Term paper

Mana gerial economics
Topic – dumping-boon or bane
Submitted to:submitteby:AFIFA NAZIM YASMEEN
Roll no:- A68 Reg. no-11012577

Mr.ashish Sharma


INDEX 1.Preface 2.Acknowledgement 3.Contents 4.Introduction 5.Objectives of study 6.Literature review 7.Methodology :-sources of data 8.Analysis 9.Conclusion 10.Research and Bibliography

various problems are to be dealt with in these courses. With the help of term paper we can able to understand the deep knowledge about the specific topic assign to us. It is part of professional courses. WE have attempted to live up these requisites while preparing this term paper.3 PREFACE AS MBA Degree requires equal attention practical as well as theoretical aspect of the business. that is why research programs are there to give deep as well as through knowledge of the subjects. During our project work I observed some of the behind the DUMPING-BOON OR BANE. It is hoped that this report meets the given expectations and various requirement of the research. .

whole-hearted guidance. ASHISH SHARMA for her active support. healthy and conductive environment and including new and fresh innovative ideas for us during the project. really acted We are really grateful to our HOD for providing us with an opportunity to undertake this project in this university and providing us with all the facilities. their help.4 ACKNOWLEDGEMENT I take this opportunity to present my votes of thanks to all those guidepost who as lightening pillars to enlighten our way throughout this project to successful and satisfactory completion of this study. particularly the various friends . it would have been extremely difficult for us to prepare the project in a time bound framework. . who have been instrumental in creating proper. We are thankful to all those. valuable time and advice. Lastly. We are highly thankful to MR. sincere cooperation and pains-taking involvement during the study and in completing the assignment of preparing the said project within the time stipulated.

.5 INTRODUCTION Dumping (in trade) Definition The practice of selling goods abroad below the price charged for the same goods in the domestic market or at a price below the cost of production. as such. • Predatory Dumping: Temporary sale of a commodity at below cost or a lower price abroad in order to derive foreign producers out of business. conditions must be met: o Domestic and foreign markets must be separated. For international price discrimination to take place. after which prices are raised to take advantage of the monopoly power abroad. usually with the aim of driving competitors out of the market. • Persistent Dumping: Continuous tendency of a domestic monopolist to maximize total profits by selling the commodity at a higher price in the domestic market than internationally (to meet the competition of foreign rivals). Types of dumping: • Sporadic Dumping: Occasional sale of a commodity at below cost in order to unload an unforeseen and temporary surplus of the commodity without having to reduce domestic prices. The good can be sold with a lower price where the demand elasticity is high. and with a higher price where demand elasticity is low. Dumping is considered to be an unfair trade practice and. o Demand elasticity of the product must be different in two markets. is prohibited under many national trade laws.

6 OBJECTIVE OF STUDY To know about the dumping wheather it is a boon or bane for the country • • • • • Reason behind the dumping in a country Adverse affect of dumping What is anti-dumping regulation Positive effect of anti.dumping Steps taken by gonernment to stop dumping-like anti dumping regulation .

. In foreign markets. This is said to be the case in domestic markets.Segmented markets where there is no arbitrage easily possible between markets. price discrimination in favor of exports is more Common because the share of exports is usually lesser than the domestic demand. producers tend to charge a higher price. (Because in imperfect market firms are price setters not price takers). firms will dump. if there is high elasticity on export sales than on domestic sales. In areas where the demand is price inelastic. . individual firms have lesser monopoly power and hence choose to keep prices lower in foreign markets while charging higher prices for domestic markets. This can also be explained through the price elasticity of demand for goods. The conditions mandatory for dumping to take place are . Only if the above two conditions are satisfied is it profitable for the exporting firm to Engage in dumping. For any firm.7 Reasons behind the dumping in the country Dumping occurs when firms start using price discrimination as a strategy for profit Maximization.Presence of an imperfect market where price discrimination between markets is Possible. Thus. In the export market. price elasticity of demand is elastic and hence prices are low.

