India may collect up to 18% tax on truck&bus tires imported from China

Authorities in India are conducting an investigation into alleged subsidies on truck and bus tyres imported from the People’s Republic of China. 

According to a document released on last Wednesday by the Directorate General of Trade Remedies, a department of India’s Department of Commerce, the investigation is taking place in response to a submission filed by local industry representative the Automotive Tyre Manufacturer’s Association (ATMA) on behalf of tyre makers Apollo Tyres, J. K. Tyre & Industries, MRF and Ceat. Should the allegations be verified, the department will recommend implementing countervailing duties.

The ATMA alleges that tyre makers and exporters in China have benefitted from subsidies given by various government bodies in the form of grants, preferential loans and equity infusion, provision of below market price goods and services and various forms of tax relief or incentives. It further claims that subsidised imports have depressed prices in India and reduced profits for domestic tyre makers.

The prima facie finding of the Directorate General of Trade Remedies is that evidence exists of “countervailable subsidies on production and export of the subject goods in the People’s Republic of China” and that “such subsidised imports are causing material injury to the domestic industry through their volume and price effects.” Based on this prima facie evidence, it has decided to initiate an investigation into the use of subsidies and resulting material injury. The investigation covers the period between October 2016 and September 2017, and the injury investigation will additionally look at periods from 2014-15 to 2016-17.

Imports into India of truck and bus radials from China increased 167 percent in the period between 2014-15 and 2016-17, rising from 30,665 tonnes to 81,896 tonnes.