India has initiated a probe into alleged dumping of aniline, a chemical mainly used by pharmaceutical industry, by European Union countries to protect domestic players.

The Commerce Ministry's designated authority, the Directorate General of Anti-Dumping and Allied Duties (DGAD), has started an investigation into alleged dumping of the chemical, also used in dyes and rubber industry, on the basis of an application filed by Gujarat Narmada Valley Fertilisers Company Ltd and supported by Hindustan Organic Chemicals.

"...The authority (DGAD) hereby initiates an investigation into the alleged dumping and consequent injury to the domestic industry...To determine the effect of dumping and to recommend the amount of anti-dumping duty...To remove the injury," the Commerce Ministry said in a notification.

The period of investigation for the purpose is from April 2009 to June 2010. "The injury investigation period will, however, cover the period 2006-07, 2007-08, 2008-09," it said.

It said that the DGAD has sufficient prima facie evidence of dumping of aniline by European Union to initiate the probe.

Earlier, the country has slapped the restrictive duty on several items such as yarn, fabrics, certain stainless steel products, auto parts and chemicals.
Countries initiate an anti-dumping probe to see whether their domestic industries have been hurt because of a surge in cheap imports.

As a counter-measure, they impose duties under the multilateral regime of the WTO.

The duty also ensures fair trading practices and creates a level-playing field for domestic producers vis-a-vis foreign producers and exporters resorting to dumping.

Unlike safeguard duty, which is levied in a uniform way, anti-dumping duty varies from product to product and country to country.