Full Text
REGD. No. D. L.-33004/99
The Gazette of India
EXTRAORDINARY
PART I—Section 1
PUBLISHED BY AUTHORITY
No. 256]
NEW DELHI, TUESDAY, SEPTEMBER 23, 2025/ASVINA 1, 1947
CG-DL-E-26092025-266426
6364 GI/2025 (1)
MINISTRY OF COMMERCE AND INDUSTRY
(DEPARTMENT OF COMMERCE)
(Directorate General of Trade Remedies)
NOTIFICATION
New Delhi, the 23rd September, 2025
FINAL FINDINGS
Case No. AD (OI)-32/202
Subject: Anti-dumping investigation concerning imports of “ Mono ethylene Glycol”
originating in or exported from the State of Kuwait, the Kingdom of Saudi Arabia and the
Republic of Singapore.
A. BACKGROUND OF THE CASE
F. No. 6/34/2024-DGTR. — Having regard to the Customs Tariff Act 1975 as amended
from time to time (hereinafter referred to as the ‘Act’) and the Customs Tariff
(Identification, Assessment and Collection of Anti-dumping Duty on Dumped Articles and
for Determination of Injury) Rules, 1995 thereof, as amended from time to time (hereinafter
referred as the “AD Rules”);
1. Whereas, the Chemicals and Petrochemicals Manufacturers Association of India (CPMA)
(hereinafter referred to as the ‘applicant’ or the ‘domestic industry’) filed an application,
before the Designated Authority (hereinafter also referred to as the ‘Authority’) on behalf
of the domestic industry in accordance with the Customs Tariff Act, 1975 (hereinafter
referred to as the “Act”) and the Customs Tariff (Identification Assessment and
Collection of Anti-dumping Duty on Dumped Articles and for Determination of
Injury) Rules, 1995, as amended from time to time (hereinafter also referred as the
“ AD Rules”) for initiation of an anti-dumping investigation concerning imports of
“Mono ethylene Glycol” (hereinafter also referred to as the “product under
consideration” or “PUC” or “subject goods” or “MEG”) originating in or exported from the
State of Kuwait (hereinafter also referred to as “SOK/Kuwait”), the Kingdom of Saudi
Arabia (hereinafter also referred to as “KSA/ Saudi Arabia”) and the Republic of
Singapore (hereinafter also referred to as “ROS/Singapore”), hereinafter collectively
referred to as the “subject countries”. The data pertaining to injury information was
provided by Reliance Industries Limited (hereinafter referred to as the “applicant”)
2. And whereas, in view of the duly substantiated application filed by the applicant, the
Authority issued a public notice vide Notification No. 6/34/2024-DGTR dated 27th
September 2024, published in the Gazette of India, Extraordinary, initiating an anti-dumping investigation
into imports of PUC from the subject countries in accordance with Rule 5 of the AD Rules
to determine the existence, degree and effect of any alleged dumping of the subject goods
and to recommend the amount of anti-dumping duty, which if levied, would be adequate to
remove the alleged injury to the domestic industry.
B. PROCEDURE
3. The procedure described below has been followed with regard to the investigation:
a. The Authority notified the embassies of the subject countries in India about the
receipt of the present anti-dumping application before proceeding to initiate the
investigation in accordance with Rule 5(5) of AD Rules, 1995.
b. The Authority vide Notification No. F.No.6/34/2024 - DGTR issued a public
notice dated 27th September 2024, published in the Gazette of India,
Extraordinary, initiating the anti-dumping investigation concerning the imports of
the subject goods from the subject countries.
c. The Authority sent a copy of the initiation notification to the governments of the
subject countries, through their embassies in India, known producers and exporters
from the subject countries, known importers/users, the domestic industry, the other
Indian producers as well as other interested parties, as per the addresses made
available by the applicant and requested them to make their views known in writing
within the prescribed time limits.
d. The Authority provided a copy of the non-confidential version of the application to
the known producers/exporters and to the governments of the subject countries,
through their embassies in India, in accordance with Rule 6(3) of the AD Rules. A
copy of the non-confidential version of the application was provided to other
interested parties, wherever requested.
e. The Authority sent an Exporter’s Questionnaire to the following known
producers/exporters to elicit relevant information in accordance with Rule 6(4) of
the AD Rules:
| SOK | KSA | ROS |
| :------------------------ | :------------------------ | :------------------ |
| EQUATE Petrochemical | Arabian Petrochemical | Coral Energy DMCC |
| Company | Company | |
| The Kuwait Olefins | Eastern Petrochemical | Shell International |
| Company | Company | Eastern Trading |
| | Jana Jubail Chemical | |
| | Industries Co. | |
| | Rabigh Refining & | |
| | Petrochemical Co. | |
| | Sadara Chemical | |
| | Company | |
| | Saudi Basic Industries | |
| | Corporation | |
| | Saudi Kayan | |
| | Petrochemical Co | |
| | Saudi Yanbu | |
| | Petrochemical Co. | |
| | Yanbu National | |
| | Petrochemical Co. | |
f. The embassies of the subject countries in India were requested to advise the
exporters/producers from their country to respond to the questionnaire within the
prescribed time limit.
g. In response, the following producers/exporters from the subject countries have
responded by filing questionnaire responses:
| S.No. | SOK | KSA | ROS |
| :---- | :-------------------------- | :---------------------------------- | :-- |
| | Producers | | |
| 1. | EQUATE Petrochemical | Saudi Yanbu | - |
| | Company (“Equate”) | Petrochemical Co. | |
| | | (“YANPET”) | |
| 2. | The Kuwait Olefins | Saudi Kayan | |
| | Company (“TKOC”) | Petrochemical Co. | |
| | | (“SAUDI KAYAN”) | |
| 3. | | Jubail United | |
| | | Petrochemical Co. | |
| | | (“UNITED”) | |
| 4. | | Eastern Petrochemical | |
| | | Company (“SHARQ”) | |
| 5. | | Arabian Petrochemical | |
| | | Company | |
| | | (“PETROKEMA”) | |
| 6. | | Yanbu National | |
| | | Petrochemical Company | |
| | | (“YANSAB”) | |
| 7. | | Rabigh Refining & | |
| | | Petrochemical Co. | |
| | | (“PRC”) | |
| | Traders | | |
| 8. | | Saudi Basic Industries | |
| | | Corporation (“SABIC”) | |
| 9. | | SPDC Ltd (“SPDC”) | |
| 10. | | SABIC Asia Pacific Pvt. | |
| | 11. | Mitsubishi Corporation, Japan | |
| | | Mitsubishi Corporation, Japan | |
h. The Authority sent Importer’s Questionnaire to the following known
importers/users of the subject goods in India calling for necessary information in
accordance with Rule 6(4) of the AD Rules:
| S.No. | Name of Importer / User / User Association |
| :---- | :------------------------------------------------ |
| 1. | Dow Chemical International Pvt. Limited |
| 2. | Filatex India Limited |
| 3. | Bhilosa Industries Pvt. Limited |
| 4. | Chiripal Poly Films Limited |
| 5. | DNH Spinners Pvt. Limited |
| 6. | Jindal Poly Films |
| 7. | Shree Durga Syntex Pvt. Limited |
| 8. | Sanathan Textiles Pvt. Limited |
| 9. | KLJ Resources Limited |
| 10. | Shubhalakshmi Polyesters Limited |
| 11. | SRF Limited |
| 12. | Starchem Polytrade Pvt. Limited |
| 13. | Starlon Exim Pvt. Limited |
| 14. | The Bombay Dyeing & Mfg. Co. Limited |
| 15. | Wellknown Polyesters Limited |
| 16. | Indorama Synthetics Limited |
| 17. | Alok Industries Limited |
| 18. | Garden Silk Mills Limited |
| 19. | Gokulanand Petrofibers |
| 20. | JBF Industries Limited |
| 21. | Sumeet Industries Limited |
| 22. | Rashmi Polyfab Private Limited |
| 23. | IVL Dhunseri Petrochem Industries Private Limited |
| 24. | Futura Polyesters Limited |
i. In response, the following importers/users have responded by filing questionnaire
responses:
| S.No. | Name of Importer / User / User Association |
| :---- | :------------------------------------------------ |
| 1. | Bhilosa Industries Pvt. Limited |
| 2. | M/s IVL Dhunseri Petrochem Industries Pvt. Ltd |
| 3. | Sanathan Textiles Limited |
| 4. | Beekaylon Synthetics Private Limited |
| 5. | D.N.H. Spinners Pvt. Ltd |
| 6. | Garden Silk Mills Pvt. Ltd |
| 7. | Wellknown Polyesters Limited |
| 8. | The Bombay Dyeing and Manufacturing Co., Ltd |
| 9. | M/s Filatex India Limited |
| 10. | M/s Indorama Synthetics (I) Ltd. |
| 11. | Polyester Textile Apparel Industries Association |
j. The Authority made available the non-confidential version of the submissions made
by the various interested parties. A list of all the interested parties was uploaded on
the DGTR website along with the request to all of them to email the non-confidential version of their submissions to all the other interested parties.
k. Request was made to the DGCI&S to provide the transaction-wise details of imports
of the subject goods for the injury period and also the period of investigation. The
Authority has relied upon the DGCI&S data for computation of the volume of
imports and required analysis after due examination of the transactions.
l. The period of investigation (“POI”) for the purpose of the present investigation is 1st
April 2023 to 31st March 2024 (12 months). The examination of trends in the
context of injury analysis covers a period of FY 2020-21, FY 2021-22, FY 2022-23
and the period of investigation.
m. The submissions made by the interested parties during the course of this
investigation, to the extent supported with evidence and considered relevant to the
present investigation, have been appropriately considered by the Authority, in this
final findings.
n. Information provided by the interested parties on a confidential basis was examined
with regard to the sufficiency of the confidentiality claim. On being satisfied, the
Authority has accepted the confidentiality claims wherever warranted and such
information has been considered confidential and not disclosed to other interested
parties. Wherever possible, parties providing information on a confidential basis
were directed to provide sufficient non-confidential version of the information filed
on confidential basis. The Authority made available the non-confidential
versions of the evidence submitted by the various interested parties in the form of public
file.
o. Wherever an interested party has refused access to or has otherwise not provided
necessary information during the course of the present investigation, or has
significantly impeded the investigation, the Authority has considered such parties as
non-cooperative and recorded the views/observations on the basis of the facts
available.
p. The Authority vide para 6 of the initiation notification dated 27th September 2024
sought comments on the scope of the PUC within 15 days of initiation. The
interested parties were further granted additional time to file comments on PUC and
PCN (Product Control Number) methodology till 26th October 2024. As no
submissions were filed by any interested party, the Authority vide notification dated
18th November 2024, notified the final scope of PUC and PCN. All the interested
parties were directed to file questionnaire responses in accordance with the PUC
finalized, by 18th December 2024. At the request of some interested parties, the time
limit was further extended to 25th December 2024.
q. The non-injurious price (NIP) based on the optimum cost of production and cost to
make & sell the subject goods in India based on the information furnished by the
domestic industry on the basis of Generally Accepted Accounting Principles
(GAAP) and Annexure-III to the AD Rules has been worked out so as to ascertain
whether anti-dumping duty lower than the dumping margin would be sufficient to
remove injury to the domestic industry.
r. In accordance with Rule 6(6) of the AD Rules, the Authority provided opportunity
to the interested parties to present their views during the oral hearing held on 17th
April 2025 and were requested to submit their written and rejoinder submissions.
However, due to the change in Designated Authority, the Authority provided
opportunity to the interested parties to present its views orally, followed by
submissions in writing, pursuant to the judgement of the Hon’ble Supreme Court in
the matter of Automotive Tyre Manufacturers’ Association (ATMA) vs. Designated
Authority, delivered in Civil Appeal No. 949 of 2006 on 07-01-2011. Accordingly,
the Authority held another public hearing on June 4, 2025. The interested parties
who presented their views in the 2nd oral hearing, were requested to file written
submissions of the views expressed orally, followed by rejoinder submissions, if
any. The interested parties were further directed to share the non-confidential
version of the written submissions submitted by them with the other interested
parties.
s. The Authority circulated the disclosure statement containing all essential facts under
consideration for making the final recommendations to the Central Government to
all interested parties on 09th Septmeber 2025. The parties were requested to file the
comments on disclosure statement if any by 16th September 2025
t. The Authority has examined all the post-disclosure comments made by the
interested parties in these final findings to the extent deemed relevant. Any
submission which was merely a reproduction of the previous submission, and which
had been adequately examined by the Authority has not been repeated for the sake
of brevity.
u. The information submitted by the domestic industry has been examined and verified
during on site-verification as well as table verification to the extent deemed
necessary and has been relied upon for the present final findings.
v. The examination and desk verification of the information submitted by the
cooperating producers/exporters from the subject countries was also carried out to
the extent deemed necessary and has been relied upon for the purpose of the present
final findings.
w. The Authority has considered all the arguments raised and information provided by
all the interested parties at this stage, to the extent the same are supported with
evidence and considered relevant to the present investigation.
x. ‘***’ in this final findings, represents information furnished by an interested party
on a confidential basis and so considered by the Authority under the AD Rules.
y. The exchange rate adopted by the Authority for the present investigation is 1 US$ =
₹ 83.70.
C. PRODUCT UNDER CONSIDERATION AND LIKE ARTICLE
C.1. Submissions of the other interested parties
4. None of the interested parties have provided any comments on the PUC or PCNs.
C.2. Submissions on behalf of the domestic industry
5. The following submissions have been made on behalf of the domestic industry:
a. The product under consideration is “Mono ethylene glycol”. It is a basic raw material for
producing all polyester yarns, fibres and PET. Its domestic availability in the country is
essential for ensuring self-reliance in the textile and PET sector.
b. None of the other interested parties have made any comments with respect to the product
scope or requested for formulating PCNs. Accordingly, the domestic industry requests the
Authority to confirm the scope of the PUC.
C.3. Examination by the Authority
6. The product under consideration is ‘Mono ethylene Glycol (MEG)’. MEG is an organic
compound with the formula (CH2OH)2. The molecular structure of MEG is as follows:
H₂C––OH
|
H₂C––OH
MEG in a beaker Molecular Structure of MEG
7. MEG is primarily of two grades - fibre and non-fibre. The domestic industry manufactures
both grades of MEG. The present investigation covers both grades of the PUC.
8. MEG is a clear, colourless, odourless, slightly viscous liquid with syrup like consistency.
Further, it is sweet in taste and is miscible in water. MEG is an important industrial product
with widespread application. It is primarily used in combination with purified terephthalic
acid for manufacturing polyester fibers and polyethylene terephthalate resins. It is also used
as an anti-freeze/coolant as well as in pharmaceuticals and cosmetic industries.
9. The PUC is classified in Chapter 29 titled “Organic Chemicals” under HS Code 2905 31 00.
The customs classification is indicative and is not binding on the scope of the product under
consideration.
10. None of the interested parties made any proposals for construction of PCNs in the present
investigation. Accordingly, the Authority has not adopted any PCN methodology in the
present investigation. Further, none of the interested parties have made any submissions
concerning the scope of the PUC.
11. In view of the above, the Authority confirms the product scope as defined at the stage of
initiation: “3. The product under consideration in the present investigation is Mono
ethylene Glycol (MEG).”
12. There are no known differences in the subject goods manufactured by the domestic industry
and those imported from the subject countries. The subject goods produced by the domestic
industry and the subject goods imported from the subject countries are comparable in terms
of characteristics such as physical and chemical characteristics, manufacturing process and
technology, functions and uses, product specifications, distribution and market & tariff
classification of the goods. The applicants have claimed that the subject goods, which are
being coming into India, are identical to the goods produced by the domestic industry.
There are no differences either in the technical specifications, quality, functions or end-uses
of the subsidized imports and the domestically produced subject goods and the product
under consideration manufactured by the applicants. The two are technically and
commercially substitutable and hence should be treated as ‘like article’ under Rule 2 (d) of
the AD Rules.
D. SCOPE OF THE DOMESTIC INDUSTRY & STANDING
D.1. Submissions of other interested parties
13. The following submissions have been made by the other interested parties with regard to
the scope of domestic industry:
a. RIL cannot constitute “domestic industry” in the present case because the definition
envisages “domestic producers as a whole, engaged in the manufacture of the like article”,
and in the present proceedings, there is no participant other than RIL.
b. The sole reliance on data from RIL undermines the reliability and objectivity of injury
analysis as it risks selective data representation and potential manipulation. thereby
compromising the accuracy and transparency of the injury evaluation. In the absence of
comparable data from other domestic producers, critical injury indicators such as price and
cost data remain unverifiable. Reliance in this regard has been placed on WTO Appellate
Body Report in EC – Fasteners (China), US – Hot Rolled Steel (Japan) and on the decision
of the Supreme Court in Reliance Industries Ltd. v. Designated Authority.
c. The definition of “domestic industry” also seeks to exclude importers of the subject goods.
In the present proceedings, RIL is both a producer and importer of MEG from the subject
countries which raises conflicts of interest, especially since it is the only participating
producer and accounts for 80-90% of the domestic production.
d. The Gauhati High Court in Century Plyboard (I) Ltd. and Anr. V. Union of India and Ors.
has observed that the discretion to include importing domestic producers within the scope
of domestic industry is not an absolute discretion. Accordingly, the Authority must examine
the nature and reason for imports made by the domestic industry.
e. The applicant has claimed that the present application has also been supported by IOCL and
IGL. However, there is no evidence of such alleged support from IOCL. The applicant has
itself considered IOCL neutral to the present investigation in its application.
f. According to recent market intelligence RIL has imported around 180 KT of PUC. The
Authority must examine as to how such imports merely account of 1% of total RIL’s sales
and production.
D.2. Submissions on behalf of the domestic industry
14. The following submissions have been made on behalf of the domestic industry:
a. The present application has been filed by the Chemicals and Petrochemicals
Manufacturers’ Association of India on behalf of Reliance Industries Ltd (“RIL”).
RIL accounts for more than 75% of Indian production and constitutes a “major
proportion” of total domestic production in India in terms of Rule 2(b) of AD
Rules, 1995. Further, the standing requirements under Rule 5(3) of AD Rules,
1995 have also been fulfilled
b. There are two other known producers of the subject goods in India, namely Indian
Glycol Limited and Indian Oil Corporation Limited.
c. Reliance Industries Limited has imported an insignificant quantity of subject
goods from the subject countries during the POI. However, such imports account
for less than 1 percent of the total demand and around l% of its production.
Further, such imports have been made under export promotion schemes.
d. the use of the word “may” in Rule 2(b) of AD Rules, clearly provides the
Authority discretion to include even such domestic producers who are either
importers of the subject goods or even when such a domestic producer is a related
party of the exporter
e. the Panel in EC – Fasteners (China) observed that investigating authorities have
discretion whether or not to exclude related or importing domestic producers. This
discretion was further affirmed by the High Court of Gauhati in Century
Plyboards v. Union of India. Further, reliance is placed on the Authority’s Final
Findings in anti-dumping investigation concerning imports of Melamine and
Single mode optical fibre wherein the Authority included importing domestic
producer and a domestic producer related to importer of subject goods within the
scope of the Domestic Industry
D.3. Examination by the Authority
15. Rule 2(b) of the AD Rules defines the domestic industry as under:
‘(b) ‘domestic industry’ means the domestic producers as a whole
engaged in the manufacture of the like article and any activity
connected therewith or those whose collective output of the said
article constitutes a major proportion of the total domestic
production of that article except when such producers are related to
the exporters or importers of the alleged dumped article or are
themselves importers thereof in such case the term ‘domestic
industry’ may be construed as referring to the rest of the producers’.
16. The Authority notes that the application has been filed by Chemicals and Petrochemicals
Association of India on behalf of Reliance Industries Ltd. The application has been
supported by Indian Glycol Limited. Apart from the two producers, there is one another
producer, Indian Oil Corporation Limited. Reliance Industries Limited constitutes
'major proportion' in terms of Rule 2(b) of the AD Rules.
17. The Authority notes that the production of the applicant accounts for a major proportion of
the total domestic production. The Authority further notes that Reliance Industries
Limited has imported the subject goods from the subject countries. However, such
imports constitute only 1% of their total production and the overall demand in the
country. This limited import activity does not alter the applicant's nature of business
from manufacturer to trader. Accordingly, the applicant is eligible to be considered as
the domestic industry for the purposes of the present investigation. Moreover, the
applicant is not related to any exporter of the subject goods in the subject countries or
importer of the subject goods in India. Thus, the applicant constitutes domestic industry as
defined under Rule 2(b) of the AD Rules, and the application satisfies the requirement of
standing in terms of Rule 5(3) of the AD Rules.
E. CONFIDENTIALITY
E.1. Submissions of other interested parties
18. The producers/exporters/other interested parties have not made any submission in this
regard.
