G/SG/Q2/IND/23  
 
2 June 2016  
(16-2956)  Page: 1/2  
Committee on Safeguards  Original: English  
 
NOTIFICATION UNDER ARTICLE 12.1(A) OF THE AGREEMENT 
ON SAFEGUARDS ON INITIATI ON OF AN INVESTIGATION 
AND THE REASON FOR IT 
NOTIFICATION PURSUANT TO ARTICLE 12.1(C) 
OF THE AGREEMENT ON SAFEGUARDS 
QUESTIONS POSED BY UKRAINE REGARDING 
THE NOTIFICATIONS OF INDIA1  
(Hot-rolled flat sheets and plates (excluding hot rolled flat products in coil form) 
and 
Hot-Rolled flat products of non-alloy and other alloy Steel 
in coils of a width of 600 mm or more) 
The following communication, dated 30 May 2016, is  being circulated at the request of the 
Delegation of Ukraine. 
_______________ 
On 7 December 2015, the Republic of India initiated a safeguard investigation concerning imports 
of hot-rolled flat sheets and plates (hereinafter – HRS). 
On 5 April 2016, the Republic of India notified the WTO with the application of the final 
safeguard measures on imports of hot-rolled flat products of alloy or non-alloy steel in coils (hereinafter – HRS in coils). 
Ukraine has very serious concerns regarding the initiation of the safeguard investigation and the 
decision of the Republic of India on imposing sa feguard measures on import of the products under 
consideration and hereby would like to ask the Republic of India to clarify the following. 
Question 1 
In both cases India used the annualized forecasted  data. The approach of showing the increase in 
imports of product under consideration on annualized forecast for 2015-2016 contradicts the principles and provisions of the Agreement on Sa feguards. According to Article 2.1, the Member 
imposing safeguard measures must have determined that the product under consideration is being 
imported in such increased quantities as to cause or threaten to cause serious injury to the domestic industry. This provision does not stipulate any kind of forecast for the imports development. 
Under the WTO rules, the imposition of safeguard measures can be justified "as a result of 
unforeseen developments" and due to the increase  in imports, which must be recent enough, 
sudden enough, sharp enough, and significant enou gh, both quantitatively and qualitatively. 
Moreover, such increase in imports must cause or threaten to cause "serious injury" to the 
domestic industry producing like or directly competitive products. 
                                               
1 G/SG/N/6/IND/42 (and G/SG/N/6/IND/42/Corr.1) and G/SG/N/8/IND/28/Suppl.1-
G/SG/N/10/IND/19/Suppl.1-G/SG/N/11/IND/14/Suppl.3. G/SG/Q2/IND/23 
 
- 2 - 
 
  It should be noted, that the provisions of th e Agreement on Safeguards and Article XIX of the 
GATT 1994 do not allow the use of forecast for the evaluation of the increase in imports. 
Would Republic of India please explain how the ap plication of safeguard measures on imports of 
HRS in coils and the initiation of investigation on HRS based on the annualized forecasted data 
comply with Article 2.1 of the Agreement on Safeguards? 
Would Republic of India please clarify the methodology used by the Department of Revenue for 
annualizing the forecasted data? 
Question 2 
The existence of serious injury to Indian industry was not proved in the investigation on HRS in 
coils as well as in the Application on initiation of investigation on HRS. In particular, certain indicators concerning the Indian industry showed  positive trends during 2013-2016 or remained 
stable over the injury period, including: domest ic sales, capacity utilization, employment and 
productivity, production of domestic industry. 
Pursuant to Article 4 of the Agreement on Safeguards, "serious injury" relates to a significant 
overall impairment in the position of a domestic industry. In addition, the term "serious injury" 
requires a very high standard to be met. 
In light of the positive development of the afor ementioned indicators, would Republic of India 
please explain how the determination that domestic industry is suffering serious injury in case on 
HRS in coils complies with Articles 2.1, 4.1 (a) and 4.2 (a), (b) of the Agreement on Safeguards? 
Would India also clarify how the decision to init iate safeguard investigation on HRS based on the 
Application which actually proves positive deve lopment of Indian industry complies with the 
provisions of Articles 2.1, 4.1 (a) and 4. 2 (a), (b) of the Agreement on Safeguards? 
Question 3 The Republic of India did not provide in the notifi cation on application the final safeguard measures 
on HRS in coils the information regarding procedures for prior consultation with Members having a 
substantial interest as exporters of the product under consideration. 
Thus, Ukraine considers that India did not provide Members having a substantial interest as 
exporters of the product under consideration with the adequate opportunity of being consulted in 
advance. 
Article 8.1 of the Agreement on Safeguards impo ses an obligation on Members to "endeavour to 
maintain" equivalent concessions with affected exporting Members. The Members concerned may 
agree on any adequate means of trade compensation for the adverse effects of the measures. 
If there is no agreement on this, the affected exporters can unilaterally consider to suspend equivalent concession, given the fact that safeguard measures has not been based on absolute 
increase in imports, but in a forecast developmen t, hence not meeting the criteria spelled out in 
Article 8.3 of the Agreement on Safeguards. 
Would Republic of India please explain how the absence of the information regarding procedures 
for prior consultation with Members having a substantial interest as exporters of the product under 
consideration in the investigation on HRS in coils complies with the requirements for notifications under the Agreement of Safeguards approved by the Committee on Safeguards during the meeting 
on 19 October 2009
2? 
 
__________  
                                               
2 G/SG/1/Rev.1-G/SG/N/6/Rev.1-G/SG/89 of 5 November 2009.