The Union finance ministry is set to extend existing anti-dumping duty on import of Chinese sodium citrate used in pharmaceutical and food industry following Union ministry of commerce and industry’s insistence.
The finance ministry imposed anti-dumping duty on sodium citrate imported from China on May 20, 2015 for five years. The duty will expire on May 19, 2020.
The imposition of anti-dumping duty on import of Chinese chemical was recommended by Directorate General of Trade Remedies (DGTR), an investigative arm of Union ministry of commerce and industry on February 26, 2015 after conducting a probe into it. The probe was initiated by DGTR on February 28, 2014.
The import of Chinese chemical declined over the last five years only due to the imposition of anti-dumping duty. However, they continue to remain significant despite the imposition of anti-dumping duty.
Landed price of imports is below the level of selling price of the domestic industry and price undercutting has remained positive over the last five years except briefly in 2017-18. Therefore, imports are likely to undercut prices of the domestic industry in the event of cessation of anti-dumping duty.
India has imported 841 metric tons of sodium citrate from China in FY 2015-16 followed by 1,159 metric tons of Chinese chemical in FY 2016-17, 772 metric tons in FY 2017-18, 1,014 metric tons in FY 2019-20 and 811 metric tons in FY 2020-21.
Before the expiry of the said duty, Posy Pharmachem Private Limited has filed an application before the DGTR for initiating sunset review investigation into imports of sodium citrate from China, alleging likelihood of recurrence of dumping and consequent injury to the domestic industry in case of cessation of existing anti-dumping duties.
Posy Pharmachem accounts for around 32% production of sodium citrate in India. Besides Posy, some of the major producers of sodium citrate in India are Adani Pharmachem, Sunil Chemicals, India Phosphate, Alpine Labs, Amijal Chemicals, Sujata Chemicals, Vasa Pharmachem, Devendra Kirti Pharmachem, Wang Pharaceuticals & Chemicals, Ishita Drugs & Industries Ltd.
The DGTR on the basis of the prima facie evidence initiated sunset review investigation on October 25, 2019 to examine whether the expiry of the anti-dumping duty on import of Chinese chemical is likely to lead to recurrence of dumping and injury to the domestic industry.
The directorate noted that the performance of the domestic industry has deteriorated considerably, and continued dumping of sodium citrate may adversely impact the ability of the domestic industry to raise capital investment.
It recommended to extend existing anti-dumping duty to protect domestic industry and suggested imposition of USD 152.78 per metric ton anti-dumping duty on import of sodium citrate from China.
Sodium citrate is imported in India from several Chinese companies-- Qingdao Sonef Chemical Company Limited, Weifang Vot lnternational Business, Hai Hui Group, Foodchem International Corporation, Yixing Zhenfen Medical Chemical Co. Ltd., Hainan Huarong Chemical Co. Ltd, Lianyungang Dongtai Food lngredients Co. Ltd, Lianyugang Shuren Kechuang Food, Addivtive Co. Ltd., COFCO, Laiwu Taihe Biochemistry Co., Ltd, Weifang Ensign Industry Co. Ltd., Jiangsu Guoxin Union Energy Co. Ltd etc.
Sodium citrate is a chemical compound that comes in the form of monosodium citrate, disodium citrate and tri-sodium citrate. It is sodium salt of citric acid and has a sour and salty taste. Sodium citrate is mainly used in pharma industries as an expectorant and urine alkanizer. It is also used as a pharmaceutical aid, food additive in dairy industries, laboratory reagent in water treatment, acidity regulator in drinks, an emulsifier for oils when making cheese and an antioxidant in food, etc.
Sodium citrate is also known as tri sodium citrate, tri sodium citrate dehydrate, sodium citrate dehydrate, tribasic sodium citrate, sodium citrate tribasic dehydrate, sodium citrate dibasic sesquihydrate, sodium citrate monobasic bioxtra.
Countries conduct anti-dumping investigation to determine whether their domestic industries have been suffered due to rise in cheap imports. To reduce the dumping of cheap imported product, they impose duties under the multilateral regime of the World Trade Organization.
The objective of the duty is to ensure fair trade practices and create a level-playing field for domestic manufacturers with regard to foreign producers and exporters.