MOSCOW (MRC) -- Gulf Cooperation Council (GCC) mono ethylene glycol (MEG) imports into India may be severely hurt as a result of an ongoing anti-dumping investigation targeting imports from Oman, Saudi Arabia, Kuwait & UAE, reproted Kemicalinfo with reference to the Gulf Petrochemicals and Chemicals Association (GPCA).
According to GPCA analysis, the inconsistent investigative practices by Indian authorities on anti-dumping regulations raise serious concerns under World Trade Organization (WTO) rules and threaten to severely hurt GCC economies, jeopardising USD543 million worth of mono ethylene glycol (MEG) imports, which is equivalent to 20% of total chemical imports from the region into India.
India is the second largest importer of GCC chemicals and accounts for over a third of total GCC export volume together with China.
On April 6, 2020, Indian authorities terminated the investigation for the sole imports from Saudi Arabia, and continued the investigation into imports from Kuwait, Oman and the United Arab Emirates. This partial termination of the investigation is inconsistent with Indian anti-dumping rules, said the group.
“GPCA is therefore urging the fair treatment of GCC MEG producers and calling upon Indian authorities to terminate the partial investigation into MEG imports from the remaining GCC states, in order to restore a level playing field for all producers and allow for the continuation of exports of MEG from the GCC to India in the future,” it said in a press statement.
MEG is an essential raw material for the production of various end user products ranging from clothing and other textiles, through packaging to kitchenware, engine coolants and antifreeze. Polyester and fleece fabrics, upholstery, carpets and pillows, as well as light and sturdy PET drink and food containers originate from ethylene glycol.
Dr Abdulwahab al Sadoun, Secretary General, GPCA, commented, “As the regional body for the Arabian Gulf chemical industry, GPCA calls for the immediate termination of the partial anti-dumping investigation into regional MEG imports into India. This detrimental and ill-advised measure is having a harmful impact not just on GCC economies but also on bilateral trade, threatening to disrupt India’s domestic market and damage long-standing friendly relations between the nations.”
Last December, India’s Reliance Industries in its application to the government said the MEG export prices of the five countries were lower than their domestic prices. Oil- and gas-rich ethylene producers Kuwait, Oman, Saudi Arabia and UAE get feedstock at discounted prices. It later sought termination of investigation against Saudi Arabia.
MEG is one of the main feedstocks for the production of polyethylene terephthalate (PET).
As per MRC's ScanPlast report, Russia's estimated PET consumption decreased to about 53,890 tonnes in February 2020, down by 3% year on year. 100,830 tonnes of PET chips were processed in Russia in the first two months of 2020. February PET production in Russia dropped to 45,800 tonnes, down by 5% year on year. Russia's overall PET production fell in January-February 2020 by 13% year on year.