practices, would prevent the decline of the domestic industry and would create conditions for fair trade.

The imposition of anti dumping measures would not restrict imports from the subject country in any way and therefore, would not hinder the consumers’ access to the imported goods.