The Directorate General of Trade Remedies (DGTR) has recommended imposition of provisional anti-dumping duty on imports of Isobutylene-Isoprene Rubber (IIR) or butyl rubber from China, Saudi Arabia, Russia, Singapore and US on an application by Reliance Sibur Elastomers (RSEPL), the sole producer of the product in India.
The duties proposed on imports of IPR from the five countries that were causing damage to the Indian producer range from $319 to $647 per tonne depending on the country from which the product has originated. Highest duty has been imposed on butyl rubber imported from Saudi Arabia while lowest has been on the product coming from China. The DGTR investigation showed the margin of injury from dumping is 15% to 60%, which is significant and hurts the domestic industry.
The Central Board of Indirect Taxes and Customs is expected to notify the duties shortly.
IIR is obtained by petroleum refinery cracking and is used in tyre manufacturing, seals, vibration control equipment, waterproofing materials and industrial rubber products. It is also used in diaphragms, gaskets, wire and cable insulations, liners, O-rings, seals, weather stripping and bottle closures.
DGTR had started investigation into the complaint on dumping of the product from these countries in June 2023 on an application by RESPL which is majority owned by Reliance Industries Ltd (RIL).
During investigation the response was sought from exporters and importers of the product and the main user industry - the tyre manufacturers like Ceat and MRF and Automotive Tyres Manufacturers Association (ATMA).
The RIL group company had started commercial production of IIR in March 2022 and in its submission before the investigating authority contended that the landed price of the synthetic rubber is below the selling price of the domestic industry which is forcing it to suffer losses.
It said because of the lower prices of imported products it is forcing it to keep the prices low and run its production facilities below capacity and sometimes even shut down plants. It has also been forced to sell its production abroad at a loss because of the price pressure in the local market. The claims of injury were accepted by the DGTR points and it recommended provisional anti-dumping duty.
Imports of the product in 2021-22 was 29808 MT and RSEPL has also said that its production capacities can meet the local demand.
The notification on the duty will be issued by the Department of Revenue in the Ministry of Finance. In the meantime the DGTR has invited public comments on its findings and hold public hearing before giving its final findings.