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Meaning of Anti-Dumping
7-10-2014
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Meaning of Anti-Dumping Article by Anuj Somani
 A standard technical definition of dumping is the act of charging a lower price for similar goods in a foreign market than one charges for the same goods in a domestic market for consumption in the home market of the exporter. This is often referred to as selling at less than "normal value" on the same level of trade in the ordinary course of trade. Under the World Trade Organization (wto) agreement, dumping is condemned (but is not prohibited) if it causes or threatens to cause material injury to a domestic industry in the importing country.
Definition of Anti-Dumping Duty
A protectionist tariff that a domestic government imposes on foreign imports that it believes are priced below fair market value. In India, anti-dumping duties are imposed by the Department of Commerce and often exceed 100%. They come into play when a foreign company is selling an item significantly below the price at which it is being produced. The logic behind anti-dumping duties is to save domestic jobs, although critics argue that this leads to higher prices for domestic consumers and reduces the competitiveness of domestic companies producing similar goods.
Indian Anti-Dumping Measures Against China
For a few years, several high-level government meetings have been taking place to discuss trade relations between India and China. One topic that is frequently on the agenda of these meetings is the use of antidumping (ad) policy and disputes related to it. While China has initiated only 4 cases against India, India has initiated 147 cases against China of which 120 ended with the imposition of measures against Chinese producers. In relative terms, this corresponds to 22.4% of all Indian ad initiations and 25.1% measures that India imposed against its trading partners worldwide between 1995 and 2011. Worldwide is targeted by its trading partner as frequently as china by India. Roughly every fourth Indian ad case is directed towards China. No other country.
Difference betweenAnti- Dumping Duty and Normal Customs Duty
Although Anti-Dumping duty is levied and collected by the Customs Authorities, it is entirely different from the Customs duties not only in concept and substance, but also in purpose and operation. The following are the main differences between the two: -
Conceptually, Anti-Dumping and the like measures in their essence are linked to the notion of fair trade. The object of these duties is to guard against the situation arising out of unfair trade practices while customs duties are there as a means of raising revenue and for overall development of the economy. Customs duties fall in the realm of trade and fiscal policies of the Government whileAnti-Dumping and Anti subsidy measures are there as trade remedial measures. The object of Anti-Dumping and allied duties is to offset the injurious effect of international price discrimination while customs duties have implications for government revenue and for overall development of the economy. Anti-Dumping duties are not necessarily in the nature of a tax measure in as much as the Authority is empowered to suspend these duties in case of an exporter offering a price undertaking. Thus such measures are not always in the form of duties/tax. Anti-Dumping and Anti subsidy duties are levied against exporter / country in as much as they are country specific and exporter specific as against the customs duties which are general and universally applicable to all imports irrespective of the country of origin and the exporter. Thus, there are basic conceptual and operational differences between the customs duty and the Anti-Dumping Duty. The Anti-Dumping Duty is levied over and above the normal customs duty chargeable on the import of goods in question.
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