. /.  WORLD TRADE  
ORGANIZATION   
G/SG/N/7/IND/9 
G/SG/N/8/IND/22 4 October 2011 
 
(11-4791) 
Committee on Safeguards Original:   English 
   
NOTIFICATION UNDER ARTICLE 12.4 OF THE AGREEMENT ON 
SAFEGUARDS BEFORE TAKING A PROVISIONAL SAFEGUARD 
MEASURE REFERRED TO IN ARTICLE 6 
 
NOTIFICATION UNDER ARTICLE 12. 1(b) OF THE AGREEMENT ON 
SAFEGUARDS ON FINDING SE RIOUS INJURY OR THREAT 
THEREOF CAUSED BY INCREASED IMPORTS 
 
INDIA 
 
Imports of Phthalic Anhydride 
   The following communication, dated 1 October 2011, is being circulated at the request of the Delegation of India.  
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1. Evidence of Serious injury or th reat thereof caused by increased import 
 
 The Director General (Safeguards) has made a preliminary determination after examining all the relevant factors that increased imports of Phth alic Anhydride from number of countries has caused 
serious injury and also there is a threat of serious injury to the domestic industry.  There is a sudden 
and steep surge in imports both in absolute and relative terms.  Imports of Phthalic Anhydride 
increased from 28,098 MT in 2009-10 to 61,965 MT in 2010-2011 showing an increase of 121% in 
absolute terms. The imports also increased in relation to the domestic production from 14.08% in 
2009-10 to 28.52% in 2010-11. The share of imports in the domestic market has gone up from 11% in 2008-09 (Q4) to 20% in 2011-12 (Q4). The share of domestic producers in the domestic consumption 
has fallen significantly from 85% in 2009-10 to 74% during 2010-11.  The production of domestic 
industry has seen declining trends from second qu arter 2009-10 and has dropped to 50,125 MT in 
quarter one of 2011-12.  The capacity utilization of  domestic industry declined from 87% in Q2 of 
2010-11 to 75% in Q1 of 2011-12.  The sales of domestic industry increased till fourth quarter 2010-11 but declined during first quarter 2011-12.   There has not been a significant change in the level of 
employment and productivity during the injury ass essment period.  The profitability of domestic 
industry has steeply deteriorated and the dom estic industry is suffering financial losses. 
 
2. Information on whether there is an absolute increase in import or an increase in import 
relative to domestic production 
 
 The imports of Phthalic Anhydride have show n an increasing trend in absolute terms as well 
as compared to the domestic production causing injury and serious threat of injury.  
 G/SG/N/7/IND/9 
G/SG/N/8/IND/22 Page 2 
 
 
   The table below gives the Quarterly import fi gures relating to Phthalic Anhydride (PAN): 
 
Financial Year Quarter Total Imports (MT) Domestic Production 
(MT) 
2008-09 Q4 6,103 49,607 
2009-10 Q1 7,240 47,985 
Q2 5,163 58,259 
Q3 8,526 40,437 
Q4 7,169 52,853 
2010-11 Q1 23,615 55,503 
Q2 8,611 58,168 
Q3 18,082 52,319 
Q4 11,657 51,271 
2011-12 April-May 9,188 35,716 
 
There is a sudden and steep surge in import both in absolute and relativ e terms. Imports have 
increased from 28,098 MT in 2009-10 to 61,965 MT  in 2010-11 showing an increase of 121% in 
absolute terms.  Further, the import with resp ect to domestic production has also increased from 
14.08 % in 2009-10 it increased to 28.52 % in 2010-11.  3. Precise description of the product involved  
 Phthalic Anhydride (PAN) is classified unde r Customs sub-heading No. 29173500 under the 
Customs Tariff Act, 1975. 
 
4. Precise description of the proposed measure 
 
 DG Safeguards, the investigating authority, h as concluded that critical circumstances exist 
justifying imposition of provisional safeguard duty immediately to prevent injury to the domestic 
industry which would be difficult to repair if the application of safeguard measure is delayed. DG 
Safeguards has recommended imposition of provisi onal safeguard duty on imports of Phthalic 
Anhydride into India at the rate of 10% ad-valorem  for a period of 180 days.     
 
5. Proposed date of introduction of measure 
  The safeguard measures will come into force fro m the date of issue of notification in this 
regard by the Department of Revenue, Ministry of Finance. 
 
6. Expected duration of the measure  
 As in 5 above. 
 
7. Further information  
 The Preliminary Findings were published in  Gazette of India on 23 September 2011. 
 
 
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