Anti-dumping duties on imports from China could trigger price hikes: experts

0

Ease of doing business for MSMEs: India had imposed anti-dumping duties on the axle of trailers (axles are rods or a shaft that turns the wheels and supports the weight of the vehicle), the hydrofluorocarbon (HFC) component ) R-32 gas – a refrigerant used in small split air conditioning systems and silicone sealant – a liquid adhesive used to insulate automotive parts, electronics, aluminum windows and doors, appliances; etc.

Ease of doing business for MSMEs: The anti-dumping duty imposed on several Chinese products by the Indian government to promote domestic manufacturing and restrict cheaper imports from China may increase the cost of local production and, consequently, the prices of finished products, experts say. India had imposed anti-dumping duties on the axle of trailers (the axles are rods or a shaft that turns the wheels and supports the weight of the vehicle), the hydrofluorocarbon (HFC) component of R-32 gas – a refrigerant used in small split system air conditioning and silicone sealant – a liquid adhesive used to insulate automotive parts, electronics, aluminum windows and doors, household appliances; etc.

“This charge was based on the findings of the Directorate General of Trade Remedies (DGTR) on how these products were exported to India at prices below normal value and on the ‘material’ injury caused to the domestic industry, ”said the Central Board of Indirect Taxes. and customs have said so in several notifications regarding goods imported from companies in China.

“While this would help local axle manufacturers gain market share, the cost will only increase and the end customer will have to pay the passed on cost. About 85 percent are small operators in the industry. an impact of around 15-20% on the cost of axles, because importing from China is cheaper than the cost of the same product made in India, ”Naveen Kumar Gupta, secretary general of All India Motor, told Financial Express Transport Congress Online The price of an axle varies from around Rs 5,000 per piece to over Rs 60,000 depending on its use and application.

The anti-dumping duty on HFCs in R-32 and silicone sealant has been in effect for five years. “There is a causal link between the dumping of the product under consideration and the injury to the domestic industry and has recommended the imposition of anti-dumping duties on imports of subject goods originating in or exported from subject countries and imported into India, in order to eliminate injury to the domestic industry, ”one reads the CBIC notifications citing the DGTR’s findings.

Subscribe now to the Financial Express PME newsletter: your weekly dose of news, views and updates from the world of micro, small and medium enterprises

The duty on R-32 was $ 1,171.78 per metric ton (MT) to $ 1,519 per MT and $ 396.99 per MT – $ 738.73 per MT on silicon sealants. “Almost all companies import R-32 refrigerant. It was imported because it was cheaper from China. Most of the importers are bottlers and they do not have a manufacturing facility in India. The cost will now increase for them if they set up factories in India instead of importing from China, which would also be expensive now, otherwise they will not be able to compete ”, Vikram Luthra, Director, SAAV Refrigeration and Secretary The North Indian Refrigeration and Air Conditioning Trades Association told Financial Express Online.

The cost also depends on the size of the plant and the lifespan of the product, as the government seeks to gradually reduce HFCs from 2032 with a cumulative reduction of 10% in 2032, 20% in 2037, 30% in 2042, and 85% in 2047, in accordance with the Kigali Amendment ratified to the Montreal Protocol, a global pact on substances that deplete the ozone layer. “Although HFCs do not deplete the stratospheric ozone layer, they have a high global warming potential ranging from 12,000 to 14,000, which has a negative impact on the climate,” the Cabinet said in August this year. year by announcing its approval of the amendment.

“HFC R-32 will also start to disappear from 2030. The chemical plants are expected to operate for at least 20-30 years while the bottling plant itself would cost Rs 2-3 crore and the storage tank would be worth Rs. 50 lakh. The cost will ultimately have to be borne by the customers in the end. I estimate the cost of Rs 115-120 per kg will be added. No one wants to invest in the short term because after 10 years the elimination will begin. However, I don’t think the impact would be very large as the cost of the refrigerant in, say, a Rs 40,000 AC is only worth around Rs 400. The additional duty would not be very high ”, KK Sharma, owner, Value Refrigerants and Member, All India Air Conditioning and Refrigeration Association, told Financial Express Online.

Financial Express is now on Telegram. Click here to join our channel and stay up to date with the latest news and updates from Biz.

Share.

About Author

Comments are closed.