The government is mulling imposing anti-dumping duty on imports of acetone, a chemical used in drugs and explosives, to protect domestic players from cheap shipments from Japan and Thailand.

Acting on an application of domestic producers on the alleged dumping of the chemical from the two countries, the Directorate General of Anti-dumping and Allied Duties (DGAD) has initiated an anti-dumping probe.

"After finding evidences of dumping of the goods from the two countries, the DGAD has initiated investigation," an official said, adding that the period of probe is October 1, 2008 to June 30, 2009.

The government has initiated a similar probe on imports of phenol, used in the manufacturing of plywood and particle boards, from the two Asian nations.

India has slapped anti-dumping duty on several items such as yarn, fabrics, some of the stainless steel products and chemicals.

A recent WTO report said that India was the second only to Argentina among the G-20 nations in initiating anti-dumping investigations during January-July 2009. India had started 15 probes in the first seven months of 2009.

Unlike safeguard duty, which is levied in a uniform way, anti-dumping duty varies from product to product and country to country. Both duties are allowed under the multilateral trade rules of the WTO.