JEDDAH, Aug 12 ( Arab News) : Saudi Arabia on Wednesday urged India to lift the anti-dumping tax it has imposed on its polypropylene exports, saying the measure violated World Trade Organization (WTO) regulations.
Abdul Rahman Al-Zamil, chairman of Saudi Export Development Center’s (SEDC) executive council, expressed his anguish over India imposing over 22 percent tax on Saudi polypropylene.
He hoped that India would reconsider the decision in the light of the strategic trade relations between the two countries. He described the Indian measure as “unreasonable,” and urged New Delhi to take a speedy decision before taking up the issue at the WTO.
According to Al-Zamil, India imposed anti-dumping taxes on Saudi polypropylene exports, saying it had cheaper feedstock. “The availability of cheap feedstock in the Kingdom is quite natural as a result of abundant local gas supply and the location of petrochemical plants closer to gas pipelines.”
He said India took the measure after it had failed in its previous attempts to impose anti-dumping tax on Saudi products as a result of the their competitive prices in Indian market.
“During WTO talks the Kingdom had proved that Saudi feedstock prices were fixed on a commercial basis with gas producers taking a reasonable profit. All WTO members including India have accepted this point,” Al-Zamil said. “India has signed the WTO agreement. So the Indian argument has no basis.”
He said Saudi Arabia’s commerce, finance and foreign ministries had made a lot of efforts to convince New Delhi to change its “irrational” anti-dumping-tax decision. But India ignored them.
He pointed out that Saudi nonoil exports to India were valued at only SR180 million compared to huge Indian exports to the Kingdom. “Most Indian products are exempted from customs duty while some products pay a nominal five percent tariff.”
Al-Zamil said Saudi Arabia had not imposed any customs duty on Indian products citing the reason of dumping despite the presence of potential reasons because of its desire to strengthen bilateral relations.
The SEDC statement indicated that India was risking huge economic interests by taking anti-Saudi trade measures. “The service contracts received by Indian companies in technological, medical and oil sectors have valued billions of riyals annually,” it said.
He referred to the protest raised by the Gulf Petrochemicals and Chemicals Association (GPCA) against India’s anti-dumping tax, saying WTO would not accept India’s reasoning for the measure.