Anti-dumping on jute goods to hamper trade

THE business community in Bangladesh has rightly expressed the concern over the Indian governments move to impose 25 to 30 percent anti-dumping duty on export of jute goods to its market. Earlier this week media report made the disclosure of Delhi’s move in this regard prompting protest from various chamber bodies and trade associations. The DCCI has also urged the Indian government on Thursday to stop the move to keep export of jute goods to India unaffected. They said the Indian move is not based on reasonable ground and justified at a time when Bangladesh is seriously lobbying with India to make our export access easier to Indian market. It contradicts fair trade.

We believe that the concern of our business circles is quite reasonable at a time the existing trade balance is over 12 times against Bangladesh. It is not correct that Bangladesh’s jute goods such as jute yarn are under-priced as Indian Jute Mills Association (IJMA) claims causing loss to their competitiveness. What is true is that local producers are dominating their market because exporters from Bangladesh have to work against many disadvantages and spend a lot to reach the Indian market.

In this situation our trade circle’s fear makes sense that the Indian move will seriously impact our local farmers, jute goods processors and exporters to finally add to more trade imbalance. When Bangladesh is asking India to remove the existing tariff and non-tariff barriers to fully implement the duty-free trade under SAFTA, several duty-free export items are rather facing major setback. Export of jute goods was so far at zero tariff but Indian government now wants to impose higher level of tariff on its export. RMG export is also suffering the most from counter veiling duty thus narrowing all scope for new trade creation and expansion of existing trade. Such Indian attitude is not conducive to allow Bangladesh to increase its trade to India.

Reports said that the Indian government’s Directorate of Anti-dumping and allied duties is convinced that Bangladesh is dumping its cheaper jute goods into Indian market at low cost and market study has verified it. But Bangladesh Tariff Commission officials differ with the Indian claim. In our view one may also look into the new Indian government move from a different perspective. Since Bangladesh has stopped exporting raw jute, Indian jute mills owners are facing setback; as many of them were dependent on raw jute import from Bangladesh. We are not sure whether or not the new move has any relation with such decision of Bangladesh government.

We must say a big country like India can’t take Bangladesh as a threat to its market. Rather Bangladesh needs support to increase exports to India to repay the growing import bills. In our view India must rethink its move.