NOTIFICATION NO. 14/16/2002-DGAD DATE 08/08/2003
Anti-dumping Investigation concerning imports of Plastic Opthalmic Lenses from People's Republic of China and Chinese Taipei.Having regard to the Customs Tariff Act 1975 as amended in 1995 and the Customs Tariff (Identification, Assessment and Collection of Anti-Dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995, thereof:
A. PROCEDUREThe procedure described below has been followed with regard to the investigation:
i) The Designated Authority (hereinafter also referred to as Authority), under the above Rules, received a written application from M/s Techtran Polylenses Limited, Hyderabad, a member of Indian Plastic Opthalmic Lenses Association (IPOLA), Karnataka (hereinafter referred to as petitioner) on behalf of the domestic industry, alleging dumping of Plastic Opthalmic Lenses (hereinafter also referred to as subjectgoods) originating in or exported from People's Republic of China and Chinese Taipei (hereinafter referred to as subject countries). The petition is also supported by M/s Indian Plastic Opthalmic Lenses Association whose other members are M/s Indian Opthalmic Lenses Manufacturing Co. Pvt. Ltd., Karnataka and M/s Prakash Plastic Industries (Madras) Pvt. Ltd., Chennai.
ii) Preliminary scrutiny of the application filed by the petitioner revealed certain deficiencies, which were subsequently rectified by the petitioner. The petition was, therefore, considered as properly documented.
iii) The Authority on the basis of sufficient evidence submitted by the petitioner decided to initiate the investigation against imports of the subject goods from the subject countries. The authority notified the Embassies of People's Republic of China and Chinese Taipei in New Delhi about the receipt of dumping allegation before proceeding to initiate the investigation in accordance with the sub-Rule 5(5) of the Rules.
iv) The Authority issued a public notice dated 27.8.2002 published in the Gazette of India, Extraordinary, initiating Anti-Dumping investigations concerning imports of the subject goods classified under Customs Code 9001.50 Schedule I of the Customs Tariff Act, 1975 as amended in 1995 originating in or exported from the subject countries.
v) The Authority forwarded a copy of the public notice to the known exporters (whose details were made available by petitioners) and gave them an opportunity to make their views known in writing within forty days from the date of the letter in accordance with the Rule 6(2):
vi) The Authority forwarded a copy of the public notice to all the known importers (whose details were made available by petitioner) of subject goods in India and advised them to make their views known in writing within forty days from the date of issue of the letter in accordance with the Rule 6(2).
vii) Request was made to the Central Board of Excise and Customs (CBEC) to arrange details of imports of subject goods made in India during the past three years, including the period of investigation.
viii) The Authority provided a copy of the petition to the known exporters and the Embassy of the subject countries in accordance with Rules 6(3) supra. A copy of the non-confidential petition was also provided to other interested parties, wherever requested.
ix) The Authority sent a questionnaire to elicit relevant information to the following known exporters/producers, in accordance with the Rule 6(4):
1. M/s Wenzhou East Optical Glasses Co. Ltd., PR China
2. M/s Wenzhou Wuzhou Group Co. Ltd., PR China
3. M/s Wenzhou Mingda Optical Glasses Co. Ltd., PR China
4. M/s Bin Shyh Enterprises Co. Ltd., Taiwan
5. M/s Daily Glasses Enterprise Co. Ltd., Taiwan
6. M/s Y & S (Tianjin) Industries Ltd., PR China
x) The Embassies of the subject countries in New Delhi were informed about the initiation of the investigation in accordance with Rule 6(2) with a request to advise all concerned exporters/producers from their country to respond to the questionnaire within the prescribed time. A copy of the letter, petition and questionnaire sent to the known exporters was also sent to the Embassy of the subject countries in accordance With Rule 6(3).
xi) A questionnaire was sent to the following known importers Asset associations of the subject goods inaccordance with Rule 6(4):
1. M/s R.K. Optical Services, New Delhi
2. M/s Ajay international, Delhi
3 . Mls Enterp6se trading Co., DOM
4. M/s Indian Optics Private Ltd., Delhi
5. M/s Reflect Optics, Mumbai
6. M/s Prime Optics, Mumbai
7. M/s Unity Optics, Mumbai
8. M/s Patni Opticians, Mumbai
The last date of submission was 7th October 2002. On request of interested parties, extension of time wasgranted up to, 1st. November 2002.
Response/information to the questionnaire/notification was filed by the following exporters/producers:
1. M/s Wenzhou East Optical Glasses Co. Ltd., PR China
2. M/s Wenzhou Wuzhou Group Co. Ltd., PR China
3. M/s Wenzhou Mingda Optical Glasses Co. Ltd., PR China
4. M/s Y &S (Tianjin) Industries Ltd., PR China
Response/information to the questionnaire/notification was filed by the following Importers/user Associations.
1. M/s R.K. Optical Services, New Delhi
2. M/s Enterprise Trading Co., Delhi
3. M/s Indian Optics Pvt. Ltd., Gurgaon
None of the exporters/producers from Taiwan has responded.
xii) The Authority kept available non-confidential version of the evidence presented by various interestedparties in the form of a public file maintained by the Authority and kept open for inspection by the interestedparties as per Rule 6(7).
xiii) Cost investigation was also conducted to work out optimum cost of production and cost to make and sellthe subject goods in India on the basis of Generally Accepted Accounting Principles (GAAP) and theinformation furnished by the petitioner.
xiv) ****in this notification represents information furnished by interested parties, on confidential basis and soconsidered by the Authority under the Rules.
xv) Investigation was carried out for the period starting from 1st April 2001 to 31St March 2002 i.e. the periodof investigation (POI).
B. VIEWS OF EXPORTERS, IMPORTERS AND OTHER INTERESTED PARTIES1. PETITIONER'S VIEWS
a) PRODUCT UNDER CONSIDERATION
(i) The imported product is Plastic Opthalmic Lenses, which are used in spectacles to correct Eye Vision ofHuman beings. These lenses are imported in finished, Uncut form, ready to mount in spectacle frames. TheITC (HS) classification of the products is 9001.50 which attracts peak Customs duty of 30% (2002 budget).
(ii) The lenses are made out of Bis Allyl Di-carbonate; generically known as CR-39 with Refractive Index of1.488 and Abbe number of 50 plus. These lenses are basically modern day lenses substituting age old,glass lenses.
(iii) The product is under OGL.
b) DOMESTIC INDUSTRY
(i) The petition is filed by the Indian Opthalmic Lens Association (IPOLA), 48 L&M, Kiadb Industrial area,Doddaballapur-58 9203, Bangalore, North Dist., Karnataka represented by its President. The members ofthe Association account for 90% of domestic Plastic Opthalmic lenses production.
(ii) The annual production capacity of the member units:
| (a) | TECHTRAN POLYLENSES LTD.
(DTA Sale Entitlement of the 100% EOU) | 1,000,000 PAIRS |
| (b) | INDIAN OPTHALMIC LENSES
MANFACTURING CO. PVT. LTD. | 1,500,000 PAIRS |
| (c) | PRAKASH PLASTIC INDUSTRIES (MADRAS) PVT LTD. | 125,000 PAIRS
_______________ |
| | | 2,625,000 PAIRS
_______________ |
(iii) The industry has installed production capacity much higher than the realized production
| Manufacturer name | Installed capacity | Actual production or realized capacity |
|---|
| Prakash Plastic Industries | 125,000 Pairs | 125,000 Pairs (100%) |
| Techtran Polylenses Domestic Capacity | 1,000,000 Pairs | 464,139 Pairs (46.41%) |
| Indian Opthalmic Lenses Manufacturin Co. | 1,500,040 Pairs | 750,000 Pairs (50%) |
| Total | 2,625,000 Pairs | 1.339,139 Pairs (51.00%) |
|---|
(iv) The average annual production value of the above three companies is approximately Rs.150 million.
