The Directorate General of Trade Remedies (DGTR) under India’s commerce ministry, has ordered an investigation into the Sunset Review clause concerning the import of jute products originating from Bangladesh and Nepal under the Customs Tariff Act, 1975. The order has been given to prevent the Indian jute industry from getting badly hurt from the rampart import of jute yarn, hessian fabrics and jute sacks taking place.
The imports are happening on the strength of an earlier exemption given to some jute mills in Bangladesh by the Indian authorities against anti-dumping duty (ADD) and circumvention duty (CVD).
The Indian Jute Mills Association (IJMA) has alleged that a section of Indian traders imports a bulk of jute products from the exempted mills and such mills supply beyond their capacity sourcing the produce from other non-exempted mills in Bangladesh. “This is an absolute abuse of their special status causing harm to the Indian jute industry,” IJMA president Raghevendra Gupta said.
The government of Bangladesh extends cash subsidies between 7.5% and 20% on their exports of jute products. Further, jute goods from Bangladesh and Nepal flow freely into India without any duty under the SAFTA treaty. Since the Indian government’s imposition of anti-dumping duty in January 2017, the Bangladesh government’s subsidy has been increased to nullify any hurdle to their trade. The jute industry in India was forced to file for circumvention duty when importers in India began to import sacking cloth instead of sacking bags, to evade anti-dumping duty (ADD) from that time onwards, Gupta said.