India is not worried about the possibility of China dumping more goods in India following the US decision to impose higher penal duties on certain Chinese products, including electric vehicles (EVs), as the country has institutions and mechanisms in place to check such inflows, a senior official has said.

“We have our DGTR (Directorate General of Trade Remedies) system. We have our effective anti-dumping system. So, in case somebody wants to dump goods in India, we have all the institutional mechanism to look at it. We will work on it accordingly,” a government official said.

Dumping of goods is said to take place when a country exports goods to another country at a price lower than the price in the exporter’s domestic market. It is not allowed under WTO rules as it hurts the importing country’s domestic industry.

US’ heavy penalties

Earlier this week, US President Joe Biden announced heavy penal tariffs on China across strategic sectors such as steel and aluminium, semiconductors, electric vehicles, batteries, critical minerals, solar cells, ship-to-shore cranes and medical products.

“China’s unfair trade practices concerning technology transfer, intellectual property and innovation are threatening American businesses and workers. China is also flooding global markets with artificially low-priced exports. In response to China’s unfair trade practices and to counteract the resulting harms, today, President Biden is directing his Trade Representative to increase tariffs under Section 301 of the Trade Act of 1974 on $18 billion of imports from China to protect American workers and businesses,” per a statement issued by the White House.

Per the new order, under Section 301, the tariff rate on electric vehicles from China under will increase from 25 per cent to 100 per cent in 2024 and on semiconductors from 25 per cent to 50 per cent by 2025.

“Both the USA and the EU are cutting import of EVs from China. The raising of tariff on EVs, batteries and many other new technology items by the US may push China to dump these products in other markers including India. It’s a moment for India’s DGTR to remain vigilant,” per a report issued by Global Trade and Research Initiative (GTRI).

The DGTR is an integrated single window agency for providing comprehensive and swift trade defence mechanism in India. It protects the domestic industry against unfair trade practices like dumping and actionable subsidies from any exporting country, by using trade remedial methods under the WTO, Customs Tariff Act and Rules and other relevant laws and international agreements.

The GTRI report also pointed out the opportunities that Indian exporters could focus on. “Higher duties (imposed by the US) on Chinese face masks, syringes and needles, medical gloves and natural graphite presents a significant opportunity for India. By ramping up production and export of these in-demand products, India could enhance its trade footprint in the US market,” it noted.