. /.  WORLD TRADE  
ORGANIZATION   
G/SG/Q2/TUR/6 
4 May 2012 
 (12-2383) 
Committee on Safeguards Original:   English 
 
 
 
NOTIFICATION UNDER ARTICLE 12.1(A) OF THE AGREEMENT 
ON SAFEGUARDS ON INITIATION OF AN INVESTIGATION 
AND THE REASONS FOR IT 
 
NOTIFICATION UNDER ARTICLE 12.1(B) OF THE AGREEMENT ON 
SAFEGUARDS ON FINDING A SERIOUS INJURY OR THREAT 
THEREOF CAUSED BY INCREASED IMPORTS  
 
NOTIFICATION UNDER ARTICLE 12.1(C) OF 
THE AGREEMENT ON SAFEGUARDS 
 
Replies to Questions Posed by INDIA1  
Regarding Notifications of TURKEY2 
 
(Certain types of cotton yarn) 
  
 The following communication, dated 30 April 2012, is being circulated at the request of the 
Delegation of Turkey. 
_______________ 
  
 In the document G/SG/Q2/TUR/4 dated 5 De cember 2011 India raised questions and asked 
clarifications regarding certain aspects of determination of threat of serious injury in the context of the 
notification (G/SG/N/8/TUR/13-G/SG/N/10/TUR/ 13-G/SG/N/11/TUR/16, da ted 24 June 2011) of 
Turkey.  Turkey would like to clarify the issu es raised in the said communication as follows:   
 
 India states that production has increased to 112 (indexed) in 2010 from 100 (indexed) in 
2006, and domestic sales has increased to 110 (i ndexed) in 2010 from 100 (indexed) in 2006, and 
capacity utilization has increased to 105 (indexed) in 2010 from 100 (indexed) in 2006, and also adds 
that there is a gradual improveme nt in profits during 2009 and 2010.  India claims that a comparison 
between the first quarters of 2010 and 2011 is not a "reasonable basis" for finding threat of serious 
injury.  
  The arguments of India are based on a "point-to-point" comparison.  That is, comparing the 
starting point with the end point of Period of Inv estigation (PoI) and disregarding the data from the 
first quarter of 2011.  This approach neglects the s ubstantial downward trend in the injury data at the 
most recent period.  Turkey considers that "poi nt-to-point" comparison falls short in explaining 
change in the trend of indicators.  Turkey also be lieves that the investigating authority should analyze 
the most recent period regarding injury.  Moreover,  injury figures regarding the most recent period are 
essential for determination of "threat of serious injury".  
 
                                                      
1 G/SG/Q2/TUR/3.   
2 G/SG/N/6/TUR/14/Suppl.1-G/SG /N/7/TUR/10-G/SG/N/11/TUR/17. G/SG/Q2/TUR/6 
Page 2 
 
 
   In addition to this, Turkey takes note that India has not considered the sharp and sudden 
decline in production, domestic sales and capacity u tilization ratio in the most recent period.  The 
production has decreased significantly from 100 (indexed)  in the first quarter of to 2010 to 73 in the 
first quarter of 2011.  The domestic sales have also  decreased from 100 (indexed) in the first quarter 
of to 2010 to 67 in the first quarter of 2011.  The capacity utilization ratio has decreased 27 points 
remarkably in the first quarter of 2011 compared to the same period of 2010.  
 
 In general, the arguments raised by India in terms of production, sales and capacity utilization 
are not convincing, because they are based on a "point -to-point" comparison, rather than an analysis 
of the most recent trends.  India's objections agai nst comparison of 2010 and 2011 quarterly data also 
appear to be groundless.  
 Furthermore, India suggests that "production" and "domestic sales" data for the first quarter 
of 2011 is just "projected".  Turkey would like to underscore that all of the data for the first quarter 
of 2011 which have been provided by the dom estic industry is actually collected data. 
 
 Also, India indicates that profitability of th e domestic industry has improved gradually 
in 2009 and 2010.  Although there has been a gra dual improvement in terms of decreasing loss, the 
domestic industry has not been able to generate profit during the PoI ( see table ).  
 
Profitability 2006 2007 2008 2009 2010 
(%) -8 -9 -12 -6 -2 
Index 100 99 96 102 107 
 
 It is clear that sudden and sharp increase in imports in the first quarter of 2011 have caused 
deterioration in domestic industry's relevant inju ry figures.  On the other hand, if there was no 
safeguard measure, gradual improvement in declinin g loss of the domestic industry would be reversed 
in the very near future beca use of the increase in import. 
  Besides these issues raised  by India, Turkey takes note that India has not touched upon other 
figures of injury such as end of inventories, employment, productivity, consumption, market share of 
imports, relative imports (imports/ production), abso lute imports and monthly absolute imports.  
Turkey would like to refer to its notification regarding these figures for its finding of "threat of serious 
injury".  
  In conclusion, as clarified above and disclosed in the notification, Turkey believes that the 
injury figures and the import figures clearly show that there is a "threat of serious injury". 
  
 
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