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Picture Courtesy: THE HINDU

Context:

The Ministry of Commerce is intensifying its efforts to curb import surges and combat dumping practices by trading partners.

COMMERCE MINISTRY INTENSIFIES CRACKDOWN ON UNFAIR TRADE PRACTICES

What unfair trade practices does the Commerce Ministry combat?

Dumping => When a country or company sells its products in another country (like India) at prices much lower than what they charge in their own country.

Example: a company selling an item for ₹50 in its home country but selling the same item for only ₹20 in India, even if it costs them ₹40 to make.

Why do companies dump?

To get rid of extra stock => Sell them cheaply abroad to clear stock
To capture market share => To push local businesses out and take over the market.
To use economies of scale => Selling more, even at a lower price, can help them produce more efficiently and lower costs overall.

An import surge means a sudden increase in the amount of a particular product coming into India. The Department of Commerce has established a comprehensive system to monitor import surges across all commodities.

Why is an import surge a problem?

If an import surge happens because of "malpractice" (unfair methods), it can flood the Indian market with foreign goods.
This can hurt Indian industries because they might not be able to sell their products if cheaper, often unfairly priced, foreign goods are widely available.

Who leads this initiative within the Commerce Ministry?

The Ministry of Commerce empowers two key departments to lead this initiative: the Directorate General of Foreign Trade (DGFT) and the Directorate General of Trade Remedies (DGTR).

Directorate General of Foreign Trade (DGFT) => Formulates and implements the foreign trade policy of India

It governs the import and export of goods, issuing regulations and restrictions as necessary to manage the nation's trade.
When the government identifies an "unusual surge" in imports stemming from malpractice, the DGFT steps in to restrict these imports.

Directorate General of Trade Remedies (DGTR) => National authority for administering all trade remedial measures

Its primary function involves conducting investigations into instances of dumping, subsidized imports, and import surges that harm domestic industries.
It recommends imposing anti-dumping duties, countervailing duties, or safeguard measures to protect Indian manufacturers.

Remedy Type	Definition	Purpose
Anti-Dumping Duty	Tax on goods sold below their normal value in the exporting country, harming the importing country's industry.	To offset the unfair low price and protect domestic industry.
Countervailing Duty	Tax on goods that receive unfair subsidies from their exporting government, harming the importing country.	To offset the unfair advantage gained from subsidies.
Safeguard Duty	Temporary duty on a sudden surge of imports (even if fairly priced) that cause serious injury to domestic industry.	To give domestic industry time to adjust to increased competition.

What are the international rules for these trade remedies?

India, as a member of the World Trade Organization (WTO), must follow its rules when applying trade remedies.

WTO Anti-Dumping Agreement => Strict rules on how a country can investigate and apply anti-dumping duties.

A country must prove that dumping is occurring, calculate the "dumping margin," and show that the dumped imports are causing "material injury" to its domestic industry.

WTO Agreement on Subsidies and Countervailing Measures (SCM Agreement) => Defines what constitutes a subsidy and outlines the conditions under which a country can impose countervailing duties.

WTO Agreement on Safeguards => Allows members to take emergency safeguard actions if imports increase to such an extent that they cause or threaten to cause serious injury to a domestic industry.

It requires demonstrating a clear link between increased imports and injury, and the measure must be temporary and applied equally to all imports.

Which products and countries are currently under investigation?

In June 2025, the DGTR initiated eight anti-dumping investigations across various product lines originating from a total of 12 countries or groupings.

Product Line	Originating Countries/Groupings
Industrial Chemicals	China, Taiwan, Kuwait, Malaysia, Oman, Qatar, Saudi Arabia, UAE, Switzerland, EU
Types of Glass Wool	Egypt
Types of Paperboards	Indonesia

How do these actions protect India's domestic industries?

By creating a fair competitive environment, the government prevents foreign goods from unfairly undercutting local products. This enables Indian manufacturers to compete on merit, promote industrial growth, safeguards jobs, and promotes self-reliance within the country.

FAQ

What is "dumping" in international trade?

Dumping refers to the practice where a country exports goods to another country at a price lower than their normal value or production cost.

What is the role of DGTR and DGFT in curbing unfair trade practices?

The Directorate General of Trade Remedies (DGTR) investigates dumping and other unfair trade practices, while the Directorate General of Foreign Trade (DGFT) implements trade policies and can restrict imports found to be causing harm.

Which countries are currently under anti-dumping investigation by India?

The DGTR has initiated investigations against 12 countries or groupings, including China, Taiwan, Kuwait, Malaysia, Oman, Qatar, Saudi Arabia, UAE, Switzerland, EU (for chemicals), Egypt (for glass wool), and Indonesia (for paperboards).

Must Read Articles:

DIRECTORATE GENERAL OF TRADE REMEDIES

INDIA'S TRADE TRENDS, TRADE DEFICIT

INDIA'S TRADE FIGURES

ANTI-DUMPING DUTY: DEFINITION, IMPOSITION, AND IMPLICATIONS

Source: THE HINDU

PRACTICE QUESTION

Q. Beyond the imposition of duties, what other policy interventions can the government undertake to strengthen domestic industries against dumping? 150 words