E.2. Submissions on behalf of the domestic industry
19. The domestic industry has not made any submission in this regard.
E.3. Examination by Authority
20. With regard to confidentiality of information, Rule 7 of AD Rules provides as follows:
‘Confidential information:
(1) Notwithstanding anything contained in sub-rules (2), (3) and (7)of
rule 6, sub-rule(2) of rule12,sub-rule(4) of rule 15 and sub-rule (4)
of rule 17, the copies of applications received under sub-rule (1) of
rule 5, or any other information provided to the designated authority
on a confidential basis by any party in the course of investigation,
shall, upon the designated authority being satisfied as to its
confidentiality, be treated as such by it and no such information shall
be disclosed to any other party without specific authorization of the
party providing such information.
(2) The designated authority may require the parties providing
information on confidential basis to furnish non-confidential
summary thereof and if, in the opinion of a party providing such
information, such information is not susceptible of summary, such
party may submit to the designated authority a statement of reasons
why summarization is not possible.
(3) Notwithstanding anything contained in sub-rule (2), if the designated
authority is satisfied that the request for confidentiality is not
warranted or the supplier of the information is either unwilling to
make the information public or to authorise its disclosure in a
generalized or summary form, it may disregard such information.’
21. The interested parties, in their various submissions, have raised the issues of
confidentiality claims by other interested parties. The information provided by the
interested parties on confidential basis was examined with regard to sufficiency of the
confidentiality claims. On being satisfied, the Authority has accepted the confidentiality
claims, wherever warranted and such information has been considered confidential and not
disclosed to other interested parties. Wherever possible, parties providing information
on confidential basis were directed to provide sufficient non-confidential version of the
information filed on confidential basis. The Authority made available the non-confidential
versions of the evidence submitted by the various interested parties in the form of public
file.
22. A list of all the interested parties was uploaded on DGTR’s website along with the
request to all of them to email the non-confidential version of their submissions to all other
interested parties.
F. Miscellaneous Submissions
F.1. Submissions by the other interested parties
23. The following miscellaneous submissions have been made by the other interested parties:
a. Prior to the present investigation, the Authority has initiated two investigations on the
PUC, at the behest of the domestic industry.
b. In both instances, the Authority has found prima facie, that there was sufficient evidence
of dumping, injury and causal link to initiate these investigations.
c. However, in both instances there were no grounds for recommending duties. Clearly, the
prima facie assessment of the presence of dumping, injury and causal link was overturned
by the time the investigation concluded in both cases.
d. After the non-inclusion of Iran in the present investigation, the applicant was under
obligation to re-submit the data after de-cumulating the effect of imports from Iran in
terms of Rules 5 and 6 of AD Rules.
e. The present investigation is without jurisdiction as the application was withdrawn by the
domestic industry without approval from the High Court of Delhi.
F.2. Submissions on behalf of the domestic industry
24. The following miscellaneous submissions have been made on behalf of the domestic
industry:
a. The first investigation was initiated in 2019 for the POI January–September 2019. During
the proceedings, the applicants observed higher dumping from the subject countries than
at the stage of initiation. Moreover, the POI data in the first application did not capture
post-POI market realities, as the sources of dumping had shifted.
b. In the second application, the Authority found exporters from Kuwait and Saudi Arabia
dumping the subject goods but held there was no injury since the domestic industry
earned 20% profit on cost of sales during the concerned POI (Jan–Dec 2020). The
domestic industry challenged this before CESTAT, which directed a re-examination.
However, with nearly three years elapsed since that POI, and with dumping and injury
having worsened, a fresh application was filed and the second application withdrawn.
c. The repeated applications before the Authority only show the vulnerable state of the
Indian MEG industry, laying bare the unfair trade practices of exporters from Kuwait and
Saudi Arabia.
F.3. Examination by Authority
25. The Authority examined the sufficiency of evidence at the stage of initiation of the
investigation. It is noted that the applicant had provided sufficient evidence concerning
dumping, injury and causal link, based on which the Authority had initiated the present
investigation.
26. The Authority has considered the comments of the interested parties concerning previous
investigation as well as its own findings. However, the Authority notes that each
investigation is to be carried based on facts of the period pertaining to the specific
investigation.
G. NORMAL VALUE, EXPORT PRICE AND DUMPING MARGIN
G.1. Submissions on behalf of the other interested parties
27. The following submissions have been made by the other interested parties regarding the
determination of normal value, export price and dumping margin:
a. The domestic industry’s methodology to compute normal value is incorrect as it has not
considered domestic sales of the producers in the subject countries. The Authority is
obliged under S. 9A(1)(c)(i) of the Act to determine normal value based on the domestic
sales of producer/ exporter as declared in the exporters’ questionnaire response. However,
if the conditions laid down for such basis are not fulfilled, normal value can be determined
on sales to third country.
b. SABIC Group has made sufficient volumes of sales [***%] in its domestic market.
Normal value has to be computed in accordance with Art. 2.2.1.1. of the AD Agreement
unless the records of the company are not in accordance with GAAP or where records do
not reasonably reflect the costs associated with production and sales of the product.
SABIC Group has also provided third country sales data.
c. SG&A costs and profits must be based on actual data pertaining to production and sales
of the producer, unless there are no sales in the ordinary course of trade.
d. Asian contract price (“ACP”) is not the basis on which annual or spot sales of MEG are
conducted in Asia including India. Rather the same is used for long-term contracts,
typically ranging from 7-15 years. Equate Group has submitted annual purchase contracts
of PUC across several countries which are marked to average China CFR prices, a fact
which the domestic industry had accepted in previous investigation. Comparison of export
price to India with ACP is inappropriate and is an attempt by the applicant to create and
artificial and exaggerated price difference.
e. Equate Group’s average export price to India was higher than China or Pakistan during
the POI.
f. PRC has neither exported the subject goods to India nor made domestic sales during the
POI. However, it has participated in the investigation as it is a related party to SABIC
Group, on account of common shareholding by Saudi Aramco. The Authority in LDPE
investigation had treated PRC and Sadara as related and awarded them a single rate of
duty.
g. Equate Group has fully cooperated in the present investigation and given the negligible
volume of domestic sales, normal value should be constructed based on the basis of COP
in the country of origin plus reasonable amount of SG&A and profits. Further, in line with
Authority’s consistent practice, the Authority should adopt a profit margin of 5% per cent
as reasonable amount. Equate Group has also provided third country sales data to assist the
Authority in its analysis.
h. Reliance on TKOC’s financial statements is incorrect as it does not relate to POI and it
does not take into account, performance of Equate. Profit margins reported in TKOC’s
financial statements are for ethylene and MEG and thus, cannot be applied for determining
the appropriate profit margin for the PUC.
i. Corporate level profitability is influenced by range of factors beyond normal commercial
MEG sales such as long terms supply agreement, integration benefits and other strategic
operations. Equate Group has submitted product specific cost and sales information related
to MEG and therefore, in terms of Rule 4 of AD Rules, and Art. 2.2.1.1 of AD Agreement,
constructed normal value should be determined based on the records of the exporters as
long conditions under Art. 2.2.1.1 of AD Agreement are being fulfilled.
j. PMS has not been defined in CTA or in AD Rules. The uses of adjectives “particular”
and “market” indicates that market situation must be ‘exceptional, distinct, individual,
single, specific’ and to establish PMS, the Authority must conclude that there exists an
exceptional/ distinct state of affairs in the market.
k. Indian Law and WTO Agreement do not permit examination of PMS in input/ raw
material market. The domestic industry tried to mislead the Authority by referring to laws
of EU, Canada and US to claim that such countries consider PMS for inputs. The
municipal law in such countries is significantly different than India.
l. Provisions of raw material distortion in EU Anti-dumping Regulation are not present in
Indian law and therefore, the practice of EU in this regard is irrelevant.
m. All reference in Art. 2.2 of the AD Agreement pertain to like product or the PUC,
therefore, the same does not allow the Authority to look into allegation of distortion in
inputs.
n. The burden of proof to establish PMS lies on the applicant and it has not established the
same for Kuwait or Saudi Arabia as held by the Panel in US-Shirts and Blouses. The
applicant has in previous investigations also relied on incorrect legal standard for PMS.
o. The applicant’s submissions are based on surmises and conjectures of alleged
government control over pricing on feedstock gases are insufficient to establish the claim
of PMS. Further, the applicant’s PMS allegation pertains to the feedstock used in
production of PUC and not PUC itself.
p. Regulation of prices of natural gas or liquids by Government of KSA (“GKSA”) cannot
be regarded as “distinct state of affairs in relation to supply of inputs and feedstock.” Such
regulatory measures are employed by all governments including Government of India. No
evidence has been provided how such measures distort the market for inputs within the
country.
q. Applicants have equated mere regulation of prices to distortion. Further, mere existence
of government measure cannot lead to the conclusion that costs associated with the
production and sale of MEG are not reasonably reflected or establishes that a proper
comparison cannot be carried out between domestic and export sales.
r. Cost recorded in the books of the exporters cannot be rejected merely because input
prices are being regulated by state or because input prices are allegedly unreasonable due
to existence of regulation. Despite domestic prices of inputs being lower than international
prices on account of Argentine export tax system, the Appellate Body in EU-Biodiesel
(Argentina) held that it was not sufficient basis for concluding that producer’s records do
not reasonably reflect the cost of production and sale of biodiesel. Similar approach was
undertaken by the Appellate Body in Ukraine – Ammonium Nitrate (Russia) and EU-Cost
Adjustment Methodologies (Russia). Further, “reasonably reflect” indicates that only
truthfulness and accuracy of record kept by exporter can be examined and whether such
records suitably and sufficiently correspond to the costs actually incurred by investigated
producer in the production and sales of the PUC.
s. The applicant has not provided any evidence to establish that a price equalization regime
exists in KSA or that exporters in KSA benefit from such a regime in manufacturing of
subject goods.
t. As per EU-Biodiesel, the investigating authority cannot replace “in country cost of
production” with international benchmarks such as ethylene benchmarks suggested by the
applicant.
u. As per the legal standard laid down by the Authority in Uncoated Copier Paper, the
domestic industry has to prove that government intervention has led to lower prices in
domestic market.
v. The domestic industry’s reliance on Australia – A4 Copy Paper is erroneous for the
reason that the Panel has nowhere given its finding on Indonesia’s claim that the term
"particular market situation" as it appears in Article 2.2 of the Anti-Dumping Agreement
cannot be used to address distortions in the cost of inputs.
w. Ethane pricing in GKSA is based on combination of commercial reasons and
environmental concerns, further for propane and butane, GKSA has set out a detailed
formula to ensure domestic natural gas prices are based on international market prices. The
linking of feedstock prices to market prices ensures that prices are based on commercial
considerations and enable the producers’ recovery of full costs and a profit in the ordinary
course of business. The same was accepted by the Working Party during WTO Accession
Negotiations of KSA.
x. Prices fixed for ethane is used for producing downstream products for export markets or
for consumption within KSA. Accordingly, price comparability is not affected.
y. The European Commission had relied on the SABIC Group’s cost of production as
reported in its books in its MEG investigation.
z. The USDOC in several investigations has held government control as insufficient
evidence to constitute PMS.
aa. The applicant’s allegation on PMS is linked to alleged subsidization by GKSA, however,
no details of such alleged programs were provided. Even if existence of such alleged
schemes is accepted, the appropriate measure would be countervailing duty and not anti-dumping duty.
bb. Applicant’s reliance on websites concerning third country export prices is misplaced.
SABIC Group has provided third country prices, which indeed shows that such prices are
comparable to India.
cc. The existence of PMS in KSA cannot lead to automatic rejection of actual costs. No
evidence has been provided to establish that PMS prevents proper comparison between
export and domestic prices. The applicant has failed to distinguish between
‘reasonableness’ of cost and “whether costs reasonably reflect the costs associated with
production and sales of the subject goods.” In terms of Art. 2.2 of the AD Agreement, the
Report of the Panels in Australia – A4 Copy Paper and EEC – Cotton Yarn, the Authority
must ascertain whether the existence of PMS does not permit a proper comparison of
domestic sales with export sales.
dd. Cost of production is common for both domestic and export products, no separate costs
are recorded for the two types of sales and PUC is sold in both markets at market
determined rates.
ee. In case of KSA and Kuwait, no evidence has been provided to establish that proper
comparison between domestic sales and export sales is impermissible. Further, in the
previous investigation even though Authority concluded the existence of PMS in KSA, it
did not reject the actual costs of the exporters from KSA. Further, even if applicant’s
allegations concerning PMS are found to be correct, there is no legal basis to reject the
recorded costs of the respondents.
ff. Despite finding of PMS in previous investigation, the Authority did not make any
adjustments to the recorded cost of production of the producers of KSA.
gg. Lower price of particular commodity cannot be considered PMS. Costs cannot be rejected
if such costs are lower due to regional advantages. Natural advantage cannot be considered
PMS.
hh. No new evidence has been presented to substantiate PMS allegation against SOK or to
contradict Authority’s previous findings against SOK on PMS. While the applicant has
referred to state owned entities in KSA and SOK, no evidence has been provided how
Government of SOK (“GSOK”) exercises control over sales of input materials that distorts
domestic prices or renders domestic prices unreliable for computation of normal value.
The mere fact that Kuwait Petroleum Corporation is a state-owned entity is not sufficient
to establish the allegation of PMS.
ii. The applicant has also not provided the alleged royal decree based on which it has
claimed PMS.
jj. There is no unified GCC market and different feedstock producers price feedstocks
differently. Further, applicant has requested for comparison of cost of production of
exporters from SOK and KSA against international ethylene benchmark prices, which the
applicant has not disclosed in non-confidential version, and has claimed lower raw
material cost contribute to PMS. Mere lower prices of inputs in SOK are not sufficient
basis to conclude existence of PMS. Lower prices in Gulf Region, Saudi Arabia and the
US is on account of natural competitive and regional advantages, including abundant
access to oil and gas resources and not due to government intervention, as alleged by the
applicant.
kk. The domestic industry relies on imported feedstock which leads to higher cost of
production in India.
ll. Issue of availability of raw material at less than adequate remuneration can be examined
only through anti-subsidy investigation as has been held by the Authority in Uncoated
Copier Paper (F.No. 6/32/2017-DGAD). The examination of alleged “financial
contribution” can only be investigated in a countervailing duty investigation.
mm.The Authority has rejected claims of PMS in KSA in Clear Float Glass from Pakistan,
Saudi Arabia and UAE. Further, in LDPE from Qatar, KSA, Singapore, Thailand, UAE
and USA, the Authority concluded that sufficient evidence did not exist whether PMS
prevented a proper and fair comparison between domestic selling and export price.
nn. There is no requirement to issue detailed PMS questionnaire when the issue has already
been examined in detail in previous investigation.
G.2. Submissions on behalf of the domestic industry
28. The following submissions have been made on behalf of the domestic industry with
regard to the normal value, export price and dumping margin:
a. None of the participating exporters have denied the fact that they were dumping the
subject goods into India.
b. The monthly contract prices published by the exporters for Asian region and India
clearly shows the level of dumping by the exporters. In this regard, the applicant has
relied upon the Asian contract prices published on the official website of the Equate Group
for the POI, which shows that the average price difference between the Indian contract
prices and Asian contract prices is at least 300 USD.
c. SABIC Group sells to other Asian markets at significantly higher prices than those to
India, with the gap between Asian contract prices and actual export prices to India being
around USD 300. For this purpose, the applicant has relied on the Asian Contract price for
the month of November, 2023 as published on a secondary source (Argaam website).
d. The claim of the exporters that Asian Contract Prices are negotiated for long-term
contracts of 7–15 years is misleading, as there is no logic as to why monthly prices would
be declared for such long-term agreements. This contradicts SABIC Group’s own
statement during the second oral hearing, where it asserted that Asian Contract Prices are
meant for 1–2-year contracts. Moreover, MEGlobal’s (a part of the Equate group) website
explicitly states that Asian Contract Prices reflects short-term demand-supply dynamics in
the Asian market.
e. It is also unclear that when the Indian Contract Prices reflect nearly the actual import
price of MEG from Kuwait to India, why Asian Contract Prices would not be reflective of
export prices to Asian countries unless the exporters from Kuwait are also engaged in
trade distorting activities in their exports to other Asian markets.
f. Exporters from Kuwait have sought determination of dumping margin based on
constructed normal value. As per Section 9A(1)(c) of the Customs Tariff Act, 1975, where
domestic or third-country sales are unavailable, normal value is to be constructed using
cost of sales and reasonable profit. The Authority should consider the actual profit being
earned by them for computation of CNV.
g. The applicant has provided substantial evidence to support its allegation of particular
market situation in case of both the subject countries.
h. The markets of Saudi Arabia and Kuwait, and in general, the Gulf Cooperation Council
region, are affected by a particular market situation due to government intervention in the
pricing of key inputs and utilities. This intervention distorts the cost of key raw materials
and utilities, and as a result, the costs reflected in the producers' records do not reasonably
reflect the costs associated with the production of the subject goods. Therefore, such costs
cannot be relied upon for determination of dumping margin, particularly for conducting
the ordinary course of trade test. In this regard, the Applicant places reliance on Article
2.2.1.1 of the WTO Agreement on Anti-Dumping, which permits deviation from recorded
costs where they do not reasonably reflect the costs associated with the production and
sale of the PUC.
i. The Authority is under no obligation to accept the cost of production reported by the
exporters if conditions set out under Article 2.2.1.1 are satisfied, provided it finds a
compelling reason to disregard such costs.
j. The applicant submits that once prima facie evidence to support the allegation of
particular market situation has been provided, the burden of proof rests upon the exporters
from the subject country to demonstrate that particular market situation does not exist, in
the case of SOK.
k. The Government of Saudi Arabia, through the Law of Gas Supplies and Pricing
Regulation and its implementing Regulation, controls the pricing of certain hydrocarbons
which are used as inputs or utilities in the production of the subject goods. Additionally, a
price equalisation regime is in place whereby the government compensates Saudi Aramco
for losses incurred in selling these regulated gas products to downstream users. This
mechanism has been acknowledged by the Government of Saudi Arabia in its Trade
Policy Review.
l. Under the dual pricing regime, the Ministry of Energy under the Government of Saudi
Arabia mandates Aramco to supply regulated gas products to downstream producers at
regulated domestic prices. The Government of Saudi Arabia compensates Aramco for any
losses incurred from selling inputs at these regulated rates.
m. The SABIC Group’s argument that “ordinary government measures” relating to input and
feedstock price regulation cannot constitute a PMS is entirely misconceived. Reliance in
this regard is placed on the Panel decision in Australia – A 4 Copy Paper. Accordingly,
even ordinary government measures may give rise to a Particular Market Situation if they
result in market distortions.
n. Even in the previous investigation, the Authority had unequivocally confirmed the existence of
particular market situation in Saudi Arabia.
o. Similar distortions likely exist in Kuwait, although due to limited transparency, direct
evidence of distortion could not be obtained. Based on market intelligence, the
Government of Kuwait has issued a royal decree allowing the two exporters from the
Equate Group to procure key feedstock from government supplier at significantly low
rates.
p. The profits earned by the Equate Group on MEG sales are even higher than the exporters
from Saudi Arabia. Given the substantial share of ethylene in the total cost of MEG
production, the Applicant believes that the exporters from Kuwait benefit from raw
material and utility costs that are even lower than the already distorted costs of the
exporters from Saudi Arabia.
q. In response to Equate Group’s claim that low input costs cannot constitute a Particular
Market Situation unless they prevent a proper comparison between normal value and
export price, the Applicant submits that the existence of a Particular Market Situation and
its impact on price comparability are two distinct legal tests, as clarified by the Panel in
Australia – A4 Copy Paper.
r. If natural gas or input suppliers to downstream entities were truly operating on a full cost
recovery basis while selling at regulated domestic prices, there would be no need for the
Government of Saudi Arabia to compensate them.
s. The fact that a government measure leading to a Particular Market Situation may also
qualify as a subsidy does not preclude the Authority from examining its impact on costs
and prices of the subject goods in the exporting country. Reliance in this regard is placed
on the Panel’s ruling in Australia – A4 Copy Paper, which clearly held that a finding of a
Particular Market Situation does not amount to a specific action against a subsidy.
t. The Australia A4-Copy Paper Panel very clearly observed that “the market situation must
be distinct, individual, single, specific but that does not necessarily make it unusual or out
of the ordinary — i.e. exceptional.” Arguendo, even ordinary government measures cannot
be precluded in a situation where such measures lead to a particular market situation.
u. The Authority in the previous investigation had unequivocally confirmed the existence of
particular market situation in Saudi Arabia.
v. Even when PMS affects both normal value and export price, it does not negate its impact
on price comparability. The Panel in Australia – A4 Copy Paper did not bar investigating
authorities from rendering a finding on non-comparability merely because the same inputs
are used in both domestic and export production. The Panel expressly found that even
when a distorted input is used in the production of goods for both domestic and export
markets, exporters may leverage such distorted costs differently across markets, depending
on prevailing market conditions.
w. The European Commission has already levied 7.7% and 46.7% anti-dumping duties on
MEG exported by SABIC Group and MEGlobal Americas Inc., a related party of the
Equate Group, respectively in 2021 which also shows that exporters from subject countries
adopt unfair trade practices and are selling at dumped prices in third country markets as
well.
x. In the previous investigation, the Authority failed to assess cost, pricing, and profitability
before concluding that existence of particular market situation did not affect price
comparability.
