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The government has decided to terminate a safeguard investigation on imports of ‘PVC Suspension Grade Resin’ — used extensively in building and construction, automotive, and medical industries — from Japan under the India-Japan Comprehensive Economic Partnership Agreement (CEPA).
This follows a representation made by the domestic industry to the Directorate General of Trade Remedies (DGTR) in March withdrawing its initial demand for a safeguard probe against the product.
The industry submitted that there were material changes in the market situation for PVC Suspension Grade Resin that prompted it to withdraw their application, but it would want the liberty to file the application again in future.
“In view of the aforesaid request made by the applicants, the Director General hereby terminates the investigation initiated on 8th September, 2020….,” the DGTR , under the Commerce & Industry Ministry, stated in its termination order dated July 8, 2021.
Last year, domestic producers DCW Limited, DCM Shriram Limited and Chemplast Cuddalore Vinyls Limited had filed an application before the DGTR in accordance with CEPA and bilateral safeguard rules for initiation of bilateral safeguard investigation concerning alleged increased imports of “PVC Suspension Grade Resin” from Japan.
Safeguard duties
In case of a CEPA, a country can usually impose safeguard duties on imports from its partner country in case it is proved that the reduced import duties under the trade pact had resulted in a sharp surge in imports of a particular item causing injury to the domestic industry.
“After determining that there is prima facie evidence to justify initiation of the safeguard investigation, the Director General had initiated the safeguard investigation in order to determine whether the imports of the product under consideration from Japan constitute increased imports and whether the increased imports have caused or are threatening to cause serious injury to the domestic industry,” the notification stated.
However, now that the complainants have called for a withdrawal of the investigation, there is no ground for continuing the probe to find out whether the imports were causing serious injury to the domestic industry.
“If the domestic industry would want to pursue the safeguard case again sometime later, it would have to file a fresh application and supply supporting figures,” a source told BusinessLine.
India’s imports from Japan fell 12.14 per cent to $10.9 billion in 2020-21 while its exports to the country declined 1.9 per cent to $4.4 billion.
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