(v) The member companies manufacture Single Vision and Bifocal lenses, similar to the imported productsfrom Taiwan and China. The member companies also produce semi-finish products of Single Vision andBifocal, even though the volumes are small.
(vi) None of the manufacturer member companies import any of the products and none of the membercompanies have any relation to the importers or exporters of dumped article.
(vii) There are only two other small plastic lens manufacturers in the country, who are not-party to this complaint(I) reflect Optics, Doctor House, Mumbai and (2) Global Optics Pvt, Ltd., New Delhi
c) LIKE ARTICLE
(i) The Plastic Opthalmic Lenses may be substituted by glass lenses, however, glass is inferior to Plastic interms of safety., absorption of ultra violet radiation, customer comfort etc.
(ii) There are no material differences between the dumped )roducts and products manufactured by themembers. Both the products are made out of CR-39 or equivalent raw material, and is cast adoptingpolymerization. There may be slight difference in the initiators used. Polymerization cycle and process mayvary from manufacturer to manufacturer.
d) DUMPING
As per the petition the extent of alleged dumping of the subject goods is as follows:
| Year | Taiwan | China | Others |
|---|
| | No. of pairs imported | CIF value per pair in Rs. | No. of pairs imported | CIF value in Rs. | No. of Pairs imported | CIF value in Rs. |
|---|
| 2000-01 | 3,97,593 | 43.40 | 5,50,319 | 31.61 | 6,75,570 | 116.07 |
| 2001-02 | 6,23;534 | 14.65 | 8,72,400 | 30.43 | 6,58,946 | 103.14 |
The imported products constitute 62% of domestic market share in 2001-02.
(i) Estimates of Normal Value -Since the petitioners do not have access to the local selling prices of the dumped articles in the exporting countries, Taiwan and China, the computed normal value has been worked out by the petitioners as follows:-
a) Raw Materials: consumption of Monomer i.e. CR-39 or NS-200 would be approximately 24 grams/lens. Themonomer suppliers world wide are PPG, U.S.A and Great Lakes Chemical Corp., Netherlands and their uniform price is US$4.50 per kg.
| Hence monomer cost Per pair of Lenses (Rs)= 2X24/1000X$4.5X48.6 = Rs.5.25X2 = | | Rs.10.501 Pair |
| Initiator: Isopropyl Peroxide supplied by AKZO NOBEL, NOF JAPAN, ETC. The pure IPP price is $60 per kg and IPP (PURE) is used 3% of the monomer weight. |
| Cost of Initiator per pair of lenses = 2X24 grams X3%X1 Kg/1000 grams X$60 (per kg)X48.6 (Exch. Rate) = Rs 2.10X2= | | Rs.4.201 Pair |
| Total raw materials cost per Pair | = Rs.7.35X2= | Rs.14.70 Pair |
| b) Stores and Spares including. chemicals, gasket, glass moulds, mechanical and electrical supplies @ Rs. 4.OOper lens = Rs4.OX2= | | Rs.8.00 Pair |
| c) Power and Fuel: Approximately 0.8 to 0.9 KW power is required to manufacture one lens. Assuming the Power cost in China as 50% of Indian power cost, the power and fuel would be no less than Rs.1.60 per lens = Rs.1.60X2= | | Rs.3.20 Pair |
d) Wage Cost: IN a semi-automated plant, the productivity is approximately 40 lenses/makeshift. Assuming a low Chinese wage cost of 600 yuan per month per person oir 3600 rupees/month (c@6 Rs. Per yuan. )
Wage cost works out 3600+(25 days/monthX40 lenses/man day)+3.6X2= | | Rs.7.20 /Pair |
| e) Packing and selling costs |
| Packing material : Rs1.50 /Lens |
| Misc. selling cost : RS0.50/Lens |
| Total Rs 2.DOJLeris | | Rs. 4.00lPair
|
| f) Factory overheads and administrative costs approx. 3.0X2= | | Rs. 6.00/Pair
|
| Total Manufacturing cost before interest and depreciation | | Rs.43.101Pair
|
| g) Interest | | Rs.10.10/Pair
|
| h) Depreciation | | Rs.7.001 Pair
|
| Constructed Normal value (As per the petition): | | Rs.60.20/Pair |
(vi) The average imported price to India for the last two years and the current year is listed here:
(A) Import Price/Pair (CIF)
(Quantity in Pair) Source: DGCIS| | 1999-2000 | 2000-2001 | 2001-2002 |
|---|
| Chinese Taipei | 52.42 | 43.40 | 14.65 |
| China PR | 41.88 | 31.61 | 30.43 |
| Others | 56.36 | 116.07 | 103.14 |
(B) FOB Price computation of dumped -goods:
The DGCIS statistics report the CIF price to Indian shore. To determine the FOB price, the costs involved in inland transportation, forwarding and port handling, ocean freight and Indian port delivery charges etc. are to be deducted.
| | Rs/Pair |
|---|
| inland transportation | 1.00 |
| Forwarding and port handling | 1.00 |
| Ocean Freight | 3.00 |
| Port-Delive charges | 1.00 |
| Total | 6.00 |
These expenses are assumed conservatively to be constant during the two-year period of review.
(C) Import Price Rs/Per Pair (FOB)
| | 1999-2000 | 2000-2001 | 2001-2002 |
|---|
| Chinese Taipei | 46.42 | 37.40 | 8.65 |
| China PR | 35.88 | 25.61 | 24.43 |
| Others | 50.36 | 110.07 | 97.14 |
Hence the Dumping Margin:
2001-2002| | Taiwan | China |
|---|
| Normal Value (in Indian Rs per air | 60 | 60 |
| Export price FOB (in Indian Rs. per air | 8.65 | 24.43 |
| Dumping margin (in Indian Rs. per air | 51.35 | 35.57 |
| Dumping Margin % | 85.58% | 59.28% |
e) INJURY
The Following arguments have been extended by the petitioners towards provisional injury determination:
(i) The importers have flooded their products in Indian markets to the extent of 61.70%.
(ii) Total demand of Plastic Lenses for 2001-2002
a) Imports:
Source: DGCIS| | Pairs | % |
|---|
| Chinese Taipei | 623,534 | 17.8 |
| China | 872,400 | 25.0 |
| Others | 658,946 | 18.9 |
(b) Domestic Sales
| Techtran Domestic Sales | 464,139 | 13.3 |
| All other IPOLA members | 875,000 | 25.0 V |
| Others | NIL | NIL |
| Total | 3,494,019 | 100.0 |
iii) While Taiwan and China imports have increased from 2000-2001 to 2001-2002 by about 60%, Techtranlost its sales by about 7.3% in the same period. Techtran was unable to reach even 50% of its eligible domestic capacity.
| | 2000-2001 | 2001-2002 | Sales Volume %
increase of (Decrease) |
|---|
| Techtran Polyllenses domestic sales | 500763 Pairs | 464,139 Pairs | (7/3%) |
| Taiwan | 397,5593 Pairs | 623, 534 Pairs | 57% |
| China | 550,319 Pairs | 872,400 Pairs | 59% |
(iv) The domestic units were making losses or barely breaking even in expanding market. Some of the unitsare closed or sold out under economic distress.