G.3. Examination by the Authority
29. Under section 9A(1)(c), the normal value in relation to an article means:
‘i) The comparable price, in the ordinary course of trade, for the like article, when
meant for consumption in the exporting country or territory as determined in
accordance with the rules made under sub-section (6), or
ii) when there are no sales of the like article in the ordinary course of trade in the
domestic market of the exporting country or territory, or when because of the
particular market situation or low volume of the sales in the domestic market of the
exporting country or territory, such sales do not permit a proper comparison, the
normal value shall be either:
(a)comparable representative price of the like article when exported from the
exporting country or territory or an appropriate third country as determined in
accordance with the rules made under sub-section (6); or
(b) the cost of production of the said article in the country of origin along with
reasonable addition for administrative, selling and general costs, and for profits, as
determined in accordance with the rules made under sub-section (6);
Provided that in the case of import of the article from a country other than the
country of origin and where the article has been merely transshipped through the
country of export or such article is not produced in the country of export or there is
no comparable price in the country of export, the normal value shall be determined
with reference to its price in the country of origin.’
30. The Authority sent questionnaires to the known producers/exporters of the subject
countries, as well as to the appropriate diplomatic representative advising them to provide
information in the form and manner prescribed by the Authority within the prescribed time
limit.
31. The Authority notes that the domestic industry has claimed the existence of particular
market situation in KSA and SOK. With regards to KSA, the domestic industry has
claimed that Government of KSA operates a dual pricing mechanism for regulated gas
products used in the production of the PUC through price equalization regime, under
which it sets prices for supplying such inputs (ethane, propane etc.) to downstream
industry. The domestic industry has provided extracts from KSA’s Trade Policy Review
and the Annual Report of Saudi Aramco to claim the same. Further, with respect to SOK,
the domestic industry has claimed that SOK being part of the unified GCC market in
which distorted prices exist, the prices of feedstock in SOK are also distorted.
32. Other interested parties have disputed the domestic industry’s claim concerning the
existence of PMS. SABIC Group has claimed that there is no price equalization regime in
KSA and the alleged distortive pricing measures claimed by domestic industry are normal
price regulation by Government of KSA as is done by governments all over the world.
33. In relation to KSA, based on the evidence available on record, and in particular, Saudi
Aramco’s Annual Report, and the Authority’s previous findings in the Anti-dumping
investigation concerning imports of Monoethylene Glycol originating in or exported from
Kuwait, Saudi Arabia and the USA, the Authority finds no reason to digress from its
previous conclusion regarding the existence of PMS in KSA. However, the Authority has
also not found sufficient evidence on record to establish that such distortion affects
comparability between the export price and domestic price. Accordingly, the Authority has
not carried out any adjustments based on PMS allegation to the cost of production of
producers from KSA.
34. Further, the Authority did not find any direct evidence concerning existence of PMS in
SOK during the POI. Accordingly, no adjustments have been made on account of PMS in
case of producers from SOK.
35. The normal value and export price for all producers/ exporters from the subject countries
have been determined as below.
G.3.1 Determination of Normal Value and Export Price
a) Normal Value for producers/exporters from SOK
Normal Value for Equate Group
(b) Equate Petrochemical Company (“Equate”)
36. The producer has reported domestic sales of *** MT having a value of *** USD in the POI,
which have been made to its unrelated parties. The producer has claimed adjustments on
account of inland transportation and credit cost. It is noted that domestic sales account for
less than 5% of total export sales volume made to India by Equate and accordingly,
domestic sales made by Equate do not qualify the sufficiency test. Accordingly, the
Authority has not considered such sales for determination of normal value.
37. In its questionnaire response, Equate has claimed normal value based on cost of production,
and reasonable selling, general and administrative expenses and profits. Accordingly, the
Authority has constructed the normal value based on the cost of production of the subject
goods in the originating country with reasonable addition of selling and administration
expenses and adding profit margin. The normal value so determined has been proposed in
the dumping margin table below.
(c) The Kuwait Olefins Co. (“TKOC”)
38. The producer has reported domestic sales of *** MT having a value of *** USD in the POI.
However, all TKOC’s domestic sales have been made to its related party, Equate, which has
exported the subject goods and therefore, have not been consumed in SOK’s domestic
market. Accordingly, the Authority has not considered TKOC’s domestic sales for
computation of normal value.
39. The Authority also notes that TKOC in its questionnaire response has claimed computation
of dumping margin based on constructed normal value i.e., cost of production plus
reasonable selling, general and administrative expenses and profits. Accordingly, the
Authority has constructed the normal value based on the cost of production of the subject
goods in the originating country with reasonable addition of selling and administration
expenses and profits. The ex-factory normal value so determined has been proposed in the
dumping margin table below.
Normal value for non-cooperating producers.
40. The normal value for non-cooperative producers/exporters from the SOK has been
determined based on facts available in terms of Rule 6(8) of the AD Rules. The normal
value so determined is proposed in the dumping margin table below.
b) Export price for producers / exporters from SOK
Export price for Equate Group
(d) Equate
41. The producer has exported *** MT of subject goods having value of *** USD to India
during the POI. Equate has made direct exports as well as exports through unrelated
traders. Except Mitsubishi Corporation, no other unrelated traders have participated in the
present investigation. Equate has claimed adjustments on account of shipping costs, credit
cost, bank charges and LC discounting charges. Equate Group has also sold subject goods
produced by producers other than Equate Group. Such transactions have not been
considered for computation of dumping margin or injury margin for Equate Group, and
have been considered for such other producers. The net export price so determined is
proposed in the dumping margin table below.
(e) TKOC
42. TKOC has exported *** MT of subject goods having value of *** USD to India during
the POI. TKOC has made no direct sales to India, and all its sales have been made either
through its related trader Equate or unrelated traders. Except Mitsubishi Corporation, no
other unrelated traders have participated in the present investigation. However, such
transactions are insignificant in terms of total volume exported to India by TKOC. The net
export price so determined is proposed in the dumping margin table below.
Export price for non-co-operative exporters/producers.
43. The export price for non-cooperative producers/exporters from SOK has been determined
based on facts available in terms of Rule 6(8) of the AD Rules. The net export price so
determined is proposed in the dumping margin table below.
b) Normal Value for producers/exporters from KSA
Normal value for SABIC Group
44. The following producers from SABIC Group have participated in the present
investigation:
(i)Arabian Petrochemical Company (Petrokemya),
(ii) Eastern Petrochemical Company (Sharq);
(iii) Jubail United Petrochemical Company (United),
(iv) Saudi Kayan Petrochemical Company (Saudi Kayan),
(v) Saudi Yanbu Petrochemical Company (Yanpet);
(vi) Yanbu National Petrochemical Company (Yansab);
(vii) Rabigh Refining & Petrochemical Company (Rabigh).
45. It is noted by the Authority that during the POI, only Sharq and Yanpet have made sales
of the PUC in the domestic market of Saudi Arabia. All sales in the domestic market were
made to related trader, SABIC, which has sold the subject goods to unrelated domestic
customers. Further, the Authority notes that there are no domestic sales of the PUC by
Petrokemya, United, Saudi Kayan and Yansab.
(a) Normal Value for Sharq
46. Sharq has reported domestic sales of *** MT having value of *** USD in its domestic
market. All domestic sales were made through its related trader SABIC. Sharq’s domestic
sales constitute more than 5% of its exports sales volume to India and therefore, it
considers that domestic sales of Sharq are sufficient in quantity. The Authority further
carried out the ordinary course of trade test to examine the profitable transactions. Upon
examination, it was noted that more than 80% of sales were made below the cost of
production. Accordingly, for determination of normal value, the Authority has only
considered profitable sales. Sharq has claimed adjustments for logistics and has been
accepted after desk verification. The normal value so determined has been proposed in the
dumping margin table below.
(b) Normal value for Petrokemya, Saudi Kayan, United
47. Petrokemya, Saudi Kayan and United have not made domestic sales of the subject goods
in the POI. Accordingly, the Authority has constructed the normal value based on the cost
of production of the subject goods in the originating country with reasonable addition of
selling and administration expenses and profits. The normal value so determined has been
proposed in the dumping margin table below.
(c) Normal value for Yansab, Yanpet and Rabigh
48. The Authority also notes that Yansab, Yanpet and PRC have also participated in the
present investigation. However, none of them have exported the subject goods to India in
the POI. Accordingly, the Authority has not determined normal value / export price for
them. However, as these producer form part of the same group, duty margin determined
for SABIC Group shall be applicable to these exporters.
(d) Normal value for non-cooperating producers.
49. The normal value for non-cooperative producers/exporters from the KSA has been
determined based on facts available in terms of Rule 6(8) of the AD Rules. The normal
value so determined is proposed in the dumping margin table below.
Export price for producers / exporters from Saudi Arabia
Export Price for SABIC Group
(a) Export Price for SHARQ
50. SHARQ has exported *** MT of subject goods having value of *** USD to India during
the POI. SHARQ has made sales through its related traders, SABIC and SPDC. SABIC
has exported the subject goods to India through its related entity SAPPL. SPDC has
exported the subject goods to India through its related trader Mitsubishi Corporation.
SHARQ and its related traders have claimed adjustments on account of ocean freight,
insurance, inland freight, port and other related expenses, credit cost, outsourcing fee, bank
charges and commission which has been accepted after desk verification. The net export
price so determined has been proposed in the dumping margin table below.
(b) Export Price for PETROKEMYA
51. PETROKEMYA has exported *** MT of subject goods having value of *** USD to
India during the POI. PETROKEMYA has made sales through its related trader, SABIC
and SAPPL. PETROKEMYA and its traders have claimed adjustments on account of
ocean freight, insurance, inland freight, port and other related expenses, credit cost,
outsourcing fee, bank charges, and commission which has been accepted after desk
verification. The net export price so determined has been proposed in the dumping margin
table below.
(c) Export Price for SAUDI KAYAN
52. SAUDI KAYAN has exported *** MT of subject goods having value of *** USD to
India during the POI. SAUDI KAYAN has made sales through its related trader, SABIC
and SAPPL. SAUDI KAYAN and its traders have claimed adjustments on account of
ocean freight, insurance, inland freight, port and other related expense, credit cost,
outsourcing fee, bank charges, and commission which has been accepted after desk
verification. The net export price so determined has been proposed in the dumping margin
table below.
(d) Export Price for UNITED
53. UNITED has exported *** MT of subject goods having value of *** USD to India during
the POI. UNITED has made sales through its related trader, SABIC and SAPPL. UNITED
and its traders have claimed adjustments on account of ocean freight, insurance, inland
freight and other related expenses, credit cost, outsourcing fee, bank charges and
commission which has been accepted after desk verification. The net export price so
determined has been proposed in the dumping margin table below.
Export price for non-co-operative exporters/producers.
54. The export price for non-cooperative producers/exporters from KSA has been determined
based on facts available in terms of Rule 6(8) of the AD Rules. The net export price so
determined is proposed in the dumping margin table below.
Normal Value for producers/exporters from ROS
Normal value for non-cooperating producers.
55. No producer exporter of subject goods from ROS has participated in the present
investigation.
56. Accordingly, the normal value for producers/exporters from ROS has been determined
based on facts available in terms of Rule 6(8) of the AD Rules. The normal value so
determined is mentioned in the dumping margin table below.
Export price for non-cooperative exporters/producers.
57. The export price for non-cooperative producers/exporters from ROS has been determined
based on facts available in terms of Rule 6(8) of the AD Rules. The net export price so
determined is mentioned in the dumping margin table below.
G.3.2 Dumping Margin
58. The Authority notes that both in case of SOK and KSA, participating exporters are
related to each other and form a group. Accordingly, the Authority has determined
weighted average dumping margin for the group. The normal value, export price and
dumping margin determined in the present investigation are as follows:
Dumping Margin Table
+--------------------------------+-----------------+-----------------+-----------------+-----------------+-----------------+
| Producer | Normal Value | Net Export | Dumping Margin | Dumping Margin | Dumping Margin |
| | (USD/MT) | Price (USD/MT) | (USD/MT) | (%) | Range (%) |
+================================+=================+=================+=================+=================+=================+
| SOK | | | | | |
+--------------------------------+-----------------+-----------------+-----------------+-----------------+-----------------+
| Equate Petrochemical Company | *** | *** | *** | *** | 40-50% |
+--------------------------------+-----------------+-----------------+-----------------+-----------------+-----------------+
| The Kuwait Olefins Co. | *** | *** | *** | *** | 0-10% |
| (“TKOC”) | | | | | |
+--------------------------------+-----------------+-----------------+-----------------+-----------------+-----------------+
| Equate Group Weighted Average | *** | *** | *** | *** | 20-30% |
+--------------------------------+-----------------+-----------------+-----------------+-----------------+-----------------+
| Others | *** | *** | *** | *** | 40-50% |
+--------------------------------+-----------------+-----------------+-----------------+-----------------+-----------------+
| KSA | | | | | |
+--------------------------------+-----------------+-----------------+-----------------+-----------------+-----------------+
| Arabian Petrochemical Company | *** | *** | *** | *** | 40-50% |
+--------------------------------+-----------------+-----------------+-----------------+-----------------+-----------------+
| Eastern Petrochemical Company | *** | *** | *** | *** | 0-10% |
+--------------------------------+-----------------+-----------------+-----------------+-----------------+-----------------+
| Jubail United Petrochemical | *** | *** | *** | *** | 30-40% |
| Company | | | | | |
+--------------------------------+-----------------+-----------------+-----------------+-----------------+-----------------+
| Saudi Kayan Petrochemical | *** | *** | *** | *** | 30-40% |
| Company | | | | | |
+--------------------------------+-----------------+-----------------+-----------------+-----------------+-----------------+
| SABIC Group Weighted Average | *** | *** | *** | *** | 20-30% |
+--------------------------------+-----------------+-----------------+-----------------+-----------------+-----------------+
| Others | *** | *** | *** | *** | 40-50% |
+--------------------------------+-----------------+-----------------+-----------------+-----------------+-----------------+
| ROS | | | | | |
+--------------------------------+-----------------+-----------------+-----------------+-----------------+-----------------+
| Others | *** | *** | *** | *** | 40-50% |
+--------------------------------+-----------------+-----------------+-----------------+-----------------+-----------------+
H. ASSESSMENT OF INJURY AND CAUSAL LINK
H.1. Submissions of the other interested parties
59. The following submissions have been made by the other interested parties with regard to
the injury and causal link:
a. The Authority must examine IGL’s data for a proper injury assessment as in terms of S.9B
of the Act injury is to be assessed for ‘established industry’ in India and not for the
applicant alone.
b. The Authority in previous investigations such as Plain Medium Density Fibre Board (MDF)
has called for information from other domestic producers. In the absence of non-participation by IOCL and IGL, the Authority should draw conclusions from the non-participation of these two producers.
c. All injury parameters of the applicant demonstrate improvement from the base year and
preceding years. As per DGTR’s previous findings, the domestic industry has not suffered
any injury till December 2020. Further, non-recommendation of provisional findings
indicates that the domestic industry’s position has remained more or less same.
d. As per responding exporters, dumping margin is negative and accordingly, even if
parameters support a case of injury, no duty can be recommended.
e. The Authority’s decision to not impose anti-dumping duties and the withdrawal of the
previous application are evidence that domestic industry’s case was frivolous. The
withdrawal of the last application was followed by increased imports from RIL USA Inc,
which is an attempt to skew the data and project an illusion of injury to justify the present
application.
f. The applicant’s claim concerning continued injury since 2020-21 is legally untenable as the
Authority terminated the investigation on the ground of no material injury.
g. India does not have production capacity of 27 lakhs, and the applicants must be put to strict
proof regarding the actual production and capacity of the Indian Industry. Further, the
Authority must exclude shutdowns faced by RIL while calculating overall available
capacity.
h. It is unclear if RIL’s captive consumption has been considered while reporting domestic
capacity of 27 lakhs MT. If such captive consumption has been included, then it amounts to
an inflated view of overcapacity for the PUC.
i. Iran has been excluded from the scope of the present investigation even though imports
from Iran were more than 3% of total imports (as claimed by the applicants) and
accordingly, Iran should have been included in the present investigation.
j. The Authority should share excel copy of transaction-wise import data as per the judgement
in Exotic Décor Pvt. Ltd. and Ors. v. Designated Authority, Directorate General of Anti-Dumping & Allied Duties for analysis and comments so that interested parties can assist the
Authority in reaching correct conclusion. Import data is not party specific, accordingly the
same cannot be claimed confidential.
k. The word “significant” in Para (ii) of Annexure II to AD Rules indicates that the Authority
must assess whether there has been a significant increase in the volume of dumped imports
either in absolute terms or in relation to production and consumption in India.
l. There is no adverse volume effect in the present investigation. There has been a decline in
volume of imports in absolute terms compared to 2022-23 and the base year. Opposed to
the applicant’s assertion that the said decline is on account of imposition of QCO, the
decline in volume of imports is attributable to increased domestic capacity and production.
m. The Applicant’s claims regarding the volume effect of imports are inconsistent and fail to
establish a causal link with the alleged injury. The Applicant has acknowledged that until
FY 2022–23, a demand-supply gap in the Indian market necessitated imports. With IOCL’s
new capacity becoming operational in February 2022, domestic capacity became sufficient
to meet total demand.
n. This development confirms that earlier imports were driven by supply constraints, not due
to injurious price effect of imports. Notably, imports declined during the POI, coinciding
with IOCL’s expansion, indicating a natural shift by Indian buyers to domestic suppliers.
Had imports from Kuwait been displacing domestic production, this capacity expansion
would have had little to no impact on import trends.
o. The decline in import volumes of subject goods during the POI clearly indicates a shift
towards domestic sourcing, thus, indicating imports from Kuwait are not causing injury to
the domestic industry. Further, the decline in the volume of imports during the POI
indicates that imports have not exerted continuous volume pressure on the domestic
industry.
p. Imports have declined despite a growth in total demand which indicates that injury cannot
be attributed to imports of MEG by the subject countries.
q. The domestic industry has admitted that it has imported substantial quantities of subject
goods to meet requirements of its downstream value-added products. If existing capacities
are sufficient to meet Indian demand, it is unclear as why it could not procure the same
from other domestic producers.
r. It needs to be demonstrated that price undercutting is significant or whether the prices of
imports have had a suppressing or depressing effect on the selling prices of the domestic
industry.
s. The domestic industry’s selling price has moved upwards since the base year which
indicates that domestic selling prices were not suppressed. While cost of sales has
fluctuated, the selling price has kept pace and therefore, there is no discernible suppression
or depression of price linked to subject imports.
t. There is no correlation between the landed price of the subject goods and the selling price
of the subject goods. Price undercutting has remained the same throughout the injury
analysis period and landed price and selling price of the domestic industry has moved in
tandem.
u. The domestic industry’s selling price is not based on imports rather the same is based on
CFR China Price. Thus, import prices in India have no role to play and therefore, imported
MEG from subject countries cannot have any price impact on the domestic industry.
v. The Authority must determine whether information regarding selling prices as provided by
applicants is with respect to non-captive sales or for both captive and non-captive sales in
which case, price undercutting provided by the domestic industry would not be correct
representation.
w. There is no price undercutting, or it is merely marginal.
x. The price undercutting calculation provided by the applicant is incorrect. The derived
selling price of the applicant is Rs. 40,886/MT during the POI based on which price
undercutting is negative. Thus, applicant’s claim concerning positive and significant price
undercutting is false and misleading.
y. Further, in terms of China – X Ray Equipment, where price undercutting comes negative, it
is incumbent on the domestic industry or the Authority to explain why the domestic
industry was not able to increase it prices and causality between the imports and alleged
injury.
z. The prices for subject goods fell globally during the POI, including the exports from non-subject countries and is not on account of dumping but due to decline in prices in China
which is the benchmark followed by exporters for the Indian market.
aa. The domestic industry has not demonstrated that the current level of capacity utilization,
despite being high is inadequate due to imports of subject goods from the subject countries.
bb. The domestic industry’s sales have increased compared to the base year. Despite a
reduction of 15 index points in captive consumption, total sales volume has declined only
by 14 index points, clearly indicating that decline in sales during POI compared to previous
years was on account of reduction in captive consumption and lack of export sales.
cc. The domestic industry has made imports even though it had inventories and its capacity
utilization remained low leads to the necessary conclusion that it has projected higher
capacities than actually functional.
dd. The domestic industry has claimed that it has taken a commercial decision to reduce
production in order to avoid inventory built up. However, at the same time, it is claiming
that in order to remain viable it must maintain capacity utilization in the range of 80-90%.