These preparations contain either single drug or drugs in fixed dose combination (FDC). All formulations are used for treatment or prevention of diseases. The total number of essential drugs mentioned in the 14th list of essential medicines by WHO is 312.8 Adverse affect of dumping in India:1. India has become dumping ground for banned drugs.000 branded formulations are available in India. it seems. comes cheap for the health officials of our country. But many of the irrational combinations are popular and widely prescribed by physicians in our country. Out of it only few drugs are lifesaving and essential drugs. out of which only 18 are fixed dose combinations. pharmaceuticals Many spurious drugs that have been banned. withdrawn or marketed under restrictions in other countries. The business for production of banned drugs is blooming and because there are more consumers here and all illegalities are duly . painkiller. This may be due to the implementation of product patent regime where the mediocre companies find various alternatives to sustain themselves in the market place and combination products for newer indications play a major role. depression. There was alarming increase in irrational FDCs in recent years and pharmaceutical companies manufacturing these FDCs are luring physicians to prescribe by unethical means. India has become a dumping ground for banned drugs. However. the safety profile of the established drugs will alter when they are combined together." The safety of the combination drugs has to be thoroughly evaluated and there are considerations for the drugs that are already in the market as individual or single drug entity. Life. continue to be sold in India. otherwise maximum of them are available as alternative or substitute to each other. The pharmaceutical companies and defaulters are playing with the lives of thousands of people who are not aware of the harmful effects of the drugs they sell. Otherwise how else would you justify the existence of drugs withdrawn elsewhere in the world but still sold and prescribed in India? "More than 60.

As big time business enterprises and small time defaulters. withdrawn or marketed under restrictions in North America. pharmaceuticals have been growing in every direction. causing a lot of damage to themselves. with over 1 billion population did not report any. continues to be sold in India.that have been banned. there has not been a single instance of adverse drug reaction reported against any drug in the country. Worst than that is the little knowledge and slapdash attitude of the buyers. Europe and many Asian countries. while Vicks Action 500 from the stable of Procter and Gamble is discarded for increasing chances of brain hemorrhage. Nimulid (Panacea Biotec) that are discarded for reported liver damage. . "Regulations in India and US vary. There are few provisions for a proper check and control of spurious drugs in Indian markets. 33 and 225 adverse drug reaction on nimesulide. In the US. The irony is that very few people know about the banned drugs and consume them unaware. it should stop being available in the market.including cisapride. Nimesulide and Piperazine. drugs like Analgin. Indian regulatory authorities should also withdraw it from the market. Eleven drugs . But there are times when a drug is banned yet continues to be sold for a few months till stock lasts. India. Unfortunately that does not happen". which in fact is a very wrong decision and can be dangerous. a large population takes medicine and drugs without prescribing a doctor. When a certain drug is found to have side affects.9 obeyed. However. Another drug Sildenafil (erectile dysfunction drug) had 18 adverse drug reactions reported from Australia but none from India. Some of the most common ones include Nise (Dr Reddy's). Even at this time. Assessing adverse drug reaction is not an easy task and in a developed country like the US not more than 10% of the side effects are recorded. Whenever a drug is banned by the Drug Controller of India. The business of production of these discarded drugs is booming in India. According to a health ministry source. discarded worldwide due to serious side effects are among the bestsellers in India. nimesulide and phenylpropanolamine . Anti-depressant drug Droperol (produced by Triokka) has been discarded for irregular heartbeats in patients. "There is a lot grey zone in the field". monitoring of adverse drug reaction is not followed in the curriculum for medical students in India and majority of doctors do not maintain records on patients. Thanks to a virtually "absent" adverse drug reaction mechanism in the country. respectively had submitted 25. Switzerland and Italy with a population of about 4 million. Anti-diarrhoeal drug Furoxone (from the house of Glaxo) was withdrawn from the market after reports of cancer in some patients. Cisapride. 33 million and 57 million. Countries like Ireland. India's contribution to the worldwide collection of data on the side effects of different drugs is dismal. drugs are not banned. who were administered the drug. furazolidone. According to a report of the World Health Organisation. The issue is severe and we must not delay in spreading the warning message to the offenders and innocent people. they are withdrawn from the market.

