India Proposes Safeguard Duty At 10% Ad Valorem On Phthalic Anhydride Imports .

The Director-General (Safeguards) has proposed to levy an interim safeguard duty at ten percent ad valorem on the import of Phthalic Anhydride or PAN from South Korea, Israel and Taiwan to protect the interest of domestic industry, reports said.

PAN is widely used to manufacture synthetic resins, which act as binders in paint products, besides playing a primary role as a chemical intermediate in the production of plastics and polyester resins.

The DG recalled that an investigation initiated earlier by the authorities had led to the imposition of both preliminary and definitive safeguard duty for a span of three years at the rate of 25 percent, 15 percent and 10 percent from January 29, 2009, to January 28, 2012. But, the Central Government, however, imposed definitive safeguard duty for one year only at 25 percent from January 29, 2009, to June 30, 2009 and at 15 percent from July 1, 2009 to December 31, 2009.

Although there was a decline in imports in 2009-10, following imposition of provisional safeguard duty, the imports witnessed a phenomenal growth once the effective period of safeguard duty came to an end, it said.

Stating that since this is a fresh case based on the recent serious injury or threat of serious injury being beset by the domestic industry, the period of investigation was taken from the fourth quarter of 2008-09 onwards, it said that the import data up to December 2010 was gleaned from Directorate-General of Commercial Intelligence and Statistics.

Imports have increased from 28,098 tonnes in 2009-10 to 61,965 tonnes, showing an increase of 121 percent in absolute terms. Besides, the import with respect to domestic production also surged rapidly to 28.52 percent in 2010-11 from 14.08 percent in 2009-10.

The share of imports in the domestic market has gone up from 11 percent in fourth quarter of 2008-09 to 20 percent in April to May 2011-12, while the market share of domestic producers in domestic consumption has fallen significantly. The petitioners who enjoyed an average market share of 85 percent in 2009-10 saw this to fall to 74 percent in 2010-11.

As safeguard probes are supposed to provide protection to the domestic industry in critical circumstances, such as at this juncture, the DG said as a span of more than one year had elapsed, the imposition of immediate provisional safeguard measures for a period of 180 days could be considered. Accordingly, the DG proposed safeguard duty at ten percent ad valorem. A call on the proposal would be taken by the Safeguard Boards, comprising Secretaries of Commerce and Revenue.

Source : rttnews.com