India probes alleged subsidised export of certain steel items by Indonesia

New Delhi: India has initiated a probe into an alleged subsidised export of certain steel products by Indonesia, following complaints by domestic industry.

The petitioners have alleged that the producers/exporters of certain steel products in Indonesia have benefited from the actionable subsidies provided at various levels by the Indonesian government.

The commerce ministry's investigation arm Directorate General of Trade Remedies (DGTR) has started the probe to see whether the subsidy programmes are impacting the Indian industry.

Indian Stainless Steel Development Association (ISSDA), Jindal Stainless, Jindal Stainless (Hisar) and Jindal Stainless Steel have filed an application on behalf of domestic industry before the directorate, alleging subsidisation of these products by Indonesia.

They have requested for initiation of an anti-subsidy investigation for levy of countervailing duties on imports of the goods.

According to a notification of the DGTR, it has found evidence of "countervailable subsidies" on production and export of the goods.

Such subsidised imports are causing material injury to the domestic industry, it said.

In view of this, "the authority hereby initiates an investigation into the alleged subsidisation and consequent material injury and threat of injury to the domestic industry," it said.

The directorate would determine the existence, degree and effect of alleged subsidisation.

If it is established that subsidies by Indonesia is impacting domestic industry, the DGTR would recommend the amount of countervailing duty, which if levied, would be adequate to remove the injury to the domestic industry.

Under the global trade rules of the World Trade Organisation (WTO), a member country is allowed to impose anti-subsidy to countervailing duty if a product is subsidised by the government of its trading partner.

These duties are trade remedies to protect domestic industry. Subsidy on a product makes it competitive in price terms in other markets. Countries provide this to boost their exports.

India and Indonesia are members of the WTO. Indonesia is a major trading partner of India. The bilateral trade between the countries have increased to USD 21.12 billion in 2018-19 from USD 20.4 billion in the previous fiscal. Trade balance is in the favour of Indonesia.