{"id":12142,"date":"2023-06-17T11:48:31","date_gmt":"2023-06-17T06:18:31","guid":{"rendered":"https:\/\/vajiramandravi.com\/current-affairs\/?p=12142"},"modified":"2025-03-30T07:35:46","modified_gmt":"2025-03-30T02:05:46","slug":"about-countervailing-duty-cvd","status":"publish","type":"post","link":"https:\/\/vajiramandravi.com\/current-affairs\/about-countervailing-duty-cvd\/","title":{"rendered":"About Countervailing Duty (CVD)"},"content":{"rendered":"<h2><strong>About Countervailing duty (CVD):<\/strong><\/h2>\n<ul>\n<li>It is a specific form of <strong>duty that the government imposes to protect domestic producers by countering the negative impact of import subsidies<\/strong>.<\/li>\n<li>CVD is thus an <strong>import tax by the importing country on imported products.<\/strong><\/li>\n<li>The <strong>World Trade Organization (WTO) permits the imposition of CVD<\/strong> by its member countries.<\/li>\n<li><strong>Why is CVD imposed?<\/strong>\n<ul>\n<li><strong>Foreign governments sometimes provide subsidies to their producers<\/strong> <strong>to make their products cheaper <\/strong>and boost their demand in other countrie<\/li>\n<li>To <strong>avoid flooding the market in the importing country with these goods<\/strong>, the government of the importing country imposes CVD, charging a specific amount on the import of such goods.<\/li>\n<li>The <strong>duty nullifies and eliminates the price advantage enjoyed<\/strong> by an imported product.<\/li>\n<li>The <strong>duty raises the price of the imported product<\/strong>, bringing it closer to its true market price<\/li>\n<\/ul>\n<\/li>\n<li><strong>Who administers CVD in India?<\/strong>\n<ul>\n<li>The countervailing measures in India are <strong>administered by the Directorate General of Anti-dumping and Allied Duties (DGAD<\/strong>), in the commerce and industry ministry\u2019s <strong>department of commerce<\/strong>.\u00a0<\/li>\n<li>While the <strong>department of commerce recommends the CVD,<\/strong> the <strong>department of revenue in the finance ministry acts<\/strong> <strong>upon the recommendation<\/strong> within three months <strong>and imposes such duties<\/strong>.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<h3>What is Anti-dumping duty (AD)?<\/h3>\n<ul>\n<li>It is a protectionist <strong>tariff that a domestic government imposes on foreign imports that it believes are priced below fair market value.<\/strong><\/li>\n<li><strong>Dumping is a process wherein a company exports a product at a price <\/strong>that is <strong>significantly lower <\/strong>than the price<strong> it normally charges<\/strong> <strong>in its home<\/strong> (or its domestic) market.<\/li>\n<\/ul>\n<h3>Countervailing duty v\/s Anti-dumping duty<\/h3>\n<ul>\n<li><strong>AD is imposed to prevent low-priced foreign goods from damaging the local market<\/strong>. On the other hand, C<strong>VD will apply to foreign products that have enjoyed government subsidies<\/strong>, which eventually leads to very low prices.<\/li>\n<li>While the <strong>AD duty amount depends on the margin of dumping<\/strong>, <strong>the CVD<\/strong> amount will completely <strong>depend upon the subsidy <\/strong>value of the foreign goods.<\/li>\n<\/ul>\n<p>&nbsp;<\/p>\n<hr \/>\n<h3>Q1)\u00a0What is Anti-dumping duty (AD)?<\/h3>\n<p>It is a protectionist tariff that a domestic government imposes on foreign imports that it believes are priced below fair market value. Dumping is a process wherein a company exports a product at a price that is significantly lower than the price it normally charges in its home (or its domestic) market.<\/p>\n<p><strong>Source:<\/strong>\u00a0<a href=\"https:\/\/economictimes.indiatimes.com\/industry\/banking\/finance\/banking\/future-locs-to-africa-could-cover-defence-says-exim-bank-md\/articleshow\/101027546.cms\" target=\"_blank\" rel=\"nofollow noopener\"><u>Finance Ministry likely to impose countervailing duty on steel imports from China<\/u><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>CVD is a specific form of duty that the government imposes to protect domestic producers by countering the negative impact of import subsidies.<\/p>\n","protected":false},"author":5,"featured_media":12143,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1],"tags":[],"class_list":{"0":"post-12142","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-upsc-prelims-current-affairs","8":"no-featured-image-padding"},"acf":[],"_links":{"self":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/12142","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/users\/5"}],"replies":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/comments?post=12142"}],"version-history":[{"count":0,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/12142\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media\/12143"}],"wp:attachment":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media?parent=12142"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/categories?post=12142"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/tags?post=12142"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}