The Finance Ministry has imposed definitive anti-dumping duty on ‘flax’ or ‘linen’ fabric imports from China and Hong Kong. This duty would be applicable only on those flax fabrics with flax content of over 50 per cent. ‘Flax’ and ‘linen’ are synonymous and these fibres are used to produce yarn and fabric. Based on the recommendations of the commerce ministry, the revenue department has now imposed anti-dumping duty of $ 0.75 per metre on ‘flax’ fabric imported from China. In the case of ‘flax’ fabric imported from Hong Kong, the anti-dumping duty has been pegged at $ 0.63 per metre.

What is meant by Dumping?

Dumping is a colloquial term that refers to the act of offloading a stock with little regard for its price. In simple words, Dumping is the export by a country or company of a product at a price that is lower in the foreign market than the price charged in the domestic market or below its cost of production..

For example,

There are two countries. Country A and Country B.

Country A manufactures a Pen for Rs 10. It exports the Pen to Country B. Rather than selling the pen at higher cost or at a competitive cost, Country A sells the Pen for just Rs 5. This will obviously affect the Pen Companies in Country B. This is called Dumping.

To avoid this, the government usually impose Anti-Dumping Duty.