01/20/2015

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DGS against imposing safeguard duty on flexible slabstock polyol imports

Chennai-based Manali Petrochemicals had approached the Directorate General of Safeguards (DGS), under the Finance Ministry, for imposition of safeguard duty on import of flexible slabstock polyol (FSP) of molecular weights 3,000 to 4,000. The company had sought protection for the domestic producers against serious injury or threat of serious injury caused by the increased imports of FSP. Safeguard duty is a temporary protectionist measure, which is brought in for a certain time-frame to avert any damage to the domestic industry from cheap imports. After an investigation into the imports, the DGS said the existence of alleged serious injury or threat of serious injury to domestic industry during the period of investigation (2010/2011 to 2013/2014) "does not stand vindicated and therefore, no protection as prayed for by the applicant was warranted.” "In view of the discussions...and the conclusions reached, safeguard duty on the imports of the 'Flexible Slabstock Polyol of MW 3000 to 4000' is not recommended and the investigation in this case is terminated,” said the DGS notification. FSP is imported from several countries, and mainly from Singapore, the Netherlands, the USA, Korea RP, Thailand, and Taiwan. It is a polyether and on reaction with catalysts and additives yields polyurethane foams used in pillows, bolsters, upholstery, mattresses, transport seating, and packaging. The DGS found that there has been a significant increase in imports in absolute terms as well as in relation to production in relation to the base year. However, it added that increase in imports have resulted in decline in market share of the domestic industry but there is no evidence to suggest overall impairment of the domestic industry as it is in overall profit during the period of investigation and loss, if any, is due to other factors. Meanwhile, the DGS also recommended against imposition on safeguard on imports of a chemical, Sodium di-chromate, used in manufacture of bulk drugs especially in ibuprofen. Source: "The Economic Times”, India, 18 January 2015

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