India plans extending anti-dumping duties on Chinese and Korean phthalic anhydride imports to protect domestic manufacturers from unfair pricing.
India's Directorate General of Trade Remedies (DGTR) has recommended the extension of anti-dumping duties on imports of Phthalic Anhydride (PA) from China and South Korea for an additional five years. This decision follows a comprehensive sunset review investigation, concluding that the expiry of the current duties would likely lead to a continuation or recurrence of dumping and subsequent material injury to the domestic industry. The existing anti-dumping duties were initially imposed in August 2021 for a five-year period, covering imports from China, Indonesia, South Korea, and Thailand, after an investigation found that these countries were exporting PA at prices below their normal value, causing significant harm to Indian manufacturers.
The recent sunset review, initiated in January 2026, was prompted by an application from major Indian producers, including IG Petrochemicals Ltd, Thirumalai Chemical Industries Ltd, and TCL Intermediates Pvt Ltd. These companies argued that low-priced imports from the subject countries continued to adversely impact their operations. The DGTR's findings supported these claims, noting that despite substantial investments of approximately Rs 1,900 crore by domestic manufacturers to expand capacity, their profitability had sharply deteriorated due to the influx of cheap imports. The authority determined that the continuation of anti-dumping measures is both "appropriate and necessary" to safeguard the long-term viability of the domestic sector.
Under the new recommendation, anti-dumping duties will be maintained at 40.08 per metric tonne for Chinese imports and 140.17 per metric tonne for Korean imports. Interestingly, the review found that Thailand had a negative injury margin, leading to the recommendation that duties on imports from Thailand should not be extended.
The extension of these duties carries several significant impacts. Economically, it aims to protect and bolster India's domestic Phthalic Anhydride industry, allowing local producers to compete on a more level playing field against foreign counterparts. Phthalic Anhydride is a critical industrial chemical, widely used in the manufacture of plasticizers, resins, paints, coatings, dyes, and pigments. Therefore, the duties will directly influence the pricing and supply dynamics for these downstream industries. While safeguarding domestic producers, the measure could also lead to higher input costs for industries relying on imported PA. Geopolitically, this move reinforces India's commitment to employing trade defense mechanisms to counter unfair trade practices, potentially leading to continued trade discussions with China and South Korea. The previous imposition of duties had already seen a decline in overall chemical imports, notably from China, while imports from other regions like Taiwan increased, leading to new anti-dumping investigations. This illustrates the dynamic nature of global trade flows in response to such protective measures.
