If a company exports a product at a price (export price) lower than the price
it normally charges on its own home market (normal value), it is said to be
'dumping' the product.
Dumping can harm the domestic industry by reducing its sales volume and
market shares, as well as its sales prices. This in turn can result in decline
in profitability, job losses and, in the worst case, in the domestic industry
going out of business.
Often, dumping is mistaken and simplified to mean cheap or low priced
imports. However, it is a misunderstanding of the term. On the other hand,
dumping, in its legal sense, means export of goods by a country to another
country at a price lower than its normal value. Thus, dumping implies low priced
imports only in the relative sense (relative to the normal value), and not in
Anti dumping is a measure to rectify the situation arising
out of the dumping of goods and its trade distortive effect. Thus, the purpose
of anti dumping duty is to rectify the trade distortive effect of dumping and
re-establish fair trade. The use of anti dumping measure as an instrument of
fair competition is permitted by the WTO. In fact, anti dumping is an instrument
for ensuring fair trade and is not a measure of protection for the domestic
industry. It provides relief to the domestic industry against the injury caused
Anti dumping measures do not provide protection per se to the domestic
industry. It only serves the purpose of providing remedy to the domestic
industry against the injury caused by the unfair trade practice of dumping.
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