Anti-Dumping Duty on Single-Mode Optical Fiber (SMOF)

The Directorate General of Trade Remedies (DGTR), an arm of the Commerce Ministry of India, has imposed an anti-dumping duty on Single-Mode Optical Fiber (SMOF) from China, Korea and Indonesia. The anti-dumping duty imposed under this notification shall be effective for a period of five years (unless revoked, superseded or amended earlier) from the date of publication.

Optical Fibres

• Optical fibres are used to transmit data in the form of light pulses. The fibres are bundled together to make optical fibre cables, which are used to transfer digital data signals in the form of light up to distances of hundreds of miles, with higher throughput rates than those achievable via electrical communication cables. 
• Major consumption of SMOF is driven by 3G/4G/5G rollout by telecom companies, connectivity of gram panchayats and defence. SMOF facilitates transmission of a single-spatial mode of light as a carrier and is used for signal transmissions within certain bands. It is used for manufacture of optical fibre cables, including unit-tube and multi-tube stranded cables, tight buffer cables, armoured and unarmoured cables, ribbon cables and dry core cables.

What is Custom Duty?

Custom duty is a tax imposed by a federal or central government on goods and services when they cross international borders. Customs duty can be charged both on exports as well as imports.

Under the new GST regime from 2017, customs duty has been replaced by IGST as per Article 269A of the Constitution of India. 

As per this act, the IGST on import of goods & services is levied under the purview of the IGST Act, 2017 .

Types of custom duty

• Integrated Goods and Services Tax (IGST)
• The IGST component depends on the HSN code of the goods being imported. In cases where imported goods are liable to Anti-Dumping Duty or Safeguard Duty, value for calculation of IGST as well as Compensation Cess shall also include Anti-Dumping Duty amount and Safeguard duty amount.
• GST Compensation Cess
• This Cess is being collected to compensate the states of India for any loss of revenue on account of the implementation of GST in the country. This Cess is supposed to be applicable only till 1st July 2022. It is calculated as 15% of the IGST value.
• Countervailing duty on subsidized articles (CVD)
• Administered by the Central Government’s Directorate General of Anti-dumping and Allied Duties (DGAD), CVD is the duty charged to the importer to somewhat neutralize the subsidies given by the government to the exporting country.
• Anti-dumping duty
• Some imports are liable for anti-dumping duty in India to discourage such imports into the country. Anti-dumping duty can range from 0% to 550% of the invoice value of the goods.
• Safeguard duty
• Safeguard duty is applied by the government for a period of time when sudden increase in imports is seen for a particular product. This increase typically stems from import tariff concessions or World Trade Organization (WTO) obligations taken by the importing country. The safeguard duty gives domestic producers a grace period to become more competitive.