Reliance Sibur Elastomers complains against China
The issue of dumping of Chinese goods in the Indian market has once again become heated. Dumping means when a country sells the goods manufactured in another country at a price lower than its cost in the market of another country, so that the domestic industry there can be destroyed. This time the matter is related to the rubber industry and the complainant is none other than a company associated with one of the country’s biggest industrialists, Mukesh Ambani.
The government has taken immediate action on this serious complaint. ‘Directorate General of Trade Remedies’ (DGTR), a very important unit of the Ministry of Commerce, has started an official investigation into this matter. This investigation focuses on a particular type of rubber imported from China.
Why was this needed?
This investigation has been started on the application of a domestic manufacturer. According to the circular issued by DGTR, the name of the applicant company is Reliance Sibur Elastomers. This company is a joint venture between Reliance Industries (RIL) and Sibur, in which Reliance Industries holds a major stake. Mukesh Ambani is the chairman of Reliance Industries.
In its complaint, Reliance Sibur Elastomers has made serious allegations against ‘Hello Isobutene’ and ‘Isoprene Rubber’ imported from China. The company says that China is dumping these products in India, that is, selling them at very unfair and low prices. Because of this, the domestic industry producing this rubber in India is being badly affected. It has become difficult for them to survive in this artificially created ‘price war’. Therefore, the applicant company has requested the government to immediately impose anti-dumping duty on this import from China, so that an environment of fair competition can be created in the market.
What is the impact of this rubber on our lives?
The issue on which such a big step has been taken is not an ordinary rubber. According to the news, this Chinese rubber is mainly used in the automobile industry. This means that it is used in many other important parts including tires of your car, motorcycle, bus and truck.
When domestic industries produce this rubber, they sell it in the market at a fixed quality and price. But if the same goods start coming very cheap from abroad, then who will buy the goods of Indian companies? Due to this, the production of domestic factories may come to a halt, their profits may end and worst of all, the jobs of the people working there may be at risk. Therefore, this matter is not just between two companies, but it has the potential to affect the supply chain of the entire automobile sector and the employment associated with it.
Who will take the final decision on fees?
DGTR has started the investigation, but there is a fixed procedure for it. First of all, DGTR will thoroughly investigate whether the allegations of Reliance Sibur Elastomers are true. The investigation will find out whether China is really dumping? And if so, has the dumping caused “actual injury” to the Indian domestic producer?
If both these things are proved in the investigation, then DGTR will recommend imposition of duty on its behalf. It is important to understand here that DGTR itself does not impose fees. It is clearly stated in the circular that the final decision on imposing fees is taken by the Ministry of Finance.