The demand is still there for these drugs and that is why they are supplied. he said.500 companies. “With the external problems of various sick economies with huge surplus capacities in chemicals and “nowhere to go”.000 crore and export revenues worth Rs 75. . South Korea. The chemical industry. no doctor can be blamed for prescribing it and as long as doctors keep prescribing. South Korea. Noted doctors keep themselves informed of the harmful side-effects of these drugs and do not prescribe them".000 crore.” he added. The industry. has called for urgent antidumping measures to create a level playing field for the domestic industry. Prices of a broad range of basic chemicals including polymers. “This compares negatively against the higher duties ranging from 12-30 per cent in neighbouring countries which have strong chemical and polymer industries. which records an annual sales of over Rs 2.Cheap imports threatens Indian chemical firms The ongoing global recession is posing a unique threat to the Indian chemical industry as the companies are finding increased competition from global chemical suppliers who are turning in large numbers to tap the ‘still growing’ Indian markets. Hence the stabilisation of the Indian economy and demand boost will not help the chemical industry. which comprises over 9.” Parthasarathy explained.5 per cent. the US and the EU have higher duties. "Till the time the drugs are not banned by regulatory authorities. 2. chemists will keep selling these drugs".” said R Parthasarathy. Indian money will be unintentionally supporting jobs and industry in these countries at the expense of Indian jobs. Indian Chemical Council (ICC). industry complains. experts say. Doctors and patients who are used to prescribing and using the drug should realize that there are better and safe alternatives". Taiwan and West Asia) focusing on India as the only large consuming nation without deep structural weaknesses. This has resulted in major chemical/petrochemical economies in this region (China. West Asia.10 Drugs continue to be available over the counter because doctors keep prescribing it. While construction and consumption will go up. says that the government’s attempt to rejuvenate Indian economy can only worsen the situation as India is amongst the very few large markets that remain in its growth phase. "There have been campaigns against various drugs. Taiwan and Asean will benefit. India is the obvious target and this has already started. only the manufacturers from China. and agro-chemicals have crashed 30 to 70 per cent in the last two months due to cheap imports.45. petrochemicals. vice-president. “India remains the only bright spot among the large economies. Many people have the opinion that "The problem is two-sided. are unaware of the researches being conducted worldwide. Many doctors. According to ICC. with rock-bottom prices. Even developed countries like Japan. the problem is seriously aggravated by the prevailing import duty structure of the chemical industry that is between 5 per cent and 7.

the price gap between the Indian and Chinese products is huge and difficult to explain. reveals a survey conducted by the Federation of Indian Chambers of Commerce and Industry (FICCI). The industry feels that the government should take urgent measures to stop anti-dumping as normal anti-dumping procedures are time consuming.11 The ICC. has already approached the high-level official committee that is looking at the second stimulus package to present their case. “Immediate imposition of severe testing requirements on imports from China is a must as these include basic items of consumption and even vaccines. the survey points out.5-7 per cent rate. light engineering goods like power presses. India is an obvious first choice in such a scenario given its geographical proximity and the fact that it is still growing at an appreciable 6. whose products are 10-70 per cent cheaper than Indian products. and metal products like auto components. ammonium chloride. heavy engineering goods such as high speed diesel engines. Interestingly. “Trade and industry have reported that with western markets losing their appetite for imports. eroding the market share of Indian companies.Cheap Chinese imports hurt SMEs Industry wants strict anti-dumping measures NEW DELHI: Cheap Chinese imports are giving Indian small and medium enterprises (SMEs) a tough time. 3. chemicals and chemical products such as soda ash.Cheap Chinese hurts small and medium indusrties A majority of Indian SMEs are feeling the heat in the domestic market due to rising imports from China. The industries that have been impacted by this “onslaught” includes processed food items such as honey. imports into India and other neighbouring countries would only go up.” the survey adds. Indian SMEs have asked the government to take strict anti-dumping measures to stop cheaper Chinese imports and save Indian industry. welding machines and printing machinery. Chinese manufacturers are increasingly looking at alternative markets to offload their wares. 4. along with industry chambers like Ficci. In 2008 there has been a substantial rise in Chinese imports into India. Indian SMEs have urged the government to clear quality and safety norms for Chinese imports before being allowed to be marketed in India. almost 75 per cent. Indian SMEs are apprehensive that as the Chinese government gives more incentives to boost exports. are offloading their products in India. particularly when the global economic slowdown and weakening domestic demand are affecting companies across sectors. .” the survey says. Chinese manufacturers.