The submissions are mutually contradictory.
ee. The market share of subject imports from the subject countries has declined in the POI
compared to FY 2022-23 and market share of the domestic industry has in fact improved
during the POI.
ff. Sales of other domestic producers have doubled over the injury period.
gg. The reduction in market share was on account of capacity expansion by Indian Oil
Corporation. Any increase in market share of imports between 2020-21 and 2021-22 was on
account of demand-supply gap and imports lost their market share when domestic producers
increased their capacities.
hh. The domestic industry’s sales value and selling price have increased compared to the base
year.
ii. There is no correlation between prices of domestic industry and imports. While prices of
subject imports from Kuwait increased from 100 index points in 2020-21 to 142 in 2021-22,
the domestic industry’s profitability worsened. If imports were responsible for price
suppression and injury, profitability should have increased with increase in import prices.
Further, the domestic industry’s profitability has improved in the POI, when prices from
Kuwait fell and subject goods were allegedly being dumped at margins as high as 60-70%,
which further confirms the lack of correlation.
jj. The change in profitability parameters is on account of increased cost of sales of the
domestic industry. The rising cost structure coincides with steady decline in domestic
industry’s profitability which clearly indicates that cost of sales is the primary factor
affecting profitability, rather than movement in import prices.
kk. The domestic industry imports its ethane from its fully owned subsidiary RIL USA Inc.,
The price at which the domestic industry procures ethane from RIL USA Inc., is much
higher than the export price of ethane from USA.
ll. The domestic industry’s explanation that the difference was on account of terms of sales
i.e., US prices were reported on FOB basis, whereas Indian import prices were reported on
FOB basis is incorrect. Such a high difference cannot be attributed to freight and insurance.
The applicant’s cost of ethane is artificially high and therefore, the Authority must assess
whether the applicant’s procurement of ethane is at arm’s length.
mm.The domestic industry’s profitability has significantly declined after it has started to import
ethane from its related entity and it must explain as to why the abovementioned facts were
not responsible for reduced competitiveness vis-a-vis imports.
nn. The domestic industry’s depreciation has increased significantly in the POI compared to
previous years without any change in fixed assets, capital employed and working capital.
No explanation has been provided regarding the sudden increase in depreciation.
oo. The domestic industry’s profitability parameters have significantly improved compared to
2022-23. The improvement in profitability runs contrary to the domestic industry’s claims
of worsening injury.
pp. The reliance on the observations of the Supreme Court in Reliance Industries Ltd. v. UOI, is
misplaced as the same specifically pertained to the treatment of captive inputs in the context
of determination of the Non-Injurious Price, which is a constructed, normative benchmark
used for comparison with import prices.
qq. Profitability is not a theoretical construct, and substituting actual costs with hypothetical
market prices to artificially show losses undermines the integrity of the injury assessment
and distorts the true economic performance of the domestic industry.
rr. The Authority must rely on domestic industry’s reported financial data in its books without
making any hypothetical adjustments based on external benchmarks as MEG producers
typically producer ethylene in-house or source it via captive arrangements.
ss. The cost of production must be determined based on the records maintained by the domestic
producers and not on notional costs.
tt. The loss to domestic industry is on account of geographical factors and not due to alleged
dumping.
uu. RIL in its recent press release has admitted that its MEG margins have improved by 46%
from a low base. Accordingly, the domestic industry is not suffering from any injury.
vv. While closing inventory has increased, average inventory days of sales have declined which
clearly indicates that increase in inventory index was not due to reduced sales but on
account of strategic stocking of RIL’s commercial decision of blocking supply to
downstream competitors.
ww.The decline in productivity parameters was on account of reduced captive consumption
and lack of export sales made by the domestic industry.
xx. The domestic industry is itself a multi- product company hence it cannot be said that its
ability to raise capital is affected in any way.
yy. The threat of material injury must be clearly foreseen and imminent. Mere existence of
surplus capacities or changes in third country markets are insufficient and cannot lead to a
conclusion threat of material injury
zz. No evidence has been provided to support the claim that India would be the preferred
destination for exports. The presence of BIS certification requirements places additional
conditions on imports, thus making a comparatively less accessible market.
aaa. Historical trade patterns also do not show unmanageable surges into India even when
capacity expansion occurred in the subject countries.
bbb.Exports of subject goods from Saudi Arabia to India have not exceeded 5% of their total
exports to India.
ccc. Merely because subject countries have high export potential does not mean that such goods
would be exported as the same is dependent on factors such as raw material, supply chain
constraints.
ddd.The financial performance of the domestic industry has been primarily influenced by
market-driven factors, including rising raw material costs, increased inventory levels, and
global oversupply conditions, which has constrained price realization and impacted
profitability.
eee. RIL in its Q2 Investor Presentation for FY 2023-24 has stated “MEG-Naphtha margin
surged 53% to US$ 67/MT, driven by increased downstream operations and weaker
naphtha prices. However, margins continue to remain weak due to capacity overhang and
higher inventory.”
fff. Economic Slowdown in China has led to reduced consumption of MEG in China which has
impacted MEG margins, which was also recognized by RIL in its Q4 FY 23 Media Release.
ggg.Decline in applicant’s sales was not due to competition from imports but on account of
increase in sales by other domestic producers. If imports were cause of injury, all Indian
producers would have experienced decline in sales.
hhh.Production of MEG is heavily reliant of Naphtha-derived ethylene. RIL has admitted in its
investor presentation that MEG delta remained low due to strong Naphtha prices. Thus,
decline in profitability is on account of rising input costs rather price suppression by
imports.
H.2. Submission on behalf of the domestic industry
60. The following submissions have been made on behalf of the domestic industry with
regard to the injury and causal link;
a. The growth in Indian demand has made it highly attractive target for exports of subject
goods. Producers from the subject countries have aggressively reduced their prices to
penetrate the market. As a result, the Indian domestic industry has been consistently
facing injury from dumped imports since 2019.
b. Regarding the reliability of data pertaining to injury parameters the domestic industry has
agreed to all necessary verification which the Authority may require to ascertain the
veracity and correctness of the reported data.
c. The domestic industry has faced injury from dumped MEG imports since 2019. The subject
countries consume only *** % of their production domestically and are primarily focused
on exports. While Indian demand grew by *** % over the injury period, Global MEG
consumption grew just *** %, leaving *** % of the subject countries' capacities idle in
2024—equivalent to *** % of India's demand.
d. IOCL has two plants located in Panipat (capacity of 457000 MT) and Paradip (capacity of
357000 MT). Thus, at the end of the POI of the present investigation, Indian MEG capacity
stood at 27 lacs MT and is sufficient to meet the entirety of the Indian demand.
e. Despite prior investigation which was initiated vide Notification No. 6/8/2021-DGTR
dated June 28, 2021, confirming dumping and significant injury margins, no anti-dumping duties were imposed as the domestic industry was deemed to earn reasonable
profits and not face injury.
f. The condition of the Indian domestic industry has worsened significantly due to the
absence of remedial measures despite ongoing dumping and injury since January 2019,
which has intensified over time. The domestic industry’s profitability has almost
completely eroded, and it has been forced to sell at non-remunerative prices. This has
resulted in almost *** % decline in PBIT and ROCE.
g. Imports of subject goods from the subject countries have risen significantly in the POI
compared to the base year, both in absolute terms and relative to India's production and
consumption. Further, compared to base year, imports have doubled in the POI.
h. The dumped imports from the subject countries also rose significantly relative to the
domestic industry’s production and total non-captive consumption until 2022–23.
i. The imports from the subject countries consistently increased during the injury period until
2022–23. Although the imports declined marginally in the POI as compared to 2022-23,
the same was only on account of the imposition of the Quality Control Order on MEG
imports in June 2023, which offered only temporary relief to the domestic industry.
Notably, in the post-POI period, imports from the subject countries have already surpassed
2022–23 levels.
j. The market share of imports from the subject countries consistently increased, with a
slight dip during the POI compared to 2022–23 but remained higher than in the base year
and 2021–22. In contrast, the domestic industry’s market share declined sharply from
nearly *** % in the base year to *** % in the POI.
k. Imports from the subject countries have remained in excess of demand supply gap since
2020-21. Till the commissioning of IOCL’s capacity in Q 4 of the POI, the demand-supply
gap was in the range of 3,00,000-5,00,000 MT. However, the level of dumped imports
from the subject countries far exceeded the demand-supply gap.
l. The dumped imports have had a suppressing and depressing effect on the prices of the
domestic industry. Further, such imports are undercutting the prices of the domestic
industry.
m. The landed value of the subject goods was below the cost of sales and selling price of the
domestic industry which clearly shows the price pressure on the domestic industry.
n. SABIC Group has relied on hypothetical calculations based on trends from the previous
investigation to allege that price undercutting from the subject countries is negative in the
present POI. No weight whatsoever should be attached to sheer conjecture, particularly in
circumstances where actual verified data is readily available with the Authority.
o. The domestic industry's production and capacity utilization have significantly
declined during the POI. Historically, capacity utilization remained above *** % since
2018-19, but due to continued dumping, it has fallen below *** %, making production
unviable. Production has mirrored this trend, declining significantly in the POI.
p. Despite significant growth in demand between 2020–21 and 2022–23, the domestic
industry's non-captive sales declined during this period. Although there was a slight
improvement in the POI due to the imposition of the Quality Control Order, sales levels
during the POI remain *** % lower compared to the base year. In contrast, imports from
the subject countries almost doubled during the same period.
q. The market share of imports from the subject countries consistently increased, except in
the POI, wherein it slightly declined compared to 2022-23 levels, but remained higher than
the base year and 2021-22.
r. The market share of the domestic industry declined from almost 50% in the base year to
30% in the POI.
s. Despite the marginal improvement in the POI, the market share has remained significantly
below the base year and 2021-22 levels.
t. A comparison of the domestic industry’s condition in the POI with the period 2018-19 (i.e.
period when there was no dumping) shows a significant deterioration in the domestic
industry’s capacity utilization, return on investments and profits.
u. The data provided for profitability is based on the books of Reliance Industries Ltd. (RIL),
an integrated manufacturer with a cost advantage due to captive ethylene. Notably, the key
raw material, ethylene, is transferred at cost in RIL’s books. The Hon'ble CESTAT, in its
judgment dated 29.09.2023, citing the Supreme Court's decision in Reliance Industries
Ltd. v. UOI (2006 (202) E.L.T. 23 (S.C.)), ruled that injury assessment should consider the
market price of captive inputs, not internal transfer prices. RIL's marginal profits would
turn into losses if the market price of ethylene is factored in.
v. All financial parameters, PBT, PBIT, Cash Profit, ROCE and PBDIT significantly
declined since 2020-21 and the domestic industry faced significant losses during 2022-23.
Marginal improvement in the POI was on account of temporary respite due to QCO.
w. Compared to the base year and 2021-22, all profitability parameters of the domestic
industry have significantly declined.
x. SABIC Group has selectively presented its claims while denying the domestic industry’s
request to disclose the alleged import prices of ethane that form the very basis of its
assertion.
y. The domestic industry during the on-site verification has fully cooperated with the
investigation team and has provided all desired information in relation to the procurement
of ethane prices through RIL USA, which clearly dismantles the false narrative attempted
by SABIC Group.
z. RIL procures ethane directly from suppliers via RIL USA. In the past as well, RIL India
has sourced ethane from traders who charged a trading margin. The same margin
continues to be paid to RIL USA as expenses towards sourcing. The ethane procurement
price is benchmarked with the same benchmark as before used for unrelated suppliers.
aa. The domestic industry captively manufactures ethylene and transfers the same at cost. As
ethylene is transferred at cost, it is not subject to market fluctuations.
bb. Applying the market price of ethylene will address the submissions of other interested
parties regarding the alleged inflated price of ethane and consequent ethylene prices.
cc. Despite rising domestic demand, due to the continued dumping and injury, no new
domestic capacities have been announced, as existing capacities remain under-utilized.
dd. MEG is a strategic business unit under RIL and all investments concerning MEG,
including raising future capital investments, are decided based on profitability and returns
earned on the MEG business. If the arguments of the interested parties were to be
accepted, then it would mean that all multi-product companies should funnel money from
profitable business segments to loss-making segments.
ee. Equate Group has quoted RIL’s investor presentation to claim that RIL’s profitability has
declined on account of global overcapacity. On account of the overcapacity in the subject
countries and almost no domestic consumption in their respective markets, exporters from
the subject countries have targeted the only remaining market with high MEG
consumption i.e., India.
ff. Producers in the subject countries are predominantly export-oriented and maintain
significant excess capacities in relation to their domestic market consumption, which
threatens the Indian domestic industry with material injury.
gg. Capacities substantially in excess of the domestic demand have been set up in the subject
countries. These capacities account for almost 500% of the entire Indian demand.
hh. Consumption and production of the subject goods in third country markets is relatively
stable. It is unlikely that exporters of subject goods from the subject countries would be
able to divert their exports to third countries.
ii. Exports of subject goods from one of the subject countries (Saudi Arabia) to European
Union is restricted on account of imposition of anti-dumping duties. Further, China market
is also no longer available on account of increased indigenous capacity in China.
H.3. Examination by the Authority
61. Rule 11 of the AD Rules read with Annexure II to the AD Rules provides that an injury
determination shall involve examination of factors that may indicate injury to the domestic
industry, taking into account all relevant facts, including the volume of dumped imports,
their effect on prices in the domestic market for like articles and the consequent effect of
such imports on the domestic producers of such articles. In considering the effect of the
dumped imports on prices, the Authority examines whether there has been a significant
price undercutting by the dumped imports compared with the selling price of the like
article in India, or whether the effect of such imports is otherwise to depress prices to a
significant degree or prevent price increases, which otherwise would have occurred, to a
significant degree. Further, for examination of the impact of the dumped imports on the
domestic industry in India, indices having a bearing on the state of the industry such as
production, capacity utilization, sales volume, inventory, profitability, net sales realization,
the magnitude and margin of dumping, etc. have been considered.
62. The Authority has examined the submissions of all interested parties with regard to injury
to the domestic industry in the foregoing paragraphs.
H.3.1 Cumulative assessment of injury
63. Article 3.3 of the WTO agreement and para (iii) of Annexure II of the A D Rules
provides that in case where imports of a product from more than one country are being
simultaneously subjected to anti-dumping investigation, the Authority will cumulatively
assess the effect of such imports, in case it determines that:
a. The margin of dumping established in relation to the imports from each country is
more than two percent expressed as a percentage of export price and the volume of
the imports from each country is three percent (or more) of the import of like article
or where the export of individual countries is less than three percent, the imports
collectively account for more than seven percent of the import of like article, and
b. Cumulative assessment of the effect of imports is appropriate in light of the
conditions of competition between the imported article and the like domestic
articles.
64. The Authority notes that:
a. The subject goods imported from the subject countries are ‘like article’ to each
other and the user industry has imported the subject goods from one or more subject
countries. Further, as mentioned in Section C above, subject goods imported from
the subject countries are also like article to the goods produced by the domestic
industry.
b. As determined in Section G of this final findings, the subject goods are being
dumped into India from the subject countries, and the dumping margin is more than
the de-minimis limits prescribed under the AD Rules.
c. Further, the volume of imports of subject goods from each of the subject countries
is individually more than 3% of the total volume of imports.
d. Imports from the subject countries not only directly compete with the like articles
offered by each of them but also the like article offered by the domestic industry in
the Indian market.
65. In view of the above, the Authority considers that conditions laid down for cumulative
assessment of imports have been fulfilled and has cumulatively assessed the effect of
dumped imports of the subject goods from subject countries on the domestic industry.
66. As regards submission by the importer association regarding inclusion of Iran for injury
assessment, the Authority notes that the volume of imports was below the de-minimis
level specified in the AD Rules. Accordingly, Iran was excluded from the purview of the
present investigation.
H.3.2 Volume effect of the dumped imports
a) Assessment of demand / apparent consumption
67. With regard to the volume of the dumped imports, the Authority is required to consider
whether there has been a significant increase in the volume of dumped imports, either in
absolute terms or relative to production or consumption in India.
68. The Authority has defined, for the purpose of the present investigation, total demand for
the subject goods in India as the sum of domestic sales of the domestic industry, domestic
sales of the other domestic producers and imports of subject goods from all sources based
on DGCI&S data. The demand so assessed is provided in the table below.
+-------------------------------------+------------+-----------+-----------+-----------+------------+
| Particulars | Units | 2020-21 | 2021-22 | 2022-23 | POI |
+=====================================+============+===========+===========+===========+============+
| Subject Countries | MT | 5,28,528 | 9,12,575 | 13,12,512 | 10,57,586 |
+-------------------------------------+------------+-----------+-----------+-----------+------------+
| Trend | Index | 100 | 173 | 248 | 200 |
+-------------------------------------+------------+-----------+-----------+-----------+------------+
| Kuwait | MT | 3,83,519 | 6,16,079 | 7,85,939 | 7,14,900 |
+-------------------------------------+------------+-----------+-----------+-----------+------------+
| Saudi Arabia | MT | 1,24,417 | 2,31,913 | 4,11,242 | 3,06,948 |
+-------------------------------------+------------+-----------+-----------+-----------+------------+
| Singapore | MT | 20,592 | 64,583 | 1,15,332 | 35,739 |
+-------------------------------------+------------+-----------+-----------+-----------+------------+
| Imports from Non Subject Countries | MT | 44,878 | 9,424 | 74,336 | 15,586 |
+-------------------------------------+------------+-----------+-----------+-----------+------------+
| Total Imports | MT | 5,73,407 | 9,21,998 | 13,86,849 | 10,73,172 |
+-------------------------------------+------------+-----------+-----------+-----------+------------+
| Total Sales of domestic industry | MT | *** | *** | *** | *** |
+-------------------------------------+------------+-----------+-----------+-----------+------------+
| Trend | Index | 100 | 111 | 100 | 93 |
+-------------------------------------+------------+-----------+-----------+-----------+------------+
| Sales of other domestic producers | MT | *** | *** | *** | *** |
+-------------------------------------+------------+-----------+-----------+-----------+------------+
| Trend | Index | 100 | 141 | 84 | 156 |
+-------------------------------------+------------+-----------+-----------+-----------+------------
| Total Demand/Consumption including | MT | *** | *** | *** | *** |
| captive | | | | | |
+-------------------------------------+------------+-----------+-----------+-----------+------------+
| Trend | Index | 100 | 126 | 135 | 122 |
+-------------------------------------+------------+-----------+-----------+-----------+------------+
| Total Demand/Consumption excluding | MT | *** | *** | *** | *** |
| captive | | | | | |
+-------------------------------------+------------+-----------+-----------+-----------+------------+
| Trend | Index | 100 | 132 | 145 | 135 |
+-------------------------------------+------------+-----------+-----------+-----------+------------+
69. It is noted that:
a. Demand for the subject goods has consistently increased until 2022-23. There has
been a marginal decline during the POI compared to 2022-23. However, demand
remains above 2021-22 and 2022-23 levels. It is further noted that over the injury
period, demand has increased by *** %.
b. Imports of subject goods have substantially increased over the injury period.
Compared to the base year, the volume of subject imports has almost doubled in
the POI whereas compared to 2022-23, the volume of subject imports has declined
in the POI.
b) Import Volumes from the subject countries
70. With regard to the volume of the dumped imports, the Authority is required to consider
whether there has been a significant increase in dumped imports, either in absolute terms
or relative to production or consumption in India. For the purpose of injury analysis, the
Authority has relied upon DGCI&S data. The import volumes of the subject goods from
the subject countries and share of the dumped imports during the injury investigation
period are as follows:
+---------------------+-------+-----------+-----------+-----------+------------+
| Particulars | UOM | 2020-21 | 2021-22 | 2022-23 | POI |
+=====================+=======+===========+===========+===========+============+
| Kuwait | MT | 3,83,519 | 6,16,079 | 7,85,939 | 7,14,900 |
+---------------------+-------+-----------+-----------+-----------+------------+
| Saudi Arabia | MT | 1,24,417 | 2,31,913 | 4,11,242 | 3,06,948 |
+---------------------+-------+-----------+-----------+-----------+------------+
| Singapore | MT | 20,592 | 64,583 | 1,15,332 | 35,739 |
+---------------------+-------+-----------+-----------+-----------+------------+
| Subject Countries | MT | 5,28,528 | 9,12,575 | 13,12,512 | 10,57,586 |
+---------------------+-------+-----------+-----------+-----------+------------+
| Non-subject | MT | 44,878 | 9,424 | 74,336 | 15,586 |
| Countries | | | | | |
+---------------------+-------+-----------+-----------+-----------+------------+
| Total Imports | MT | 5,73,407 | 9,21,998 | 13,86,849 | 10,73,172 |
+---------------------+-------+-----------+-----------+-----------+------------+
| Subject Country dumped imports in relation to |
+-----------------------------------------------------------------------------+
| Demand without captive consumption | % | *** | *** | *** | *** |
+------------------------------------+----+-----+-----+-----+-----+
| Production | % | *** | *** | *** | *** |
+------------------------------------+----+-----+-----+-----+-----+
| Total Imports | % | 92% | 99% | 95% | 99% |
+------------------------------------+----+-----+-----+-----+-----+
71. From the above, the Authority notes that-
a. The volume of subject imports from subject countries has significantly increased in
absolute terms during the POI compared to the base year. While there has been a
decline in the volume of subject imports in the POI compared to 2022-23, it is noted
that such imports remain significantly above the base year and the 2021-22 levels.
b. Subject imports from the subject countries accounted for nearly the entirety of total
imports into India, representing a substantial share of 99% during the POI.
c. Compared to the base year, volume of subject imports from subject countries in
relation to Indian demand and production have increased by *** % and *** %
respectively. While compared to 2022-23, volume of subject imports from the subject
countries have declined in relation to Indian demand and production in the POI, they
continue to remain significantly above the base year and 2021-22 levels.
d. The subject imports from subject countries increased significantly in absolute terms as
well as in relative terms during the POI in comparison to base year.
