Anti-dumping in India: the complete guide

What counts as dumping?

In everyday language, dumping sounds like it just means cheap imports. Under Indian trade remedies law, it means something more specific: a producer in another country exports a product to India at a price lower than the price it charges for the same product in its own domestic market. That price gap, not the absolute cheapness of the import, is what the law is concerned with. A product can be inexpensive without being dumped, and a product can be dumped even if its Indian price still looks high, as long as it is priced lower here than it is priced at home.

Dumping on its own is not unlawful and does not automatically trigger a duty. The Customs Tariff Act, 1975 and the rules made under it require two further things before any duty can be considered: the dumped imports must be causing or threatening material injury to an Indian industry making the like article, and there must be a causal link between the dumped imports and that injury.

How is dumping measured?

DGTR compares three figures for the product under investigation. Normal value is the comparable price at which the same product is sold in the ordinary course of trade in the exporting country’s own market. Export price is generally the CIF value of the exported product, adjusted for ocean freight, insurance, and commission, to arrive at an ex-factory figure that can be compared on the same basis. The dumping margin is the difference between normal value and export price at the same level of trade, usually expressed as a percentage of the export price.

A very small dumping margin is treated as not worth pursuing: an anti-dumping investigation is terminated if the margin works out to less than 2 per cent of the export price, a threshold generally referred to as de minimis. Investigations are also terminated where the volume of dumped imports from a single country is below 3 per cent of total imports of the like article, unless dumped imports from several such countries together exceed 7 per cent of total imports.

Who can ask DGTR to investigate?

An anti-dumping investigation is normally triggered by an application from India’s domestic industry, meaning the domestic producers of the like article as a whole, or those whose collective output forms a major proportion of total domestic production of that article. Producers who are themselves related to, or are, importers of the allegedly dumped article are generally excluded from that count. For an application to be treated as made on behalf of the domestic industry, the producers expressly supporting it must account for at least 25 per cent of total domestic production of the like article, and those supporting the application must outnumber, by output, those opposing it, among producers who have expressed a view either way.

The rules also allow DGTR to initiate an investigation on its own, without a formal application, on the basis of information received from customs authorities or any other source, provided the Authority is satisfied there is sufficient evidence of dumping, injury, and a causal link between the two. Beyond the applicant, the investigation recognises several interested parties, including the foreign exporters or producers under investigation, Indian importers of the product, the government of the exporting country, and relevant trade associations. A party that files a questionnaire response is treated as registered even without a separate written request.

What has to be shown before a duty is imposed?

Beyond dumping itself, DGTR has to be satisfied on injury and causal link before it can recommend a duty. Injury is assessed by looking at both volume effects, such as whether the market share of dumped imports is rising against domestic production, and price effects, such as whether the dumped imports are undercutting, depressing, or suppressing domestic prices. A wide set of economic indicators feeds into that assessment, including output, sales, profits, market share, productivity, capacity utilisation, cash flow, employment, and the ability to raise capital.

If a duty is warranted, Indian law follows the lesser duty rule: the duty recommended is the lower of the dumping margin and the injury margin, rather than automatically the full dumping margin the WTO framework would otherwise permit. The injury margin is the difference between the non-injurious price that the domestic industry could reasonably have charged, and the landed value of the dumped imports. This keeps the duty tied to removing the actual injury, not to penalising the exporter beyond that.

Who runs the investigation, and how long does it take?

DGTR, in the Department of Commerce, runs the investigation and issues findings; the Department of Revenue in the Ministry of Finance separately decides whether to notify and levy the duty, generally within three months of DGTR’s recommendation. An anti-dumping investigation is generally initiated within about 30 days of an application being accepted as complete. The full guide to how the stages unfold, from pre-initiation scrutiny through preliminary findings, provisional duty, oral hearing, disclosure, and final determination, is covered in how a DGTR investigation works. If you export to India or import the product concerned, what you are expected to do at each of those stages is covered separately in responding to an investigation.

How long does an anti-dumping duty last?

An anti-dumping duty stays in force for a period of not more than five years from the date of imposition, unless the notification sets a shorter period. Before that period runs out, the domestic industry can apply for a sunset review to examine whether the duty should continue, and DGTR can also review the duty on its own initiative at any point before expiry. There is no statutory cap on how many times a duty can be extended through successive sunset reviews, as long as the evidence continues to support continuation. Reviews of every kind, including sunset review, mid-term review, and new shipper review, are explained in appeals and reviews.

Is anti-dumping duty the same as customs duty?

No. Ordinary customs duty is a general, revenue-raising charge that applies uniformly to all imports of a tariff line, regardless of exporter or country of origin. Anti-dumping duty is a targeted trade remedy: it is specific to a particular product, a particular country of export, and often a particular producer or exporter, and it is levied on top of the ordinary customs duty otherwise payable. Its purpose is to offset an unfair pricing practice and its resulting injury, not to raise general revenue, and DGTR can suspend it where an exporter offers an acceptable price undertaking instead.

Where do I check if a product is under investigation?

The case tracker lists ongoing and concluded DGTR matters by product and country. If you are not sure whether a product or transaction could be exposed to dumping, countervailing, or safeguard action, the dumping indicator walks through the relevant inputs in plain language. General questions on process and terminology are collected in the frequently asked questions and the glossary.