Explain Anti-Dumping duties.

Anti-Dumping Duties

 

The WTO Agreement on Antidumping regards that products are "dumped" when companies export them at prices lower than those at which they offer in their home market. Dumping is not illegal in itself; it becomes unlawful as soon as it brings about injury to local businesses in the importing country. Dumping is an action by a company.  In other words, it is a predatory pricing model where the exporter or a company exports and prices its products beneath production costs or underneath what they offer for in their home market.

So, Anti-dumping duties are for battling ‘dumping’, that hurts the domestic makers of the importing nation.

We can define Anti-Dumping Duty as a trade levy imposed by any government on imported products which have prices less than their fair normal values in their domestic market. It varies from product to product and from country to country. The Anti-dumping duty is calculated to bridge the gap back to a fair market value.

In India, anti-dumping duty to be levied is recommended by Union Ministry of Commerce while the Union Finance Ministry imposes it.

In fact, anti-dumping is an instrument for ensuring fair trade and is not a measure of protection per se for the domestic industry.

 


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