(v) The imports from Taiwan and China are increasing year after year, while the import prices have gone downsince these countries are dumping the products below their costs of production. The plastic lenses areimported into India at the lowest price in the world.
(vi) The domestic units are not able to compete the ridiculous (below raw material cost) prices and are forcedto find export markets or shut down.
(vii) One domestic unit set up by SRF has incurred heavy losses and could not operate economically resultingin distress sale to a multi-national subsidiary, Indian Ophthalmic Lenses Manufacturing Co. Pvt. Limited.The reorganized unit is functioning at reduced capacity. Techtran Polylenses Ltd. is struggling to servicethe debt burden and continues to remain as non-performing asset to the financial institutions. ForbesGokak Ltd., a TATA subsidiary, had set up a plastic lens manufacturing facility at Aurangabad and closedafter incurring accumulated losses of Rs.70 crores and loss of employment of some 250 person.
(viii) It is the firm belief in the industry that the imports from China and Taiwan are under-invoiced, to evadeCustoms duty and resulting low imported cost. The country looses out on Customs duty revenue and alsoon the industrial front by the failures of domestic units (invested capital,` employment, revenue base etc). Inyear 2001-2002, Techtran alone has paid Rs.82.80 lakhs duties (at 50% of import duty) on domestic sales464,139 pairs whereas Taiwan imports got by, paying Rs.107 lakhs on imports of 872,400 pairs. Thesefacts prove beyond doubt the common belief of unscrupulous, under invoiced imports.
(ix) The landed value from Taiwan and China in 2001-2002 are 25.84 per pair and 30.89 per pair respective)
(x) The demand of Plastic Opthalmic Lenses in India has been increasing but virtually all the growth in demandis stolen by unscrupulous imports, dumping below cost or suppressing the cost of sale.
(xi) Selling Prices/Pair (FOB)
(xii) Comparison of other importing countries
| | 1999-2000 | 2000-2001 | 2001-2002 |
|---|
| Taiwan | Rs.46.42 | Rs.37.40 | Rs8.65 |
| China | Rs.35.88 | Rs.25.61 | Rs24.43 |
| Others | Rs.50.36 | Rs.110.07 | Rs97.14 |
(xii) Comparison of other importing countries
| | 1999-2000 | 2000-2001 | 2002 |
|---|
| All other countries Sales volume in airs | 1,135,515 | 675,570 | 658,946 |
Average selling price of all other countries
(in Rs/ air CIF | 56.36 | 116.07 | 103.14 |
In summary, the domestic industry has contended that the Chinese and Taiwanese products are exportedin India at a price much lower than the normal value (in some cases below the cost of raw materials) andthereby causing injury to domestic industry in terms of sales volume loss, lower capacity utilization and shutdown of certain units. The dumping margins are very high with respect to these countries.
f) GENERAL ISSUES
(i) Glass Lenses Impact
Even though glass lenses compete in the total ophthalmic lens market, they do not cause any injury to theplastic lens since the plastic lens market share in India is increasing and plastic lenses replace glass as ithappened in developed countries. Plastic lenses are superior, modern product and enjoy safety and healthbenefits over glass lenses. Glass lenses are not hurting plastic lens industry but the, plastic lens importsdumped at, below cost prices are causing injury to domestic industry from getting fair share of growingdomestic market
(ii) Classification of –goods
Article Code 9001.50.00 is for "spectacle lens of other material". Glass lenses are under article Code9001.40.00 and hence spectacle lens of other material constitute plastic lenses of spectacle only since noother material is used for making spectacle lenses.
2. IMPORTER'S VIEWS
1. M/S Enterprise Trading Co.
(i) Only CR 39 lenses are covered under the scope of investigation whereas Acrylic lenses are made fromdifferent manufacturing process viz. injection moulding and different raw materialh and,' therefore, are notwithin the purview of investigation.
(ii) The Normal Value on the basis of raw material consumption and other costs would come to ****$/pair exfactory export price as ****V/pair evidencing no dumping.
(iii) Other types of Lenses like Polymethyl Methaacrylate (PMMA) lenses, Polycarbonate lenses, specialtylenses like anti-reflection multi coating, hydro-phobic coating, anti-EMI coating and anti-scratch coatinglenses are not manufactured by the domestic industry and that reliance is placed on the Hon'ble CEGAT'sjudgement in case of Birla Periclase Vs. Designated Authority.
(iv) There is no injury caused to the domestic industry.
(v) M/s Techtran is 100% EoU and that their cost of production cannot be relevant for domestic sales. Thusinformation of M/s Techtran should not be taken into account.
2. M/s R.K. Optical Services
(i) That they have not imported any of the CR 39 lenses during the period of investigation and have mainlyimported Acrylic Lenses.
3. M/s Indian Optics Pvt. Ltd.
(i) They are manufacturer of both plastic and glass lenses but also import special type of lenses with uniqueapplication from China, Singapore and Indonesia.
(ii) CR-39 lenses are made from ADCA/NS 200, while Acrylic lenses are made from Polymethyl Methacrylate(PMMA).
(iii) The process for CR-39 lenses and Acrylic lenses are different as the first one is produced by the castingprocess and the second one is produced by the injection moulding process.
(iv) The refractive index of the different type of plastic Opthalmic/Spectacle lenses are 1.498 for CR-39 andAcrylic Lenses, 1.56, 1.60, 1.523, 1.67, 1.58 are the other refractive indexes for the Plastic OpthalmicLenses, 1.58 for Polycarbonate lenses.
(v) They do not oppose antidumping Duties on the plastic CR-39 -1.49 lenses but oppose the anti dumpingduties on any other specialty lees, which are not manufactured by the domestic producers. These are antireflectionmulti coating, hydrophobic coating, anti-EMI coating and anti-scratch coating lenses. Thedomestic producers have only capacity for anti-scratch coating/Hard coating.
(vi) They support fixing of a minimum export price for plastic Opthalmic lenses CR-39 but excluding thespecialty lenses.
d) Other Importers i.e. M/s Unity Optics, Mumbai and M/s Prime Optics, Mumbai have mentioned that they havenot imported CR-39 type lenses from PR China and Taiwan.
3. EXPORTER'S VIEWS
1. MIS Y &S(TIANJIN) INDUSTRIES LTD., PR CHINA
(i) MIS Y &S(Tianjim) Industries Ltd. have provided the CIF price of the Monomer used as ****$/MT and theprice of IPP used as ****$ Pei MT procured from the local sources and has claimed that their productioncost is much lower because of lower cost of the raw material as above.
(ii) It has been submitted that CR 39 and Acrylic Lenses are not like article and only CR 39 lenses arecovered. Domestic industry has not produced nor has the capacity to produce the Acrylic lenses.
(iii) The normal value of the exporter as indicated on the basis of the total cost of production as ****$/pair instead of ****$/pair as claimed by the petitioner. The exporter has indicated various reasons for claiming thecost of production.
(iv) The exporter has also offered for verification and has indicated that they are operating as per the marketprinciples.
2. M/S WENZHOU WUZHOU GROUP CO. LTD., PR CHINA (WUZHOU)
· That Wuzhou is a private Limited company incorporated and registered in the People's Republic of Chinain 2001 and is an exporter of Plastic Opthalmic Lenses. Wuzhou is a market economy company. There isno State/Government control of Wuzhou. Wuhou not receive any subsidies and maintains its accountsconsistently in accordance with international norms/practice.
· The decision of Wuzhou with respect to prices are made in response to market signals reflecting supplyand demand and the costs of the inputs reflect market values.
