Anti-dumping Investigation Launched on
Electrical Insulators from China after Sunset of 35% Safeguard Duty
[Anti-dumping Initiation
Notification No. 14/11/2013 DGAD dated 5th September 2013]
Subject: Initiation of
Anti-Dumping Duty investigation concerning imports of ‘Electrical Insulators’
originating in or exported from China PR.
M/s WS Industries (India)
Ltd., M/s Modern Insulators Limited; M/s Insulators and Electrical Company, M/s
Bharat Heavy Electrical Limited and M/s Aditya Birla Nuvo Ltd have filed an application before the Designated
Authority (hereinafter referred to as the Authority) in accordance with the
Customs Tariff Act, 1975 as amended from time to time (hereinafter referred to
as the Act) and the Customs Tariff (Identification, Assessment and Collection
of Anti- Dumping Duty on Dumped articles and for Determination of injury)
Rules,1995 as amended from time to time (hereinafter referred to as the AD
Rules) for initiation of Anti-Dumping Duty investigation concerning imports of
electrical Insulators (hereinafter also referred to as the subject goods)
originating in or exported from China PR (hereinafter also referred to as the
subject country). M/s WS Industries (India) Ltd., M/s Modern Insulators Limited; M/s Insulators and Electrical Company, M/s Bharat
Heavy Electrical Limited and M/s Aditya Birla Nuvo Ltd have provided the relevant information necessary
for initiation.
2. AND WHEREAS, the Authority finds that sufficient evidence of
dumping of the subject goods originating in or exported from the subject
country; ‘injury’ to the domestic industry; and causal link between the alleged
dumping and ‘injury’ exist to justify initiation of an anti-dumping
investigation; the Authority hereby initiates an investigation into the alleged
dumping, and consequent injury to the domestic industry in terms of the Rules 5
of the AD Rules, to determine the existence, degree and effect of any alleged
dumping and to recommend the amount of antidumping duty, which if levied, would
be adequate to remove the ‘injury’ to the domestic industry.
Domestic Industry &
Standing
3. The petition has been filed by WS Industries (India) Ltd., Modern
Insulators Limited; Insulators and Electrical Company, Bharat Heavy Electrical
Limited and Aditya Birla Nuvo
Ltd. There are a number of other producers of the product under consideration
in India. The Authority has noted that Modern Insulators Limited, Insulators
and Electrical Company, Bharat Heavy Electrical Limited and Aditya
Birla Nuvo Ltd have certified that there are no
imports of the product under consideration by them..
The petitioners have stated that WS Industries (India) Ltd. imported low end
unfinished articles of the product under investigation. WSI has stated that the
company has already stopped importing the product from China and there are no pending order for supplies from China, nor company is
negotiating any orders with Chinese suppliers. Imports made by the WSI
constitute approx 15.47% of its production, 2.75% of
total imports from China and 1.22% of consumption in India during the period of
investigation. The Authority is of the view that the focus of WS Industries
(India) Ltd has not turned to imports and the company is not behaving like an
importer trader. The focus of the company continues to be of a producer and do
its own production. The company has been considered as eligible domestic
industry within the meaning of the Rules.
4. The Authority further notes that the total production of the
petitioners, viz., Modern Insulators Limited; WS Industries (India) Ltd,
Insulator and Electrical Company, Bharat Heavy Electrical Limited and Aditya Birla Nuvo Ltd during the
Period of Investigation (POI) is significantly beyond 50% of Indian production.
The Authority, therefore, determines that the petitioners have standing to file
the present petition and petitioner companies constitute Domestic Industry
within the meaning of the Anti Dumping Rules for the
purpose of present investigation.
Product under consideration
5. The product under consideration for the purpose of present
investigation is “Electrical insulators of Glass, or Ceramics/Porcelain, whether
assembled or unassembled, excluding (a) telephone or telegraph insulators of
voltage rating up to 1 kV, (b) electrical or electronic appliances/device
insulators of voltage rating up to 1 kV, and (c) composite insulators”
6. The petitioners have submitted that Insulators can be either of
porcelain or of glass. Porcelain Insulators are produced using clay, silica,
feldspar and metal parts; while glass insulators are produced using silica and
metal parts. Both constitute one article, considering the characteristics of
these two types, manufacturing process, functions, uses and prices. In fact,
the product is a technology neutral product. Power Grid Corporation has floated
tenders for procurement of insulators which can be of glass or porcelain. Power
Grid Corporation has placed no distinction between glass and porcelain
insulators and has placed orders solely on the basis of prices. Power Grid
Corporation has not made any technical distinction between the two products.
Further, the product is sometimes invoiced by the suppliers without reference
to “glass” or “porcelain”. The commercial invoice available in respect of
manufacturers of glass insulators does not refer to “glass”. Import data of the
product under consideration also at several instances does not refer to
“glass”. It is, thus, evident that the mere difference in the two types is in
the form of raw material and production technology, which does not lead to two
distinct articles. The article produced through two different technologies
clearly constitutes one article only.
7. The main function of Electrical Insulator is to insulate one
conducting body from another at high voltage areas, or to insulate a body which
can transmit electrical energy to the surrounding, at areas where such
transmission of electrical energy has to be avoided. Typical applications of
electrical insulators are in Bushings, Disconnectors,
Circuit breakers, Transformers, Power transmission and
distribution lines, including railways, Electrostatic Precipitators etc.
