Anti-dumping duty slapped on silica import from China

NEW DELHI : India has imposed anti-dumping duty on untreated fumed silica, used in the production of pharmaceuticals, cosmetics, dyes and food additives, for five years to offset the impact on domestic industry from dumped imports from China and South Korea.

The duty is applicable on imports originating in or exported from the People’s Republic of China and South Korea, according to an official order.

“The anti-dumping duty imposed under this notification shall be effective for five years (unless revoked, superseded or amended earlier) from the date of publication of this notification,” said the order issued on Thursday.

The duty at specified rates is applicable on the chemical produced in these two countries and exported from any other country or produced anywhere and exported from China or Korea, with certain exceptions.

India has been using anti-dumping duties effectively to prevent cheap imports from affecting local manufacturers.

Besides the anti-dumping duties, the government has also started calibrating basic customs duty, the tariff barrier, to protect the local industry.

Earlier this year, India had announced a review of customs duty exemptions.

The harm low-cost imports from China could cause to local producers had become evident when the coronavirus pandemic disrupted the global supply chain, which affected bulk drug supplies to the local pharmaceutical industry.

Some of the Indian public sector bulk drug companies had earlier become sick as they could not compete with cheap imports from China.

The government’s strategy is to give incentives to those investing in local manufacturing facilities, make raw material imports cheaper, and make imported finished products costlier through duties so that local producers get an edge over imports.

The government’s production-linked incentive (PLI) scheme may cut down imports of key raw materials such as bulk drugs and formulations from China by 25-35%, according to an estimate by credit rating agency Icra.

Icra said that the PLI scheme will reduce import dependence and boost domestic production of high-value products; and increase the value addition in exports.