In the probe, the directorate would determine the existence, degree and effect of any alleged dumping. (Representative image)

India has initiated probe into alleged dumping of a chemical used in paint and leather industry from Brazil, Indonesia and Thailand following a complaint from a domestic player. The commerce ministry’s investigation arm – Directorate General of Antidumping and Allied Duties (DGAD) – has stated that it has found sufficient evidence of dumping of ‘non-plasticised industrial grade nitrocellulose excluding nitrocellulose damped in Ethanol and waterwet’ from these three countries.

“The authority hereby initiates an investigation into the alleged dumping, and consequent injury to the domestic industry,” DGAD has said in a notification.

In the probe, the directorate would determine the existence, degree and effect of any alleged dumping.

If established that dumping has caused material injury to domestic players, the DGAD would recommend imposition of anti-dumping duty on the imports of the chemical from these nations.

The product is a flammable compound and it is used in the manufacture of wood lacquers, auto refinish paints, leather finishing lacquers, nail varnishes and printing inks.

Nitrex Chemicals India Ltd has filed an application for initiation of the probe and imposition of the duty.

The period of investigation covers April 2016 – September 2017 (18 months). However, for the purpose of injury investigation, the period will also cover the data of 2013-16.

Anti-dumping duties are levied to provide a level playing field to local industry by guarding against cheap below-cost imports.

Imposition of anti-dumping duty is permissible under the World Trade Organisation (WTO) regime. Both India and China are members of the Geneva-based body.

The duty is aimed at ensuring fair trading practices and creating a level-playing field for domestic producers vis-a-vis foreign producers and exporters.