Injury to Domestic Industry

The applicant must be able to show that dumped imports are causing or are threatening to cause material injury to the Indian ‘domestic industry’. Material retardation to the establishment of an industry is also regarded as injury. The existence of injury or threat of injury or material retardation in domestic industry has to be based on:-

a. Positive evidence and objective examination.

b. The volume of dumped imports.

c. Effect of the dumped imports on prices.

d. Consequential impact of the dumped imports on domestic industry.

It must be demonstrated that the dumped imports are, through the effects of dumping, causing injury. The demonstration of a causal relationship between the dumped imports and the injury to the domestic industry shall be based on an examination of all relevant evidence before the authorities.

The effect of the dumped imports shall be assessed in relation to the domestic production of the like product when available data permit the separate identification of that production on the basis of such criteria as the production process, producers' sales and profits. If such separate identification of that production is not possible, the effects of the dumped imports shall be assessed by the examination of the production of the narrowest group or range of products, which includes the like product, for which the necessary information can be provided.

No one of these factors by itself can necessarily give decisive guidance but the totality of the factors considered must lead to the conclusion that further dumped exports are imminent and that, unless protective action is taken, material injury would occur. With respect to cases where injury is threatened by dumped imports, the application of anti-dumping measures shall be considered and decided with special care.

The material injury or threat thereof cannot be based on mere allegation, statement or conjecture. Sufficient evidence must be provided to support the contention of material injury. Injury analysis can broadly be divided in two major areas:

The Volume Effect

The Authority examines the volume of the dumped imports, including the extent to which there has been or is likely to be a significant increase in the volume of dumped imports, either in absolute terms or in relation to production or consumption in India, and its affect on the domestic industry.

The Price Effect

The effect of the dumped imports on prices in the Indian market for like articles, including the existence of price undercutting, or the extent to which the dumped imports are causing price depression or preventing price increases for the goods which otherwise would have occurred. The consequent economic and financial impact of the dumped imports on the concerned Indian industry can be demonstrated, inter alia, by:

a. decline in output

b. loss of sales

c. loss of market share

d. reduced profits

e. decline in productivity

f. decline in capacity utilization

g. reduced return on investments

h. price effects

i. adverse effects on cash flow, inventories, employment, wages, growth, investments, ability to raise capital, etc.

Injury analysis is a detailed and intricate examination of all the relevant factors. It is not necessary that all the factors considered relevant should individually show injury to the domestic industry.