India has initiated a probe into alleged dumping of a chemical, used in dye and pharma industry, from China following a complaint by a domestic company.
Prima Chemicals had filed an application before the Directorate General of Trade Remedies (DGTR) for investigation of anti-dumping duty concerning imports of of "1-Phenyl-3-Methyl-5-Pyrazolone" exported from China.
The directorate, under the Commerce Ministry, will see whether the chemical is being dumped by Chinese firms in India and if it is impacting the domestic industry.
If it is established in the probe that dumping of the chemical is denting margins of domestic firms, the DGTR would recommend anti-dumping duty with a view to guard local industry from cheap imports.
"The authority, hereby, initiates an investigation to determine the existence, degree and effect of any alleged dumping in respect of the subject goods originating in or exported from China and to recommend the amount of anti-dumping duty, which if levied, would be adequate to remove the injury to the domestic industry," it said.
The product is used as a dye intermediate and in pharmaceutical industry.
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The period of investigation is April 2018 to June 30, 2019 (15 months). It would also cover the period from 2015-18.
Countries carry out anti-dumping probe to determine if their domestic industries have been hurt because of a surge in below-cost imports.
As a counter measure, they impose duties under the multilateral regime of the World Trade Organization.
The duty is also aimed at ensuring fair trading practises and creating a level-playing field for domestic producers with regard to foreign producers and exporters.
India has already imposed anti-dumping duty on several products to check cheap imports from countries including China, with which India has a major concern of widening trade deficit.