"No safeguard duty on aluminium and hence there should be no anti-dumping duty on digital plates"

1.   In the Preliminary Findings the Designated Authority has accepted all round improvement in the performance of Technova, the domestic industry, as would be observed from the facts stated hereunder:

2.      Reservations made in the Preliminary Findings:

2.1              The reservations made in the Preliminary Findings are on account of Inventories and Profits/Return on Capital Employed.

2.2              With regard to the Inventory, we wish to state that in the Preliminary Findings, it is stated that the Inventories of the domestic industry increased substantially during the period of investigation as mentioned hereinafter(Para 110):

Indexing Inventory as mentioned in Para No.110 of the Preliminary Findings has little meaning as inventories are insignificant in absolute terms, as stated hereunder:

It would be observed that with the production of 12.46 Million Sq. M. in 2010-11 (POI) the inventory was 1.33 Million Sq. M. which works out to 39 days production as against inventory of 25 days in 2007-08 and 32 days in 2008-09 and 2009-10.

Since production of the domestic industry has increased from an indexed figure of 100 in 2007-08 to 505 in 2010-11 (Period of Investigation), Inventories were bound to shoot up to 505 anyway keeping everything else as  constant.

Furthermore, the Company added number of types of products, here again in number of sizes, thicknesses, etc. of the said products. Since the said products are sold to lacs of dealers all over the country and since the Company has made phenomenal changes in their Distribution Network to ensure prompt availability of each type of product to each dealer all over the country, the Company is required to maintain inventory of the products at its various depots. Thus it would be obvious that to offer full range of products promptly to all their customers, throughout the country, the Company needs to maintain all types of sizes and thicknesses. Such being the case, the Domestic Industry has done a phenomenal job in containing the inventory to merely 39 days of production during the POI.

2.3              With regard to the profits and Return on Capital employed, we wish to state that the total demand in the country during the year 2007-08 was only 4.347 Million Sq. M. as detailed hereinafter:

                                                                                         2007-08 (figures in Million sq/mtrs)

                       Imports from China & Japan              1.123

                       Imports from other countries              0.964

                       Sales Volume of Technova                  2.260 

                       Total Demand/Consumption              4.347

                                                                                         -------

2.4       The capacity of Technova was 6.00 Million Sq.M. in 2007-08 and the Capacity   

Utilisation stood at merely 41%.

It would thus be obvious that Technova’s total capacity during the year 2007-08 was 138% of the total demand/consumption in the country of 4.347 Million Sq.M.

2.5       It is thus amazing that in a span of one year Technova decided to put in huge      capital investment to increase their capacity from 6 million Sq. M. (in 2007-08) to  18 Million Sq.M. (in 2008-09) in spite of the fact that the total demand/ consumption in the country during 2007-08 was only 4.347 million Sq. Ms.

Thus Technova, for reasons best known to them, in 2008-09 increased their capacity 7.96 times, their sales volume of 2.260 Million Sq. M. and 4.14 times the total demand/consumption in the country in the year 2007-08.

It is further amazing that Technova made an agreement with Agfa that they would not indulge in any exports of Digital Plates in countries where Agfa is operating.

It is all the more shocking to note that Technova continued to infuse huge capital year after year in spite of their claim of low return on their investments as indexed hereinafter:

Capital Investment

                               2007-08           2008-09           2009-10           2010-11

                                      100                  201                  324                  395

The additional capacity was added in 2008-09. However, the company has claimed continued increase in capital employed and depreciation. The increase shown in capital employed is because of the increase claimed in assets and not working capital as the Company has claimed significant increase in depreciation cost as well as interest cost:

Thus it is obvious that the Five-fold increase in depreciation as well as interest during the POI is the only cause of injury to the domestic industry, if any.

In any case, in spite of the shocking blunders made by the domestic industry, the Return on Capital Employed has been more than satisfactory, as can be observed from the figures given hereinafter:

We fail to understand as to why, in spite of the above, the Government is entertaining this Anti-dumping petition on digital plates in the first place now, when practically no other product or consumable used in the printing industry is privileged to be treated preferentially. Plate is just like any other consumable used amongst many others (paper, ink, chemicals, blankets, finishing devices, etc.) in the manufacture of a printed product. All these products have innumerable players (domestic and overseas) equally competing to serve the customer. The playing field is level-giving the customer the right to choose, be it quality, price, availability and service among others. Thus it is expected, hopefully, that the Government will see through this filter, and be just in serving the real needs of the printers in India rather than a monopoly manufacturer seeking 100% control of the market.

