UPSC Articles
Anti-dumping probe against vinyl tiles
Part of: Prelims and GS-III Economy
Context: India has initiated an anti-dumping probe against imports of a certain type of tiles, used for covering the floors in residential and commercial buildings, from China, Taiwan and Vietnam following a complaint by domestic players.
Key takeaways
- Directorate General of Trade Remedies (DGTR) is probing the alleged dumping of “vinyl tiles other than in roll or sheet form.
- If it is established that the dumping has caused material injury to the domestic players, the DGTR would recommend an anti-dumping duty on these imports.
What is Dumping?
- Dumping is a process wherein a company (Ex: Chinese Firm X) exports a product (for Ex: to India) at a price that is significantly lower than the price it normally charges in its home (China) market.
What is Anti-Dumping Duty?
- An anti-dumping duty is a protectionist tariff that a domestic government imposes on foreign imports that it believes are dumped.
- This is done with the rationale that these products have the potential to undercut local businesses and the local economy.
- According to global trade norms, including WTO, a country is allowed to impose anti-dumping duty to provide a level-playing field to domestic manufacturers.
- The duty is imposed only after a thorough investigation by a quasi-judicial body, such as DGTR in India.
- While the intention of anti-dumping duties is to save domestic jobs, these tariffs can also lead to higher prices for domestic consumers.
- In the long-term, anti-dumping duties can reduce the international competition of domestic companies producing similar goods.
Directorate General of Trade Remedies (DGTR)
- The Directorate General of Trade Remedies was named in May 2018 as an integrated single window agency for providing a comprehensive and swift trade defence mechanism in India.
- Roles and functions:
- DGTR deals with Anti-dumping, Countervailing Duty (CVD) and Safeguard measures.
- It also provides trade defence support to our domestic industry and exporters.
- DGTR provides a level playing field to the domestic industry against the adverse impact of unfair trade practices by using Trade Remedial methods under the relevant framework of WTO arrangements.
- DGTR functions as an attached office of the Department of Commerce, Ministry of Commerce and Industry.
News Source: TH