72. Other interested parties have claimed that until FY 2022-23, imports were necessitated by
demand-supply gap and with the operationalization of IOCL’s expanded capacity for
MEG, imports have declined in the POI indicating shift towards domestic sourcing, which
indicates that there is no continuous pressure from imports. On the other hand, the
domestic industry has claimed that imports have declined in the POI temporarily on
account of imposition of QCO by the Government of India.
73. The Authority notes that despite increase in IOCL’s capacity, imports of subject goods in
the POI remain above the 2021-22 and base year levels. IOCL has carried out capacity
expansion for the subject goods in two phases – the first capacity expansion took in 2022-
23, wherein MEG capacity at its Panipat Plant was increased to 425,000 MT from earlier
3,02,000 MT. The second capacity expansion happened at the end of the POI wherein a
new MEG Plant with 332,000 MT was inaugurated at its Paradip Plant. Between 2021-22
and the POI, IOCL’s capacity increased by almost 1,20,000 MT. However, during the
same period, imports from the subject countries also increased by 1,45,011 MT. Thus, it
cannot be said that capacity expansion by IOCL led to decline in the volume of imports of
subject goods from the subject countries.
74. Other interested parties have also claimed that subject imports from subject countries
have declined despite growth in Indian demand, and therefore, injury cannot be attributed
to subject imports from the subject countries. The Authority notes that while demand in the
POI has declined compared to 2022-23 levels, demand levels in the POI remain above and
comparable to 2021-22 levels.
75. It is noted that between 2021-22 and the POI while demand increased by only *** %, the
volume of imports from the subject countries increased by 16%. During the same period,
non-captive sales of the Indian Industry declined by *** %. As compared to the base year,
the increase in absolute volume of subject imports from the subject countries has outpaced
the absolute growth in demand in the POI. This indicates that volume of subject imports
has increased in the POI in both absolute and relative terms. Accordingly, the Authority
disagrees with the submissions of the other interested parties.
76. Other interested parties have argued that the domestic industry has made significant
quantities of imports from the subject countries. As has already been examined above, it is
noted imports made by the domestic industry constitute only around 1% of its total
production and sales.
H.3.3 Price effect of the dumped imports
77. In terms of Annexure II (ii) to the AD Rules, with regard to the effect of the
dumped imports on prices, the Authority is required to consider whether there has been a
significant price undercutting by the dumped imports as compared with the price of the
like product in India, or whether the effect of such imports is otherwise to depress prices
to a significant degree or prevent price increase, which otherwise would have occurred, to
a significant degree.
a) Price undercutting
78. In order to determine whether the imports are undercutting the prices of the domestic
industry in the market, price undercutting has been determined by comparing the landed
price of the subject imports based on DGCI&S data with the net sales realisation of the
domestic industry during the POI.
Price Undercutting
+-----------------+-----------+-----------+-----------+-----------+-------------------+
| Subject Country | CIF Value | Landed | NSR | Price | Price Undercutting|
| | | Value | | Undercutting| Range |
+=================+===========+===========+===========+===========+===================+
| | ₹/MT | ₹/MT | ₹/MT | % | Range |
+-----------------+-----------+-----------+-----------+-----------+-------------------+
| Kuwait | 41,574 | 43,860 | *** | *** | 0-10 |
+-----------------+-----------+-----------+-----------+-----------+-------------------+
| Saudi Arabia | 41,952 | 44,260 | *** | *** | 0-10 |
+-----------------+-----------+-----------+-----------+-----------+-------------------+
| Singapore | 42,988 | 44,171 | *** | *** | 0-10 |
+-----------------+-----------+-----------+-----------+-----------+-------------------+
| Subject | 41,731 | 43,987 | *** | *** | 0-10 |
| Countries | | | | | |
+-----------------+-----------+-----------+-----------+-----------+-------------------+
79. As can be seen from the above, subject goods originating in the subject countries were
imported into the Indian market at prices lower than the NSR of the domestic industry.
Price undercutting from the subject countries as a whole and from each of the individual
subject countries is positive.
80. SABIC Group has disputed the price undercutting calculation provided by the domestic
industry and has claimed that price undercutting is negative compared to KSA. The
Authority has considered the actual net sales realization of the domestic industry based on
which it has determined the price undercutting for KSA to be positive.
81. SABIC Group has claimed that while considering price undercutting only non-captive sales
should be considered. The Authority notes that MEG is transferred by the Applicant at
market price for captive and non-captive consumption. Accordingly, the Authority has
considered net sales realization for all domestic sales made by the domestic industry for the
purpose of computing undercutting.
b) Price suppression/depression
82. For the purpose of analyzing price suppression and depression, the applicants have
provided information about (a) cost of sales, (b) domestic net sales realisation as is given
in the table below. The same has been compared with the landed value of subject goods.
Price Suppression/ Price Depression
+----------------------+---------+-----------+-----------+-----------+-------+
| Particulars | UoM | 2020-21 | 2021-22 | 2022-23 | POI |
+======================+=========+===========+===========+===========+=======+
| Cost of Sales | ₹/MT | *** | *** | *** | *** |
+----------------------+---------+-----------+-----------+-----------+-------+
| Trend | Index | 100 | 149 | 187 | 142 |
+----------------------+---------+-----------+-----------+-----------+-------+
| Landed Price | ₹/MT | 39,064 | 53,481 | 46,402 | 43,987|
+----------------------+---------+-----------+-----------+-----------+-------+
| Trend | Index | 100 | 137 | 119 | 113 |
+----------------------+---------+-----------+-----------+-----------+-------+
| Net Sales Realisation| ₹/MT | *** | *** | *** | *** |
+----------------------+---------+-----------+-----------+-----------+-------+
| Trend | Index | 100 | 137 | 126 | 119 |
+----------------------+---------+-----------+-----------+-----------+-------+
83. It is seen that until 2021-22, the landed price of subject goods from the subject countries
increased and remained above the cost of sales of the applicant. The domestic industry
was also able to increase its selling price along with increase in its cost of sales until
2021-22. However, since 2021-22, landed value of the subject goods has continuously
declined, which was accompanied by an increase in the volume of the subject goods in the
POI compared to 2021-22. The domestic industry has explained that it was forced to
match the import prices in order to retain its market share. It is noted that the NSR of the
domestic industry has also followed the same trend as the landed price of the subject
goods from the subject countries. Thus, the decline in landed price forced the domestic
industry to lower its NSR to remain competitive and retain its market share.
84. The Authority further notes that during the POI domestic industry has been making sales
at cost level, barely making any profits, even though its cost of sales has declined in the
POI.
85. Other interested parties have claimed that because domestic industry’s selling price has
moved upwards since base year, therefore, it cannot be considered that domestic industry’s
prices have been suppressed. The Authority notes that despite an increase in cost of sales
of the domestic industry over the injury period, the domestic industry has not been able to
commensurately increase its selling prices. Further, compared to 2022-23, landed prices of
subject goods from the subject countries have declined. Accordingly, the Authority
considers that subject imports from subject countries have depressed and suppressed prices
of the domestic industry.
86. Other interested parties have also commented that price for subject goods fell globally
during the POI due to decline in prices in China. The Authority notes that none of the
interested parties have provided any information substantiating the decline in global prices.
On the contrary, based on the information available concerning exports to third countries
in the questionnaire response submitted by participating exporters from SOK and KSA,
who are major exporters of the PUC globally, the Authority notes that export prices to
third countries have indeed increased in the POI compared to 2022-23. Accordingly, it
cannot be considered that prices in Indian market declined due to decline in global prices.
J.1. Economic parameters of the domestic industry
87. Annexure II to the AD Rules provide that the examination of the impact of the dumped
imports on the domestic industry should include an objective and unbiased evaluation of
all relevant economic factors and indices having a bearing on the state of the industry,
including actual and potential decline in sales, profits, output, market share, productivity,
return on investments or utilization of capacity; factors affecting domestic prices, the
magnitude of the margin of dumping; actual and potential negative effects on cash flow,
inventories, employment, wages, growth and the ability to raise capital investments.
Accordingly, various injury parameters relating to the domestic industry are discussed
herein below.
a) Production, capacity, capacity utilization and sales volumes
88. The Authority has considered the capacity, production, capacity utilization and sales
volume of the domestic industry over the injury period.
Production, Installed Capacity, Capacity Utilisation and Sales
+-------------------+---------+-----------+-----------+-----------+-------+
| Particulars | UoM | 2020-21 | 2021-22 | 2022-23 | POI |
+===================+=========+===========+===========+===========+=======+
| Capacity | MT | *** | *** | *** | *** |
+-------------------+---------+-----------+-----------+-----------+-------+
| Trend | Index | 100 | 100 | 100 | 100 |
+-------------------+---------+-----------+-----------+-----------+-------+
| Production | MT | *** | *** | *** | *** |
+-------------------+---------+-----------+-----------+-----------+-------+
| Trend | Index | 100 | 97 | 86 | 80 |
+-------------------+---------+-----------+-----------+-----------+-------+
| Capacity Utilisation | % | *** | *** | *** | *** |
+-------------------+---------+-----------+-----------+-----------+-------+
| Range | % | 90-100% | 90-100% | 80-90% | 80-90%|
+-------------------+---------+-----------+-----------+-----------+-------+
| Domestic Industry | MT | *** | *** | *** | *** |
| Sales | | | | | |
+-------------------+---------+-----------+-----------+-----------+-------+
| Trend | Index | 100 | 111 | 100 | 93 |
+-------------------+---------+-----------+-----------+-----------+-------+
89. From the above, the Authority notes that:
a. The domestic industry’s capacity has remained constant throughout the injury
period. However, the capacity utilization of the domestic industry consistently
declined over the same period, reaching its lowest level during the POI.
b. Despite an increase in demand for the PUC in the domestic market, the domestic
sales as well as the production of the domestic industry showed a significant
decline during the POI when compared to the base year and 2021-22.
90. SABIC Group has claimed that the domestic industry has reported higher capacities than
actually functional. The Authority has verified the capacity reported by the domestic
industry and found it to be correctly reported.
91. Other interested parties have argued that decline in sales during the POI was on account
of reduced captive consumption and lack of export sales. The Authority has compared the
volume of captive sales and non-captive sales made by the domestic industry over the
years. It is noted that the ratio between the captive and free market sales in total sales has
remained in the same range over the injury period. It is noted that there has been some
marginal improvement in the non-captive sales of the domestic industry during the POI
compared to 2022-23. The domestic industry has explained that the same was on account
of imposition of QCO during the POI.
92. As regards the decline in export sales, the domestic industry has explained that export
sales were undertaken during the base year and 2021-22 as prices in domestic market
were not remunerative on account of dumped and low-priced imports being sold by the
KSA, SOK and USA into the Indian market.
b) Market share
93. Market share of the domestic industry and of imports was as shown in the table below:
Market Share
+---------------------------+-------+-----------+-----------+-----------+-------+
| Market share | Unit | 2020-21 | 2021-22 | 2022-23 | POI |
+===========================+=======+===========+===========+===========+=======+
| Non-captive domestic industry Sales | MT | *** | *** | *** | *** |
+---------------------------+-------+-----------+-----------+-----------+-------+
| Trend | Index | 100 | 107 | 85 | 87 |
+---------------------------+-------+-----------+-----------+-----------+-------+
| Sales of Other Indian | MT | *** | *** | *** | *** |
| Producers | | | | | |
+---------------------------+-------+-----------+-----------+-----------+-------+
| Trend | Index | 100 | 141 | 84 | 156 |
+---------------------------+-------+-----------+-----------+-----------+-------+
| Total Indian Sales | MT | *** | *** | *** | *** |
+---------------------------+-------+-----------+-----------+-----------+-------+
| Trend | Index | 100 | 114 | 85 | 102 |
+---------------------------+-------+-----------+-----------+-----------+-------+
| Imports from Subject | MT | 5,28,528 | 9,12,575 | 13,12,512 | 10,57,586|
| Countries | | | | | |
+---------------------------+-------+-----------+-----------+-----------+-------+
| Imports from Other | MT | 44,878 | 9,424 | 74,336 | 15,586|
| Countries | | | | | |
+---------------------------+-------+-----------+-----------+-----------+-------+
| Non-Captive Demand in | MT | *** | *** | *** | *** |
| India | | | | | |
+---------------------------+-------+-----------+-----------+-----------+-------+
| Trend | MT | 100 | 132 | 145 | 135 |
+---------------------------+-------+-----------+-----------+-----------+-------+
| Market Share | | | | | |
+---------------------------+-------+-----------+-----------+-----------+-------+
| Domestic industry | % | *** | *** | *** | *** |
+---------------------------+-------+-----------+-----------+-----------+-------+
| Other Indian Producers | % | *** | *** | *** | *** |
+---------------------------+-------+-----------+-----------+-----------+-------+
| Indian Industry | % | *** | *** | *** | *** |
+---------------------------+-------+-----------+-----------+-----------+-------+
| Subject Countries | % | *** | *** | *** | *** |
+---------------------------+-------+-----------+-----------+-----------+-------+
| Other Country Imports | % | *** | *** | *** | *** |
+---------------------------+-------+-----------+-----------+-----------+-------+
94. It is observed that the market share of the domestic industry declined significantly by
17% during the POI compared to base year. During the same period, the market share of
imports from the subject countries increased by *** %. This trend clearly indicates that
imports from the subject countries are capturing the market share of the domestic industry
by selling at dumped prices.
95. It is noted that the market share of subject countries has declined in the POI compared to
2022-23, however, the market share of subject countries continues to remain above the
base year and 2021-22 levels.
96. Other interested parties have also contended that decline in domestic industry’s sales
during the POI is on account of increase in sales of other domestic producers. The
Authority notes that non-captive sales of the domestic industry and other Indian producers
have increased in the POI compared to 2022-23. The domestic industry has explained that
the same was on account of imposition of QCO during the POI. Moreover, compared to
2021-22, the increase in sales of other domestic producers was not significant in relation to
the overall decline suffered by the domestic industry and did not correspond to the sharp
rise in the volume of dumped imports from the subject countries.
97. Further, when compared with 2021-22 i.e., a period in which demand levels were similar
to the POI, the Authority notes that market share of the Indian Industry has indeed
declined whereas market share of subject countries have increased in the POI, which
establishes that the Indian Industry has collectively lost market share to dumped imports
from the subject countries.
c) Inventories
98. Inventory position of the domestic industry over the injury period is given in the table
below:
Inventory
+-----------------+-------+-----------+-----------+-----------+-------+
| Particulars | UoM | 2020-21 | 2021-22 | 2022-23 | POI |
+=================+=======+===========+===========+===========+=======+
| Average Inventory| MT | *** | *** | *** | *** |
+-----------------+-------+-----------+-----------+-----------+-------+
| Trend | Index | 100 | 72 | 87 | 98 |
+-----------------+-------+-----------+-----------+-----------+-------+
99. It is noted that inventory declined until 2022-23 after which it increased and has reached
almost base year level.
d) Profitability, cash profits and return on capital employed
100. Profitability, return on investment and cash profits of the domestic industry over the
injury period are given in the table below:
Profitability Parameters
+--------------------------+-------+-----------+-----------+-----------+-------+
| Particulars | UoM | 2020-21 | 2021-22 | 2022-23 | POI |
+==========================+=======+===========+===========+===========+=======+
| Cost of Sales | ₹/MT | *** | *** | *** | *** |
+--------------------------+-------+-----------+-----------+-----------+-------+
| Trend | Index | 100 | 149 | 187 | 142 |
+--------------------------+-------+-----------+-----------+-----------+-------+
| NSR | ₹/MT | *** | *** | *** | *** |
+--------------------------+-------+-----------+-----------+-----------+-------+
| Trend | Index | 100 | 137 | 126 | 119 |
+--------------------------+-------+-----------+-----------+-----------+-------+
| PBT | ₹/MT | *** | *** | (***) | *** |
+--------------------------+-------+-----------+-----------+-----------+-------+
| Trend | Index | 100 | 82 | (170) | 5 |
+--------------------------+-------+-----------+-----------+-----------+-------+
| PBIT | ₹/MT | *** | *** | (***) | *** |
+--------------------------+-------+-----------+-----------+-----------+-------+
| Trend | Index | 100 | 78 | (104) | 25 |
+--------------------------+-------+-----------+-----------+-----------+-------+
| PBDIT | ₹/MT | *** | *** | (***) | *** |
+--------------------------+-------+-----------+-----------+-----------+-------+
| Trend | Index | 100 | 65 | (44) | 60 |
+--------------------------+-------+-----------+-----------+-----------+-------+
| Cash Profit | ₹/MT | *** | *** | (***) | *** |
+--------------------------+-------+-----------+-----------+-----------+-------+
| Trend | Index | 100 | 64 | (69) | 56 |
+--------------------------+-------+-----------+-----------+-----------+-------+
| PBIT as % of Average | % | *** | *** | (***)% | *** |
| Capital Employed (ROCE) | | | | | |
+--------------------------+-------+-----------+-----------+-----------+-------+
| Range | % | 0-10 | 0-10 | (10)-0 | 0-10 |
+--------------------------+-------+-----------+-----------+-----------+-------+
101. From the above, it is seen that:
a. The selling price of the domestic industry has declined in the POI vis-à-vis year
2021-22 and 2022-23.
b. The profitability and return on capital employed of the domestic experienced a
significant decline until 2022-23, after which a slight improvement was observed. The
applicant has submitted that during the POI, the Government of India imposed a
Quality Control Order on the PUC. Consequently, imports decreased marginally,
leading to a slight improvement in the profitability of the domestic industry compared
to the previous year, during which the domestic industry incurred substantial losses.
c. The applicant further submitted that the imposition of the QCO is not a
comprehensive remedy for addressing the injury suffered by the domestic industry, as
the majority of exporters have already obtained the necessary certifications to continue
exporting to India. Consequently, while the QCO may have temporarily resulted in very
light decrease in imports, it does not address the fundamental issue of imports coming
at low prices, which continues to exert pressure on the domestic industry’s
performance.
102. Other interested parties have argued that decline in profitability is on account of domestic
industry’s procurement of ethane from its related party, RIL USA Inc., since 2022-23. It
has also been stated that RIL’s procurement price of ethane as reported through market
intelligence is much higher than export price of ethane from USA. To examine the same,
the Authority called for purchase invoices of ethane for the entire injury period. Based on
examination of the same, the Authority notes that the domestic industry’s ethane prices are
based on international benchmarks and the domestic industry was using the same
benchmark for procurement from other unrelated sources prior to 2022-23. The
commission and other charges are also in the same range. As regards the change in
depreciation, the Authority has verified the same and wherever need appropriate
adjustments have been made.
103. Equate Group has argued that there is no correlation between the decline in profitability
of domestic industry and the landed value as despite increase in landed value in 2021-22,
domestic industry’s profitability declined. The Authority notes that between 2020-21 and
2021-22, the domestic industry was able to increase its prices commensurate to the
increase in landed price. However, the landed price of subject imports did not increase
commensurate to the increase in the cost of sales of the domestic industry. Accordingly,
domestic industry’s profits had declined.
104. Other interested parties have also cited RIL’s investor presentation to argue that injury is
not on account of dumped imports but due to global overcapacity. The Authority notes that
investor presentations are consolidated corporate communications intended for
shareholders, whereas injury examination is carried out based on verified product-specific
cost data submitted by the domestic industry. Thus, isolated statements in investor
presentations are not determinative regarding the existence or non-existence of injury.
e) Employment, productivity and wages
105. The position with regard to employment, wages and productivity of the domestic industry
is as follows:
Labour and Productivity Parameters
+----------------------+---------+-----------+-----------+-----------+-------+
| Particulars | UoM | 2020-21 | 2021-22 | 2022-23 | POI |
+======================+=========+===========+===========+===========+=======+
| No. of Employees | Nos. | *** | *** | *** | *** |
+----------------------+---------+-----------+-----------+-----------+-------+
| Trend | Index | 100 | 93 | 96 | 95 |
+----------------------+---------+-----------+-----------+-----------+-------+
| Wages | ₹ Lakhs | *** | *** | *** | *** |
+----------------------+---------+-----------+-----------+-----------+-------+
| Trend | Index | 100 | 95 | 80 | 92 |
+----------------------+---------+-----------+-----------+-----------+-------+
| Productivity/day | MT/day | *** | *** | *** | *** |
+----------------------+---------+-----------+-----------+-----------+-------+
| Trend | Index | 100 | 97 | 86 | 80 |
+----------------------+---------+-----------+-----------+-----------+-------+
106. It is noted that the number of employees and their wages decreased in the POI compared
to base year.
