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Anti-dumping duties constraining industry growth

The government cautioned on Tuesday that prohibitive anti-dumping and countervailing duties by the developed nations including US and the European Union was constraining industrial growth even though exports have grown by 13.5 per cent during the first half of 2002-03.

"It is critical to remove regulatory inefficiencies like prohibitive food standards" as part of efforts to realize export potential of India's agriculture sector, the mid-year economic Review, presented in Parliament by Finance Minister Jaswant Singh, stated.

Overall growth of the industry has been constrained due to relatively slow revival of demand, competition from cheap imports and prohibitive barriers in form of anti-dumping and countervailing petition moved by EU, US and Canada, it said.

Despite the external sector remaining buoyant, the review said foreign direct investment in India at $1,358 million during April-August was lower compared to $1,469 million in the corresponding period last year.

"Weak investor sentiment and sluggish performance of the Indian stock markets resulted in a net outflow of $248 million dollars through the FII route in the first five months of the current fiscal," it warned while pointing out that during the same period last year an inflow of $873 million was recorded.

In this context, the review said that "retiring and refinancing" of more expensive external debts was a priority in the debt management policy and added that India had prepaid over $600 million during first half of current fiscal by taking advantage of softer interest regime worldwide.

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Mid-term Economic Review 2002
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