Muscat: GCC ethylene glycol (EG) imports into India may be severely hurt as a result of an ongoing anti-dumping investigation targeting imports from Oman, Saudi Arabia, Kuwait, UAE and Singapore, according to the Gulf Petrochemicals and Chemicals Association, the regional trade body representing the common interests of the chemical and allied industries in the Arabian Gulf.
The inconsistent investigative practices by Indian authorities on anti-dumping regulations raise serious concerns under World Trade Organization (WTO) rules and threaten to severely hurt GCC economies, jeopardising $543 million worth of mono ethylene glycol (MEG) imports, which is equivalent to 20 per cent of total chemical imports from the region into India, according to GPCA analysis. India is the second largest importer of GCC chemicals and accounts for over a third of total GCC export volume together with China.
On April 6, 2020, Indian authorities terminated the investigation for the sole imports from Saudi Arabia, and continued the investigation into imports from Kuwait, Oman and the United Arab Emirates. This partial termination of the investigation is inconsistent with Indian anti-dumping rules, said the group.
“GPCA is therefore urging the fair treatment of GCC MEG producers and calling upon Indian authorities to terminate the partial investigation into MEG imports from the remaining GCC states, in order to restore a level playing field for all producers and allow for the continuation of exports of MEG from the GCC to India in the future,” it said in a press statement.
MEG is an essential raw material for the production of various end user products ranging from clothing and other textiles, through packaging to kitchenware, engine coolants and antifreeze. Polyester and fleece fabrics, upholstery, carpets and pillows, as well as light and sturdy PET drink and food containers originate from ethylene glycol.
Dr Abdulwahab al Sadoun, Secretary General, GPCA, commented, “As the regional body for the Arabian Gulf chemical industry, GPCA calls for the immediate termination of the partial anti-dumping investigation into regional MEG imports into India. This detrimental and ill-advised measure is having a harmful impact not just on GCC economies but also on bilateral trade, threatening to disrupt India’s domestic market and damage long-standing friendly relations between the nations.”
He added: “This is the latest in a series of trade-restrictive practices introduced by Indian authorities that GCC chemical exports have been confronted with over the years. GPCA is working closely with GCC authorities to advocate for the immediate termination of the investigation in line with India’s international obligations and the fair treatment of all WTO member states. At a time of pandemic, the uninterrupted supply of chemical raw materials is essential to addressing the global health crisis and we call upon authorities to work together to ensure we maintain the materials needed in factories across the globe today to ensure no shortage of essential raw materials.”
Echoing this sentiment, the International Council of Chemical Associations (ICCA), of which GPCA is a member, recently wrote to the G20 leaders as well as trade ministries in various states, to commend their statement on easing supply chain constraints. ICCA further called upon world leaders to coordinate with the industry for the removal of trade barriers and commit to stopping trade distorting practices, particularly for materials and products, including those made from chemicals and petrochemicals, deemed essential in the fight against the COVID-19 pandemic. As a member of the G20, India must act now to roll back any applied or future measures that contradict its G20 commitments.