Gujarat State Fertilizers and Chemicals surges over 4% on reports of anti-dumping duty approval

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Gujarat State Fertilizers and Chemicals surges over 4% on reports of anti-dumping duty approval
Gujarat State Fertilizers & Chemicals
  • Reportedly, the Directorate General of Trade Remedies has recommended anti-dumping duty on Caprolactam from the European Union, Korea, Russia and Thailand.
  • This is seen benefiting the company as it had filed an application for anti-dumping duty on Caprolactam earlier.
  • Shares of the company rose 4% on Tuesday morning.
Shares of Gujarat State Fertilizers and Chemicals rose over 4% on Tuesday after a report by news channel CNBCTV-18 said that India’s Directorate General of Trade Remedies (DGTR) has recommended anti-dumping duty on Caprolactam used in nylon-making from the European Union, Korea, Russia and Thailand.

The Gujarat-based firm had earlier filed an application for anti-dumping duty on Caprolactam as cheap imports by some countries were disrupting trade for domestic players. The company manufactures fertilisers and industrial chemicals.

Gujarat State Fertilizers and Chemicals surges over 4% on reports of anti-dumping duty approval
Flourish chart/BSE data

Basically, anti-dumping duty is a tariff imposed on imports from other countries that export products at cheaper value thereby disrupting trade in the domestic market.
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To ensure a level playing field in the domestic market, the government imposes anti-dumping duty on foreign imports when it believes that the goods are being “dumped” – through the low pricing – in the domestic market. Anti-dumping duty is imposed to protect local businesses and markets from unfair competition.

The company had alleged that material injury was being caused to the domestic industry due to dumped imports from the subject countries and has requested the DGTR for the imposition of the anti-dumping duties on the imports.

The imposition of anti-dumping duty is permissible under the World Trade Organisation (WTO) regime. The duty is aimed at ensuring fair trading practices and creating a level-playing field for domestic producers vis-a-vis foreign producers and exporters.
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