Glass or Porcelain insulators are classified under
customs heading 8546 under Chapter 85 of the Customs Tariff Act.
Like Articles
8. The petitioners have claimed that there is
no known difference in porcelain insulators imported from China PR and produced
by the petitioner companies. As regards glass insulators, there is some
difference in technology adopted in production of glass and porcelain
insulators. However, the product is technology neutral product and the steps
involved in production process are similar. Further, since some of the raw
materials involved are different, the operating parameters for handling the raw
materials differ, thus leading to some difference in plant & equipment.
Porcelain insulators produced by the domestic industry are commercially substitutable
with glass insulators. The consumer like Power Grid Corporation of India
Limited uses glass insulators and ceramic insulators interchangeably.
Therefore, for the purpose of the present investigation, the Authority has
considered that porcelain insulators produced by the domestic industry are
comparable to porcelain and glass insulators imported from China PR in terms of
essential product characteristics such as physical & technical
characteristics, functions & uses, product specifications, and tariff
classification. Consumers can use and are using the two interchangeably. The
two are technically and commercially substitutable. The Authority, therefore
treats the subject goods produced by the domestic industry as ‘Like Article’ to
the subject goods being imported from the subject country.
Subject Country
9. The country involved in the present
investigation is China PR.
Normal value
10. The Petitioners have submitted that China PR
should be treated as a non-market economy and the normal value should be
determined in accordance with para-7 of Annexure-I to the Rules. The
petitioners have claimed normal value of porcelain insulators on the basis of
cost of production in India, duly adjusted to including selling, general &
administrative expenses and reasonable profits; stating that information
relating to cost or price in a market economy third country is not available at
this stage. For glass insulators, normal value has been determined on the basis
of normal value of porcelain insulators duly adjusted. Petitioners have
submitted that the product is consumed in numbers, whereas the present
calculations of dumping margin are on weight basis. The normal value claims by
the Petitioners have been considered for the purposes of initiation
.
Export Price
11. The Petitioners have claimed export prices on
the basis of China Customs data to assess the volume and value of imports in
India. Separate export price has been determined for porcelain and glass
insulators duly adjusted. Price adjustments have been made on account of
commission, port expenses, inland freight and bank
charges to arrive at the net export price.
Dumping Margin
12. The Petitioners have provided sufficient evidence that the normal
values of the subject goods in the subject country are significantly higher
than the net export prices, prima-facie, indicating that the subject goods
originating in or exported from the subject country are being dumped, to
justify initiation of an antidumping investigation.
Injury and Causal Link
13. Information of petitioners has been considered for assessment of
injury to the domestic industry. The Petitioners have furnished evidence
regarding the ‘injury’ having taken place as a result of the alleged dumping in
the form of increased volume of dumped imports in absolute terms and in
relation to production and consumption in India, significant price undercutting
and price depression and consequent significant adverse impact in terms of
production, capacity utilization, domestic sales volumes, inventories, market
share, profits, return on capital employed, and cash flow for the domestic
industry. There is sufficient evidence of the ‘injury’ being suffered by the
domestic industry caused by dumped imports from subject country to justify
initiation of an antidumping investigation.
Period of Investigation
14. The period of investigation (POI) for the purpose of present
investigation is from 1st April, 2012 to 31 st March,
2013. However, for the purpose of analyzing injury,
the data of previous three years, i.e. Apr’09-Mar’10, Apr’10-Mar’11,
Apr’11-Mar’12 and the proposed period of investigation has been considered.
Submission of information
15. The known exporters in the subject country and its Government
through its Embassy in India, importers and users in India known to be concerned
and the domestic industry are being informed separately to enable them to file
all information relevant in the form and manner prescribed. Any other
interested party may also make its submissions relevant to the investigation
within the time-limit set out below and write to:
The Designated Authority,
Directorate General of
Anti-Dumping & Allied Duties,
Ministry of Commerce &
Industry,
Department of Commerce,
Room No.240, Udyog Bhawan,
New Delhi 110011
Time limit
16. Any information relating to this investigation should be sent in
writing so as to reach the Authority at the above address not later than 40
days from the date of this notification. If no information is received within
the prescribed time limit or the information received is incomplete, the
Authority may record its findings on the basis of the ‘facts available’ on
record in accordance with the AD Rules.
Submission of Information on
Non-Confidential basis
17. All interested parties shall provide a confidential and
non-confidential summary in terms of Rule 7 (2) of the AD Rules for the
confidential information provided as per Rule 7 (1) of the AD Rules. The
non-confidential version or non-confidential summary of the confidential
information should be in sufficient detail to provide a meaningful
understanding of the information to the other interested parties. If in the
opinion of the party providing information, such information is not susceptible
to summary; a statement of reason thereof is required to be provided.
18. Notwithstanding anything contained in para
above, if the Authority is satisfied that the request for confidentiality is
not warranted or the supplier of the information is either unwilling to make the
information public or to authorise its disclosure in a generalised or summary
form, it may disregard such information.
Inspection of Public File
19. In terms of Rule 6(7), any interested party may inspect the public
file containing the non-confidential versions of the evidence submitted by
other interested parties.
Non-cooperation
20. In case any interested party refuses access to and otherwise does
not provide necessary information within a reasonable period, or significantly
impedes the investigation, the Authority may record its findings on the basis
of the facts available to it and make such recommendations to the Central
Governments as deemed fit.