companies feel that the anti-dumping investigations for imports from China need to be beefed up and decisions taken at a quick pace. it added. 1995). Due to dumping a country would be able to capture the international market and earn more profit. Positive effect:.12 To deal with the over the counter export subsidies that Chinese manufacturers enjoy. . especially from the small and medium scale segment.Cheap Chinese goods harming Indian industry: government news The government is taking measures to counter the threat posed to the domestic manufacturing sector in India. These duties are in accordance with the Agreement on Anti-Dumping (the agreement on the implementation of Article VI of GATT. 5. during 2008-09 and 2009-10 (up to November 2009). 'subsidised' imports or 'increased' imports. and the agreement on safeguards. including final duty in 12 cases and provisional duty in 10 cases. the agreement on subsidies and countervailing measures. from cheap and subsidised Chinese products. For example it is beneficial for the country who dumped its product but on other hand it is harmful for the country in which the dumping is being done. These provisions are aimed at offsetting the adverse effects of 'dumped' imports. a government release said today.Persistent beneficial for the country who dumped the product because due to this a country would be able to earn revenue from the international market by selling their dumped product or by selling those product having very low demand in the domestic market. the release said. India imposed anti-dumping duty on Chinese goods in 22 cases. Final safeguard duty was imposed in 4 cases during the two years. the commerce ministrys said today. POSITIVE EFFECT OF DUMPING: The effect of dumping differs from country to country.

India takes 26 trade defence measure during mar 2008-nov-09 NEW DELHI . Meanwhile. . Imports from China increased by about 35 per cent to Rs 147. including anti-dumping duty.13 Role of government India takes 26 defence measures during 2008-09 India has taken 26 trade defence measures. including anti-dumping duty.100 crore) in 2008-09. India had a huge trade gap of about $7 billion (over Rs 32. Trade defence measures offset adverse effects of dumped.605 crore in 2008-09 from Rs 109. in order to protect its small and medium enterprises from cheap imports mainly from China. in order to protect its small and medium enterprises from cheap imports mainly from China. safeguard duty can be levied in case there is serious threat of injury/market disruption. Commerce and Industry Minister Anand Sharma took up the matter of increasing trade gap with China." an official statement said.India has taken 26 trade defense measures. with imports from China amounting to more than $32 billion. since March 2008 up to November 2009. Anti-dumping duty is imposed when a product is imported at less than its normal value and causes injury to the domestic industry. since March 2008 up to November 2009. subsidised or increased imports. During a meeting with Chinese Prime Minister Wen Jiabao in Beijing on January 19.116 crore in the previous year. "During 2008-09 and 2009-10 (up to November 2009) anti-dumping duty was imposed in 22 cases and final safeguard duty was imposed in 4 cases.

