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Polypropylene makers in the country may face increased competition, with the Customs Excise and Service Appellate Tribunal allowing an appeal before the Designated Authority against anti-dumping duty on polypropylene from some countries. Saudi Arabia, Oman and Singapore, the exporting nations, are pushing the Centre for corrective measures and the sector could witness a flood of cheap imports from Saudi Arabia.
Suppressed mode
Now on suppressed mode since the introduction of a provisional anti-dumping in June 2009, followed by a final order in end 2010, imports from the Asian majors will surely get a boost if the Director-General of Anti-Dumping withdraws the protective measures following a re-run of the hearing process, as is allowed by the CESTAT. Saudi Arabia produces nearly 10 per cent of the global polypropylene output, mostly for exports to growing Asian economies, including China and India. According to available information, till the imposition of anti-dumping measures, Saudi imports were dictating the price of polypropylene in the Indian market.
Reversal of anti-dumping duty
Though officially all the parties are tight-lipped, a reversal of the anti-dumping duty may impact the fortunes of large polypropylene makers of the country led by Reliance Industries Ltd, Indian Oil, Haldia Petrochemicals and others.
A standalone petrochemicals project with over Rs 1,000-crore accumulated loss, HPL should particularly be in trouble.
While IOC has largely kept itself out of the anti-dumping proceedings, RIL was the guiding force in demanding imposition of anti-dumping duty on such imports.
Though the company's stand was vindicated by a DGAD order by way of 1.5 per cent anti-dumping duty on imports from the three nations in August 2011, CESTAT, in its ruling in August this year, found loopholes in the process of imposition of anti-dumping duty.
The aggrieved parties were allowed to seek reversal of duties before the designated authority.
Morale booster
The CESTAT ruling has come as a morale booster especially to Saudi Arabia, which is leading the pack of exporting nations to convince India to withdraw the anti-dumping duty.
The issue is likely to take the centre stage of a bilateral discussion scheduled in a couple of weeks.
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