Historically, anti-dumping action has attracted public notice in India only when Indian exporters faced anti-dumping investigations overseas. More than the actual duties imposed, the process of investigations itself became non-tariff barriers (NTBs). With import licensing disappearing and import duties slashed, dumping into India has also become a more important issue than before. Rather remarkably, before 1992-93, there was not a single instance of anti-dumping duty being imposed in India. This may be because, compared to the United States and the European Union (EU), India's anti-dumping cell is under-manned. There are only seven people in the cell, against thousands in the US or EU. Therefore, a typical anti-dumping investigation takes far too long. Nevertheless, by one way of reckoning, India has started gettings its act together.
Judging by the levy of final duties , India had climbed to the fifth position in the world in 1997, in terms of the use of the anti-dumping lever. Today, India's rank is fifth, although the Indian figure of 89 (final and provisional) duties imposed since 1995 is considerably short of the US's over 200.
Dumping is defined as exporting a product at lower than normal value, with the normal value being defined the as domestic sales price, export price in a third market, or the costs of production plus permitted mark-ups. Dumping is not illegal. For dumping to be illegal, anti-dumping duties have to be imposed, there must be injury to domestic industry and a causal link between the act of dumping and injury, to the exclusion of any other changes.
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Interpreted strictly, it is the easiest thing in the world to prove dumping and virtually impossible to prove the causal link. So, having proved dumping, the authorities impose anti-dumping duties, be it in the United States or in India. There is no test for predatory intent, as should have happened had dumping been interpreted as an anti-competitive practice.
Consumers obviously benefit from dumping and the code allows consumers to be consulted. But this consultation is not mandatory and in India, newsprint is probably the only instance where consumers were consulted. If chicken legs are available from Australia at Rs 15 a kilo, why should consumers be forced to pay prices of Rs 70 or more per kilo? In the US, the Heritage Foundation routinely computes the welfare costs of anti-dumping action. It is time such computations are done for India also. It is somewhat ridiculous that for several anti-dumping duties imposed, domestic Indian producers are declared monopolists with scales of production nowhere near global scales. In such circumstances, injury is a meaningless term. India has a lot to gain by pushing for scrapping of the anti-dumping agreement at WTO. The gains to India and exporters will more than compensate the losses to inefficient Indian producers.
Given non-transparent indirect tax structures and absence of books maintained according to international accounting norms, Indian exporters find it impossible to defend themselves against anti-dumping investigations. The code then allows investigating authorities to take action on the basis of the best available information. If the anti-dumping agreement is scrapped, such action will be disciplined.