In January 2017, India imposed an anti-dumping tax of $19 to $352 per tonne on the export of jute products produced in Bangladesh. Apart from the five-year trade secretary-level meeting between the two countries, Bangladesh raised objections in the joint trade talks, but India did not withdraw. Meanwhile, India’s Director General of Trade Remedies (DGTR) has launched a sunset review to continue the anti-dumping tax for another five years. This information was provided by Daily Banik Barta according to the Ministry of Commerce.
The Ministry of Commerce has recently written to the Ministry of Finance to take initiative to withdraw the anti-dumping tax. In the letter, the Ministry of Commerce said that India is Bangladesh’s second-largest import source and trading partner. India has been one of the most important export destinations for jute products since the independence of Bangladesh. But the imposition of an anti-dumping tax on jute products exported from Bangladesh in 2017 has adversely affected exports.
In 2015, India’s DGTR launched an investigation into the imposition of an anti-dumping tax on jute products imported from Bangladesh, the report said, citing Ministry of Commerce sources. Then in 2016, a definitive anti-dumping tax was recommended. In view of this, the tax was imposed on 5 January 2017 through a customs notification, which was further amended on 3 April of the same year. This hampered the export of jute products to India.
Meanwhile, at the request of Indian industry owners, DGTR has started a sunset review to increase the anti-dumping tax on jute products exported from Bangladesh for another five years. As part of the review, Bangladeshi exporters have responded to the set questions. In addition, an inter-ministerial delegation led by the Ministry of Commerce participated in the oral hearing. Simultaneously post-hearing statement and rejoinder have been submitted. The issue was also raised at a recent bilateral meeting at the Commerce Secretary level in New Delhi. The DGTR will soon release the results of the investigation.
The Ministry of Commerce says that in July 2020, the government was forced to close down the jute units operating under Bangladesh Jute Mill Corporation. As a result, the capacity of jute mills in Bangladesh has been significantly reduced. Ensuring jobs and salaries for jute workers is a constant challenge and the sector is going through an existential crisis for various reasons. The government is trying to stabilise the troubled sector with limited assistance to save the livelihoods of millions of workers and farmers. The sunset review will end existing anti-dumping taxes and bring back competition based on capabilities between Bangladeshi exporters and Indian producers.
Calling on the Minister of Finance to take initiative in this regard, the letter from the Ministry of Commerce said that the Indian Minister of Finance could be requested to withdraw the anti-dumping tax imposed by the country by explaining the position of jute products in Bangladesh’s economy. Withdrawal of anti-dumping tax would restore cooperation in the jute sector of both the countries. This will help in strengthening the friendly relations between the two countries.
According to Ministry of Finance sources, the Minister of Finance has not yet sent a letter to India in this regard. However, the letter will be sent through diplomatic channels very soon.
Jute is one of the products exported from Bangladesh to India. According to the Export Promotion Bureau (EPB), Bangladesh exported 1 thousand 96 million dollars worth of products to India in the last fiscal year 2019-20, of which 157 million dollars came from jute and jute exports. About 12% of Bangladesh’s jute products are exported to India. The exporters of this sector suffered huge losses due to the imposition of anti-dumping.
According to the Ministry of Commerce, the total trade volume between India and Bangladesh in the fiscal year 2020-21 was about USD 10 billion, of which Bangladesh’s exports to India were USD 1.3 billion. The rest was imported from India to Bangladesh. In other words, the trade deficit stands at about 9 billion dollars.
