Are Indian lawyers ready for the challenge?
India has emerged as one of the most active members of the World Trade Organisation (WTO) in terms of anti-dumping investigation. But due to lack of proper legal base to fight anti-dumping cases, domestic industries and poor farmers are being forced to depend on highly expensive western law firms, say experts.india Updated: Jan 09, 2006 00:47 IST
India has emerged as one of the most active members of the World Trade Organisation (WTO) in terms of anti-dumping investigation. But due to lack of proper legal base to fight anti-dumping cases, domestic industries and poor farmers are being forced to depend on highly expensive western law firms, say experts.
"India lacks a proper legal base to fight all these cases. We have to take help from western law firms. It is not the Indian lawyers who take up the matter of our interest abroad but the highly expensive western lawyers do that," says Sumeet Kachwaha of Kachwaha & Partners, who successfully fought the famous soda ash case.
According to 2003-04 Annual Report of the Union Ministry of Commerce, India initiated the highest number (33) of anti-dumping investigations during the second semester of 2003. During the same period, the US had the second highest number of cases (21), China 11 while Canada, Mexico and Australia reported 9, 8 and 7 cases respectively.
But the million dollar question is - are we prepared to handle these cases and protect the domestic industry and poor farmers? Is Indian legal fraternity mature enough to handle these cases in accordance with the international laws? Is the Directorate General of Anti Dumping with a work-force of 20 personnel is sufficient to protect Indian interests.
The government now provides technical and financial assistance to Indian exporters to effectively contest the cases before the investigating authorities of respective countries. But experts feel that this model would not help in the long run."Removal of trade barriers has become a reality. Now we will have to frequently handle such cases where our products will be alleged of dumping in other countries and vice versa. We will have to master it at the international level.
For it we all including government will have to act together," says Sumeet.
The government is also silent on this issue. Agriculture, which is a major source of livelihood, is going to suffer the most. It will have a great impact on the country. Since 1995, around 25,000 farmers have committed suicide, he adds.
However, the government can improve the situation by making it a matter of national interest. It cannot be done if we treat it as a matter of litigation. Still considering the volume of trade we do not even have a separate department for it. This is not even in the academic curricula of many law colleges in India, Sumeet laments.
But Indian lawyers are getting confident after having experience of handling such cases at the domestic level. In many cases such as PT Muliaglass, Berger Paints Knorr Bremse AG, Germany Indian lawyers have done well, says Diljeet Titus of Titus and Company.
"Being a relatively new field, there was an initial time gap when major proceedings were handled by foreign law firms in India to a large extent. However, in recent years Indian legal fraternity has actively and successfully command over anti-dumping due to increased frequency of such proceedings," said Atul Dua of Seth Dua and Associates.
"Still a comprehensive legislation dealing with subjects of dumping, imposition of quantitative restrictions and other safeguards is missing in India," says Som Mandal of FOX and Mandal. According to the present rule, no aggrieved individual can apply against cheap imports. An anti-dumping petition made to the Ministry of Commerce for investigation has to be supported by producers contributing to at least 25 per cent of the total domestic production of a particular good.
This clause invites hectic lobbying by the vested interests and small unorganised sectors and farmers suffer, feels Titus.
"It is true that BIG industry players are more successful in bringing favourable anti-dumping actions than smaller regional players. This is because anti-dumping investigations cannot normally be launched except in response to an application by or on behalf of the domestic industry," he says.
"The Customs Tariff Rules, defines domestic industry as, 'domestic producers as a whole engaged in manufacturing and whose collective output constitutes a major proportion of the total production'. This tilts the balance in favour of large industry players with substantial lobbies and they use it to protect their vested interests," adds Titus. Now in many countries, governments take interest in dumping issues regarding their products worldwide. Sumeet gives an example of the EU, which lobbies anywhere for any of its member nations.
"One of the examples in this regard is the Bed linen case involving exports from India, Pakistan and some other nations to Europe. On account of active involvement of the Government of Pakistan, positive results for their exporters .