Last Updated on January 14, 2024 by The Health Master
The Union commerce ministry has recommended the continuation of anti-dumping duty on semi synthetic antibiotic drug amoxycillin trihydrate imported from China for five years in order to protect domestic manufacturers from cheap imports.
In a notification on February 15, 2022, the ministry’s investigation arm, the Directorate General of Trade Remedies (DGTR), said there is a likelihood of continued dumping of amoxycillin trihydrate from China and injury to domestic players if the existing anti-dumping duties are allowed to cease.
The authority recommended imposition of anti-dumping duty on import of the product from China for five years. The recommended duty is USD 1.96 per kg.
The finance ministry takes the final decision to impose this duty. In its probe, the DGTR has concluded that there is sufficient evidence to indicate that the cessation of the duty at this stage will lead to continuation of dumping and injury to the domestic industry.
On May 16, 2017, the Central Board of Excise and Customs (CBEC) had imposed definitive anti-dumping on import of amoxycillin trihydrate from China for five years.
Aurobindo Pharma, one of the eight producers of amoxycillin trihydrate in India had filed an application on behalf of the domestic industry for sunset review of existing duties on imports of the product from China. Aurobindo’s production accounts for 30 per cent of the Indian production.
The application, supported by Penam Laboratories Ltd and Centrient Pharmaceuticals India Pvt Ltd, alleged that the dumping of amoxycillin trihydrate from China has continued even after the imposition of anti-dumping duty and that there is a likelihood of continued dumping and recurrence of injury to the domestic industry.
The applicant requested the DGTR to extend the anti-dumping duty imposed on the imports of the drug from China.
“The central government is making significant efforts to make the Indian drug industry self-reliant. The production linked incentive introduced by the government aims to promote domestic production of active pharmaceutical ingredients, key starting materials, and drug intermediates and Amoxicillin is one of the eligible API and penicillin-G and 6-APA as the key starting materials/drug intermediates.
If duties are not extended then Chinese producers will dump in the country which will not only threaten viability of Amoxicillin but all efforts going towards backward integration would also fail,” said Aurobindo Pharma in the application.
The committee on drug security constituted by the department of pharmaceuticals identified 53APIs for which the country is heavily dependent on imports. The list of such identified APIs includes amoxicillin.
A 15,000 metric tonnes plant of penicillin G of Aurobindo worth Rs. 1,392 crore has been approved by the ministry of chemicals and fertilizers.
Acting on Aurobindo’s application, the DGTR had conducted the probe. The investigation was conducted for a period of 12 months starting from April 1, 2020 to March 31, 2021 with injury analysis covering the period from April 2017 to March 2020.
The authorities observed that the landed price of the imports from China is below the selling price of the domestic industry during the period of investigation, which is likely to undercut the prices of the domestic industry in the event of cessation of duty.
The purpose of anti-dumping duty, in general, is to eliminate injury to the domestic industry by the unfair trade practices of dumping so as to re-establish a situation of open and fair competition in the Indian market which is in the interest of the people of the country.
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