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India imposes countervailing duty on Chinese tyres; Tyre stocks soar
Volumes of Chinese tyres have now come down from 150,000 per month to 30,000 units per month. Patil reportedly said that this would further go down in the coming months post this decision.
Imposition of countervailing duty on particular type of tyres imported from China for a period of five years pushed stocks of domestic tyre manufacturers on Tuesday. The stock of JK Tyre and Industries rose 4.66 per cent to Rs 79.80 at the BSE, while the scrip of CEAT also rose 4.30 per cent to Rs 941.60, of Apollo Tyres rose 0.50 per cent to Rs 200.35 and of MRF by 1.47 per cent to Rs 55,536.80.
In a notification, Ministry of Finance`s Department of Revenue said it has imposed import CVD on "new or unused pneumatic radial tyres with or without tubes and or flap of rubber (including tubeless tyres), having nominal rim dia (meter) code above 16" (inches) used in buses and lorries or trucks".
The import CVD is a country-specific levy that is imposed to offset subsidies given by foreign governments and to protect domestic industry, said an IANS report, adding that it ranges from 9.12 per cent to 17.57 per cent of the CIF value is in addition to the anti-dumping duty imposed two years ago.
"Indian government has imposed a countervailing duty on Chinese radial tyres which have above 16 inches rim. These tyres are used in trucks and buses and are already subsidized by the Chinese government," Ashwin Patil, Senior Research Analyst, LKP Securities, told IANS.
Ashwin Patil was quoted as saying, "In the wake of current slowdown in the auto industry, this act from GOI would bring some cheer to the tyre companies as the replacement markets would see higher inflow of the tyres coming from the listed or organised players in India."
Notably, volumes of Chinese tyres have now come down from 150,000 per month to 30,000 units per month. Patil reportedly said that this would further go down in the coming months post this decision.
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