· There is no distortion 'of production costs and financial situation as Wuzhou is an entirely privatecompany as described in the response to the questionnaire and accompanying confidential information.
· Wuzhou states that it is not a manufacturer and thus does not have any domestic sales and does have alicense to import or export and has exported -the subject goods to India or other countries thereafterduring a portion of the period of investigation i.e. from 1st April, 2001 to 31st March, 2002.
· Plastic Opthalmic Lenses manufactured in China and exported by Wuzhou are generally called AcrylicPlastic Lens (PMMA) while the category of subject goods manufactured and sold in India by the saidapplicant are generally called Hard Resin Lens (CR 39). Acrylic Plastic Lens are not suitable fortherapeutic or correctional purposes.
· There is no Domestic Industry in India of the category of like articles subject goods exported by Wuzhou,i.e. Acrylic Plastic Lens.
· The ex factory price during the POI of the subject goods exported by Wuzhou to India at an average ofUS$ **** per pair that is at the average third country export price, as below during the POI.
· Chinese manufacturers enjoy tremendous economies of Scale, as a result of clustered and consolidatedproduction of the subject goods, high capacity and capacity utilisation, inexpensive raw materials andlabour, no man days lost during the POI due to labour unrest or any force majeure or input supplyconstraints, inexpensive and efficient logistics and infrastructure and economies in freight and handling.The subject goods are mainly targeted for the relatively lower income market segments and not at theaffluent market segments.
· There are a number of differences between the category of subject goods produced and sold in India bythe applicant and the category of subject goods ex` crated to India by Wuzhou.
· The goods produced with CR39 and those produced with PMMA ace completely different although bothof them are classified into the Classification number of 9001.50 - Spectacle lenses of other materials.
· Products made from CR-39 are generally called Hard Resin Lens (CR-39) while those made with PMMAare called Acrylic Plasticlens (PMMA).
· The subject goods manufactured and exported by Wuzhou are neither technical nor commercialsubstitutes for the subject goods manufactured by the applicant domestic industry and thus are not likearticle with the subject goods manufactured by the applicant domestic industry.
· Glass, was in the past the material used for sheets because of its chemical structure and scratchresistance. Transparent plastic materials like PMMA. PC, CAB have replaced glass in many applicationsmainly because of their lighter weight, better impact resistance and workability. But these materials dohowever show some disadvantages compared to glass, like a poor chemical resistance', poor scratchresistance, or aging problems, all of which result in loss of mechanical and optical properties, microcracking,hazing as well as other problems while in use.
· Materials including PMMA do not always provide a fully satisfactory alternative to glass and, in manyapplications, the quality and performance of expensive equipment and instruments is compromised bythe poor performance of their transparent plastic parts.
· CR-39 (Hard Resin lenses) offer the combined benefits of Plastic materials and glass. The' Hard Resinoptical quality cast sheets are resistant to scratch, impact stress cracking, solvents, chemicals, gammaradiation, welding sparks pitting and aging. They will maintain their properties for many years through avariety of difficult environments and conditions of use, where other materials may only last a few days ormonths.
· The respective applications of PMMA and CR-39 are different. Hard Resin use are constantly growing insophisticated scientific, aerospace and nuclear applications like determination of radon concentration,research for magnetic monopoles (Macro experiment at Laboratori Nazionali del Gran Sasso), biologicalexperiment on effect of the light on vegetable and animals-and cosmic and nuclear track detectors inaerospace application.
· As per the said application the sources of raw materials are as follows:The monomer suppliers world-wide are PPG, U.S.A. and Great Lakes Chemical Corp., Netherlands.
· The PMMA industry in Asia and even world-wide is dominated by a handful of players including ICIAcrylics Inc, BASF and Elf Atochem. The PPG and Great Lakes Chemical Corp are CR-39 supplier butnot PMMA.
· The price of the PMMA purchased for production of Chinese manufacturers is just US$1.6 per kg as theyare completely different. There are differences in respective manufacturing process, raw materials andmoulds between the Acrylic Plastic Lens (PMMA) and the Hard Resin Lens (CR-39).· The production process of Hard Resin Lens (CR-39) is more complex to achieve higher specificationsand would involve higher costs and chances of a higher rejection rate.
· The normal value of the subject goods determined on the use of raw material CR-39 is not representativefor all kinds of the subject goods.
· Subject goods manufactured from PMMA may thus be excluded from the scope of the presentinvestigation.
· All third country export sales of the subject goods in China by Wuzhou during the POI were in theordinary course of trade and the confidential data therefore has been filed along with the confidentialresponse to the questionnaire.
· There is no dumping of the subject goods from China by Wuzhou as alleged at all and thus the presentinvestigation may be terminated.
INJURY AND CAUSAL LINK
· Since the applicant neither produces, nor sells the like article/subject goods there can be no injury to theapplicant with respect to a category of goods not produced by it.
· During the POI and also the preceding year the profits, production and capacity utilisation of the saidapplicant have risen while inventories have declined. Prima facie there is no evidence of material injuryto the said applicant. '
· Issue of Causal Link arises only in case dumping of like articles is proven and if any material injury isshown.
· The Applicant has relied on inadequate and inaccurate estimates of data for the last 4 months of the POI.
· The applicant has not taken congnizance of the economic slow down in India during the POI.
· The applicant has disclosed that during the POI its profits increased which would be unlikely in case ofany price suppression. Thus there is no price depression/suppression as alleged without substantiation.
3. M/S WENZHOU EAST OPTICAL GLASSES CO. LTD. PR CHINA (EAST)
· East is a private Limited company incorporated and registered in the People's Republic of China in 2001and is a manufacturer of Plastic Opthalmic Lenses. East is a market economy company.
· The ex-factory price during the POI of the subject goods exported by East to India at an average of US$**** per pair that is at or within a de-minimus range of the average domestic sales price, as above, duringthe POI.
· The cost of production during the POI at an average of US$**** per pair across models and is less thanthe domestic sales price, as stated above, during the POI.
· All domestic sales of the subject goods in China by manufacturer during the POI were in the ordinarycourse of trade and the confidential data therefore has been filed. The normal value may be determinedon the basis of the domestic sales price of the subject goods in China during the POI and this wouldshow that there was no dumping as alleged or a dumping margin within a de-minimus range.
· POI is from 1 st April 2001 to 31st March, 2002. It is submitted that the selection of the POI is flawed asthe applicant has, relied only on estimates for the final 4 months and thus prima facie has not furnishedany adequate or accurate data for the entire POI.
· The capacities mentioned are below the international economies of scale and less than the capacity ofEast. The capacity of the said applicant refers to D.T.A and thus the said applicant has t capacitycommitted for exports.
4. M/S WENZHOU MINGDA OPTICAL GLASSES CO. LTD., PR CHINA (MINGDA)
· Mingda is a privately owned limited company and is a manufacturer of Plastic Opthalmic Lenses. Mingdahas furnished the relevant confidential data in the confidential response.
· The decisions of Mingda with respect of prices, costs and inputs, including raw materials, cost oftechnology and labour, output, sales and investment, are made in response to market 'signals reflectingsupply and demand and the costs of the inputs reflect market values.
· Mingda is subject to China's. Bankruptcy Laws/winding up proceedings and there have been ofbankruptcies/closures in China of similar firms/companies.
· As in India the exchange rate is based on the market rate as determined by the China Central Bank as isreflected in the confidential data furnished along with the said confidential response to the questionnaire.
