DG Safeguards Initiates Investigation on Sodium
Dichromate Import on Vishnu Chemicals Hyderabad Complaint
[Safeguard
Initiation Notification F.No. D-22011/05/2014
dated 26th May 2014]
Sub: Initiation of Safeguard Investigation concerning Imports
of “Sodium di-chromate” into India.
An application has been filed before me under Rule 5 of
the Custom Tariff (Identification and Assessment of Safeguard Duty) Rules,
1997, by M/s. Vishnu Chemicals, Flat No 1, Suvarna
House, Sangeethanagar Colony, Somajiguda,
Hyderabad-500082 for imposition of Safeguard Duty on imports of “Sodium
dichromate” into India to protect the domestic producer of Sodium dichromate
against serious injury /threat of serious injury caused by the increased
imports of Sodium dichromate.
2. Domestic Industry
The application
has been filed by. M/s. Vishnu Chemicals, Flat No 1, Suvarna House, Sangeethanagar
Colony, Somajiguda, Hyderabad-500082 for imposition
of Safeguard Duty on imports of Sodium dichromate. The applicants
account for more than 70% of the total production of Sodium dichromate in
India.
Product under
consideration: The present application is filed for imposition of
Safeguard duty on imports of “Sodium dichromate” which is PUC. The product
under consideration is classifiable under Customs sub –heading No.28413000
3. Period of investigation (POI)
Present
application is a fresh case based on serious injury /threat of serious injury
to domestic industry caused by increased import of Sodium dichromate into
India. The POI in the case has been taken from 2010-11 to 2013-14.
4. Source of information
The import data
for the product under consideration has been taken from DGCI&S till
January, 2014 and same has been relied upon and taken into consideration for
analysis. The domestic data from 2010-11 to 2013-14 has been submitted by the
applicant and the same has been verified by on-site visits to the manufacturing units of the domestic
industry by the department. The verified data has been taken into consideration
for injury analysis.
5. Increased Imports
Imports of Sodium
dichromate into India have shown
significant increase. The data relating to imports of Sodium dichromate from
2010-11 to Jan 2014 as per DGCIS data, is as under:
Financial Year |
Total Import (MT) |
Import Indexed |
2010-11 |
4765 |
100 |
2011-12 |
5516 |
116 |
2012-13 |
7205 |
151 |
2013-14 (upto Jan
2014) |
9503 |
- |
2013-14 (Annalized) |
11404 |
239 |
It is evident that imports of the product under consideration
have sharply increased during the injury period. The imports have increased
from 4765 MT in 2010-11 to 11404 MT till 2013-14 (Annualized.) recording an
increase of 139 %. Thus, import has increased on absolute basis during the
entire period of investigation.
6. Serious Injury to the Domestic industry
The applicants
(hereinafter referred to as DI) have claimed that the increased imports of
Sodium dichromate have caused and are threatening to cause serious injury to
the domestic producers of Sodium dichromate .The threat of serious injury to
domestic industry is clearly visible from the data provided by the applicants
as detailed below:
a) Production: The domestic production of DI decreased
up to FY2012-13, but increased marginally in year 2013-14. The production index
of Domestic Industry fell to 96 in 2013-14 from 100 in FY 2010-11, as shown
below:
Financial Year |
Production (MT) |
Production Indexed |
2010-11 |
30407 |
100 |
2011-12 |
30383 |
100 |
2012-13 |
28608 |
94 |
2013-14 |
29128 |
96 |
b) Increased Imports w.r.t total production: Sodium
dichromate is imported into India from a number of countries, and mainly from.
South Africa, Russia and Kazakhistan The imports of
Sodium dichromate have shown an increasing trend in absolute terms as well as
compared to the total production. The imports and production of Sodium
dichromate during financial year 2010-11 to 2013-14 are as under:
Financial Year |
Total Imports (MT) |
All India Production (MT) |
% of Increase in import with respect to production |
2010-11 |
4765 |
42487 |
11.22 |
2011-12 |
5516 |
42463 |
12.99 |
2012-13 |
7205 |
39188 |
18.39 |
2013-14 |
11404 |
39708 |
28.72 |
The Imports have increased from 4765 MT in 2010-11 to 11404
MT in 2013-14 (Annualised) which shows an increase of 139%. The import with
respect to total production was 11.22 % in 2010-11 and increased to 28.72 % in
2013-14.
