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Anti-Dumping: Global Abuse of a Trade Policy Instrument The fiasco at the Doha round of talks and the increasing resort, by nations, to the anti-dumping laws simply confirm this fact. In other words, in addition to the concerted attempts (by the developed nations) to impose labour standards and thus erect barriers against imports from the developing nations, this business of anti-dumping provisions are emerging into a means to curb free trade. The point is that non-trade barriers continue to emerge and this is happening in less than a decade after the WTO came into existence. Bibek Debroy and Debashis Chakraborty have put together studies by specialists from across the world, to show that the provisions in the WTO agreement relating to anti-dumping are now a means that the governments in various countries, developed and developing, are beginning to use to the detriment of free trade. This collection of eight essays, being focused studies on various instances of nations abusing the provisions of the Anti-Dumping Agreement (ADA), covey the need for substantive changes in the Agreement, that are a part of the WTO treaty. The abuse, as the essays establish, is most common in the manner in which national regimes seek investigations even where there is no case. In other words, the essays clearly establish that back-to-back investigations against dumping are ordered, by nations, with a view to protect domestic industry. It emerges that while the US had used this path to protect its own industry being gobbled up by the imports from the developing nations (cases with regard to India, Turkey and South Africa have been illustrated in this book), the essays also deal with a trend, in recent times, of the developing nations too resorting to back-to-back investigations against dumping. K.D.Raju’s essay on the Indian experience brings out that the resort to the provisions of the ADA is aimed at, more often, to protect (with non-trade barriers) the interests of a section of the Indian manufacturers and is leading to adverse effects on the small scale sector, downstream. The essay establishes that the SSIs, which are also consumers of raw material, are denied the advantage of importing cheap raw materials from manufacturers abroad (and end up depending on domestic manufacturers) and are hence victims of the ADA. The essays establish that the investigations, in most instances, are meant only to frustrate free trade. And this is done by way of statistics that the national regimes are content with ordering back-to-back investigations and rarely take the cases to the Disputes Settlement Body (DSB) of the WTO. Nicola Theron’s essay, dealing with the experience of South Africa, foregrounds the fact that anti-dumping investigations are resorted to by the national regimes as a trade-restrictive instrument and thus defeating the very rationale of the WTO. Brink Lindsey, along with Daniel Ikenson, concludes that the US regime’s record in this business of abusing the ADA has ended up serving the cause of lobbying for protection of domestic industries, which by all definitions, is inimical to the cause of the WTO. And Yuefen Li, clearly establishes that the ADA is serving the cause of the multi-national corporations (MNCs) and to the detriment of those nations that took to industrialisation late. The Chinese experience, outlined in this essay by Li, shows that anti-dumping investigations are resorted to, by national regimes across the world, to deny to Chinese manufacturers, the inherent advantages they have thanks to the late industrialisation. The collection is a good read for those deluded by the belief that free-trade is a possibility and that national regimes will resist, over time, the temptation to protect domestic industry. But then, economic history is replete with instances that show that free-trade is more a rhetoric; or an illusion. And this collection of essays is a case in point that this illusion persists even today. For, there is a consensus that emerges through the eight essays and the introduction by Debroy and Chakraborty: that it is possible to remove the distortions. The illusion that national regimes will resist the temptation of erecting non-trade barriers.
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The
birth of the World Trade Organisation (WTO) was held, by a section of
economists and planners, as an event that marked the end to all the bad
things about the GATT regime. A view was peddled that the unfair
practice of non-trade barriers would no longer hinder commerce between
nations and that the signing of the treaty at Marakesh in March 1993
marked the beginning, in the true sense, of a global free trade regime.
But then, it did not take too long to realise that non-trade barriers
did not vanish. And that the WTO regime too could be derailed.