Published on: September 2, 2022

Anti-dumping duty

Anti-dumping duty

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Årsta The Indian government has decided not to extend the anti-dumping duty imposed on ammonium nitrate imported from Russia, Iran and Georgia.

background:

  • The commerce ministry’s investigation arm DGTR had conducted a probe to review the need for the continuing imposition of anti-dumping duty on the product imported from these countries, following a complaint from the domestic industry.

About ammonium nitrate

  • The product is used in manufacturing slurry-based and emulsion-based explosives, which are in turn used for mining and infrastructure purposes. It is also used as a fertiliser in many countries.
  • However, in India, it is not included under the definition of fertilisers under the Fertiliser Control Order, 1985.
  • The current duty on the product would expire on September 11.

What is anti-dumping duty?

  • An anti-dumping duty is a protectionist tariff that a domestic government imposes on foreign imports that it believes are priced below fair market value.
  • In order to protect their respective economy, many countries impose duties on products they believe are being dumped in their national market; this is done with the rationale that these products have the potential to undercut local businesses and the local economy.
  • While the intention of anti-dumping duties is to save domestic jobs, these tariffs can also lead to higher prices for domestic consumers.
  • In the long-term, anti-dumping duties can reduce the international competition of domestic companies producing similar goods.
  • The duty is aimed at ensuring fair trade practices and creating a level-playing field for domestic producers with regard to foreign producers and exporters.

Who decides the tariff?

  • While DGTR recommends the duty, the finance ministry takes the final decision to impose the same.