Govt refuses to impose safeguard duty on auto components

The government has refused to impose safeguard duty on imports of some auto components of medium and heavy commercial vehicles from China, saying these are not affecting the domestic industry.

After conducting an investigation following a complaint filed by Bharat Forge, the Directorate General of Safeguard and Allied Duties (DGS) said it did not find sufficient evidences to impose the duty.

"There is no sufficient evidence of causal link between the increased import of products and the market disruption of the domestic industry...So no safeguard duty are recommended," an official said.

Bharat Forge, leading auto component maker, had sought imposition of safeguards duty on imports of front axle beam, steering knuckle and crankshaft of medium and heavy commercial vehicles into India from China to protect the domestic players.

Subsequently, DGS carried out the investigations and found the increase in imports were temporary in nature.

Unlike anti-dumping duty which varies from product to product and country to country, safeguard duty is levied in a uniform way. Both duties are allowed under the multilateral trade rules after investigations to stand the WTO scrutiny.

A recent WTO report said among the G-20 countries, India initiated the maximum safeguard probes during January-July, 2009.

The report said out of the total 16 investigations started to impose safeguard duties, India accounted for 14.

India has started safeguard investigations mainly on imports of hot-rolled coils, sheet, strips, coated paper and paper board.