The commerce ministry has recommended for extension of anti-dumping duty for five years on carbon black used in the rubber and tyre industry from China and Russia, with a view to guard domestic players from cheap imports from these two countries.
In a notification, the ministry's investigation arm Directorate General of Trade Remedies (DGTR) has said there is a "positive" evidence of likelihood of dumping of 'carbon black used in rubber applications' and injury to the domestic industry if the existing anti-dumping duty would be removed.
"The authority considers it necessary to recommend continuation of definitive anti-dumping duty" on all imports from China and Russia for a "further period of five years,", it has said.
The directorate has recommended two duties, USD 494 per tonne for imports coming from China and USD 36.17 per tonne from Russia. The finance ministry takes the final decision to impose this duty.
In its probe, the directorate has concluded that there is a continued dumping of the product from these countries and "the imports are likely to enter the Indian market at dumped prices in the event of expiry of duty".
The Carbon Black Manufacturers Association, on behalf of domestic producers, had filed the application before the DGTR for continuation of the duty on the product from these two nations.
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 price of that product in the importing country, hitting 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.