· Mingda states that it does not have the license to import or export and has not exported the subjectgoods to India or other countries during the POI i.e. from Ist April, 2001 to 31st March, 2002. Mingdastates that it has, inter alia, sold the subject goods to exporters, who possess the required license toexport and that such sales are treated as Mingda's domestic sales of the subject goods and is providingsome confidential data with respect to the exports to India of the above mentioned exporters during thesaid POI in the relevant confidential appendices to the confidential response to the Questionnaire.
M/s East and M/s Mingda have reiterated the views as submitted by M/s Wuzhou on the issue of Like Article
C. EXAMINATION BY AUTHORITY
The foregoing submissions made by the exporters, petitioner, importers and other interested parties, to theextent these are relevant as per Rules and have a bearing upon the case, have been examined, consideredand dealt with at appropriate places in these findings.
1. PRODUCT UNDER CONSIDERATION
The Authority notes that the petition has been filed by M/s Techtran Polylenses Limited, Hyderabad, a memberof Indian Plastic (c)pthalmic Lenses Association (IPOLA), Karnataka on behalf of the domestic industry, allegingdumping of Plastic Opthalmic Lenses (hereinafter also referred to as subject goods) originating in or exportedfrom People's Republic of China and Chinese Taipei. The petition is also supported by M/s Indian PlasticOpthalmic Lenses Association whose other members are M/s Indian Opthalmic Lenses Manufacturing Zo. Pvt.Ltd., Karnataka and M/s Prakash Plastic Industries (Madras)Pvt. Ltd., Chennai. The petitioners to the currentinvestigation are manufacturing and selling plastic opthalmic lenses manufactured out of CR39. The lensesmanufactured by the petitioners are made out of Bis Allyl IOi-carbonate, generically known as CR-39 withRefractive Index of 1.498 and Abbe number of 50 plus. These lenses are basically modern day lensessubstituting age old, glass lenses.
The Plastic Opthalmic Lenses are used in spectacles to correct Eye Vision of Human beings. These lenses areimported in finished, Uncut form, ready to mount in spectacle frames. The ITC(HS) classification of the productsis 9001.50 which attracts Customs duty, of 30%(2002 budget). The product is under OGL.
There are also other plastic materials from which lenses are manufactured for various purposes, includingopthalmic lenses. Therefore, the initiation notification covered all type of plastic opthalmic lenses for thepurpose of investigation. However, representations have been received from the interested parties to excludecertain type of plastic lenses, not manufactured by the domestic industry and having different properties as wellas end use, from the scope of current investigation. The Authority in this regard notes the submissions made byvarious importers/exporters regarding the exclusion of Acrylic lenses manufactured out of PolymethylMethacrylate (PMMA) and other lenses viz. Polycarbonate and specialty lenses like anti-reflection, multicoating,hydro-phobic coating, anti-EMI coating and anti-scratch coating lenses. It has been mentioned byvarious interested parties that the acrylic lenses are different from CR 39 since they are produced by theinjection moulding process, whereas CR 39 is manufactured by casting process. Also there is significant pricedifference in the two types of lenses as the cost of production is different. It has been mentioned by variousinterested parties that the petitioners have filed the petition specific to CR 39 lenses, which are used forcorrecting, vision only. It has been submitted that the acrylic lenses made from PMMA lenses are used mainlyfor sunglasses and have technical properties different from that, which are possessed by CR 39.
As regards specialty lenses like, anti-reflection, multi-coating, hydrophobic coating, anti-EMI coating and antiscratch coating, the Authority notes that anti-scratch/ hard lenses only are made by Domestic Industry and not the other types. However unlike Acrylic lenses which are stated to have different end use, no argument onthese not being like article to CR 39 lenses, has been advanced nor any quantification on adjustments onaccount of special features has been made:
However, the authority notes that all plastic lenses are being imported under the Customs tariff number9001.50, meant for spectacle lenses, which otherwise means prescriptive lenses used for corrective use. Thatbeing the cases, it appears that plastic lenses manufactured out of PMMA can also be used, and are beingimported, as prescriptive lenses to compete with CR 39 lenses. Therefore, it would not be proper to completelyexclude the plastic lenses made out of PMMA from the scope of the current investigation. Accordingly, pendingverification of the product exported by these exporters and their technical and commercial substitutability, thePMMA lenses are included within the product under consideration, for the purpose of preliminary determination,pending final determination. ,
Therefore, the Authority holds that this investigation covers "Plastic Opthalmic Lenses viz. CR 39 lensesalso called Hard Resin Lenses or equivalent, used for correcting vision". These lenses are in finished,uncut form, ready to mount in spectacle frames. These are made out of Bis Allyl Di-carbonate, genericallyknown as CR-39 or equivalent. These lenses are the modern day lenses substituting age old, glass lenses.These are classified under the Customs Head 9001-50 and can be imported under OGL with the basic Customsduty of 30% during the Period of Investigation. The Authority notes the claim of the interested parties that acryliclenses produced by PMMA and Polycarbonate lenses which are used in non prescriptive usage such assunglasses are not interchangeable and substitutable with CR 39 lenses, which are used for prescriptive visioncorrection purpose. However, issue of exclusion of these products from the scope the product underconsideration will be addressed on verification of their interchangeability and substitutability.
The specialty lenses like anti-reflection multi coating, hydrophobic coating, anti-EMI coating and anti-scratchcoating are however, within the scope of the product under consideration for the purpose of preliminarydetermination pending verification' and final determination.
2. LIKE ARTICLE
Article 2.6 of the Agreement on Antidumping defines 'like article' as: "a product which is identical, i.e. alike in allrespects to the product under consideration or in the absence of such a product, another product which,although not alike in all respect; has characteristics closely resembling those of the product underconsideration". Identification of `like article' in the exporting country is required for determination of the normalvalue of the product in the ordinary course of trade in that country.
The petitioners have claimed and Authority notes that the goods produced by them are like article to the goodsproduced, and exported from the subject countries. CR 39 lenses have been imported, at least from PR China,manufactured by one of the co-operating exporters i.e. M/S Y & S (Tianjin) Industries, and for this categoryinterchangeability of domestically produced goods and those exported has not been disputed. Other threeresponding exporters i.e. Wenzhou East, Wenzhou Group and Wenzhou Mingda have indicated that they produce and export goods manufactured out of PMMA, which is, both technically and commercially different from the corrective lenses manufactured by the petitioners from CR39. Therefore, they have claimed that their products are not technically and commercially substitutable or interchangeable with the product manufactured by the petitioners. Considering these submissions the authority has confined this investigation to prescriptive/ corrective plastic opthalmic lenses made out of CR 39 and equivalent only. However, the authority notes that Acrylic lenses and lenses made out of other materials (other than CR 39) have also been imported under Customs tariff head 9001.50.00 (which is basically for spectacle lenses and excludes sunglasses and other non-opthalmic glasses, which are covered elsewhere). Therefore, the contention of the three exporters from China that they are producing and exporting PMMA lenses only, and that the lenses exported/imported by them are not used for corrective opthalmic use, does not appear to be entirely correct.
The Authority, in view of submissions made by other interested parties, and keeping in view the substitutabilityand interchangeability of the goods from subject countries and those produced by the domestic industry,considers the subject goods exported and domestically produced subject goods as like article as per Rule 2(d)for the purpose of preliminary determination pending final determination.
