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Unfair Trade Practices:

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Published: 9th Jan, 2020

Unfair Trade Practices:

Agro-based industries lose their competitive edge due to unfair trade practices adopted by exporters of other countries. Such practices manifest in two forms-

  • Dumping- It is observed that exporters from other countries often dump their products in Indian Markets at rates cheaper than those at which they sell their products in their domestic markets.
  • Subsidies- Govt of those countries from where imports are sourced by India, are observed to be providing subsidies to their exporters.

Trade Remedies-

  • India’s Customs Tariff Act, 1975 and related Anti-Dumping Rules and CVD Rules, 1995 provide the legal backing for Govt of India to protect the domestic manufacturer against unfair trade practices of exports of other countries.
  • The DGTR under the Department of Commerce is a quasi judicial body. It recommends ADD or CVD when investigations point out that the domestic industry has indeed suffered because of unfair trade practices. On the recommendation of DGTR, the enhanced duties are put into place by Govt’s Department of Revenue.
  • Thus, the Agro-based industries can approach DGTR to redress their grievances in cases where exports of other countries have materially injured them or likely to injure them in the absence of any trade remedial measure.
  • Another trade remedial measure from ADD or CVD, is a safeguard measure which may be resorted by government when there is a surge in imports of any commodity due to which serious injury is caused to the domestic industry.

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