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What is Margin of Dumping

What is Margin of Dumping 

Margin of Dumping refers to difference between the market price of that product prevailing in the market and the export rate at which it is exported.

For Eg. If Product X is exported to India. The Export price of the product is Rs. 1000. The market price in India is Rs. 1250. Then the margin of Dumping would be Rs.250 (1250 – 1000)

There are many cases in which the Anti Dumping Duty can be avoided. They are :-

  1. When there is no sufficient proof for Dumping.

Eg. When product X is exported to India at Rs 1000 but the current market price is Rs. 1250. Now finding to reasons it was found that there was only one player in the market selling and he was charging higher than the normal price. So there is no proof for Dumping.

  1. When margin of Dumping is less than 2% of export price

Eg. Export price = Rs 1000 , Market price = Rs 1010

Here, Margin of Money = Rs 10 (1010 – 1000), i.e. 1 % of the export price, so there is no need for antidumping duty to be charged

  1. If it obtained in writing from the concerned person who started or requested to start the anti dumping investigation.
  1. When the imports for a particular product in a particular country is less than 3% of the total imports of the like article.
  1. If the loss caused to the Domestic player is very negligible. The word negligible may vary from person to person.

It does not always mean that the dumped products exported to a particular country are cheap products, but it only mean that in relative sense that it means related to or in accordance to that market price and not to the capability of the person to buy it.

The basic difference between the normal custom duty and anti dumping duty is that the anti dumping duty charged is of intention to avoid unfair trade practices while that of normal is to raise the income and development of the country.

Thus Anti-Dumping Duty can be called a SPECIAL KIND OF DUTY, as it not applicable to each and every kind of industry but only to specific industry.

What is Margin of Dumping

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