3. DOMESTIC INDUSTRY
The petition has been filed by M/s Techtran Polylenses Limited, Hyderabad, a-member of Indian PlasticOpthalmic Lenses Association (IPOLA), Karnataka on behalf of the domestic industry, alleging dumping ofPlastic Opthalmic Lenses (hereinafter also referred to as subject goods) originating in or exported from People'sRepublic of China and Chinese Taipei (hereinafter referred to as subject countries). The petition is alsosupported by M/s Indian Plastic Opthalmic Lenses Association whose other members are M/s Indian OpthalmicLenses Manufacturing Co. Pvt. Ltd., Karnataka and M/s Prakash Plastic Industries (Madras) Pvt. Ltd., Chennai.The Authority also notes that M/s Techtran Polylenses Ltd along with the other petitioners accounts for almost90% of the total domestic production (on the basis of domestic sales entitlement of Techtran and productioncapacity of other petitioners) and therefore, have the standing to file the petition on behalf of the domesticindustry as per Rule 5 (3) (a) and (b) of the Anti-Dumping Rules and also represent Domestic Industry in termsof Rule 2(b). The fact that M/s Techtran is an 100% Export Oriented Unit (EOU) does not exclude them for thescope of the domestic industry as per Rule 2(b). The fact that as per the Exim policy of the country thismanufacturer was permitted to sell the goods in Domestic Tariff Area (DTA and also that domestic sales of thesubject goods have been made by them in Period of Investigation, qualifies them to be a part of the DomesticIndustry as per Rule 2(b). Even if, the argument of the opponent to the Petition that M/s Techtocam PolylensesLtd, being a 100% EOU is accepted, the production capacity of the other two Petitioners supporting the Petitionqualified the standing requirement. In such a situation, the DTA sales entitlement of the 100% EIOU will beignored both from domestic capacity as well as production side and other two producers with combinedproduction capacity of 1.625 million pairs will constitute more than 50% of the domestic production and,therefore, conform to the standing requirement. Therefore the Authority concludes that the petitioners have thestanding to file the petition on behalf of the domestic industry.
4. NORMAL VALUE & EXPORT PRICE
Under Section 9A (1)(c), 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 theexporting country or territory as determined in accordance with the rules made under sub-section (6); or
(ii) when there are no sales the like article in the ordinary course of trade in the domestic market of theexporting country or territory, or when because of the particular market situation or low valume of the salesin 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 oran 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 foradministrative, selling and general costs, and for profits, as determined in accordance with the rules madeunder sub-section (6);
Provided that in the case of import of the article from a country other than the country or origin and wherethe article has been merely transsshipped through the country of export or such article is not produced inthe country of export or there is no comparable price in the country of export, the normal value shall bedetermined with reference to its price in the country of origin.
The normal value and ex-factory export price determination is illustrated below.
NORMAL VALUE
PR CHINA
1 M/s Wenzhou East Optical Glasses Co. Ltd., M/s Wenzhou Wuzhou Group co. Ltd. and M/s Wenzhou,Mingda Optical Glasses Co. Ltd.
In respect of the producers/exporters, viz. M/s Wenzhou East Optical Glasses Co. Ltd., M/s Wenzhou WuzhouGroup co. Ltd. and M/s Wenzhou Mingda Optical Glasses Co. Ltd., the respondents claim and Authority notesthat they have exported PMMA manufactured Acrylic lenses which have a different manufacturing process thanof CR 39 type of lenses. The cost and price of two types of lenses vary significantly and also the usage ofthese-two lenses are in different end use segments. While examining various submission by interested partieson the question of like article for the purpose of this investigation arid specifically the issue of inclusion orexclusion of other lenses (other than CR 39) s
The Authority also notes that the above producers/exporters have indicated that they are operating on themarket economy principle. These exporters have responded to the specific questionnaire in this regard.M/s Wenzhou East Optical Co Ltd.
The exporter has claimed that there is no restriction on import of raw materials and PMMA is procured fromSumitomo Chemicals, Singapore. The other raw material are procured from the local sources through long-termcontracts and the utlities are procured from local utilities providers at market rates. The exporter has notsubmitted any published balance sheet and audited documents to substantiate that the company operatesunder market economy principles. as far as other parameters for determination of market economy status of thecompany is concerned the respondent has submitted copies of various laws of PR China. But the extent andmanner in which these law are being implemented and followed cant not be corroborated from the responsefiled, without verification. The Authority in this regard recalls the provisions of non-market economy as indicatedin the Anti dumping Rules read with Custom Notifications No. 44/99(N.T.) dated 15th July, 1999, 28/2001(N.T.)dated 31st May, 2001 and 1/2001 (NT-Customs dated 4th January, 2002. Moreover, the invoices of exports toIndia do not indicate the base material of the lenses exported. It is therefore difficult to conclude that the lensesexported were made out of PMMA. Moreover, data on cost of raw materials and manufacturing cost provided bythe exporter has not been corroborated with documentary evidence. Therefore, pending final verification andfinding, the authority holds that the exporters have failed to rebut the presumptions that they operate in nonmarket economy conditions and proceeds to construct the normal value on the basis of facts available. theconstructed normal value has been worked out as ****$/pair for the purpose of preliminary determinationpending final determination.
M/s Wenzhou Mingda Optical Co. Ltd.
This is a manufacturing company having no licence to export or import and its products are exported to Indiathrough M/s Wenzhou Wenzhou Group Co. Ltd. They have also responded to the specific questionnaire onmarket economy status and informed that they source all their raw materials from domestic producers ordealers by long term contracts or from domestic producers or dealer by long term contracts or from spot market.Other responses as far as cost of production and market orientation of the company are similar to the responsefiled by M/S Wenzhou East and therefore, not repeat herein. The respondent has produced only copies orvarious laws of PR China to prove that the company is market drive, without corroborating with its ownpublished documents. Therefore, in view of their failure to rebut the presumption of non-market market conditionas stated above, the Authority proceeds to construct the normal value as per the facts available. Theconstructed normal value has been worked out as ****$/pair for the purpose of preliminary determinationpending final determination.
M/s Wenzhou Wenzhou Group Co. Ltd.
This being a trading company, exporting goods manufactured by the other two companies and relied on thecost data of these companies. As the normal value for the manufacturers concerned are being constructed, thesame will also be applicable to this exporter also.
Export prices
The Authority has referenced the export price on the basis of the response given by the Importer of subjectgoods during the period of investigation. The Authority has allowed adjustments on inland freight, ocean freight,port expenses, commission and other expenses to an extent of -****. ****, ****, **** and **** $/pair respectively on the basis of data provided by the exporter and the importer. Adjustment on commission has been considered to an extent of ***% as the goods has been exported through a trading house.
The ex-factory export price comes to ****$/per pair.
M/s Y &S (Tianjin)- Industries Ltd., PR China
Normal Value
The Authority notes that the producer has exported CR-39 lens during the Period of Investigation and agreed toco-operate in the investigation process. The producer has provided the cost of production details but has notprovided the domestic selling prices of the subject goods during the period of investigation. The Authority notesthat the producer has also indicated that they are operating on the market economy principle but they have notprovided any specific evidence to this effect, specifically in respect of the four parameters as stipulated in theAnti Dumping Rules read with Customs Notifications No. No.44/99(N.T.) dated 15" July, 1999, 28/2001(N.T/)dated 31St May, 2001 and 1 /2001(NT-Customs dated 4t" January, 2002. The exporter has also not respondedto the specific questionnaire sent to it seeking information on its Market Economy status. The Authority in thisregard also notes that in cases of exports of Steel Concrete Reinforcing Bars by PR China to USA dated22.6.2001, exports of Bicycles by China to EU dated 30.6.2001 and exports of non-frozen apple juiceconcentrate by China. to EU dated 13.4.2002 China has been treated as non-market economy. The Authorityhowever; notes that the exporter has provided the international raw material prices for the use in themanufacture of the subject goods and the evidence regarding the appropriate packing cost for the subjectgoods. In view of the failure of the exporter to rebut the presumptions of non-market condition as, explainedabove, the Authority has proceeded to construct the normal value in respect of this exporter. However, the costelements of the raw material provided by the exporter has been considered and the other cost components asprovided by the domestic industry has been taken for appropriately constructing the cost of production of thesubject goods during the period of investigation for referencing the normal value. The cost of production detailshave been considered on the basis of the cost of production of the subject goods in India in accordance with theAnti Dumping Rules read with Custom Notifications No.44/99(N.T.) dated 15th July, 1999, 28/2001(N.T dated31st May, 2001 and 1/2001(NT-Customs dated 4th January, 2002. The Authority has therefore constructed thenormal value as ****$/pair for the purpose of preliminary determination pending final determination.
