DGTR Bats For Countervailing Duty On Saturated Fatty Alcohol Imports From Three Nations

Last year in February, DGTR investigated alleged subsidisation by Indonesia, Malaysia and Thailand on exports of the chemical.

<div class="paragraphs"><p>(Source:&nbsp;<a href=";utm_medium=referral&amp;utm_content=creditCopyText">Venti Views</a> on <a href=";utm_medium=referral&amp;utm_content=creditCopyText">Unsplash</a>)</p></div>
(Source: Venti Views on Unsplash)

The commerce ministry has recommended imposition of countervailing duty on imports of a chemical, used in making personal care products such as shampoo, soap and detergents, from Indonesia, Malaysia and Thailand as it was impacting the domestic industry, according to a notification.

The ministry's investigation arm Directorate General of Trade Remedies in its findings after a probe has said that imposition of the definitive countervailing duty on imports of 'saturated fatty alcohol' is required to offset subsidisation by these countries and injury to domestic players.

Last year in February, the directorate initiated the probe into alleged subsidisation by Indonesia, Malaysia and Thailand on exports of the chemical.

"Accordingly, definitive countervailing duty... is recommended to be imposed from the date of notification to be issued in this regard by the central government on all imports of the subject goods from the subject countries," the DGTR notification said.

Following a complaint by a domestic firm, the DGTR conducted the probe to examine whether the subsidy programmes of these countries for exports of saturated fatty alcohols are impacting the domestic industry.

VVF India Ltd. had filed an application before the directorate alleging subsidisation of this chemical from these three nations.

The company had requested initiation of an anti-subsidy probe for levy of countervailing duties on the imports from these countries.

The company had alleged that producers and exporters of the product in these countries have benefited from subsidies provided by their respective governments at various levels.

The finance ministry takes the final decision on imposing the duty.

The recommended duty ranges between 3% to 30% of cost, insurance, freight value of the consignment.

Under the global trade rules of the World Trade Organisation, a member country is allowed to impose anti-subsidy or countervailing duty if a product is subsidised by the government of its trading partner.

These duties are trade remedies to protect domestic industry. Subsidy on a product makes it competitive in price terms in other markets. Countries provide this to boost their exports.

These three countries are important trading partners of India and they all are members of the Geneva-based multilateral organisation WTO.