Govt working on verification system to help exporters deal with countervailing duty cases

14 May 2024 Evaluate

The government is working on a verification system to help exporters deal with countervailing duty cases on domestic products over the Remission of Duties and Taxes on Exported Products (RODTEP) scheme. The exercise is important as countervailing or anti-subsidy duties were imposed on certain domestic units by the US and European Union (EU). 

The products which were investigated by these countries involved reimbursement of levies like electricity duty, VAT on fuel or APMC taxes under the Scheme for RoDTEP. The scheme is a World Trade Organisation (WTO) compliant measure. The duties have been imposed on certain units only and that too because they could not produce the right documents to the investigation authorities. The commerce ministry is helping Indian exporters to keep proper documentation to deal with these cases. Besides checking the documents of units, investigation authorities also look at the official verification mechanism to ascertain whether the government is randomly checking the incidence of duties or not. 

Before imposing countervailing or anti-subsidy duty (CVD), a country carries out detailed investigations on products which it believes that its trading partner is subsidising for export purposes. Subsidising exports is a kind of unfair trade practice. Countervailing duties can only be imposed if the investigating agency of the importing country determines that the imports of the product in question are subsidized and are injuring a domestic industry.


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