Japanese authorities contend that the procedure adopted by India in establishing injury to domestic industry and causal links were not in tune with WTO norms, the sources said.

During the recent visit of commerce secretary P Prabhu to Tokyo, Japan had pushed for bilateral talks on the issue, they said.

As per the WTO rules, member countries should try to sort out disputes through bilateral talks before approaching the dispute settlement body).

If Japan takes India to the body if bilateral talks to settle the issue fail, it will be the first time any country drags India to the WTO on anti-dumping grounds.

Japanese ambassador Hiroshi Hirabayashi said: "The Government is expected to refrain from abusing anti-dumping measures. It should not follow the bad precedent set by the USand the European Union."

The anti-dumping duty slapped on the three products in December 1998 did not conform to the WTO norms, he said.

"The Indian authorities are sincerely listening to our pleas, and we hope that the bilateral talks would succeed," Hirabayashi said.

The Automotive Tyre Manufacturers Association (Atma), which is an user industry of EPDM, said that in the past the Government imposed anti-dumping duty only to the extent of the dumping margins determined.

In recent cases, however, the Government had adopted a reference price, which was a sort of floor price of import. The difference between the actual import price and the floor price will be levied as the dumping duty, and this works out to a much higher dumping margin, Atma said.

The designated authority on anti-dumping had set a reference price of Rs. 114,446 per tonne for EPDM originating from JSR Corporation and any other exporter, and Rs 101,716 for the product coming from DSM Idemitsu Co Ltd.

EPDM, which is a syntheticpolymer, is mainly used in automotive applications like profiles, radiators, hoses, and seals.

The investigation on acrylic fibre, which is an economical substitute for wool used in apparels and household products, was carried out against Japan, Portugal, Spain, and Italy.

The final anti-dumping duty applies for Asahi Chemical Industries, Mitsubishi Rayon, Toyobo Corporation and other exporters of acrylic fibre from Japan.