107. Productivity per day and productivity per employee have consistently declined throughout
the injury period as a result of decrease in the production of the domestic industry.
f) Growth
Growth
+-------------+-----------+-----------+-----------+-------------------+
| Particulars | 2021-22 | 2022-23 | POI | In relation to |
| | | | | base year |
+=============+===========+===========+===========+===================+
| Production | (***) | (***) | (***) | (***) |
+-------------+-----------+-----------+-----------+-------------------+
| Domestic | *** | (***) | *** | (***) |
| Sales | | | | |
+-------------+-----------+-----------+-----------+-------------------+
| Profit | (***) | (***) | *** | (***) |
+-------------+-----------+-----------+-----------+-------------------+
| ROCE | (***) | (***) | *** | (***) |
+-------------+-----------+-----------+-----------+-------------------+
108. From the above, the Authority notes the domestic industry’s production and sales have
declined in the POI. The domestic industry’s profitability has also registered a negative
growth. Further, as compared to FY 2021-22 the domestic industry’s profits have declined
substantially. Although the figures pertaining to ROCE have shown improvement in the
POI compared to 2022-23, the Authority notes that ROCE has significantly declined
compared to base year.
g) Impact on the ability to raise capital investment
109. The domestic industry has submitted that it has not been able to earn adequate return on
profits and therefore, its ability to raise capital investments has been impaired
significantly. It has also been asserted that on account of dumped imports no new
investment is being planned as the domestic producers have not been able to earn
adequate return on the investments already made.
h) The magnitude of dumping
110. The dumping margin from the subject countries is above de-minimis level and is
considered significant.
111. In view of the foregoing, the Authority concludes that the domestic industry has suffered
material injury on account of dumped imports from the subject countries.
J.2.Threat of material injury
112. In addition to its claim of material injury, the domestic industry has also asserted that
imports of subject goods from the subject countries further threaten to materially injure the
domestic industry. The applicants have provided data based on PCI WoodMackenzie
regarding the consumption, production and sales of the subject countries.
Production, Demand and Capacities in Subject Countries
+---------------------------+-------+-------+-------+-------+
| Particulars | 2021 | 2022 | 2023 | 2024 |
+===========================+=======+=======+=======+=======+
| Subject Countries | *** | *** | *** | *** |
| Production | | | | |
+---------------------------+-------+-------+-------+-------+
| Trend | 100 | 112 | 111 | 113 |
+---------------------------+-------+-------+-------+-------+
| Subject Countries | *** | *** | *** | *** |
| Capacities | | | | |
+---------------------------+-------+-------+-------+-------+
| Trend | 100 | 105 | 105 | 105 |
+---------------------------+-------+-------+-------+-------+
| Idle Capacities | *** | *** | *** | *** |
+---------------------------+-------+-------+-------+-------+
| Trend | 100 | 80 | 82 | 77 |
+---------------------------+-------+-------+-------+-------+
| Subject Countries | *** | *** | *** | *** |
| Demand | | | | |
+---------------------------+-------+-------+-------+-------+
| Trend | 100 | 104 | 101 | 106 |
+---------------------------+-------+-------+-------+-------+
| Indian demand | *** | *** | *** | *** |
+---------------------------+-------+-------+-------+-------+
| Trend | 100 | 123 | 135 | 122 |
+---------------------------+-------+-------+-------+-------+
| Idle Capacity as% of Indian demand | *** | *** | *** | *** |
+---------------------------+-------+-------+-------+-------+
| Range | 110-120| 70-80 | 70-80 | 70-80 |
+---------------------------+-------+-------+-------+-------+
Source: PCI Wood Mackenzie Report
113. It is noted that the subject countries have maintained significant idle capacities during the
period 2021 to 2024. Though there has been a marginal decline in idle capacities from ***
million MT in 2021 to *** million MT in 2024, such idle capacities continue to remain
substantial. The domestic demand in the subject countries is negligible in comparison to
their capacities. This indicates that more than 95% of the production in the subject
countries is surplus to domestic requirements, thereby making them structurally export-oriented. The increasing Indian demand, coupled with negligible domestic demand in the
subject countries, makes India a natural ground for the surplus production of the subject
countries.
114. The Applicants have also claimed that China, one of the major markets for the subject
countries, has also achieved self-sufficiency in terms of production of MEG and
accordingly, exports would further be diverted from the subject countries to India. Further,
the Authority has also examined the volumetric information provided by the participating
exporters from the subject countries in Appendix-1 of their individual questionnaire
response. In case of Kuwait, the Authority notes that production of subject goods has
increased in the POI compared to 2022-23, and export sales to India have also increased
and reached their highest levels in the POI. Moreover, exports sales to third countries have
declined in the POI. It may be noted that these sales also include trading sales made by
Equate Group. Further, exports to India constitute almost 53% of total production by
Equate Group.
115. In case of Saudi Arabia, the Authority notes that producers participating in the present
investigation have provided market-wise sales information only for the POI. Accordingly,
the Authority has considered sales made by their related trader SABIC for this
examination. Based on the same, the Authority notes that exports of subject goods to India
and third countries, significantly increased in CY 2022 and then further increased in CY
2023, with a marginal decline in the POI for exports to India as well as third countries.
However, the rate of growth of exports to India over the injury period considerably
exceeded the growth rate of exports to third countries. Notably, the spike in exports to
India took place in CY 2022 which coincides with the period of imposition of anti-dumping duties on the SABIC Group concerning exports of the subject goods to the
European Union.
116. The applicants have also provided demand for MEG in third countries.
MEG Demand in third countries
+-------------+-------+-------+-------+-------+
| Particulars | 2021 | 2022 | 2023 | 2024 |
+=============+=======+=======+=======+=======+
| Demand | *** | *** | *** | *** |
+-------------+-------+-------+-------+-------+
| Trend | 100 | 99 | 101 | 107 |
+-------------+-------+-------+-------+-------+
117. It is noted that demand in third countries has remained relatively stable compared to India
which has exhibited significant growth in demand. Given the growing Indian demand, and
the rate of growth of exports of subject goods from the subject countries to India, the
Authority considers that exports of subject goods from the subject countries, would be
diverted to the Indian market.
118. The Authority notes that producers in the subject countries maintain significant surplus
and idle capacities, far in excess of their limited domestic demand, rendering them
structurally export-oriented. Idle capacities alone are equivalent to a substantial share of
Indian demand. Further, on account of imposition of trade remedial measures by European
Union, there are limited markets for such exports. At the same time, Indian demand has
continued to grow, making India an attractive destination for exports.
J.3. Overall Assessment of Injury
119. The examination of the imports of the subject goods and the performance of the
domestic industry shows the following:
i. Imports of subject goods from the subject countries have remained at consistently
high levels throughout the injury period. Even though there was a marginal decline
in the POI compared to 2022–23, import volumes in the POI were substantially
higher than in 2020-21 and 2021-22.
ii. The landed value of subject imports declined significantly during 2022–23 and the
POI. This decline, coupled with large import volumes, exerted continuous
downward pressure on the domestic selling prices.
iii. Subject imports have undercut the prices of the domestic industry and have also
suppressed and depressed its selling prices, preventing the domestic industry from
raising prices commensurate with its costs.
iv. Compared to the base year and 2021-22, the domestic industry’s production,
capacity utilisation, and sales volumes have declined despite growth in demand,
reflecting the inability of the industry to increase output due to the presence of
dumped imports. Although, domestic industry’s parameters have marginally
improved in the POI compared to 2022-23, its market share continues to remain at
low levels compared to 2021-22, while subject countries have captured a
significant portion of demand.
v. The financial performance of the domestic industry has deteriorated considerably.
Profits, cash profits, and return on capital employed turned negative in 2022–23.
There was minor improvement in the POI compared to 2022-23, but the domestic
industry has been earning non-remunerative returns and profits.
vi. Inventories of the domestic industry have increased during the POI.
vii. The subject countries maintain very large production capacities far in excess of
their domestic demand, with idle capacities alone equivalent to 73% of Indian
demand. The producers in the subject countries are structurally export-oriented.
viii. The combination of substantial idle capacities in the subject countries, absence of
significant domestic demand in those countries, restrictions in other major
markets, and growing Indian demand establishes that India is a natural target for
the exporters from the subject countries, creating a real and imminent threat of
further injury.
I. MAGNITUDE OF INJURY MARGIN
120. The Authority has determined the NIP for the domestic industry on the basis of principles
laid down in AD Rules read with Annexure III, as amended. The NIP of the product under
consideration has been determined by adopting the information/data relating to the cost of
production provided by the domestic industry. The NIP has been considered for comparing
the landed price from the subject country for calculating injury margin. For determining
the NIP, the best utilisation of the raw materials and utilities has been considered over the
injury period. Best utilisation of production capacity over the injury period has been
considered. Extraordinary or non-recurring expenses have been excluded from the cost of
production. A reasonable return (pre-tax @ 22%) on average capital employed (i.e.,
average net fixed assets plus average working capital) for the product under consideration
was allowed as pretax profit to arrive at the NIP as prescribed in Annexure III to the AD
Rules.
121. The landed price for the cooperative exporters has been determined on the basis of the
data furnished by the exporters. For all the non-cooperative producers/exporters from the
subject countries, the Authority has determined the landed price based on facts available.
I.1. Injury Margin for related producers and exporters
122. In accordance with the above, related producers and exporters have been regarded as one
single entity and attributed one single injury margin which was calculated on the basis of
the weighted average of the injury margins of the cooperating related producers and
exporters.
123. Based on the landed price and the NIP determined as above, the injury margin as
provisionally determined by the Authority is provided in the table below.
Injury Margin Table
+-----------------------------+--------------+--------------+--------------+--------------+--------------+
| Producer | Non Injurious| Landed Price | Injury Margin| Injury Margin| Injury Margin|
| | Price ($/MT) | ($/MT) | ($/MT) | (%) | Range (%) |
+=============================+==============+==============+==============+==============+==============+
| KUWAIT | | | | | |
+-----------------------------+--------------+--------------+--------------+--------------+--------------+
| Equate Petrochemical Company| *** | *** | *** | *** | 20-30 |
+-----------------------------+--------------+--------------+--------------+--------------+--------------+
| The Kuwait Olefins Co. | *** | *** | *** | *** | 20-30 |
+-----------------------------+--------------+--------------+--------------+--------------+--------------+
| Equate Group Weighted | *** | *** | *** | *** | 20-30 |
| Average | | | | | |
+-----------------------------+--------------+--------------+--------------+--------------+--------------+
| Others | *** | *** | *** | *** | 30-40 |
+-----------------------------+--------------+--------------+--------------+--------------+--------------+
| Saudi Arabia | | | | | |
+-----------------------------+--------------+--------------+--------------+--------------+--------------+
| Arabian Petrochemical Company| *** | *** | *** | *** | 20-30 |
+-----------------------------+--------------+--------------+--------------+--------------+--------------+
| Eastern Petrochemical Company| *** | *** | *** | *** | 20-30 |
+-----------------------------+--------------+--------------+--------------+--------------+--------------+
| Jubail United Petrochemical | *** | *** | *** | *** | 20-30 |
| Company | | | | | |
+-----------------------------+--------------+--------------+--------------+--------------+--------------+
| Saudi Kayan Petrochemical | *** | *** | *** | *** | 20-30 |
| Company | | | | | |
+-----------------------------+--------------+--------------+--------------+--------------+--------------+
| SABIC Group Weighted | *** | *** | *** | *** | 20-30 |
| Average | | | | | |
+-----------------------------+--------------+--------------+--------------+--------------+--------------+
| Others | *** | *** | *** | *** | 30-40 |
+-----------------------------+--------------+--------------+--------------+--------------+--------------+
| Singapore | | | | | |
+-----------------------------+--------------+--------------+--------------+--------------+--------------+
| Others | *** | *** | *** | *** | 20-30 |
+-----------------------------+--------------+--------------+--------------+--------------+--------------+
J. NON-ATTRIBUTION ANALYSIS AND CAUSAL LINK
124. The Authority examined whether other factors listed under the anti-dumping Rules could
have caused injury to the domestic industry. The Authority examined known factors other
than the dumped imports and ascertained whether these at the same time have been
injuring the domestic industry, so that the injury caused by other factors, if any, is not
attributable to the dumped imports. Factors which are relevant in this respect include, inter
alia, the volume of subject goods not sold at dumped prices, contraction in demand or
changes in the pattern of consumption, trade restrictive practices, changes in technology,
the export performance of the domestic industry and the productivity of the domestic
industry.
a) Volume and value of imports from third countries
125. It is noted that imports from non-subject countries are negligible by the way of volume.
The imports from the subject countries constitute around 1% of the imports in India.
Therefore, the injury caused cannot be attributed to the third countries.
b) Contraction in demand
126. The Authority notes that the demand for the subject goods increased until FY 2022-23.
There was marginal decline in demand during the POI. However, demand levels continue to
be above the base year and 2021-22 levels. Accordingly, the Authority considers that the
domestic industry has not suffered injury due to a contraction in demand.
c) Pattern of consumption
127. It is noted that there has been no material change in the pattern of consumption of the
product under consideration, which could have caused injury to the domestic industry.
d) Conditions of competition and trade restrictive practices
128. The Authority notes that there is no evidence of conditions of competition or trade
restrictive practices that could have been responsible for the claimed injury to the domestic
industry.
e) Developments in technology
129. The Authority notes that there has been no change in technology for the production of
the subject goods that could have caused injury to the domestic industry.
f) Export performance of the domestic industry
130. The injury information examined hereinabove relates only to the performance of the
domestic industry in terms of its domestic market. Moreover, the domestic industry has not
exported the PUC during POI. Thus, the injury suffered cannot be attributed to the export
performance of the domestic industry.
g) Performance of other products
131. The Authority has considered the data relating only to the performance of the subject
goods. Therefore, the performance of other products produced and sold is not a possible
cause of injury to the domestic industry.
J.1. Factors establishing causal link
132. While other known factors listed under the Rules have not caused injury to the domestic
industry, the Authority notes that the following parameters show that injury to the domestic
industry is caused by dumped imports.
i. The subject imports from each of the subject countries are being dumped above the
de-minimis threshold, and cumulative assessment has been found appropriate as
imports from each country exceed the de-minimis volume thresholds.
ii. Volume of subject imports from the subject countries has remained consistently
high and, despite a decline in the POI compared to 2022-23, account of 99% of
total imports into India and account for more than *** % of the Indian demand.
Between 2021-22 and the POI, imports increased by 16% while demand grew only
*** %.
iii. The volumes of subject imports from subject countries have also increased in
relation to the consumption and production of the domestic industry.
iv. The landed value of subject countries is lower than the NSR, yielding positive price
undercutting in the POI.
v. Since 2022-23, landed prices of subject countries have fallen while volumes of
subject imports continue to remain high. Further, the domestic industry’s NSR has
followed the same downward trend, demonstrating price suppression and
depression. During the POI, the domestic industry was forced to sell near cost and
could not raise prices in line with costs.
vi. The domestic industry accounted for *** % market share in the POI. Though there
has been marginal improvement compared to 2022-23, the same continues to remain
well below 2020-21 and 2021-22 levels.
vii. The domestic industry profitability parameters have significantly declined in the POI
compared to the base year. The profits have reduced to less than 1% whereas ROCE
has reduced to *** %.
133. The Authority, in view of the aforementioned, concludes that there exists a causal link
between the dumping of the subject goods and injury to the domestic industry.
K. INDIAN INDUSTRY’S INTEREST & OTHER ISSUES
K.1 Submissions of other interested parties
134. The following submissions have been made by the other interested parties:
a. MEG is mixed with purified terephthalic acid (“PTA”) to prepare a mixture known as
melt, which is used in the production of synthetic yarn. MEG accounts for 23.40% of cost
of melt and imposition of anti-dumping duty would have significant impact on the
downstream industry.
b. Imposition of 20%-30% anti-dumping duties would increase MEG prices by Rs. 5.10/kg.
If duties are imposed on MEG, Indian manufacturing industry will not be able to expand
their operations as it would not be able to procure MEG at international prices.
c. Ministry of Finance had acknowledged the adverse impact of duties on PTA and had
accordingly, terminated the duties before the expiry of five years.
d. The applicant has not provided non-confidential version of how impact of 0.3% as alleged
has been computed. Relatively small cost increases at each stage of production and
distribution can compound, especially in industries operating on thin margins.
e. The PUC, a critical input for polyester fibers, textiles, and various downstream industries,
is essential for sectors like packaging, cosmetics, and EV batteries. India's domestic
production is insufficient, with over 70% captively consumed, necessitating imports to
meet demand. Anti-dumping duties on PUC could significantly increase costs for
downstream industries, making polyester textiles and PET packaging more expensive,
exacerbating the inverted duty structure, and affecting competitiveness. This would impact
over 40,000 small and medium manufacturers, threaten jobs, and hinder India's EV goals
by raising lithium-ion battery costs. Overall, imposition of anti-dumping duty could
negatively affect multiple sectors of the Indian economy.
f. The imposition of anti-dumping duties would adversely impact the entire textile sector,
already under price pressure. The applicant uses substantial portion of MEG captively for
end products, other producers would face a disadvantage, forced to compete with the
applicant and imported MEG while purchasing expensive raw materials.
g. The imposition of anti-dumping duties would significantly increase manufacturing costs
for polyester staple fibre (“PSF”) due to higher landed costs and a substantial domestic
supply shortage, despite the domestic industry operating near full capacity. Additionally,
domestic MEG prices are expected to rise in tandem with ADD, further inflating costs
across the man-made fibre value chain. This would exacerbate the pricing pressure already
faced by the Indian PSF and downstream industries from cheaper imports, making them
less competitive, risking business closures, and leading to potential job losses. For a low-margin business like PSF, an ADD of $100/MT would raise raw material costs by
₹2,530/MT, creating a significant financial burden and threatening the viability of the
sector.
h. The imposition of anti-dumping duties on imports will raise costs for downstream
products, reducing their competitiveness in domestic and export markets. Buyers may face
limited procurement options, potentially creating a monopolistic scenario due to the
already small number of suppliers. This would exacerbate challenges for the distressed
textile industry. Additionally, product availability is further constrained by the lack of
Bureau of Indian Standards certification among producers of the PUC.
i. Imposing anti-dumping duties on PUC, a key raw material for textiles, will raise domestic
prices, increasing production costs for textile yarns. This will lead to lower demand,
reduced production rates, and pressure on profit margins. Consequently, textile prices will
rise in domestic markets, weakening the sector's competitiveness internationally. With
PUC in short supply, domestic manufacturers will align their prices with those of imports,
further escalating costs.
K.2 Submissions on behalf of the domestic industry
135. The following submissions have been made on behalf of the domestic industry:
a. The Indian MEG industry is not a monopoly, as is evidenced by the two other significant
producers in India (IGL and IOCL) and particularly, by IOCL’s recent expansion of its
capabilities. The real threat to competition in the industry is the significant dumping,
which has raised the barrier for entry of any other new entrants; and is also prohibiting the
existing players from making any further investment in the industry.
b. The subject goods are primarily used to manufacture polyester-based clothing and PET
bottles. Detailed calculations in respect of anti-dumping duties have already been
submitted which clearly establishes that the impact of the anti-dumping duties of around
50 USD/MT on the end user would be 0.3 % or less.
c. During the course of oral hearing, certain interested parties/ user industries claimed that
the impact of ADD would be in the range of 15% on polyester staple fibre (“PSF”), if a
duty of 30% is imposed.
d. The Applicant submits being an intermediate raw material, the impact of 4.28 % can be
easily passed on to the next stage consumers by the PSF suppliers. The duties become cost
only in the hands of the ultimate end-consumers, on whom the impact of duties would,
undisputedly, not more than 0.3%.
e. The impact of anti-dumping duties on the immediate downstream product and the end
product is minimal.
f. Notwithstanding the gross incorrectness of the calculation, the Polyester Textile
Industries Association has suggested to assess the impact on “MELT”, a product which is
not even sold commercially in the market. Accordingly, the applicant requests the
Authority to disregard these submissions.
K.3 Examination by the Authority
136. The Authority issued initiation notification inviting views from all interested parties,
including importers, consumers and other interested parties. Further, the Authority also
requested the users/ consumers to provide relevant information concerning present
investigation including the likely impact of imposition of anti-dumping duties on end users,
substitutability of PUC, price-sensitivity of demand, long term contracts etc. The Authority
notes that several users of the subject goods have participated in the present investigation.
