Page 193 - International Marketing

NPP

BRILLIANT'S Overseas Market 195

(ii) It may be used as a device for limiting foreign competition in a
market.
Arguments in Defense of Dumping
1. It facilitates the exporters to complete on more favorable terms
with local and foreign competitors in the market.
2. The production meant for exports would bring down production
cost per unit of the product.
3. The consumers in the country where product is dumped, would
appreciate the privilege of buying foreign goods at a low prices in
comparison to normal conditions.
The practice of dumping may be of benefit to the importing economy
in its own industry is not developed in the field to meet the local needs.
But, if the country produces sufficiently to cater to the demand of the local
market, then it becomes essential to protect the industry from the foreign
competitors and this can be done by bringing anti-dumping legislations.
In practice, the producers facing the anti-dumping legislations have
developed a number of ways to defeat these provisions. One of the most
common approach in the product differentiation from the one sold in the
domestic market. Another tactics employed is to make agents and
distributors and extend credit to them.
Anti-dumping duty
In the 1980's and early 1990s, 80 percent of antidumping charges
were brought by the United States, Canada, the EU and Australia often
against Asian countries. However many of the new cases of anti-dumping
have been brought to the WTO by developing countries such as South
Africa, India, Brazil, Indonesia and Mexico. The United States, the EU,
Canada and Australia have brought less than one- third of the cases.
Forty three of the cases were brought against the EU and its members.
There are numerous instances of countries levying charges of dumping
against china, Japan and even United States. India has been taking various
actions against Chinese exporters of different commodities to restrict the
damage caused to a range of domestic industry.
For instance, the imposition of anti-dumping duty on nylon tyres
cord, rubber chemicals and even an automotive tyres by the Indian
Government authorities against the imports from China.
Indian experiences with dumping and anti-dumping
Dumping has become a major issue in India in the post liberalization
period. Developing nations like India that had erected high tariff and non-