Assistance for exporters on dumping action

FOCUS WTO

The government announced a financial assistance package for exporters for meeting their costs and legal expenses related to trade matters like anti-dumping action and countervailing duties in other countries.

The financial assistance is to be routed through Export Promotion Councils to "deserving candidates", Commerce and Industry Minister Kamal Nath said. Trade economists were, however, skeptical about whether the scheme would pass the World Trade Organisation's scrutiny.

"It depends on what form it will take when the details are notified. But it opens the doors for many WTO member countries to challenge India at the dispute settlement forum," a trade expert said.

A former commerce department official said that the government could have done without the scheme. "We have always been wedded to anti-dumping. We are the biggest user of the trade defence mechanism and also find a place on the list of countries which have been routinely subjected to anti-dumping measures," he said.

India along with Japan, European Union and Canada had won a case in the WTO's Dispute Settlement Body which sought to end the redistribution practice under the Continued Dumping and Subsidy Offset Act of 2000 or the Byrd Amendment.

Through the Byrd amendment the US had adopted a policy of redistributing the revenue from anti dumping levies to affected companies. The complainants had argued that the US companies had the twin advantage of protecting their sales through the levy of anti-dumping and also getting the additional benefit by receiving a part of the levy.

Though the US took sometime in repealing the legislation, the EU, India and Japan finally prevailed upon it by going to the WTO's Appellate body. Between January 2002 and July 2004, India initiated 49 anti-dumping investigations. China is at the top of the list of countries subjected to anti-dumping investigations, with 30 investigations initiated during July-December 2003.

The US (12), European Union (8) and Japan (8) followed by India and South Korea with 7 each.