India’s micro, small and medium enterprises (MSMEs) require a more predictable and responsive trade remedy framework to protect domestic manufacturing from unfairly priced imports, according to a research report by the Center for Domestic Economic Policy Research (C-DEP).
The report argues that dumping by foreign producers, particularly from countries such as China, can significantly affect capacity utilisation, profitability and competitiveness within India’s manufacturing sector if timely trade remedies are not implemented.
According to the study, MSMEs are more vulnerable to dumped imports than large corporations because they have limited financial flexibility and fewer options to absorb prolonged pricing pressure.
While larger firms can often offset losses through diversified operations and stronger balance sheets, MSMEs are more directly exposed to low-cost imports that undercut domestic production costs.
The report notes that the impact extends beyond individual businesses and can affect employment generation, industrial clusters, supplier networks and broader manufacturing resilience.
C-DEP also highlighted concerns over increasing trade-circumvention practices used to bypass anti-dumping duties.
These include product modifications, routing shipments through third countries, and other mechanisms designed to avoid existing trade restrictions.
The report cited documented cases involving products such as PET resin and warned that such practices could weaken the effectiveness of trade remedies.
According to the study, rerouting dumped products through indirect channels allows imports to continue entering the domestic market despite the imposition of anti-dumping measures.
“Such practices risk diluting the intended impact of trade remedies by rerouting dumped goods into domestic markets in altered forms or through indirect channels,” the report stated.
The research emphasised the importance of implementing anti-dumping duties recommended by the Directorate General of Trade Remedies (DGTR) once investigations establish evidence of dumping and injury to domestic producers.
“Implementation of DGTR recommended anti-dumping duties are essential for ensuring fair competition and a level playing field for the domestic industry in general and for the MSMEs,” the report said.
It added that for MSME manufacturers, trade remedies are not merely a competitiveness issue but often a matter of business survival, employment protection and investment confidence.
“When dumping is established, implementation of recommended duties is critical to prevent large-scale MSME shutdowns,” the report noted.
The study further argued that safeguarding MSMEs is crucial for maintaining supplier diversity, preserving manufacturing clusters and supporting long-term industrial growth.
According to C-DEP, a stable and effective trade remedy framework would help restore fair competition, protect domestic investments and support India’s broader manufacturing ambitions under the Atmanirbhar Bharat initiative.
The report concluded that ensuring timely implementation of anti-dumping measures where injury has been established would strengthen the country’s manufacturing ecosystem and support employment-intensive sectors that are critical to export growth and economic resilience.
