The Government's move to impose anti-dumping duty on various auto components has not gone down well with the commercial vehicle industry.

On April 14, the Finance Ministry had imposed an anti-dumping duty on front axle beams and steering knuckles importd from China meant for use in heavy and medium commercial vehicles.

Recently it had slapped an anti-dumping duty on truck/bus radial tyres sourced from China and Thailand.

While trying to protect the domestic auto ancillary industries, the anti-dumping duties on mostly Chinese imports result in raising the prices of the imported components.

Industry sources say that with a capacity constraint among domestic suppliers, there is no option but to import the specific parts.

“This (the anti-dumping duty) is against the principles of the free market. As it is, the industry is experiencing a constraint in capacity from domestic suppliers and curbs on imports are not good for the industry in general,” Mr Vinod Aggarwal, CFO, Volvo Eicher Commercial Vehicles, told Business Line.

Not inferior in quality

He added that compared to the front axle beams and steering knuckles produced by domestic manufacturers such as Bharat Forge, the Chinese imports are not inferior in quality though 20-25 per cent cheaper.

Mr Vinod Dasari, Chief Operating Officer, Ashok Leyland, said, “We do import these parts and will continue to do so as they are of critical importance. We get 80 per cent of the supply from Bharat Forge and due to a capacity constraint, we import the rest.” He added that though the cost difference would not be great, the price benefit that was achieved earlier would probably go away.

“We did not anyway import for cost reasons, so mostly the small benefit in terms of lower cost of the imports will go away now,” he said.

An industry official said that all such cases such as the radial tyre issue and the front axle beams do not actually deserve such punitive measures taken.

Legal option

“Both Tata Motors and Ashok Leyland that import these components will have to take a call on the issue. Since the Ministry has now imposed the duty, the only option now is a legal procedure to show that the duties are harming the industry,” said the official.