DGTR proposes 10 per cent safeguard duty imposition on single mode optical fibre

Directorate General of Trade Remedies (DGTR), the investigation arm of Commerce Ministry, has recommended the imposition of safeguard duty of 10 per cent on imports of single-mode optical fibre (SMF) used for signal transmission for one year as it has found a significant surge in the imports of the product.

It has conducted the probe based on the complaints filed by Sterlite Technologies and Birla Furukawa Fibre Optics. These firms had sought the imposition of safeguard duty on the import of single-mode optical fibre (SMF). They claimed that there has been a sudden, sharp and significant increase in the imports in 2018-19, which has continued to be at high levels even in the most recent period i.e. from January 2019 to June 2019. It is to be noted that Sterlite Technologies has delivered ~30 per cent return on its share price in the last one month amid deteriorating operating margins.

DGTR said that the import of these fibres from developing countries listed in an earlier customs notification of 2016, (other than China) will not attract this duty. The duty on imports is proposed to be levied for a period of one year.

Single-mode optical fibre is imported from various countries including China, Japan, the US and Korea. The major quantity is imported from China. The directorate, in its probe, concluded that the product is being imported to India in such increased quantities that it may threaten the domestic manufacturers.

Also, in the recent Independence Day speech, Prime Minister Narendra Modi has announced a task to connect India's over six lakh villages with optical fibre network, that is likely to be completed in the next 1,000 days.