To understand and have an insight about the anti-dumping laws prevailing in India, let us understand what dumping particularly is, it is a processwhere a country exports its goods to other countries at a price below than the market value of the product in the exporting country.The market value of that particular product can be ascertained by the price value of the product prevailing in the domestic market or by comparing the substituted product.
The practice of dumping extremely affects the economy of the country to which the goods are being exportedand also the competition prevailing in the domestic market of the importing country. This unfair trade practice has been primarily developed from the rapid industrialization and globalization, which leaded to excessive production of commodities globally. This excessive production lead the nation to dump the products into another country, on a very large scale which drastically hampers the economy of the aforesaid state.
To curb the practice of dumping of products the government of various states has come up with the idea of imposing duties which are being levied against countries practicingdumping. These Anti-dumping duties will help in combating dumping practicesand also serve as a weapon to be used in the developing nations like India to protect its domestic market from unwanted competition arriving from the developed nation.
Under International trade this practice is considered to be unacceptable which have a distorting effect on a global trade. That is the reason why Anti-dumping laws are being imposed upon by the countries to rectify the situation arising out of dumping of goods and other effects developed from its trade. To formulate trade practices it is necessary to develop a law which will impose restrictions against the practice of dumping so as to establish a fair trade network worldwide. The use of these anti-dumping measures by the countries considered as an instrument of fair competition as permitted by the WTO.
In India the first Anti-dumping legislation came into existence in 1985 when the Customs Tariff (Identification, Assessment and Collection of duty or Additional duty on Dumped Articles and for Determination of Injury) Rules, 1985 were notified. These laws which are being developed for anti-dumping in India are based on Article VI of GATT 1994; Customs Tariff Act, 1975 - Sec 9A, 9B; Anti-Dumping Rules, 1995; Investigations and Recommendations by Designated Authority, Ministry of Commerce; Imposition and Collection by Ministry of Finance.
India is considered to be the frequent users of anti-dumping measures effectively as for the protection of its domestic industries. In India, although anti-dumping duty is levied and collected by the Customs Authorities. However, it is entirely different from custom duties. As anti-dumping and the like measures in their essence are linked to the notion of fair trade. The object of these duties is to guard against the situation arising out of unfair trade practices while customs duties are there as a means of raising revenue and for overall development of the economy. The anti-dumping and allied duties is to offset the injurious effect of international price discrimination while customs duties have implications for the government revenue and for overall development of the economy.
Any country in the world is not self-sufficient or self-reliant; in fact, every country is dependent upon each other whether how much developed the country is. Therefore, for the growth of any country, it is imperative to have free and fair trade to ensure equal conditions and opportunities available to each and every country to prosper. Dumping is one such practice that hampers this prospect. India though has laws in this regard but they are far from being perfect, implementation faults combined with the purgative approach of government often leads to excessive dumping in few areas of the economy, it needs to be curbed as soon as possible for India to have a desirable economy to which it has always dreamed for.