India to consider levying safeguards duty on LAB

29 December 2008 09:39  [Source: ICIS news]

NEW DELHI (ICIS news)--India would start investigating the linear alkyl benzene (LAB) industry’s demand for an "immediate imposition of provisional safeguards duty" on imports after 17 January, industry sources said on Monday.

The Directorate General of Safeguards (DGS) in the Finance Ministry would also study the LAB companies’ demand for three-year safeguards duty (SD), starting with 20% in the first year, 15% in second year and 10% in third year.

The companies expect to restructure their operations during this period to improve their competitiveness against imports. The surge in imports had forced three Indian producers to shut down their plants during the second fortnight of November, they added.

The companies that have shut their plants are: Reliance Industries Limited (RIL) that has plants at two sites, Nirma Limited and Tamilnadu Petroproducts Limited (TPL).

The three companies have petitioned DGS for tariff protection. The fourth LAB producer Indian Oil Corporation (IOC) has supported the petition.

DGS has observed that "prima facie" increased imports of LAB "have caused and are threatening to cause serious injury to the domestic producers" and has thus notified its decision to start investigation after considering views of all producers, consumers, foreign suppliers and other stakeholders, if any, a Government official said.

He said LAB imports had shot up from to 45,505 tonnes in 2007-08 from 21,470 tonnes in the previous year and from 4,871 tonnes in 2005-06.

DGS would ask LAB companies to specify the technical and other initiatives such as modernisation and expansion that they would implement to withstand competition from imports, sources said.

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By: Naresh Minocha
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