Export Price
The Authority has referenced the export price on the basis of the response given by M/s Enterprise TradingCompany, the Importer of subject goods during the period of investigation. The Authority has allowedadjustments on inland freight, ocean freight, port expenses, commission and other expenses to an extent of****. **** **** **** and **** $/pair respectively on the basis of data provided by the exporter -and the importer.
Adjustment on commission has been considered to an extent of ***% as the goods has been exported througha trading house.
The ex-factory export price comes to ****$/per pair.
B. ASSESSMENT OF NON-COOPERATING PRODUCERSIEXPORTERS FROM PR CHINA
Normal Value
None of the exporters/producers other than the exporters stated above from PR China have responded. Out ofthe responding parties only one exporter i.e. M/S Y & S(Tianjin) Industries Ltd., PR China has, provided certain dataon CR 39 lenses and others have claimed that they manufacture and export PMMA lenses only. The Authority hastherefore, referenced the constructed normal value as adopted for the, co-operating producer for theseexporters/producers as well.
The-normal value is therefore referenced as ****$/pair.
Export Price
The Authority has considered the least export price from the response provided by the importer viz. M/sEnterprise Trading Company for these exporters/producers. The least CIF price for these as per the importer'sresponse is *****$/per pair. The adjustments have been provided on inland freight, ocean freight, port expenses,commission and ocean insurance to an extent of ****, ****, ****, **** and ****$/ pair respectively.
The ex-factory export price comes to ****$/per pair.
C. ASSESSMENT OF ALL PRODUCERS/EXPORTERS TAIWAN
Normal Value
The Authority notes that none of the exporters/producers of subject goods from Taiwan have responded to theInitiation Notification. The Authority has therefore referenced the constructed cost of production as indicated in the foregoing para above for these exporters/producers from Taiwan also.
The normal value is therefore referenced as ****$/ pair.
Export Price
The Authority notes that in view of no response by the exporters/producers from Taiwan and also no responsefrom the importer, the best available information in terms of Rule 6(8) of Antidumping Rules has been considered.The CIF export price on the basis of the Directorate General of Commercial Intelligence and Statistics (DGCI&S) hasbeen referenced for the purpose of evaluating the export price. The adjustments on inland freight, ocean freight, port expenses, commission and ocean insurance to an extent of ****, ****, ****, **** and ****$/Pair has been allowed on CIF to evaluate the ex factory export price.
The ex-factory export price comes to ****$/ pair.
5. DUMPING: Comparison of Normal Value & Export Price
The rules relating to comparison provides as follows:
"While arriving at margin of dumping, the Designated Authority shad make a fair comparison between the exportprice and the normal value. The comparison shall be made at the same level of trade, normally at ex-workslevel, and in respect of sales made at as nearly possible the same time. Due allowance shall be made in eachcase, on its merits, for differences which affect price comparability, including differences in conditions and termsof sale, taxation, levels of trade, quantities, physical characteristics, and any other differences which aredemonstrated to affect price comparability."
The authority has carried out weighted average normal value comparison with the weighted average ex-factoryexport price in Period of Investigation, for evaluation of the dumping margin for all the exporter/producers of thesubject country.
The dumping margin for exporter/producers comes as under:
| SI No | Exporter/Producer | Ex-factoryExport Price $/pair | Normal Value $/pair | Dumping Margin as %of EP |
|---|
| 1 | PR China
1. Y&S (Tianjin) Industries |
**** |
** |
26.49 |
| 2. Wenzhou East Optical glass Co. Wenzhou Mingda Optical Glass Wenzhou Wenzhou Group Co. | **** | ** | 213.93 |
| 3. Other producers/exporters | **** | ** | 213.13 |
| 2. | Taiwan
All producers/exporters from Taiwan | **** | | 233.75 |
6. INJURY
Under Rule 11 supra, Annexure-11, when a finding of injury is arrived at, such finding shall involvedetermination of the injury to the domestic industry, "taking into account all relevant facts, including the volume ofdumped imports, their effect on prices in the domestic market for like articles and the consequent effect of suchimports on domestic pcoducecs of such articles ...." In considering the effect of the dumped imports on prices, it isconsidered necessary to examine whether there has been a significant price undercutting by the dumped imports ascompared with the price of the like article in India, or whether the effect of such imports is otherwise to depressprices to a significant degree or prevent price increases, which otherwise would have occurred, to a significantdegree.
For the examination of the impact of the dumped imports on the domestic industry in India, such indiceshaving a bearing on the state of the industry asAre production, capacity utilisation, sales quantum, stock,profitability, net sales realization, the magnitude and margin of dumping, etc. have beenconsidered, in accordance with Annexure II(iv) of the rules supra.
The Authority notes and observes the following economic parameters in the case of the domestic producers whohave filed and supported the petition:-
| | 1999-2000 | 2000-2001 | 2001-2002 POI |
|---|
| Domestic Capacity Pair | 26,25,000 | 26,25,000 | 26,25,000 |
| Production (pair) | 943695 | 1513992 | 1781265 |
| Capacity Utilisation(%) | 36% | 57% | 67% |
| Domestic Sales Pair | 432934 | 995479 | 1084573 |
| Sales to production | 46% | 66% | 61 |
| Imports from China Pair | 475585 | 550319 | 872400 |
| Imports from Taiwan Pair | 414805 | 3975931 | 623534 |
| Total Imports Pair | 2025705 | 1623482 | 2154880 |
| Demand (Pair) | 2458639 | 2618961 | 3239453 |
| Market share of domestic industry as % of demand | 17% | 38% | 33% |
| Market share of China as % of demand | 19.34 | 21.01 | 2,6.93% |
| Market share of Taiwan as % of Demand | 16.87 | 15.18 | 18.45% |
| Market share of China as % of total imports | 23.47 | 33.89 | 40.48% |
| Market share of Taiwan as % of total imports | 20.47 | 24.49 | 28.93% |
| Net Sales Realisation of Domestic Rs/Pair | **** | **** | **** |
* Based on Domestic Sales entitlement of M/S Techtran Polylenses.
(i) The Authority notes that though the production, capacity utilisation and domestic sales of the DomesticIndustry have increased from 1999 2000 to 2001-2002 in absolute terms it remains much below theinstalled capacity. One of the petitioners, i.e. M/S Techtran has been operating at about 85% capacity andmaintaining its export obligation. But it has not been able to use its domestic sale entitlement (50% ofexports for all the years due to depressed prices in the domestic market caused by dumping from thesubject countries. Actual domestic sales have been about 50% of its normal domestic sales entitlement forthe period under consideration, leading to huge built up of inventory. The other petitioner M/S IndianOpthalmics, is operating only half a shift in a day and produces only half its capacity, in order to avoidinventory built up as the domestic market is depressed due to both volume and price effect of dumpedimports.
