INDIA - SUBSIDY PROGRAMS AIMED AT INDUSTRIAL SECTORS

INDIA

SUBSIDY PROGRAMS AIMED AT INDUSTRIAL SECTORS
Last Changes Made December 2006

Effective February 15, 2000, Import Administration began publishing "Decision Memos" to reduce the size of antidumping and countervailing duty Federal Register notices. In cases in which a Final Memo was published, you will find a link to the memo listed below.

In addition, in the following programs, in instances below in which a proceeding was a Sunset Review, you will see the letters SR after the product name.

COUNTERVAILABLE SUBSIDY PROGRAMS

The subsidy programs listed below have been investigated by the Department and have been found to be "countervailable" in the cases listed and during the periods reviewed based on the criteria established in the Tariff and Trade Act of 1930, as amended. Please refer to this Act for further detail of the criteria applied. In addition, you may click on the cases listed below the subsidy program title for a full explanation of the Department's analysis in those cases.

STEEL PRODUCTS

Government of India Forgiveness of Loans from the SDF

Hot-Rolled Carbon Steel (SR) (Expedited Review - no prelim); 71 FR 70960 (12/7/06-final); Final Memo
Hot-Rolled Carbon Steel (4/99-3/00) 66 FR 20240 (4/20/01-prelim); 66 FR 49635 (9/28/01-final); Final Memo; Amended
Steel Wire Strand (4/1/01-3/31/02) (7/8/03-prelim); 68 FR 68356 (12/8/03-final); Final Memo

In October of 1998, SAIL, which was facing financial problems, proposed a turnaround plan to the Government through the SDF Managing Committee. In order to achieve the goals outlined in this plan, SAIL included in its proposal to the GOI provisions for the forgiveness of portions of its outstanding SDF debt. We determined that because the Minister of Steel has a major leadership role in the SDF Managing Committee, the actions of the SDF Managing Committee are subject to the influence and control of the Government. Therefore, we determined that the forgiveness of debt that took place constituted a financial contribution within the meaning of section 771(5)(D)(i) of the Act. Furthermore, the waiver of SDF debt was limited to SAIL, and was, therefore, specific and countervailable.

Government of India Forgiveness of Loans from the SDF

In the 1970s, IISCO, a subsidiary of SAIL, was an ailing private sector company, the management of which was assumed by SAIL in the early 1970s at the direction of the Government. IISCO continued to incur losses, and, in order to finance its debts, the government issued loans to the company in the late 1980s and early 1990s. These loans were routed through SAIL. In order to provide relief to SAIL and IISCO, the government approved a waiver of SAIL's government debts. We determined that this program was countervailable because IISCO would not have been able to repay the loans it owed to SAIL, absent the involvement of the government. That is, the actions of the government enabled SAIL to avoid bad debt expenses. Therefore, we determined that this program provided a financial contribution within the meaning of section 771(5)(D)(i) of the Act. In addition, because the government loans were limited to SAIL, we determined that this program was also specific within the meaning of the Act, and, therefore, countervailable.

Government of India Loans through the Steel Development Fund (SDF)

Carbon Steel Plate (4/97-3/98) 64 FR 40438 (7/26/99-prelim); 64 FR 73131 (12/29/99-final)
Hot-Rolled Carbon Steel (SR) (Expedited Review - no prelim); 71 FR 70960 (12/7/06-final); Final Memo
Hot-Rolled Carbon Steel (4/99-3/00) 66 FR 20240 (4/20/01-prelim); 66 FR 49635 (9/28/01-final); Final Memo Amended

The SDF was established in 1978 at a time when the steel sector was subject to price and distribution controls. From 1978 though 1994, an SDF levy was imposed on all sales made by India's integrated producers. The proceeds from this levy were then remitted to the Joint Plant Committee (JPC), the administrating authority consisting of four major integrated steel producers in India that have contributed to the fund over the years. Under the SDF program, companies that have contributed to the fund are eligible to take out long-term loans from the fund at favorable rates. We determined that the Government of India played a direct role in the creation of the SDF by mandating price increases in steel products which were authorized for use solely as a source of funds for the SDF. Therefore, this program was countervailable.

International Price Reimbursement Scheme ("IPRS")
(Replaced by the EPRS)

This program was introduced by the Government of India for exporters of products with steel inputs. The purpose of the program is to rebate the difference between higher domestic and lower international prices of steel. This program, in effect, provided steel inputs to India's manufacturers on terms and conditions more favorable than had those manufacturers actually procured steel inputs on the world market. Therefore, we determined this program to be countervailable.