Steel Industry has come out with the proposed wish at a time when Indian Government is preparing to reveal another package to boost demand. Meanwhile. which motivated domestic manufacturers to urge Indian Government for imposition of import duty. Jindal Steel and Power Director.116 crore in the previous year. S K Roongta. Due to global economic slump. said the Government to further trim down excise duty. Sushil Maroo. On this. urged the Government to impose an additional 10% import duty on steel items. major steel companies from China and Ukraine started selling their piled up stocks in India in bulk quantities. Trade defense measures offset adverse effects of dumped. subsidized or increased imports. Imports from China increased by about 35 per cent to Rs 147. safeguard duty can be levied in case there is serious or threat of injury/market disruption.” an official statement said. apart from abolishing Central Sales Tax on steel. the government should impose at least 20% import duty among other measures. Indian industry urges govt to increase import duty Indian Steel industry impels the government of India to increase import duty and imposition of countervailing duty on steel items in order to examine the cheap arrivals of the commodity from abroad.14 “During 2008-09 and 2009-10 (up to November 2009) anti-dumping duty was imposed in 22 cases and final safeguard duty was imposed in 4 cases. Mr. According to sources. the Government imposed 5% import duty on steel products. apart from 10% countervailing duty on TMT bars and a special additional duty of 4% to save domestic industry. Ispat Industry official stated that as part of package to boost demand.250 a tonne earlier this year and are now hovering around $550 mark. Anti-dumping duty is imposed when a product is imported at less than its normal value and causes injury to the domestic industry. Steel demand from infrastructure and automobile industry declined as they were hit by the global .605 crore in 2008-09 from Rs 109. which according to the officials of steel industry is an inadequate to check dumping of the commodity in the domestic market. Steel prices have touched a high of $1. chief of Steel Authority of India Limited.

Unlike anti-dumping duty. The applicants have alleged serious injury caused to the domestic producers by the increased imports of phthalic anhydride into India. a chemical used in the manufacture of plastics and dyes. Tamilnadu). Maharashtra). in order to discourage imports and protect local producers. It is produced by catalytic oxidation of ortho-xylene (OX) with air or by the catalytic oxidation of naphthalene and is used in organic synthesis of plastics (alkyd resins) and plasticizers. safeguard duties are levied in a uniform way. Pthallic anhydride imports to attract 20%safeguard duty news The government has imposed a 20-per cent safeguard duty on pthallic anhydride (PAN). for 200 day. Maharashtra) for imposition of safeguard duty to protect the domestic producers against serious injury caused by the increased imports of phthalic anhydride into India. Israel.599 tonnes for the whole of the financial year 2004-05 to 18. Mysore Petrochemicals Ltd (Raichur. which had recommended imposition of 25 per cent safeguard duty on import of pthallic anhydride for about seven months. The imports pthalic anhydride have shown an increasing trend in absolute terms as well as compared to the domestic production. IG Petrochemicals Ltd (Raigad. The duty was imposed following recommendations from the directorate general of safeguards (DGS).15 dismal economy and liquidity crunch in the market.600 tonnes in the first five months of fiscal 2006-07. Taiwan and Pakistan. Karnataka) and SI Group India Ltd (Navi Mumbai. etc. The four companies account for about 85 per cent of pthallic anhydride production in the country. . Phthalic anhydride is the principal commercial form of phthalic acid. Imports of the chemical rose by 60 per cent from 19. Indonesia. which varies from product to product and country to country. Phthalic anhydride is imported into India from Republic of Korea.Thirumalai Chemicals Ltd (Ranipet. adding the duty would remain in place for 200 days. The investigation followed an application filed by four affected firms . "The government has imposed 20 per cent safeguard duty on import of PAN. The package is expected to infuse growth in ailing sectors to increase steel offtake." a senior commerce ministry official said.

it is harmful to the domestic producers as their products are unable to compete with the artificially low prices imposed by the imported goods. Antidumping measures are of two kinds: 2 Antidumping duty: This is imposed at the time of imports. As a method of protection to the domestic industries. as per the international laws. in addition to other customs duties. . The purpose of antidumping duty is to raise the price of the commodity when introduced in the market of the importing country. As the antidumping duty is only meant to provide protection to the domestic firms in the initial stages. anti dumping duties are thus levied on the exporting country which has been accused of dumping goods in another country.16 What is anti-dumping regulation act: Although dumping does benefit the consumers of the importing country in the short run. the antidumping legislations may last for a maximum period of five years.