Needless to mention here that God forbid, but if the operations at Technova stop for any reasons viz. natural calamity, labour unrest, etc., the operations in almost all sectors including the education sector and the newspaper publications throughout the country would come to a complete standstill.

3.  No Safeguard Duty on Aluminium and hence there should be no Anti Dumping Duty on Digital Plates

• In the Review Investigation conducted by the Safeguard Directorate relating to Aluminium products, Technova has admitted that the imposition of Safeguard Duty on Alumimium rolled products from China made Technova uncompetitive, as they were unable to import their raw material requirements from China and had requested DG-Safeguards to impose corresponding Safeguard Duty on Digital Printing Plates from China PR.

• This vital fact has been withheld by Technova in their Petition to the Directorate General of Anti Dumping and Allied Duties (DGAD).

• DG – Safeguards (DGSCCE) initiated review probe was terminated vide Notification dated 13.10.2011, after the domestic industry (M/s.Aluminium Association of India and Hindalco) withdrew its application for continued levy of safeguard duty on imports of Aluminium flat rolled products (FRP) and Aluminium Foils.

• Safeguard Duty termination, automatically addresses the anomaly as claimed by Technova in their Initiation Notification with demand for anti-dumping duty on Digital Printing Plates.

• Since the sole Indian printing manufacturer is not suffering any injury now on account of termination of Safeguard Duty which was earlier imposed on imports of Litho Grade Aluminium from China PR, the investigation on imposition of anti-dumping duty on Digital Plates being imported from China and Japan should also be logically dismissed.

• In their petition relating to Anti-dumping duty on Digital Plates, Technova, for obvious reasons, while calculating the normal value, mentioned figures that show that Litho-grade Aluminium accounts for only 33 and 40% of the cost of the plates from Japan and China respectively which is totally different from the figures mentioned by them in the Review of Safeguard Duty on Aluminium Flat Rolled Products where Technova has stated “60 to 70% of the total cost of the printing plates account for Litho-grade Aluminium”.

• The Domestic manufacturer has thus quoted two totally different figures to DGSCCE and DGAD, which alone should be sufficient ground for rejecting their Petition.

4.   CtCP Plates wrongly included in the scope of the Product under consideration

• In our earlier submission, we have, in detail, clarified that as the name stands, CtCP are nothing but the normal presensitised UV sensitive Analogue Conventional Plates and we are already paying anti dumping duty on the said plates, which was imposed in 2007. In the Preliminary Findings it has been stated that CtCP plates are not subjected to EVA coating to give them a mat surface. But then Technova produces several types of PS plates with wide difference in selling prices. Obviously, they are subjected to different coatings. But that does not change their basic character of being Analogue Conventional Plates. As is the case with coated paper, some are with mat finish and some with glossy finish obviously because of different coating. But all are coated paper under tariff code 4810.

• “Taurus”, the PS plate and “Cronos” the CtCP plate, manufactured by Technova have similar technical product specifications as well as the recommended processing chemistry.

• “Taurus” and “Cronos” can both be exposed through film as well as directly through Computer.

• “Taurus” and “Cronos” are both conventional plates and are sold at around the same price.

• CtCP  Plates should, therefore, be excluded from the scope of the product under consideration.

5.         Impact of Imposition of Anti Dumping Duty

The Imposition of Anti Dumping Duty on Digital Plates would result in net loss to printers as indicated hereinafter:

(Rs. in lacs per annum)

We sincerely trust that the Designated Authority would appreciate the points highlighted by us and shall take a prudent stand by not imposing any anti-dumping duty on the imports of Digital Printing Plates from China and Japan.  Such a decision will have a far reaching consequence and enable more than 2,00,000 Indian printers to embrace and adopt contemporary plate technology to their service portfolio and make a major dent in boosting both the domestic as well as the export sales of printed materials.