The user industry has highlighted the following issues in their response:
a. Beekaylon, Garden Silks, DNH, Sanathan and Wellknown have stated that the PUC
is already subject to 18% GST and highlighted that there is a tax differential
between the raw material MEG and the end product, man-made fibres. Imposition of
anti-dumping duties would further compound the problem.
b. Beekaylon, Garden Silks, DNH, Sanathan and Wellknown have also stated that they
are not aware of anti-competitive or discriminatory behaviour by producers of PUC
in India.
c. Beekaylon, Garden Silks, DNH, Sanathan and Wellknown have highlighted that
there would be a supply shortage of PUC in India in case of imposition of duties.
d. Filatex has stated that the profit margins in Textile Industry are very less and
imposition of duties on import of PUC will further reduce profits of the downstream
industries to bare minimum which will not be sufficient for survival of such
industries.
e. Indorama Synthetics has stated that the demand for MEG is more than production
capacity in India. Therefore, majority of the producers are dependent on imports of
PUC. Imposing an anti-dumping duty on the PUC will make the textile market
uncompetitive.
f. Bombay Dyeing has submitted that the Indian PSF industry and the downstream
man-made fibre chain is already facing tremendous pricing pressure from cheap
imports from countries like China and imposition of ADD will lead to increased
costs for PSF producers.
g. PTA users association has contended that MEG constitutes 23.40% of cost of
“polyester melt”. Therefore, imposition of ADD will have significant impact on
downstream product.
h. Bhilosa Industries has submitted that man-made fibre industry operates on thin
profit margin and in case of imposition of duties, the company would have no other
option than to pass on increased costs to downstream users. It has also stated that a
30% duty margin would lead to a 10-15% impact on PSF (an intermediate product).
137. The domestic industry has also provided calculation of impact of ADD on the end
consumer after considering the impact of ADD on the end product, which it has estimated
as less than 1%. The domestic industry has also disputed the calculation provided by
Bhilosa Industries concerning impact of ADD and has submitted that PSF is an intermediate
product. The maximum impact of ADD on PSF would be 4%, which can be easily passed to
the end consumers.
138. The Authority notes that the objective of imposing trade remedial measures is not to
restrict imports but to remove the injury caused to the domestic industry from unfair trade
practices and to establish fair competition in the Indian market. The Authority is indeed
aware that the impact of such duties is not limited to only the domestic producers of the
PUC but also affects the users and consumers of the PUC. While the imposition of duties
may introduce competition concerns domestically but it can also concurrently stimulate the
emergence of new producers or further investments within the country.
139. The Authority notes that imposition of trade remedial measures are intended to restore a
level playing field for domestic producers while ensuring that downstream users continue to
have access to the subject goods at fair and non-injurious prices The Authority notes that
continuous and unabated unfair trade practices would adversely impact the prices and state
of the domestic industry, discouraging future investments in critical petrochemical capacity,
thereby undermining India’s long-term self-reliance. Thus, imposition of trade remedial
measures not only enables the domestic industry to compete on equal terms but also de-risks the users from supply chain disruptions enabling the user industry to procure the
subject goods from several sources more competitively in the long run.
140. Based on the response and submissions provided by the interested parties, the Authority
notes that the user industry is presently facing difficulties on account of differential GST on
the PUC and end product and have highlighted the same to Ministry of Textiles. The
Authority further notes that none of the users have pointed out to any anti-competitive
practices or discriminatory treatment by Indian producers of the PUC.
141. Other interested parties have contended that profit margins in textile industry are very
less and imposition of duties will impact their profitability.
142. With regard to polyester staple fibre, the Authority has examined the calculation
submitted by Bhilosa Industries and found them to be inaccurate. For example, when
computing impact of ADD on PSF, the user industry has expressed the proposed ADD on
MEG as % of total value of finished product, clearly ignoring the fact that increase in prices
of MEG on account of ADD would only impact the cost attributable to MEG, which
constitutes only 16% of the total value of PSF. The same has been illustrated below.
+-------------------------------------+------------------+-----------+
| Particulars | Computation Method | Values |
+=====================================+==================+===========+
| Price of MEG (Rs./MT) | A | 43,987 |
+-------------------------------------+------------------+-----------+
| Price of PSF (Rs./MT) (as provided | B | *** |
| by Bhilosa Industries) | | |
+-------------------------------------+------------------+-----------+
| % of MEG in PSF (as provided by | C | *** |
| Bhilosa Industries) | | |
+-------------------------------------+------------------+-----------+
| Anti-dumping duty (Only Example) | D | *** |
| (*** $./MT) | | |
+-------------------------------------+------------------+-----------+
| ADD Impact on PSF (as alleged by | E=D/B | *** |
| users) computed as ADD/Value of | | |
| Finished Product | | |
+-------------------------------------+------------------+-----------+
| MEG Cost in PSF (Rs./MT) | F=C*B | *** |
+-------------------------------------+------------------+-----------+
| Impact of ADD on MEG Cost (Rs./MT) | G= F * (D/A) | *** |
+-------------------------------------+------------------+-----------+
| Impact on PSF | I = G/B | 3.6% |
+-------------------------------------+------------------+-----------+
143. Thus, impact of imposition of ADD on PSF, an intermediate product can only be 3.6%. It
is noted that the impact of duties, if imposed, will not be significant. It is further noted that
none of the users have contended that they cannot pass on this cost to end consumers.
Moreover, none of the other interested parties have provided the impact of ADD impact on
the end consumer. and provided calculation concerning the impact of ADD on immediate
downstream products such as PSF and intermediate products such as polyester melt.
However, none of the users have provided impact of ADD on the end product.
144. On the other hand, the domestic industry has submitted computation for impact of ADD
on different end consumer products, namely PET bottles and garments (men’s shirts and
women’s sarees). The same has been illustrated below:
End Product
| Particulars | UoM | Drinking Water | Carbonated Drink | UoM | Men's Shirt | Saree |
| :---------- | :-- | :------------- | :--------------- | :-- | :---------- | :---- |
| Volume / Length | ml | 1000 | 750 | m | 2.5 | 6 |
| Retail Price | Rs | 20 | 40 | Rs | 350 | 300 |
| Polyester GSM | gm/m | NA | NA | gm/m | 110 | 90 |
| Weight | gm | 18 | 25 | gm | 275 | 420 |
| MEG Norm | kg/kg | 0.35 | 0.35 | kg/kg | 0.35 | 0.35 |
| MEG Price | Rs/kg | 44.00 | 44.00 | Rs/kg | 44.00 | 44.00 |
| MEG in end | gm | 6.3 | 8.75 | gm | 96.25 | 147 |
| product | | | | | | |
| MEG value in| Rs | 0.28 | 0.39 | Rs | 4.24 | 6.47 |
| end product | | | | | | |
| MEG % in End| % | 1.4% | 1.0% | % | 1.2% | 2.2% |
| Product | | | | | | |
| MEG ADD Rate| $/MT| *** | *** | $/MT| *** | *** |
| MEG ADD Rate| Rs/kg| *** | *** | Rs/kg| *** | *** |
| MEG ADD | Rs | 0.06 | 0.09 | Rs | 0.95 | 1.45 |
| Impact | | | | | | |
| Impact % end| % | 0.31% | 0.22% | % | 0.27% | 0.48% |
| product price| | | | | | |
145. Based on the above, the Authority notes that imposition of ADD would have an impact of
less than 1% impact on end product price which it considers can easily be passed on to the
end consumers.
146. Other interested parties have also commented that imposition of ADD will lead to
monopoly of RIL in the country. The Authority notes that apart from RIL, there are two
other producers of MEG in India, namely IOCL and IGL. IOCL has recently carried out an
expansion of MEG at its Panipat Plant and has also operationalized new MEG plant at
Paradip Complex. Further, based on response of the user industry, the Authority notes that
the Indian users have purchased PUC from both RIL and IOCL in significant quantities.
147. Other interested parties have also contended that they are already under pressure due to
cheap imports of downstream products from China and that imposition of ADD will only
further aggravate the situation. The Authority notes that imports of PET Resin, a
downstream product, from China are already subject to anti-dumping duties. Further, if
imports of other downstream products are being dumped in India, they may approach this
Authority for appropriate remedy.
148. The other interested parties have contended that due to imposition of QCO on the subject
goods, access to Indian market has been restricted, limiting MEG supply to India, which
would further be exacerbated with imposition of anti-dumping duties. The Authority notes
that the QCO is a regulatory measure, intended to ensure the quality and safety of imports
and domestic production and sales, advancing the interest of user industry and does not
prevent imports from subject countries or elsewhere. Further, none of the participating
exporters have claimed that they have not received the requisite certification.
149. The other interested parties have also pointed out that there exists significant demand
supply gap for the PUC in India. As examined in sections above, subsequent to the
commissioning of IOCL’s new capacity at the end of the POI, the Authority notes that there
exists sufficient capacity to cater to the growing Indian demand. Further, imposition of
ADD would not in any manner prevent imports of subject goods from subject countries into
India, but only correct prices ensuring fair competition in the Indian market. Moreover,
such goods can also be imported from non-subject countries, thereby, making the Indian
MEG market more competitive.
L. POST-DISCLOSURE SUBMISSIONS
L.1 Submissions by other interested parties
150. The following submissions have been made by the other interested parties:
i. The Authority has not analysed imports made by RIL during the entire injury
investigation period, including post-POI, neglecting the full impact of such
imports on the injury determination.
ii. Reliance on IGL’s data is misplaced as it has not provided cost or injury data.
India Glycol Limited has not filed information as per Trade Notice No. 13/2018
and 14/2018.
iii. The Authority lacks jurisdiction to entertain the present anti-dumping application.
iv. The principle of lesser duty rule requires the Authority to impose the lowest of the
weighted average / individual producer’s dumping margin and injury margin.
v. The Authority in para 46 (a) of the disclosure statement has indicated that it has
accepted Sharq’s cost of production but it has not mentioned that whether costs
reported by other producers have been accepted or not.
vi. The Authority has disregarded the actual data of the respondents even though such
data reconciles with records of the respondents and has been verified through
necessary system dump.
vii. The Authority has replaced the actual data of respondents with undisclosed
adjusted data without providing any justification.
viii. The cost of production for Equate and TKOC have been increased by *** % and
*** % respectively. For the same product and same company, the Authority did
not make any adjustments in the previous investigation. Given the absence of any
difference between the two investigations, the Authority should have accepted the
cost of production of the exporters as claimed by the exporters.
ix. The Authority has not disclosed essential facts to the respondents as required
under Rule 16 of Anti-dumping Rules, 1995 and is contrary to the decision of the
Panel in Russia – Commercial Vehicles. Manual of SOP requires detailed
disclosure of normal value with workings.
x. Art. 2.2.2 of the Agreement on Anti-dumping requires the Authority to compute
SGA and profit margin based on actual data of the exporters. The Authority has
made certain undisclosed adjustments to the exporter’s actual costs and thus, has
violated the principles of natural justice as laid down by the Hon’ble Supreme
Court, High Court and Tribunals.
xi. The SGA and profits determined by the Authority is far higher than actual data
maintained in records of the company. The Authority has not explained whether or
not the SGA & Profits adopted for the computation of the normal value exceeds
the profit normally realized by producers of the same general category of products
in the domestic market.
xii. The Authority should as per its practice adopt 5% profit margin for computing
normal value of exporters.
xiii. The Authority has seemingly added SGA costs twice for determining the normal
value for Petrokemya, Saudi Kayan and United.
xiv. The Authority should adjust the trader’s profit margin and indirect SGA must be
added to the export price.
xv. In China – HP- SSST (EU), the Appellate Body held that it is not sufficient for the
Authority to merely refer to the data which forms the basis for its computation, but
must disclose the data.
xvi. Art. 2.2.1.1 obliges the Authority to use the exporter’s records for calculation of
cost of production if such information meets the requirements laid down in the
article. In the present case, information provided exporters from SABIC fulfil such
conditions and therefore, the Authority should have relied on such information
unless it found compelling reasons to disregard such information.
xvii. The Authority should not disregard inventory adjustments while computing the
cost of production as such adjustments includes other adjustments such as
adjustments allowed ***.
xviii. The Authority has failed to call for data from other producers including IOCL and
thus, the Authority has not followed due process. Excluding IOCL’s data and
response undermines the objectivity of the injury and causation analysis.
xix. The user industry believes that IOCL is earning profits on the PUC. Accordingly,
respondents believe that IOCL’s performance in market contradicts injury claims
by the RIL.
xx. There is a steep decline in export sales of the PUC from FY 2021-22 when overall
demand of the PUC is on the rise globally since 2020-21 contributing to negative
economic parameters of RIL.
xxi. RIL accounts for 75-90% of market share, despite IOCL’s recent capacity
expansion. Injury analysis solely based on RIL’s performance cannot be
considered as representative of domestic industry.
xxii. If imports were the cause of injury, sales of other domestic producers would have
reduced in tandem with those of domestic industry. However, the divergence in
sales trends calls into question the causal link between the alleged dumping and
injury to the domestic industry.
xxiii. RIL imported 14,330 MT from Saudi Arabia and Singapore during POI and in
post-POI, it has imported 22,392 MT MEG from Saudi Arabia and USA.
xxiv. The Authority has considered 19% decline in volume of imports as insignificant
while referred to decline in 16% production as significant.
xxv. The Authority’s comparison with base year is incorrect as the same coincided with
COVID-19 pandemic when demand and supply were atypically depressed.
xxvi. The Authority has overlooked the fact that domestic industry’s sales have declined
despite decline in volume of imports, whereas sales of other domestic producers
have increased. Thus, imports are not the cause of injury.
xxvii. Price undercutting must be assessed for the entire injury period and not only the
POI.
xxviii. Imports from subject countries have not exerted sustained downward pressure on
during the injury period as import prices have indeed increased from 100 to 113 in
the POI. The volume of imports in POI has not increased compared to 2022-23,
but has rather declined
xxix. The domestic industry’s cost of sales has followed the trend of ethane prices.
Accordingly, decline in profitability is attributable to the increase in price of
ethane purchased from affiliate.
xxx. Profitability of domestic industry did not improve when import prices from
Kuwait increased in 2021-22 compared to 2020-21, but rather worsened. If
imports were truly responsible, domestic industry’s profitability would have
improved in 2021-22.
xxxi. Further, with decline in import prices in the POI, the domestic industry’s
profitability has improved, which further establishes that there is no causal link
between the alleged injury and imports.
xxxii. With respect to decline in Indian prices due to decline in international
benchmarks, the Authority has ignored the commodity cycle in chemicals.
xxxiii. With respect to market share, the Authority has dismissed the impact of other
Indian producers and held that the DI lost share to dumped imports. The data
shows that non-captive sales of both the Domestic Industry and other producers
increased in the POI compared to 2022–23 (from 84 to 156), reflecting
redistribution within Indian suppliers rather than capture by imports. To ignore
this element and attribute the entire decline of the applicant’s market share to
dumped imports is analytically unsound.
xxxiv. The Authority has concluded that profitability declined only because landed values
did not rise “commensurately” with the domestic industry’s costs. This logic
effectively shifts the burden of the Domestic Industry’s own cost increases onto
imports.
xxxv. The domestic industry has not disputed the respondent’s assertion that purchase of
ethane from affiliate is not at arm’s length and appears to be artificially inflated.
Merely asserting that ethane prices are based on international benchmark is
insufficient.
xxxvi. The domestic industry’s purchase price of ethane from its affiliate may be
examined to determine whether the same is at arm’s length.
xxxvii. The Authority’s dismissal of RIL’s investor presentations is unjustified. These
presentations are not casual statements but official disclosures made to
shareholders under strict corporate and securities law obligations, and they reflect
the company’s considered assessment of industry conditions.
xxxviii. The production of the Exporters from Kuwait increased by a mere *** % in the
POI when compared to 2022-23 and these were operating at near full capacity
utilization (i.e., *** %) in the POI.
xxxix. The existence of limited surplus capacity by itself is not sufficient to establish a
threat; producers in the Kuwait and the other Subject Countries export globally
and have diverse markets.
xl. The conclusion that exports to India constituted 53% of Equate Group’s
production is misleading. These exports include trading sales and reflect
longstanding supply relationships with Indian customers, not any sudden diversion
of surplus capacity. The fact that exports to third countries declined in the POI –
by a mere *** % does not indicate diversion to India; it is simply a reflection of
global trade.
xli. If Kuwait were truly seeking to offload surplus capacity into India, one would
expect a surge in import volumes during the POI. Instead, exports to India from
Kuwait actually declined from *** MT in 2022–23 to *** MT in the POI,
undermining the very basis of the Authority’s threat finding.
xlii. The Authority should adopt transfer price of captive inputs and not artificial prices
for determining NIP.
xliii. The expansion by IOCL only partially addresses the demand-supply gap as has
been admitted by IOCL on its website. There are supply constraints and users are
dependent and are forced to import.
xliv. RIL is not only the largest producer of the PUC but also the largest manufacturer
of downstream textile industry. Thus, RIL has significant control over the raw
material and PUC. There is an inherent and direct conflict of interest with other
downstream users. Imposition of ADD will only further interests of RIL as it
utilizes nearly 70% of its production for captive consumption.
xlv. Imposition of anti-dumping duty would burden textile industry and jeopardize
national economic growth and employment. Imposition of ADD would have the
effect of substantially curtailing access to imported MEG.
xlvi. The Authority has stated that MEG represents only ~16% of PSF value and has
presented a table showing a 3.6% impact, the precise assumptions and calculations
underlying these conclusions remain undisclosed. In particular, the methodology
adopted for allocating MEG costs, the values used for PSF pricing, and the
conversion norms applied are not revealed. This prevents parties from
meaningfully commenting on or verifying the correctness of the figures.
xlvii. The cumulative effect of ADD, GST differentials, and existing import duties will
materially worsen the cost structure of user industries. Ignoring this systemic
burden vitiates the Authority’s analysis.
xlviii. The Authority has summarily dismissed this concern regarding RIL’s monopoly
on the ground that other producers such as IOCL and IGL exist and have recently
expanded capacity. The Authority must recognize that a healthy and competitive
market structure is indispensable to the long-term interests of Indian downstream
industries and consumers.
L.2 Submissions on behalf of the domestic industry
151.The following submissions have been made on behalf of the domestic industry:
a. The Authority in para 26 of the disclosure statement has simply observed that each
investigation is to be carried out in view of the facts of that particular investigation.
However, it remains undisputed that the exporters from the subject countries in the previous
investigation were found to be dumping. Accordingly, the domestic industry requests the
Authority to conclude that exporters from the subject countries have been dumping subject
goods since 2020.
b. The domestic industry reiterates its submissions seeking rejection of user questionnaire
response of PTA Industries Association, Bombay Dyeing, Filatex India and Indorama
Synthetics. The user questionnaire response was circulated to the applicant only at the stage
of written submissions. Accordingly, we request the Authority to reject such submissions.
c. The Authority in para 33 of the disclosure statement has confirmed its previous findings
concerning the existence of PMS in KSA. However, the Authority has noted that there is
insufficient evidence on record to establish that such distortion affects comparability
between the export price and domestic price. Accordingly, the Authority did not carry out
any adjustments based on PMS allegation to the cost of production of producers from KSA.
d. The domestic industry recalls the Panel Report in Australia – A4 Copy Paper, wherein the
Panel had expressly acknowledged that even when the same distorted input is used to
manufacture goods for both domestic and export markets. Accordingly, it cannot be
presumed that PMS does not affect price comparability between the export price and
domestic price. Rather, the Authority should have carried out market- wise assessment of
profitability and examined the impact of raw material distortion across the different
segments prior to concluding that raw material distortion does not affect the price
comparability of the responding producers.
e. Based on para 47 of the disclosure statement, the domestic industry understands that the
Authority has considered the same distorted input price for determination of constructed
normal value for the responding producers. Having accepted that raw material price
distortion does exist in KSA’s market, the Authority should replace the distorted ethylene
and utility prices with undistorted prices within KSA for determination of constructed
normal value for computation of dumping margin.
f. The domestic industry has already provided prima facie evidence to substantiate the
existence of PMS in SOK, and the burden of proof accordingly shifts on the exporters from
SOK to demonstrate that PMS does not exist. It is reiterated the Government of Kuwait has
issued a royal decree allowing the two exporters from Equate Group to procure key
feedstock at significantly low rates. Therefore, the domestic industry requests the Authority
to recognize the existence of PMS in SOK as well, consistent with the Panel decision in
Australia – A4 Copy Paper and adjust the constructed normal value for producers in SOK to
reflect the undistorted input price.
g. The Authority has failed to consider the fact that the key raw material supplier for Equate
Group and SABIC Group is a related entity and therefore, even in absence of PMS, the
Authority ought to have examined whether such raw material prices are at arm’s length.