Sale of High-Grade Iron Ore for Less Than Adequate Remuneration

Hot-Rolled Carbon Steel (SR) (Expedited Review - no prelim); 71 FR 70960 (12/7/06-final); Final Memo
Hot-Rolled Carbon Steel (2004) 71 FR 1512 (1/10/06-prelim); 71 FR 28665 (5/17/06-final); Final Memo

The GOI, through the government-owned National Mineral Development Corporation (NMDC), provided high-grade iron ore to Essar for less than adequate remuneration. We found that NMDC provided a financial contribution as defined under section 771(5)(D)(iii) of the Act to Essar. We found that the GOI's provision of high-grade iron ore is specific under section 771(5A)(D)(iii)(I) of the Act because the actual recipient of the subsidy is limited to industries that use iron ore, including the steel industry, and is thus limited in number. We determined that this program is countervailable.

SUBSIDY PROGRAMS FOUND TO BE NOT COUNTERVAILABLE

The subsidy programs listed below have been investigated by the Department and have been found to be "not countervailable" in the cases listed and during the periods reviewed based on the criteria established in the Tariff and Trade Act of 1930, as amended. Please refer to this Act for further detail of the criteria applied. In addition, you may click on the cases listed under the subsidy program title for a full explanation of the Department's analysis in each case where the subsidy program has been examined.

No programs listed.

SUBSIDY PROGRAMS DETERMINED NOT TO EXIST

The following subsidy programs were alleged by the petitioning industries and were investigated by the Department. However, during the investigation we found no evidence that such programs actually existed. If you click on the cases listed under the subsidy program title, you will be linked to each case in which the subsidy program was referenced. It is possible that, while the program named did not exist, a similar program having a different name actually was investigated. If this is the case, you will find that program listed elsewhere in this library.

No programs listed.

SUBSIDY PROGRAMS THAT HAVE BEEN TERMINATED

The subsidy programs listed below have been investigated by the Department and have been found to have been terminated based on the criteria established in the Tariff and Trade Act of 1930, as amended. Please refer to this Act for further detail of the criteria applied. In addition, you may click on the cases listed below the subsidy program title for a full explanation of the Department's analysis in each of these cases.

No programs listed.

SUBSIDY PROGRAMS THAT HAVE NOT BEEN USED

When potential subsidy programs are investigated and found not to be used by the companies being investigated, the Department makes no determination as to their countervailability. If you click on the cases listed under the subsidy program title, you will be linked to each case in which the subsidy program was referenced.

STEEL PRODUCTS

Export Promotion Replenishment Scheme ("EPRS")
(Replaced the IPRS Program)

Castings (1997) 64 FR 61592 (11/12/99-prelim); 65 FR 3151 (5/18/00-final); Final Memo not used Court Decision; Amended Final
Castings (1996) 63 FR 37538 (7/13/98-prelim); 63 FR 64051 (11/18/98-final) not used
Castings (1994) 61 FR 64675 (12/6/96-prelim); 62 FR 32299 (6/13/97-final) not used; Amended

The Export Promotion Replenishment Scheme (EPRS) replaced the International Price Reimbursement Scheme (IPRS) to ensure that small producers of engineering goods could access raw materials at international prices. Under the EPRS, manufactures/exporters of engineering products may apply for a Release Advice from the regional licensing authority after finished goods have been exported. Based on such an advice, domestic iron and steel producers may supply pig iron to the engineering goods manufacturers/exporter at near international prices. Therefore, instead of importing pig iron, small engineering goods manufacturers could obtain supply of their raw materials from domestic sources at competitive prices. The iron and steel producers could apply for a license in advance, with the understanding that they would supply raw materials against Release Advices to be presented to them in the future by Castings exporters.

Grant-In-Aid Reported on SAIL's Annual Reports

Hot-Rolled Carbon Steel (4/99-3/00) 66 FR 20240 (4/20/01-prelim); 66 FR 49635 (9/28/01-final); Final Memo; Amended not used

SAIL's Annual Reports for fiscal years 1995 through 1999 idicate that the company received "grant-in-aid" from the Government of India under several programs ranging from environmental and labor welfare assistance to research and development grants. We determined that the face amounts of the grants received did not exceed 0.5 percent of SAIL's total sales. Thus, we determined that these grants would have been expensed in the years of receive. Because any benefits attributable to these grants would not be allocable to the period of investigation, we determined that this program was not used.

Target Scheme

Hot-Rolled Carbon Steel (2004) 71 FR 1512 (1/10/06-prelim); 71 FR 28665 final); Final Memonot used

No program description available.