Thus it is on this ground that the anti dumping duties have been justified. Section 9 of the Customs Tariff Act. This is a form of tariff and is hence treated under the customs tariff act. all anti dumping cases in India have been handled by DGAD. The main intension is to protect the domestic industries. Today. Once these firms are forced out of the market as a result of dumping by exporters. The duty is justified because in case of many industries the start up period is long and start-up costs are also high.e. Assessment and Collection of duty or Additional duty on Dumped Articles and for Determination of Injury) Rules.dumping investigations and the appointment of designated authority. Hence. the DGAD is headed by the Designated Authority of the level of Additional Secretary to the Government of India who is assisted by a Joint Secretary and a Director. It is located in New Delhi. These rules contain the operational provisions and confirm to the WTO agreement on antidumping. India and Anti dumping Acts and laws that govern dumping are:The first Indian Anti-dumping legislation came into existence in 1985 when the Customs Tariff (Identification. 1975 empowers the central government to impose antidumping duty. using predatory pricing). are governed by the anti-dumping rules. in the international context. Besides. The manner and procedure of anti. . it is the antidumping duty that protects the domestic producers initially and consumers in the long run. Since then. Anti dumping duties are charges levied against the exporting country for selling their price lower than the normal price in another country. the intentions of charging such low prices to foreign consumers is to be able to wipe out the domestic industries and eventually acquiring monopoly power in the foreign market (i.Dumping in a Global World: Why Product Quality Matters . 1985 were notified. The main difference between anti dumping and the other measures is that anti dumping is not retaliatory. there are eleven Investigating and Costing Officers REVIEW OF LITRETURE 1. The Directorate General of Anti-Dumping & Allied Duties (DGAD) was constituted in April 1998.17 Price undertaking: If the exporter himself undertakes to raise the price of the product then the importing country can consider it and accept it instead of imposing antidumping duty. it is very difficult for them to restart when the same exporters raise prices. Usually.

We show that the definition of dumping matters.g. We determine the extent to which higher dimensionality alters this outcome by introducing a model with several firms in each of several countries. whenever trade occurs dumping occurs 3. THE AUTHOR tries to prove that dumping is universal. 2. Author explain that Brander and Krugman offer a model with two countries and one firm in each country which generates the outcome that both firms dump into the export market (reciprocal dumping). the height of tariff protection and on exchange rate changes. antidumping duties) is regulated by the EU Antidumping Regulation 384/96 which complies with WTO obligations. Dumping and Anti-Dumping Paolo Farah(2005) Roberto Soprano In this article the author Robert Soprano wants to explain that the Dumping is the practice of a company exporting a product to another country at prices lower than the normal value of the product (the domestic prices of the product) on its own domestic market. He also explain that in the European Union the adoption of antidumping measures (e. depending on cross-country differences in incomes. Thus. only unilateral dumping by the low-quality firm obtains. we build a simple theoretical model of vertical intra-industry trade and investigate the strategic incentives of exporting firms to undertake dumping. By contrast. Universal Dumping of Homogeneous Products Tracy Murray (2008) In this article the author observed and explain that Contrary to predictions from traditional comparative advantage analysis. a class of models with imperfect competition predicts intra industry trade in homogeneous goods. Based on a comparison of low-quality and high-quality prices. The purpose .18 José Luis Moraga-González Jean-Marie Viaene The authors José Luis Moraga-González and Jean-Marie Viaene of the article DUMPING IN A GLOBAL WORLD:WHY PRODUCT QUALITY MATTERS Anti-dumping actions are now the trade policy of choice of developing and transition economies. the standard WTO definition leads to either reciprocal or unilateral dumping by the high-quality firm. To understand why these economies have increasingly applied anti-dumping laws.

