Govt initiates probe into alleged dumping of polypropylene

The government has initiated investigations on a petition to impose anti-dumping duty on polypropylene imports from Korea, Taiwan and the US.

Polypropylene is one of the most common polymer petrochemicals, used in a variety of day-to-day products from high tenacity cement and fertiliser bags to tough fibres such as films and containers.

Investigations have been initiated on a complaint made by major domestic producers in February, officials said. Reliance Industries, Haldia Petrochemicals, Indian Oil Corporation and Gas Authority of India are the four major producers of petrochemicals in the country.

The same companies had complained in 2009 on polypropylene imports from Oman, Saudi Arabia and Singapore; a probe is on for these.

It is alleged the prices charged by the exporting companies are well below the cost of production plus taxes, etc.

Officials said the antidumping directorate has also sought views from trade bodies and companies for proposing an anti-dumping duty on another popular and commonly used petrochemical, polyethylene. This is used in carry bags for retailing milk and vegetables.

However, officials also said the polyethylene market in India is actually facing a shortage of production, triggering imports.

An anti-dumping investigation is usually initiated on petitions from a company or a group of companies complaining of increased imports into their markets here. Dumping is defined as an unfair trade practice, with goods exported to another country at a price lower than its normal value. Thus anti-dumping, as approved by the World Trade Organisation, is a measure to restore fair trade by imposing additional "anti-dumping" duty on the imported goods to remove the price anomaly between these and domestic products.

Of late, such complaints have increased. In the past two months, the department of revenue has imposed anti-dumping duty on about a dozen new items, mainly in chemicals and petrochemicals (solvents, dyes and so forth).