The Hindu Business Line : Definitive dumping duty on tyre vulcanisers from China recommended

New Delhi, Nov. 2 The Designated Authority in the Commerce Ministry has recommended the imposition of a definitive anti-dumping duty on imported ‘tyre curing presses’, broadly known in trade parlance as tyre vulcanisers or rubber processing machineries for tyres.

Tyre curing press is a machine used for curing tyre during its manufacture, where tyres obtain their final shape and tread pattern.

Hot moulds shape and vulcanise the tyres. The mould are engraved with the tread pattern, the sidewall markings of the manufacturer and those required by law. After curing, the tyres are removed from their moulds and taken to final finish and inspection.

L&T complaint

Taking up a complaint lodged by Larsen and Tourbo Ltd, Chennai, which has claimed that there is no known difference between the products manufactured by it and the subject goods exported from China, the petitioner contended that this could have ‘any impact on price, usage and quality’ on its own product sold in the domestic market.

Injury to domestic scene

Stating that analysis of the performance of the domestic industry over the injury period reveals that the performance of the domestic industry has materially deteriorated, the Authority establishes the causal links between dumped imports and the injury to the domestic industry on three crucial counts.

Firstly, it said, the volume of dumped imports from China has sharply increased at significantly lower prices during the injury investigation period, resulting in significant price undercutting and underselling. As a direct result, the indigenous industry could not hold or increase its prices in line with increase in the cost of production, resulting in financial losses.

Secondly, it argued, the increase in import volumes and suppression of domestic prices adversely affected the profits, cash flow and return on investments of the company.

Thirdly, significant positive price undercutting led to spurt in market share of imports from China to the dismay of the domestic industry, it said, adding that the domestic industry appears to have responded to the decline in import prices by suppressing its prices and consequently suffered financial losses.

Definitive duty

Having been convinced of the fact that the domestic industry has suffered material injury, which was caused to it both by volume and price effect of dumped imports from China, the Authority has recommended definitive anti-dumping duty.

In deference to the lesser duty rule, it has plumped for definitive “anti-dumping duty equal to the lesser of margin of dumping and margin of injury so as to remove the injury to the indigenous industry”.

It further held that there is a significant differentiation of the product in terms of its capacity and prices and hence a duty in terms of reference price or fixed duty would not be appropriate in this case.

Accordingly, the Authority recommends imposition of the measure as an ad valorem duty, to be worked out as a percentage CIF (cost, insurance and freight) value of imports of the subject goods from China.

The anti-dumping duty hence is 10 per cent of CIF value of tyre cutting presses all sizes up to 130” if they are exported from China, even if the exporter and producer are from different countries and including all those exporters and producers from China.

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