The domestic industry understands that none of these related suppliers have been called
upon to provide information relevant for such examination. Accordingly, the Authority
should consider the international market price of key raw materials, particularly ethylene,
for computation of constructed normal value.
h. The Authority has found positive evidence of Absolute and relative increase in imports,
positive and significant dumping from the subject countries, decline in volumetric and
financial parameters of the domestic industry, decline in the state of domestic industry is on
account of dumped imports from the subject countries and that the exporters in the subject
countries are structurally export-oriented, with more than 95% of domestic production
being surplus to domestic consumption in the subject countries.
i. While examining the profitability of the domestic industry, the Authority has ignored the
Order of the Hon’ble CESTAT in Reliance Industries Ltd. v. Designated Authority & Ors.
(Final Order No. 51370/2023), wherein relying upon the Supreme Court’s decision in
Reliance Industries v. UOI [2006 (202) E.L.T. 23 (S.C.)], it was held that for injury
assessment the Authority must consider the market price of captive inputs and not internal
transfer prices.
j. The aforementioned judgment of the Supreme Court was in relation to injury assessment as
well as for determination of NIP. The subsequent addition of Annexure-III to the AD Rules,
1995 for determination of NIP does not dilute or override the Supreme Court’s
interpretation of Annexure-II to the AD Rules, 1995, which continues to govern injury
examination.
k. The allowed NIP of the domestic industry is significantly lower than the NIP claimed by the
domestic industry. It is submitted that several unwarranted adjustments have been made to
the NIP. Accordingly, the domestic industry submits that the Authority should re-examine
the NIP of the domestic industry.
L.3 Examination by the Authority
152. The Authority has examined the post disclosure submissions made by the domestic industry
and the other interested parties and notes that several submissions are reiterations of issues
which have already been examined suitably and addressed adequately in the relevant paras
of the final findings. The issues raised for the first time in the post-disclosure
comments/submissions by the interested parties and the domestic industry and those backed
up with evidence have been considered relevant by the Authority are examined below.
153. With respect to imports made by RIL during the injury period, the Authority notes that RIL
has imported the subject goods only during the POI and such imports account for less than
1% of its total production and sales which is minuscules quantity. RIL did not import the
subject goods during the previous years of the injury period.
154. With respect to IGL’s data, the Authority notes that supporters need to file information
pertaining to installed capacity, production, sales quantity and sales value as per Note 2 of
the Trade Notice 04/2021. The Authority notes that IGL has indeed provided data as per the
format. Further, IOCL had also filed a support letter with the Authority, however, it did not
provide the required data as per the trade notice.
155. With respect to lack of jurisdiction of entertain the present application, the Authority notes
that Hon’ble High Court of Delhi had remanded the matter back to the Authority,
subsequent to which the Authority after receiving a request for termination of investigation
in terms of Rule 14(a) of the AD Rules, 1995 terminated the investigation. In any event, the
present investigation is against a different subject country mix and pertains to a different
injury period. The application was duly documented and made a prima facie case
concerning dumping, injury and causal link. Accordingly, the Authority initiated the present
investigation.
156. The participating exporters have claimed that their cost of production has been arbitrarily
revised and that such revisions were not made in the previous investigation concerning the
PUC. The Authority notes that each investigation is carried out on the basis of specific
facts, submissions made, and information provided and substantiated with relevant
supporting evidences during the course of the investigation.
157. The Authority further notes that several interested parties have claimed that essential facts
have not been disclosed. It is noted that all essential facts have been disclosed as per the
Authority’s consistent practice.
158. During the course of desk verification, the Authority found several inaccuracies and
deficiencies in Equate Group’s response such as the cost for ethylene (captive input)
reported for PUC was significantly lower than the cost for ethylene reported at the company
level (PUC and NPUC). In their original response, Equate Group had also claimed double
deduction for by-product credit for which no reasonable justification was provided.
Similarly, freight reported by Equate Group for exports to India was revised multiple times.
Further, the claim of inventory adjustment in Appendices was revised. Thus, substantial
revisions were made by Equate Group during the verification, which the Authority has
taken on record.
159. The Authority has determined the cost of production based on the revised response
submitted by Equate Group to the extent the same could be verified. It was noted that both
Equate and TKOC purchased raw material (ethane) for production of captive input ethylene
from their related party, Kuwait Petroleum Corporation (“KPC”), however, the same was
not reported by them in Appendix 10 submitted in original response. Further it was noted
that there was significant difference in ethane purchase price reported by the two producers
in Equate Group. Equate Group refused to provide copy of Feedstock Supply Agreements
with KPC to substantiate their claimed purchase price mentioning that “the said agreement
contains very highly confidential and commercially extremely sensitive information, and as
such, cannot be submitted on record”. The Authority notes that under Rule 7 of AD Rules,
1995 confidentiality of information cannot be claimed qua the Authority itself. On account
of refusal of information, the Authority has relied on best information available on record to
compute the cost of production.
160. Further, Equate Group failed to provide sufficient justification for not allocating certain
costs, which should have been allocated to PUC. The explanation provided by Equate
Group was found to be at variance with information submitted for verification.
Accordingly, the Authority has allocated such cost, based on the information available on
record for this investigation, for determining the cost of production.
161. With reference to submissions made by exporters from Saudi Arabia concerning non-consideration of inventory adjustments while computing the cost of production as such
adjustments includes other adjustments such as adjustments allowed under ***, the
Authority notes that such adjustments have been accounted for in computation of cost of
production where the same have been substantiated. Accordingly, the Authority has
computed the cost of production as per its consistent practice.
162. With respect to claims made concerning the SGA & profits adopted by the Authority, the
Authority notes that same was based on the verified cost of production and sales
information of the individual exporters in terms of para 4 of Annexure I to the AD Rules,
1995. The Authority further clarifies that SGA costs were not added twice in case of
Petrokemya, Saudi Kayan and United.
163. With respect to adjustment of trader’s profit margin and indirect SGA to SABIC Group’s
export price, the Authority notes that ex-factory export price has been determined at the
level of each producer.
164. With respect to PTA User Industries and Mitsubishi’s claims disputing the objectivity of the
Authority’s examination on account of non-participation of IOCL and the non-examination
of IOCL’s data, the Authority notes that it had requested all domestic producers including
IOCL to submit information. However, the Authority did not receive any information from
IOCL as per the prescribed format within the established timeline. Accordingly, the
Authority has carried out injury examination based on the facts available on record.
165. Equate Group has alleged that RIL has imported the subject goods in the post-POI period. It
is noted that no evidence has been provided to substantiate the same. The present
investigation being an original investigation, the Authority does not consider it necessary to
examine post-POI developments.
166. With respect to decline in domestic industry’s sales despite decline in import volumes
during the POI, the Authority recalls its examination in para 96 of the disclosure statement
wherein it was clearly observed that non-captive sales of the domestic industry and other
producers had increased in the POI. Thus, while imports of subject goods from the subject
countries declined in the POI, domestic sales of the domestic industry and other Indian
producers of MEG increased.
167. With regards to Equate Group’s submissions concerning the re-distribution of market share
within Indian suppliers, the Authority notes that despite an increase in total sales of the
Indian MEG industry, the Authority notes that market share of Indian Industry as a whole
has also declined in the POI compared to 2021-22.
168. Equate Group has submitted that that domestic industry’s performance declined during
2021-22, despite an increase in landed price of subject imports from Kuwait. In this regard,
the Authority recalls its findings in paras 102-103 of the final findings, wherein it has been
noted that while landed value of subject imports from subject countries increased in 2021-
22, the same was not commensurate to the increase in cost of sales of the domestic industry.
169. SABIC Group has claimed that the domestic industry has not disputed the fact that ethane
purchases from its related supplier are not at arm’s length. In this regard, the Authority
notes that it has obtained and examined quarter-wise invoices and the relevant benchmarks
from the domestic industry for the injury period. Upon examination of the same, the
Authority indeed found the transactions to be at arm’s length.
170. The performance of the domestic industry has indeed improved in the POI compared to
2022-23. However, the domestic industry has claimed that the same was on account of
QCO imposition.
171. PTA User Industries Association has contended that it believes IOCL is making profits,
which contradicts the domestic industry’s claims of injury. PTA User Industries has not
submitted any data on record concerning IOCL’s level of profitability. As mentioned above,
the Authority had called for data for all Indian producers. However, IOCL did not provide
the same. Accordingly, the Authority has carried out the present examination based on
available facts.
172. With reference to determination of price undercutting for the entire injury period, the
Authority notes that price undercutting is to be determined for the POI.
173. Equate Group has claimed that its production only increased marginally in the POI
compared to previous year and existence of limited surplus capacity cannot be construed to
constitute threat of material injury. Equate Group has further contended that there is no
evidence of sudden divergence of production to India and that producers in Kuwait and
other countries export globally and have diverse markets. In this regard, the Authority notes
that it has carried out a cumulative assessment of subject countries in reaching its findings
of threat of material injury. The Authority further notes that it has only pointed out the
structural export dependency of exporters from the subject countries. Further, the Authority
is well-aware of the fact that export sales as reported by Equate Group indeed include
traded sales by Equate Group, a fact which was recorded in para 114 of the final findings.
However, such trading sales constitute less than 1% of total sales made by Equate Group.
Moreover, such traded sales also originate from the subject countries.
174. SABIC Group has submitted that NIP should be computed based on books of the domestic
industry and not notional prices of captive input. Further, the domestic industry has also
alleged that the Authority has made unwarranted adjustments to its non-injurious price. The
Authority notes that NIP has been computed based on records of the domestic industry as
per the principles laid down in Annexure-III to AD Rules, 1995.
175. Equate Group has disputed the 3.6% impact on PSF on account of anti-dumping duties and
has claimed that it is not aware of how MEG constitutes 16% of PSF value. The Authority
recalls para 137 of the final findings, wherein it has been clearly mentioned that calculation
provided by Bhilosa Industries have been examined. All assumptions considered by the
Authority for impact of anti-dumping duties are based on assumptions provided by Bhilosa
Industries. Landed price of MEG has been considered as per DGCI&S data.
176. The Authority further notes that none of the users of the PUC have disputed or provided any
further calculation for impact of anti-dumping duties on the end user provided in the
disclosure statement.
177. Equate Group has commented that existing GST differential along with import duties and
anti-dumping duties would worsen cost structure for user industries. The Authority notes
that the issue related to inverted GST structure is not within the scope of the Authority’s
determination. In any case, appropriate GST rate revisions have recently been made by the
Central Government to address such inverted duty structure issue.
M. CONCLUSIONS & RECOMMENDATIONS
178. Based on the submissions made, substantiated information provided by the interested
parties and the facts available before the Authority as recorded and examined in the
aforementioned paragraphs and on the basis of determination of dumping and consequent
injury to the domestic industry, the Authority concludes the following:
i. The subject goods exported from the subject countries and the article manufactured by the
domestic industry are ‘like article’ to each other in terms of Rule 2 (d) of the AD Rules,
1995.
ii. Reliance Industries Limited accounts for 70-80 % of the eligible domestic production, and
accordingly, the applicant satisfies the requirements stipulated under Rule 2 (b) of the AD
Rules, 1995 and application satisfies the standing requirements under Rule 5(3) of the AD
Rules, 1995.
iii. The application contained all information relevant for the purpose of initiation of the anti –
dumping investigation and necessary evidence in terms of Rule 5(2) of the AD Rules, 1995
to justify the initiation of the present investigation for determination of dumping and
material injury to the domestic industry in terms of Rule 5 (3) of the AD Rules, 1995.
iv. The claims regarding confidentiality were accepted wherever warranted and in case, where
such confidentiality claims were found to be excessive, the interested parties were directed
to disclose the same or provide appropriate non – confidential summary of the same in
terms of Rule 7 of the AD Rules, 1995. Where interested parties did not provide
information or refused access to information, the Authority has considered facts available
in terms of Rule 6(8) of AD Rules, 1995.
v. Dumping margin: Based on the information provided by the exporters from the subject
countries, and the normal value/ constructed normal value (where applicable), the dumping
margin for exporters was determined to be positive and significant.
vi. Volume effect: The volume of imports and the dumping margin of the subject goods from
the subject countries were found to be above de minimis thresholds as stipulated under
para (iii) of Annexure – II to the AD Rules, 1995. With respect to the volume effect of the
dumped imports on the state of the domestic industry as required to be assessed under para
(ii) of the AD Rules, 1995, it was found that such imports have increased in absolute as
well as relative terms to the production and consumption of the PUC in India. Imports of
subject goods from the subject countries have increased by 200% in the POI.
vii. Price effect: As regards the price effect of such dumped imports, it was found that price
undercutting from all three subject countries was positive. It was further found that such
dumped imports were depressing and suppressing the prices of the domestic industry.
viii. As regards the effect of such dumped on the economic parameters of the domestic
industry, the following conclusions were reached:
a. Production, capacity, capacity utilisation, sales, and market share: The
production and capacity utilisation of the domestic industry has declined even though
capacity has remained constant throughout the injury period. Non-captive sales have
declined until FY 2022-23, with a marginal increase in POI, on account of decline in
volume of imports due to imposition of QCO. However, volume of imports has
doubled over the injury period.
b. Market Share: Non-captive market share of the domestic industry has declined by
*** % over the injury period whereas market share of the subject imports from the
subject countries increased by *** % indicating that imports from the subject
countries have captured the market share of domestic industry. Indian industry i.e., the
domestic industry and other domestic producers have also collectively lost market
share over the injury period.
c. Cost of sales, selling price, profitability, and return on capital employed: The
selling price of the domestic industry has declined in the POI compared to 2022-23
and 2021-22. The profitability of the domestic industry has shown a minor
improvement in the POI compared to previous year, however, the same has declined
compared to 2020-21 and 2021-22. The domestic industry has earned *** % profit on
cost of sales during the POI.
d. Inventories: Inventories have increased in the POI.
e. No. of employees, productivity, and wages: Productivity has declined throughout
the injury period and reached its lowest level in the POI as a result of decrease in the
production of the domestic industry.
f. Growth: Upon comparison from the base year, it is noted that production, domestic
sales, profit and ROCE have declined and have shown negative growth in the POI
compared to the base year.
ix. Threat of material injury: Exporters from the subject countries are structurally export
oriented. With stagnant demand in third countries, it is likely that imports may be diverted
to India.
x. Injury margin: Upon comparison of the non – injurious price determined as per Annexure
– III to the AD Rules, 1995 and the landed price of subject imports from the subject
countries as required under Rule 17 (3) (b) to the AD Rules, the injury margin for the
participating exporters was found to be positive.
xi. Causal link: The domestic industry has suffered material injury due to the dumped imports
and there are no other known factors were found to be the cause of the injury. There has
been an increase in the volume of the dumped imports during the POI compared to the base
year and 2021-22. The presence of dumped imports in the Indian market forced the
applicant to sell at non-remunerative prices which has adversely affected the profitability
parameters of the domestic industry.
xii. Indian industry issues: None of the interested parties have disputed the end user duty
impact calculation, which is less than 1%. The presence of several suppliers including a
vibrant Indian domestic industry de-risks the user from supply chain disruptions and thus
enables the user industry to procure the subject goods from several sources more
competitively in the long run.
179. The Authority notes that the investigation was initiated and notified to all interested parties
and adequate opportunity was given to the domestic industry, exporters, importers and other
interested parties to provide positive information on the aspect of dumping, injury and
causal link. Having initiated and conducted the investigation into dumping, injury and
causal link in terms of the provisions laid down under the Anti-Dumping Rules, the
Authority is of the view that imposition of anti-dumping duty is required to offset dumping
and injury. Therefore, Authority considers it necessary and recommends imposition of anti-dumping duty on imports of subject goods from the subject countries.
180. Having regard to the lesser duty rule followed by the Authority, the Authority recommends
imposition of anti-dumping duty equal to the lesser of margin of dumping and the margin of
injury, so as to remove the injury to the domestic industry. Accordingly, the Authority
recommends imposition of anti-dumping duty on the imports of the subject goods,
originating in or exported from the subject countries, from the date of notification to be
issued in this regard by the Central Government, equal to the amount indicated in Col. 7 of
the duty table appended below for a period of 5 years.
Duty Table
+-------+----------+-------------+---------------+---------------+-----------------------------------+-------+
| S.No. | Heading | Description | Country of | Country of | Producer | Amount|
| | | | Origin | Export | | ($ /MT)|
+=======+==========+=============+===============+===============+===================================+=======+
| 1 | 2 | 3 | 4 | 5 | 6 | 7 |
+-------+----------+-------------+---------------+---------------+-----------------------------------+-------+
| 1 | 2905 31 | Mono | State of | Any country | EQUATE Petrochemical Company | 102 |
| | 00 | Ethylene | Kuwait | including | K.S.C.C | |
| | | Glycol | | State of Kuwait| | |
+-------+----------+-------------+---------------+---------------+-----------------------------------+-------+
| 2 | do | do | State of | Any country | The Kuwait Olefins Company | 102 |
| | | | Kuwait | including | K.S.C.C. | |
| | | | | State of Kuwait| | |
+-------+----------+-------------+---------------+---------------+-----------------------------------+-------+
| 3 | do | do | State of | Any country | Any producer other than S.No. 1 to 2| 165 |
| | | | Kuwait | including | | |
| | | | | State of Kuwait| | |
+-------+----------+-------------+---------------+---------------+-----------------------------------+-------+
| 4 | do | Do | Any country | State of | Any | 165 |
| | | | other than | Kuwait | | |
| | | | subject | | | |
| | | | countries | | | |
+-------+----------+-------------+---------------+---------------+-----------------------------------+-------+
| 5 | do | Do | Kingdom of | Any Country | Arabian Petrochemical Company | 118 |
| | | | Saudi Arabia | including | | |
| | | | | Kingdom of | | |
| | | | | Saudi Arabia | | |
+-------+----------+-------------+---------------+---------------+-----------------------------------+-------+
| 6 | do | do | Kingdom of | Any Country | Saudi Kayan Petrochemical Company | 118 |
| | | | Saudi Arabia | including | | |
| | | | | Kingdom of | | |
| | | | | Saudi Arabia | | |
+-------+----------+-------------+---------------+---------------+-----------------------------------+-------+
| 7 | do | do | Kingdom of | Any Country | Eastern Petrochemical Company | 118 |
| | | | Saudi Arabia | including | | |
| | | | | Kingdom of | | |
| | | | | Saudi Arabia | | |
+-------+----------+-------------+---------------+---------------+-----------------------------------+-------+
| 8 | do | do | Kingdom of | Any Country | Jubail United Petrochemical Company| 118 |
| | | | Saudi Arabia | including | | |
| | | | | Kingdom of | | |
| | | | | Saudi Arabia | | |
+-------+----------+-------------+---------------+---------------+-----------------------------------+-------+
| 9 | do | do | Kingdom of | Any Country | Saudi Yanbu Petrochemical Company | 118 |
| | | | Saudi Arabia | including | | |
| | | | | Kingdom of | | |
| | | | | Saudi Arabia | | |
+-------+----------+-------------+---------------+---------------+-----------------------------------+-------+
| 10 | do | do | Kingdom of | Any Country | Yanbu National Petrochemical | 118 |
| | | | Saudi Arabia | including | Company | |
| | | | | Kingdom of | | |
| | | | | Saudi Arabia | | |
+-------+----------+-------------+---------------+---------------+-----------------------------------+-------+
| 11 | do | do | Kingdom of | Any Country | Rabigh Refining & Petrochemical | 118 |
| | | | Saudi Arabia | including | Company | |
| | | | | Kingdom of | | |
| | | | | Saudi Arabia | | |
+-------+----------+-------------+---------------+---------------+-----------------------------------+-------+
| 12 | do | do | Kingdom of | Any country | Any producer other than S.No. 5 to 11| 173 |
| | | | Saudi Arabia | including | | |
| | | | | Kingdom of | | |
| | | | | Saudi Arabia | | |
| | | | | and State of | | |
| | | | | Kuwait | | |
+-------+----------+-------------+---------------+---------------+-----------------------------------+-------+
| 13 | do | do | Any country | Kingdom of | Any | 173 |
| | | | other than | Saudi Arabia | | |
| | | | subject | | | |
| | | | countries | | | |
+-------+----------+-------------+---------------+---------------+-----------------------------------+-------+
| 14 | do | do | Republic of | Any country | Any | 137 |
| | | | Singapore | including | | |
| | | | | Republic of | | |
| | | | | Singapore | | |
+-------+----------+-------------+---------------+---------------+-----------------------------------+-------+
| 15 | do | do | Any country | Republic of | Any | 137 |
| | | | other than | Singapore | | |
| | | | subject | | | |
| | | | countries | | | |
+-------+----------+-------------+---------------+---------------+-----------------------------------+-------+
N. Further Procedure
181. An appeal against the determination of the Designated Authority in these final findings
shall lie before the Customs Excise and Service Tax Appellate Tribunal in accordance with
the relevant provisions of the Act/ Rules.
SIDDHARTH MAHAJAN, Designated Authority
Uploaded by Dte. of Printing at Government of India Press, Ring Road, Mayapuri, New Delhi-110064
and Published by the Controller of Publications, Delhi-110054.