One of the reasons contributing to the increasing number anti-dumping cases in India is the high level of tariffs, writes Sharad Bhansali in one of the essays included in ‘India’s Liberalisation Experience: Hostage to the WTO?’ edited by Suparna Karmakar et al. ( >www.sagepublications.com ).
The normal impact of high tariffs is that the domestic producer is able to sell the merchandise in the home market at higher prices to the extent of the tariff protection available, he adds. “While the domestic prices in any country are a function of a large number of factors, the determination of domestic prices vis-à-vis the international prices is primarily a function of the effective level of protection.”
Acknowledging that anti-dumping is a fairly complex exercise which requires a deep understanding of law, finance, costing, and economics, the author calls for fair, transparent, and unbiased decisions to make the system more credible.
“Much of the criticism against anti-dumping as a tool of trade policy can be obviated if the process is followed in a transparent manner. The strengthening of the institutions at the investigation stage as well as the appellate stage is certainly the need of the hour.”
An efficient and responsive anti-dumping administration can also send appropriate signals to the erring exporters who might be inclined to indulge in price undercutting and underselling to the detriment of the Indian industry, suggests Bhansali.
Suggested addition to the economy-watchers’ shelf.
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