The government has imposed a countervailing duty on copper tubes and pipes coming from Malaysia, Thailand and Vietnam for five years, following recommendations by the Directorate General of Trade Remedies that has probed the matter on a suo-moto basis.
The imposition of the duty is aimed at guarding domestic players against imports that are subsidised by these countries.
“The countervailing duty imposed under this notification shall be levied for a period of five years (unless revoked, superseded or amended earlier) from the date of publication of this notification in the official gazette and shall be payable in Indian currency,” the Department of Revenue has said in a notification dated April 28.
The duty imposed is in the range of 2.13 per cent of CIF (cost, insurance, freight) value to 14.76 per cent of CIF value.
The CIF value is the actual value of the goods when they are exported.
In its probe, the Directorate General of Trade Remedies (DGTR) concluded that the volume of imports has increased in absolute terms.
While the DGTR recommends the duty, the Finance Ministry takes the final call to impose the duty.
The directorate in July/ August 2020 received representations from the Bombay Metal Exchange expressing concern over the vanishing domestic production of copper tubes and pipes and a steep decline in production in India.
This is due to a significant increase in imports from these countries on account of huge subsidies/benefits that are available to the producers in those nations and tariff concessions, the exchange had said.
They had also raised concerns regarding the limitation to filing a fully documented petition as the industry is being fragmented and dispersed.
Taking into consideration the representations, the DGTR initiated an investigation on September 25, 2020, of subsidies being granted by the governments of Malaysia, Thailand and Vietnam on exports of copper pipes and tubes to India on a suo-moto basis without a fully documented petition.
Only in 2020, two trade remedy investigations were initiated by the Directorate on a suo-moto basis after more than two decades.
Normally, the DGTR conducts a probe of trade remedies on the basis of a fully documented petition but in cases where the industry is fragmented and dispersed, in such exceptional circumstances resorts to suo-moto investigations to provide relief to the ailing domestic industry from such unfair trade practices to ensure a level playing field.
Countervailing duty is a country-specific duty imposed to safeguard the domestic industry against unfair trade subsidies provided by the local governments of the exporting nations.
Under the global trade rules of the World Trade Organization (WTO), a member country is allowed to impose anti-subsidy to countervailing duty if a product is subsidised by the government of its trading partner. PTI RR RR BAL BAL
