The commerce ministry's arm DGTR has initiated the process of formulating anti-absorption rules in respect of anti-dumping and countervailing duties to provide more protection to domestic manufacturers from cheap and subsidised imports.
Directorate General of Trade Remedies (DGTR) has floated draft anti-absorption rules and has sought views and comments from all stakeholders.
The directorate is an investigative arm of the ministry that deals with anti-dumping duty, safeguard duty and countervailing duty.
These duties are trade remedy measures, provided under an agreement of the World Trade Organisation (WTO) to its member countries.
They are used to provide a level playing field to domestic industry in case of dumping of goods, a significant increase in imports and subsidised imports.
"Anti-Absorption provisions in respect of anti-dumping and countervailing duty have been introduced in the statute through amendments to sections...the Customs Tariff Act, 1975...Accordingly, DGTR proposes to introduce...anti-absorption rules in respect of anti-dumping and countervailing duty," the directorate has said.
If a foreign exporter absorbs these duties and again starts dumping goods, anti-absorption rules come into play. Earlier there was no provision of anti-absorption norms and such issues were resolved through a mid-term review, which was a long drawn process. The anti-absorption was announced in this year's budget.
The act was already amended for this and now DGTR has started the process to frame the rules.
According to the draft rules, the domestic industry or any other interested party has to file the application, seeking initiation of Anti-Absorption investigation usually within two years from the date of imposition of definitive anti-dumping duty.
"However, in view of exceptional circumstances in a given case, the authority may accept an application after the expiry of 2 years. The application shall contain sufficient evidence as regards the existence of the circumstances to justify initiation of an anti-absorption investigation," it said.