c) Market Share & Changes in levels of Sales:
Financial Year |
Import (MT) |
Sales of DI (MT) |
Sales of other Indian Producers(MT) |
Total Demand (MT) |
% of Market Share |
|
DI |
Import |
|||||
2010-11 |
4765 |
12138 |
12080 |
43320 |
28 |
11 |
2011-12 |
5516 |
12846 |
12080 |
43499 |
30 |
13 |
2012-13 |
7205 |
17151 |
10580 |
46148 |
37 |
16 |
2013-14 |
11404 |
15780 |
10580 |
51355 |
31 |
22 |
Market share of the DI has declined sharply in the recent
period (2013-14) whereas share of the import has increased
significantly. Applicant had a market share of 37% in 2012-13,
it has declined to 31 % in year 2013-14. During the same period market share of
import has increased from 16% to 22%. It clearly shows that the DI suffered
noticeable loss in sales as well as market share, caused by increased imports
during the recent period (2013-14)
d) Capacity Utilization: The increasing
imports are resulting in significant idling of production capacity of the
domestic producers. The capacity utilization by the DI has remained constant
during period of investigation as can be seen in the Table below:
Financial Year |
Installed Capacity(MT) |
Production (MT) |
Capacity Utilisation (%) |
2010-11 |
93200 |
30407 |
33 |
2011-12 |
86000 |
30383 |
35 |
2012-13 |
86000 |
28608 |
33 |
2013-14 |
86000 |
29129 |
34 |
e) Profit/loss –The profitability of the domestic
industry has steeply deteriorated and the domestic industry is now suffering
financial losses. This is evident from the table below:-
Sr.No. |
Year |
Unit |
2010-11 |
2011-12 |
2012-13 |
2013-14 |
1 |
Profit/loss |
Rs/Kg |
(*.**) |
(*.**) |
(*.**) |
(**.**) |
2 |
Indexed |
|
-100 |
-82 |
-162 |
-313 |
f) Inventories: In view of surging
imports and loss of market share, the inventories with the domestic industry
have also increased as compared to base year 2010-11. The table below depicts
the inventory levels which have witnessed a surge during period of
investigation reflecting the plight of the domestic industry.
Financial Year |
MT |
2010-11 |
429 |
2011-12 |
1094 |
2012-13 |
851 |
2013-14 |
513 |
g) Productivity: The productivity
has gone down during the entire period of investigation..
However, DI has witnessed increase in productivity in the year 2013-14.
Financial Year |
Production (MT) |
Productivity per day (MT) |
2010-11 |
30407 |
86.88 |
2011-12 |
30383 |
86.81 |
2012-13 |
28608 |
81.74 |
2013-14 |
29129 |
83.23 |
h) Employment:
Financial Year |
Nos |
2010-11 |
537 |
2011-12 |
509 |
2012-13 |
491 |
2013-14 |
490 |
The employment has shown continuous decreasing trend
during the period of investigation period
7. The DI has requested in their application
for immediate imposition of Safeguard duty on imports of Sodium dichromate into
India for a period of four years. They have also requested for imposition of
provisional Safeguard duty in view of the steep deterioration in performance of
the domestic industry due to serious injury and threat to serious injury as a
result of increased imports of the product under consideration.
8. The application has been examined and it has
been found that prima facie increased imports of Sodium dichromate have caused
and are threatening to cause serious injury to the domestic producer of Sodium
dichromate and as such it has been decided to initiate an investigation in the
matter through this notice.
9. All interested parties may make their
views known within a period of 30 days from the date of this notice to:
The Director General (Safeguards)
Bhai Vir Singh Sahitya
Sadan; 2nd Floor,
Bhai Vir Singh Marg,
Gole Market, New Delhi-110 001,
India
Telephone: 011- 23741537
Fax: 011-23741542
E-mail: dgsafeguards@nic.in
10. All known interested parties are also
being addressed separately.
11. Any other party to the investigation who
wishes to be considered as an interested party may submit its request so as to
reach the Director General (Safeguards) on the aforementioned address within
15 days from the date of this notice.