Bangladeshi jute exporters are under strain as India considers imposing a countervailing duty on their shipments.
This comes at a challenging time when they are already grappling with an existing anti-dumping duty (ADD) in the market.
The decision stems from India’s concern that the subsidies granted by Bangladesh are adversely impacting its domestic jute industry.
India has initiated an investigation to explore the implementation of CVD. To address these concerns, the Indian government has reached out to the commerce ministry of Bangladesh, requesting a meeting.
The intention is to discuss these issues and gather insights. However, according to Senior Commerce Secretary Tapan Kanti Ghosh, the Bangladeshi ministry has requested an extension of two months before the meeting takes place.
The IJMA informed the DGTR that Bangladesh’s jute subsidies harm Indian jute industries.
CVDs are import tariffs aiming to offset subsidies granted by the exporting nation.
In contrast, an anti-dumping duty (ADD) is a tariff introduced by a domestic government to safeguard against foreign imports being priced unfairly below market value.
The core concern centres around the subsidies granted by Bangladesh, including a 12% cash incentive on exports of jute goods and a 7% incentive on jute fibers.
Furthermore, there’s a 20% subsidy for exporting carbon and jute particle board made from natural fiber.
The IJMA has specifically pointed out the substantial volume of locally-made jute sacks being exported by Bangladesh, which is impacting the Indian jute industries.
This complaint underscores the view that the subsidies are rendering Bangladeshi jute industries more competitive, ultimately affecting Indian counterparts.
Bangladesh urges India to end ADD by December 31; talks slated in Prime Ministerial meeting.
The matter involves comprehensive research and consultations with various stakeholders, as emphasized by Senior Commerce Secretary Ghosh.
It is evident that the road ahead requires careful consideration and collaboration to address the concerns of both nations regarding jute exports.
This trade concern compounds jute market dynamics, affecting India-Bangladesh trade ties, with both nations’ jute industries and trade landscape at stake.