India may not impose anti-dumping duty on polybutadiene rubber

India is unlikely to impose anti-dumping duty on polybutadiene rubber used in making tyres and golf balls, after the Commerce Ministry in its probe found that the link between dumped imports and injury to the domestic industry is not conclusively established.
The application seeking imposition of anti-dumping duty on polybutadiene rubber originating in or exported from Korea, Russia, South Africa, Singapore and Iran was filed by Reliance Industries Limited.
The commerce ministry's investigation arm - Directorate General of Anti-dumping and Allied Duties (DGAD) - concluded in its final findings that it "does not consider it appropriate to recommend levy of an anti-dumping duty" and terminated the investigation.

In its petition, RIL, a petrochemical and refinery firm which is the sole producer of polybutadiene rubber in the country, had alleged dumping and consequent injury to the domestic industry.
"It is seen that the market share of the domestic industry (in this case RIL) in demand has improved and commanding 63.30 per cent of share which is sufficient enough to control the market.
"However, the share of dumped import constitute only 9.24 per cent which may not be a reason for causing injury to the domestic industry," said the DGAD.

"Causal link between imports from subject countries and injury to the domestic industry is not conclusively established," the DGAD said in a notification.

It pointed out that there is a demand and supply gap and by imposing the antidumping duty, the consumers will be overburdened.
"The petitioner (RIL) will be given over protection in order to address the injury which is because of captive sourcing of Butadiene," said DGAD.
Imposition of further duties on rubber products will lead to an incompetent Indian industry, where imports are unduly priced at high levels and the sole producer (RIL) has complete monopoly, it said.
Moreover, the user industry i.e. the rubber industry is already burdened with heavy import and ADD (anti-dumping duty) on raw materials such as natural rubber, nitrite rubber, carbon black and rubber chemicals among others.

The final view on the DGAD's recommendations will be taken by the finance ministry.
"An appeal against the order of the central government arising out of this finding shall lie before the Customs, Excise and Service Tax Appellate Tribunal in accordance with the Customs Tariff Act," said the commerce ministry's arm.
Anti-dumping measures are taken to ensure fair trade and provide a level-playing field to the domestic industry.