but none on imported products (from China). it is around Rs15. especially those in the private sector.19 of the Handbook of Paolo Farah and Roberto Soprano is to foster a greater understanding of the EU Antidumping Regulation and assist entrepreneurs in lodging antidumping complaints. China has a fixed currency. strips. The Indian power companies. plates and boiler quality plates.Is China killing Indian manufacturing sector? In this article the author ISHA VERMA who is sales manager in LARSEN AND TOUBRO wrote this article in the year 2009 and explain that the Private sector manufacturing engineering in India is facing a stiff competition from neighbouring countries like China who is systematically killing Indian manufacturing sector and sought 25% anti-dumping duty on Chinese goods. 1998. 4.Dumping Determination Discretions Analysis: Through Lenses of Relevant Accounting Principles Samreth Seng(2006) The author observed that the Antidumping (AD) law and policy is concerned with fair trading among World Trade . The anti-dumping duty has been levied from November 27. ANTI-DUMPING DUTY CLAMPED ON HOT ROLLED STEEL IMPORTS In this article the author ( anonymous) explain about the anti dumping duties.dumping duty will affect cold rolling units like Bhushan Steels and Ruchi strips as they have to pay more on imports. 6. have placed huge orders for power plant equipment with China. sheets. Tata Iron and Steel Company Ltd. 5.he says that The Indian Finance Ministry has levied anti-dumping duty on imports of hot rolled (HR) steel coils.300 per tonne. In India. While the reference price for the HR coils is 14. The anti. This is an unfair situation for Indian goods. Essar and Lloyds are expected to benefit from the move. The HR product producers like Steel Authority of India Ltd.000 per tonne for plates and Rs22. we have taxes on goods manufactured locally. This is why there should be 25% antidumping duty on Chinese products.000 per tonne for boiler quality plates. It is not a market economy like ours.

Positive outcome of AD cases is predictable.tariffs imposed on imports judged by a government the unfairly priced. Thereby to understand the Indian perspectives. questions arise about the merits of this form of trade protection. The current paper contributes to AD literature by investigating the discretions provided in accounting principles point of view.Dumping is per se not unlawful as prices may vary from time to time. Michael Finger(2007) . 7. also being a member of WTO has drafted its laws and policies keeping in mind the provisions stated in the WTO/GATT Agreement. As more countries resort to such tariffs. as it is applied towards China. Whenever dumping emerges as a threat to domestic market of a country.He also explains that Anti Dumping basically. Article II of Agreement on implementation of Article VI of GATT 1994 provides significant discretions to national investigating authorities in investigating AD actions. in accordance with the supply-demand market fluctuation . international aspect cannot be ignored and needs an immediate reference. its Designated Authority has the power under WTO Agreement to initiate necessary action against such exporters 9. Most of the countries have imbibed and implemented various provisions on anti-dumping India. few of the statutes in India make arrangements for antidumping provisions as put forward in the present paper. deals with the price behavior of the exporters whereby. Present trade policies have picked up the most liberal approaches. normal value and dumping -margin. Free Versus Fair Trade: The Dumping Issue Karen Schiele (2005) Author says that theTrade liberalization has had little effect on the use of antidumping tariffs . Anti dumping Law and Practice: An Indian Perspective Sugandh Saksena(2001) In this article the author observed that The concept of Anti -dumping measures serves a host of implications and is important weapon in the arena of both national and international trade. and that there are various legal flaws in the way the policy is applied. J. However. it has been known to be used as protection policy. It concentrates on recent court cases involving dumping from China and on the basic non-market economy issue. Each of the accounting principles identified provides a different product cost.20 Organisation.DUMPING AND ANTIDUMPING: THE RHETORIC AND THE REALITY OF PROTECTION IN INDUSTRIAL COUNTRIES 1. injury is the main ingredient required to be proved. Although. European Anti-dumping Law and China Piet Eeckhout(1999) According to the paper of the author examines recent developments in the European Union's anti-dumping policy. 10. 8. The findings indicate that there is a great range of accounting principles relevant to the computation of exported price.Dumping as a form of price discrimination is a casual practice in the domain of international trade. particularly when other remedies are available to industries hurt by import competition. The author essentially argues that the European Union's policy does not take account sufficiently of China's development towards a market economy.

