The Hindu Business Line : Dumping duty on PHPG imports from Singapore to continue

If the anti-dumping duty is withdrawn, the volume gained by the domestic industry so far would be lost and in addition to suppressed prices, this will result in huge financial losses.

New Delhi , Sept. 4

The Designated Authority in the Commerce Ministry has recommended continuation of the definitive anti-dumping duty on imported D (-) Para Hydroxyl Phenyl Glycine Methyl Potassium Dane Salt (PHPG Dane Salt) from Singapore, after a mid-term review.

The subject goods, importedinto the country, is converted by importers/manufacturers for the production of Amoxycillin and Cefardroxyl (i.e., bulk drugs). This conversion might either be done at the PHPG/ PHPGDS manufacturers' end or at the user's end, i.e., producers of Amoxycillin.

In its final notification issued recently, the Authority held that in the original investigation, the application was filed by Daurala Organics Ltd, Daurala, Meerut (U.P.), now merged with DCM Shriram Industries Ltd, which constitutes the domestic industry, as it is the sole producer of the subject goods.

The domestic industry argued that it has come of nascent stage only due to imposition of the anti-dumping duty on the import of the PHPG base. "If the anti-dumping duty were to be withdrawn, this will result in cheap imports from Singapore and will reduce the sales volume of the domestic industry significantly."

On the other hand, the producer and exporter of subject goods from Singapore - Kaneka Singapore Corporation - has adduced reasons for revocation of the definitive anti-dumping duty in force, citing a host of reasons. These include among others that the export price of KSC to India has significantly reduced, the customs duty has been reduced from 35 to 20 per cent and the dumping margin has markedly declined and thus benchmark fixed in the original investigation should be reduced accordingly.

The Authority said that the present review being mid-term investigation, it is more relevant to examine whether revocation of present anti-dumping duties would potentially result in decline in sales volumes. Domestic industry submits in this regard, given the level of existing price depression and suppression it would be faced with significant loss of sales volumes (if the domestic selling price is increased) or losses (if the prices remain at this level), should the present anti-dumping duties be revoked.

The Authority has examined the injury parameters concerning domestic industry. Before the imposition of anti-dumping duty, the capacity utilisation for the domestic industry was only 32 per cent. However, after imposition of the anti-dumping duty, capacity utilisation during period of investigation has increased up to 100 per cent on the enhanced installed capacity.

Recommendation

The exporter from Singapore is exporting the subject material at dumped price, which is compelling the domestic industry to reduce its prices to match the export prices and in turn, resulting into losses to the domestic industry. If the anti-dumping duty is withdrawn, the volume gained by the domestic industry so far would be lost and in addition to suppressed prices, this will result in huge financial losses.

A perusal of data compiled from exporters' record clearly reveals that the landed prices of imports (without the anti-dumping duty) are significantly low as compared to non-injurious price. The domestic industry is thus forced to sell the subject goods well below the non-injurious price in the domestic market, thereby suffering material injury on account of dumped imports from Singapore and the injury is likely to persist if anti-dumping duty is withdrawn.

Hence, the Authority deems it appropriate to recommend the continuation of anti-dumping duty on imports of PHPG Dane Salt. The anti-dumping duty would be the difference between $9.13 per kg and the landed value of imports from Singapore, provided the landed price per kg is less than $9.13 per kg.

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