(ii) The capacity utilisation has remained below 70%. Though it has increased marginally between 00-01 and01-02. But sales to production of the domestic industry have declined during this period.
(iii) The imports of subject goods from the subject countries have increased from 1999-2000 to 2001-2002 inabsolute terms and also as of demand and total imports.
(iv) The market share of Domestic Industry has decreased from 20002001 to 2001- 2002 due to dumpedimports.
(v) The dumped imports have caused price under-cutting and the Net Sales Realization (NSR) of the DomesticIndustry has been lower than the Non-Injurious Price (NIP) in the Period of Investigation thus leading toprice underselling and thus financial loss to the Domestic Industry.
(vi) The demand of subject goods has increased from 1999-2002 to 2001- 2002 thus not being a constrainingfactor for injury to the Domestic Industry
(vii) One of the petitioners have been showing accumulated cash loss for the last three years including .the POIor improving their financial position mostly through export earning, while inventory is building up asdomestic sales have been affected by dumping from the subject countries.
7. CAUSAL LINK
The Authority has examined the impact of the dumped imports on the domestic industry as per principle (v),Annexure II of the Antidumping Rules. The relevant indices as set forth in para (iv) of the Annexure 'll of therules have been examined by the Authority.
The Authority has considered the views expressed by the petitioners and other interested parties` as regardsthe causal links, which have been mentioned in the preceding paragraphs. After examining the variouseconomic parameters as above the Authority has come, to the following conclusions:
(i) There has been an increase in imports of subject goods from subject countries in absolute terms aswell as in relation to the demand of said goods in India.
(ii) The market share of the dumped imports from the subject Countries has increased significantlyduring POI in comparison to the previous years: The significant volume of dumped imports from thesubject countries has resulted in significant price under cutting, price suppression/depression' forthe subject products of the domestic industry. The net sales realization of the domestic industry hasbeen significantly below the non-injurious price (NIP) of subject goods as a result of the dumpedimports from subject countries.
(iii) The domestic industry has suffered injury due to price suppression. They have not been able toraise their selling price so as to realize a fair return on the investments as the landed value of thedumped imports has considerably depressed the selling price of the domestic industry.
(iv) The above economic parameters cumulatively and collectively establish that domestic industry hassuffered material injury on account of dumping.
(v) The demand of the subject goods has not decreased but has instead increased and therefore,contraction of demand cannot be attributed as a cause of injury. The Authority also notes that thedomestic industry is globally competitive and changes in technology or competition amongst thedomestic producers are not the cause of injury. The Authority has also noted that there is someincrease in the exports made by the domestic industry in comparison to the previous year.
Therefore, decline in exports sales of the domestic industry cannot be attributed to the injury. Notechnological development in the industry or any other such factor, which could have resulted ininjury to the domestic industry, has been noticed.
8. INDIAN INDUSTRY'S INTEREST & OTHER ISSUES
The Authority holds that the purpose of anti-dumping duties, in general, is to eliminate injury caused to theDomestic Industry by the unfair trade practices of dumping so as to re-establish a situation of open and faircompetition in the Indian market, which is in the general interest of the country.
The Authority also recognizes that though the imposition of anti-dumping duties might affect the price levels ofthe products manufactured using the subject goods and consequently might have some influence on relativecompetitiveness of these products, however, fair competition in the Indian market will not be reduced by these antidumping measures. On the contrary, imposition of anti-dumping measures would remove the unfair advantagesgained by the dumping practices and would prevent the decline of the domestic industry and help maintainavailability of wider choice of the subject goods to the consumers. Imposition of anti-dumping measures would alsonot restrict imports from the subject country in any way, and, therefore, would not affect the availability of theproducts to the consumers.
9. LANDED VALUE
The landed value of imports for the purpose shall be the assessable value as determined by the Customsunder Customs Tariff Act, 1962 and applicable level of custom duties except duties levied under Section 3, 3A, 813,9, 9A of the Customs Tariff Act, 1975.
D. CONCLUSIONS:
After examining the issues raised and submissions made by the interested parties the authority provisionallyconcludes that:
a) The subject goods in all forms originating in or exported from the subject countries have been exported toIndia below its normal value.
b) The domestic industry has also suffered material injury by way of financial losses due to depressed NetSales Realization (NSR) on account of price depression and suppression caused by low landed prices ofthe dumped subject goods.
c) The injury has been caused to the domestic industry both by volume and price effect of dumping of thesubject goods originating in or exported from the subject countries.
d) The Authority recommends anti-dumping duty on imports of subject goods falling under chapter 90 andoriginating in or exported from the subject countries.
e) The Authority recommends the amount of anti-dumping duty equal to the margin of dumping so as toremove the injury to the domestic industry accrued on account of dumping. Accordingly, it is recommendedthat provisional anti dumping duties equal to the difference between the amount indicated in the column 9of the table annexed to this Notification and the landed value of subject goods, in US$/thousand pair, beimposed, from the date of notification to be issued in this regard by the Central Government, on all importsof subject goods originating in or exported from subject countries under Chapter 90 Customs sub-heading9001.50 the Customs Tariff, pending final determination .
E. FURTHER PROCEDURE
The following procedure would be followed subsequent to notifying the preliminary findings:
a. The Authority invites comments on these findings from all interested parties and the same would beconsidered in the final findings;
b. Exporters, Importers, Petitioner and other interested parties known to be concerned are beingaddressed separately by the Authority, who may make known their views, within forty days from thedate of the despatch of the letter. Any other interested party may also make known its views withinforty days from the date of publication of these findings;
c. The Authority would conduct verifications to the extent deemed necessary;
d. The Authority would provide opportunity to all interested parties for oral submissions, for which thedate and time shall be communicated to all known interested parties separately;
e. The Authority would disclose essential facts before announcing final findings.
Sd/-
L. V SAPTHARISHI, Designated Authority
ANNEXURE - I
| S. No. | Sub Hea- ding of Tariff Item | Des- crip- tion of Goods | Spe- cifi- ca- tion | Country of origin | Country of Export | Producer | Exporter | Amo- unt | Unit of Mea- sure- ment | Curr- ency |
|---|
| (1) | (2) | (3) | (4) | (5) | (6) | (7) | (8) | (9) | (10) | (11) |
|---|
| 1. | 9001.50 | Plastic Ophthalmic Lenses made out of CR 39 or equivalent | Nil | People’s Republic of China | Any country other than Taiwan | Y & (Tianjim) Industries | Any exporter | 1230.46 | 1000 Pair | US$ |
| | | | | | | Wenzhou East, Wenzhou Group & Venzhou Mingda | Any Exporter | 1078.79 | | |
| 2. | 9001.50 | Plastic Ophthalmic Lenses made out of CR 39 or equivalent | Nil | Any country | People’s Republic of China | Y & (Tianjim) Industries | Any exporter | 1230.46 | 1000 Pair | US$ |
| | | | | | | Wenzhou East, Wenzhou Group & Venzhou Mingda | Any Exporter | 1078.79 | | |
| 3. | 9001.50 | Plastic Ophthalmic Lenses made out of CR 39 or equivalent | Nil | Any country | Taiwan | Any producer | Any exporter | 1070.24 | 1000 Pair | US$ |
| 4. | 9001.50 | Plastic Ophthalmic Lenses made out of CR 39 or equivalent | Nil | Taiwan | Any country other than PR China | Any producer | Any exporter | 1070.24 | 1000 Pair | US$ |
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