What was reason to file this complain?

It was a material injury to the local industry affecting the below factors: – The decline in domestic production volume (in Saudi Arabia) – The decline in the rate of capacity utilization – Price reduction for locally made tiles – Increase of inventory, Decline in labor, and productivity, – The decline in profitability, – The decline in cash flows, – The decline in investments, and the rate of return on investment and inability to grow the size of the industry.

How the procedure went?

After the initiation of the documented complaints, GCC’s TSAIP (Technical Secretariat for Anti Injurious Practices) contacted foreign suppliers of ceramic tiles and collected their sales data (both volume-wise as well as value wise) to GCC market. The council also contacted domestic importers to cross-match the data provided by the overseas suppliers. The council also conducted in-person verification to verify the data provided above. After 17 months of internal processing of the above data, the council adopted anti-dumping measures as <a href="https://morbitiles.org/wp-content/uploads/Antidumping-measures-for-Indian-and-Chinese-tiles.pdf">declared in this official gazette</a>.

Another setback for Morbi’s export sales

Update [10th August 2020]: Despite many worrying views about the anti-dumping and future outlooks before it was enforced, we have heard from authoritative experts that exports to Saudi and other GCC markets are still not reduced much. The anti-dumping measures were imposed on 6th June. In spite of that during June 2020 the tiles exports from Morbi to only Saudi Arabia crossed 2.47 million square meters. It converts to approx 1600 containers!

Manoj Ughareja from Velsaa Vitrified LLP and Ashok Patel from Veritaas Granito have views that there is not much effect of the anti-dumping measure as it was anticipated earlier.

In the midst of paranoia created by the Covid-19 situation, there is another blow to Morbi’s flourishing ceramic tiles industry.

This time the news is from GCC (Gulf Co-operation Council), it is the largest export market for Indian tiles. So far so that many factories in Morbi were erected only considering the major chunk of GCC as a key export market for their tiles.

(FYI: GCC member countries are Saudi Arabia, Kuwait, Oman, Qatar, Bahrain, and UAE)

…and it is fact. We have analyzed the export figures (ex-Mundra port) between April 2019 to January 2020 and found that GCC markets stand at # 1 position with consumption of 38% Indian tile exports (see below pie-chart).

*Marketshare of Morbi’s ceramic tiles to world over*

We have also seen project reports of a few wall tiles factories (which they submit to avail bank loans). In such reports, they used to mention exports to Saudi Arabia as their 50% sales.

So much reliance on the single market has given a hard blow to many ceramic wall tiles factories in April 2020, when GCC market adopted 41.2% anti-dumping duty on 196 Morbi based tiles factories and whopping 106% on ALL other Indian factories (as well as exporters… see the table in the FAQ section below).

We have covered some important questions related to this anti-dumping measure by GCC.

What options are left with Morbi tiles factories after implementation of this ADD (anti-dumping duty) structure?

They are left with 2 options as under:

Option 1: Morbi factories will have considerable excess production which they will be forced to sell in the domestic market, slashing prices further in the local market. (FYI domestic market is not favorable to tiles factories due to delays in payment realization). This will result in less profitability.

Option 2: Another option left is to run the production under capacity. This is the least favorable choice as it also affects production costs.

Who initiated complain against imported tiles in the Saudi market?

Saudi Ceramics Co. (SCC) & Alfanar Ceramic documented the complaint during November 2018.

What was reason to file this complain?

It was a material injury to the local industry affecting the below factors:
– The decline in domestic production volume (in Saudi Arabia)
– The decline in the rate of capacity utilization
– Price reduction for locally made tiles
– Increase of inventory, Decline in labor, and productivity,
– The decline in profitability,
– The decline in cash flows,
– The decline in investments, and the rate of return on investment and inability to grow the size of the industry.

How the procedure went?

After the initiation of the documented complaints, GCC’s TSAIP (Technical Secretariat for Anti Injurious Practices) contacted foreign suppliers of ceramic tiles and collected their sales data (both volume-wise as well as value wise) to GCC market.

The council also contacted domestic importers to cross-match the data provided by the overseas suppliers.

The council also conducted in-person verification to verify the data provided above.

After 17 months of internal processing of the above data, the council adopted anti-dumping measures as declared in this official gazette.

When these new rates of duty will enter into force?

from 6^th June 2020 (this will applicable till next 5 years)

Is there same anti-dumping duty for Chinese made tiles?

It is noteworthy that comparatively there is less duty for Chinese tiles in GCC as per this directive. See the below table which will explain the scenario.

It is to be noted that they have excluded tiles made in Spain (which was in the original complain documents during November 2018)

Rate of dumping duty on CIF value (%)	Indian origin	Chinese origin
Non sampling cooperating companies	41.20% (196 Indian companies fall in this category)	23.5% (89 Chinese companies fall in this category)
ALL other companies	106%	76%

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