Mumbai, Mar 3: The European Commission has decided to impose punitive provisional anti-dumping duty ranging from 16 to 18 per cent on cotton grey fabrics imports from India by the second week of March, after two previous occasions when it imposed the duty only to withdraw it later.An official announcement from the commission is expected soon after the European union advisory committee on anti-dumping ratifies the proposal to impose duties on March 5.
After verifying the export statistics of five Indian textile companies, the commission has come to the conclusion that the cost of production is higher than the selling price, which established the case of dumping, ministry sources said. The sample companies that came under investigation include Century Textiles, Mafatlal Industries, Coats Viyella and Virudhanagar Textiles.
While a section of the industry feel that some members of the advisory committee will veto the decision, another section is of the view that committee members will provide unilateralsupport to the move. The officials of the affected companies point accusing fingers at the government for not petitioning the World Trade Organisation (WTO) after the commission started targeting the textile products.
But officials at the textile ministry rebuff this argument by saying that petitioning the WTO is a complex and elaborate process and the ministry had been actively campaigning against the commission's repeated attempts to levy duties.
The duties could not have come at a more inopportune time with the textile exports showing signs of recovery. The provisional duties imposed last time had a crippling effect on the leading textile companies with their net profits falling to abysmally smaller levels.
The companies appear to have revised their strategies to reduce the impact of the duties by focussing on value-added products and making inroads into newer markets, according to analysts. Value-addition coupled with exploration of new markets will tilt the scales in their favour, they add. Thecommission has imposed definitive anti-dumping duties on bed-linen exports from the country and is gearing up to initiate probe into another textile product--terry towel.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
