In a bid to give more teeth to investigating authorities and protect domestic industry from cut-throat pricing and dumping by foreign businesses, the commerce department has approved several technical provisions in the rules for trade remedies.
Currently, the government uses the rules like anti-dumping, countervailing duty (CVD) and safeguard to counter market distorting import.
For all of these, the draft amendments are likely to be notified soon by the revenue department after legal vetting, a commerce department official said.
Foremost among the new provisions will be the introduction of lesser duty rules (LDR) to allow investigating authorities impose anti-dumping duty & countervailing duty to the full extent of dumping and subsidy margins, respectively.
According to the World Trade Organization, under LDR, authorities impose duties at a level lower than the margin of dumping if this level is adequate to reversing the damage done to profitability of domestic industry.
Since 2000, developed economies had been urging emerging markets like China and India to restrict the imposition of anti-dumping duties. Brazil, Argentina, Egypt and South Africa have also been known to be major users of anti-dumping provisions.
So far in 2019, the government has initiated more than 10 anti-dumping investigations.
After lengthy discussions on the matter, the commerce department has also green signalled the introduction of tariff rate quota in the safeguard rules, which will provide greater flexibility to the government in operating and administering safeguard mechanism.
It has also decided to introduce anti-circumvention provision in Indian CVD rules to address the issue of circumvention by foreign producers and exporters availing subsidy.
These changes meet long standing demands of Indian domestic industry and are expected to provide much needed support to Indian manufacturing industry and give an impetus to Make- in- India campaign.
The measures were suggested to Commerce & Industry Minister Piyush Goyal earlier this month by the Directorate of Trade Remedies.