21 Author J. in particular about the history of antidumping regulation and its evolution under the GATT system into a major instrument of protection. The first looks into the origins of antidumping regulation. The article has three sections. 2004 The author observed that the number of anti-dumping initiatives by governments all over the world has increased significantly during the recent years. Data for the research has been gathered from 178 Australian international marketers. Author:Rahman. Protectionist interests stretch the definition of dumping as far as they may to shelter actions against imports under the antidumping umbrella. This article is about antidumping. Results of the study show that there is an agreement among the participating firms that the current anti-dumping laws of different countries are often confusing and there is no uniform definition of what may be called as ' dumping'. cooperation with local competitors and differentiation through enhanced services and trading up as good strategic measures. Antidumping is the current reality of that protection. and there is much to suggest that such protection was its intended scope. to counter the effects of anti-dumping actions. There is little in its history to suggest that the scope of antidumping was ever more particular than protecting home producers from import competition. The thesis is straightforward: antidumping is the fox put in charge of the henhouse—ordinary protection with a good public relations program.Anti-dumping measures and international pricing policy: an Australian study. January 1. There is a general perception among the participating firms that more and more governments are using this as another non-tariff barrier. An a priori model of the impact of anti-dumping measures on international firm's pricing policy has been developed based on literature review and tested using structural equation modelling technique. This has a potential effect on the international pricing policy of firms. and the third summarizes the significance of the first two. Results of this study also show that international firms are finding concentrating in less sensitive product categories. . This research focuses on the impact of the anti-dumping measures on the international pricing policy of firms and any strategic measures that the firms take to counter the anti-dumping actions. Syed H. the second examines contemporary regulation (antidumping under the GATT).MICHAEL FINGER defines that the wide gap separates the rhetoric from the reality of protection in industrial countries. 11.

domestic firms can file an antidumping petition under the regulations determined by the Department of Commerce. then antidumping duties are imposed on goods imported from the dumpers' country at a percentage rate calculated to counteract the dumping margin .22 ANALYSIS In economics. which determined "injury".S. The Department of Commerce has regularly found that products have been sold at less than fair value in U. law. "dumping" can refer to any kind of predatory pricing. The term has a negative connotation. which determines "less than fair value" and the International Trade Commission. Advocates for workers and laborers however.S. If the domestic industry is able to establish that it is being injured by the dumping. help alleviate some of the harsher consequences of free trade between economies at different stages of development Remedies and penalties In United States. These proceedings operate on a timetable governed by U. the word is now generally used only in the context of international trade law. However. markets. where dumping is defined as the act of a manufacturer in one country exporting a product to another country at a price which is either below the price it charges in its home market or is below its costs of production. believe that safeguarding businesses against predatory practices. but advocates of free markets see "dumping" as beneficial for consumers and believe that protectionism to prevent it would have net negative consequences. such as dumping.

However in reality. The underdeveloped economies have every reason to feel scared that the large scale manufacturers of the developed world will be able to flood the domestic markets with aggressive pricing. If we study the cases in India so far. as has been observed through past cases that more often than not. anti dumping legislations are filed by firms who have strong power in the domestic country and hence are able to lobby the governments. K. we realise that the duties do seem to be in favour of the dominant players. This is a very valid point and there can be no objection to antidumping duty applied on this basis. Well organised industries. REFERENCES AND BIBLIOGRAPHY BOOKS PREFERED:MANAGERIAL ECONOMICS. These firms apply for antidumping protection merely because they feel threatened by foreign firms and in the process breed inefficiency. As large as 40 out of 64 cases on which final antidumping duties have a single petitioner6. It was thought that if such a protective tool is made available to a country. if money can buy political influence as big firms have the financial muscle to bulldoze their way through the bureaucracy. it may feel encouraged to trade freely.23 Conclusion I have concluded that the dumping have different effect on different country like it is beneficial for the country who dumped the product but harmful for the country being dumped. DWETTE NEWSPAPER AND JOURNALS . are able to manoeuvre their way and get the decision in their favour. This is even easier. The government of the dumped country creates anti-dumping duties on the imported goods.GEETIKA AND GYALI GHOSH BOOKS OF MODERN THEORY – K. The Antidumping Agreement was codified during the Tokyo Round of GATT negotiation (1973-79) to stop "predatory" pricing.

in/ad_cases.24 Economics Times-Business International Business Standard Journal of International Business Research WEBSITES:http://commerce.centad.nic.org/relatedinfo13.com . http://commerce.asp http://www.PDF http://www.proquest.htm.nic.in/Guide.

Sign up to vote on this title
UsefulNot useful