Date:10/07/2004 URL: http://www.thehindu.com/2004/07/10/stories/2004071008630400.htm

Tamil Nadu

Union Finance Ministry launches probe into sago import

By Our Legal Correspondent

NEW DELHI, JULY 9. Responding to the plea by Tamil Nadu farmers, the Union Finance Ministry has initiated a suo motu investigation into import of starch and asked all interested parties to file responses by August 16.

The investigation by the Director-General of Safeguards (DGS) is a sequel to representations made by the Farmers and Farmers Association of Tamil Nadu and the Tamil Nadu Sago and Starch Manufacturers Welfare Association, Salem, for imposition of a safeguard duty on starch (1108); modified starch (3505) and tapioca-based sago (1903).

The Ministry, in a release, said the representations were examined by the DGS and it appeared that imports of starch, modified starches and manioc (cassava)-based sago caused/threatened to cause serious injury to the domestic producers. The imposition of the safeguard duty or otherwise would depend on the responses received by the DGS.

The associations had urged the Centre that the import duty on sago and starch be raised from 30 to 100 per cent and on modified starch from 20 to 150 per cent, which is the bound rate under the WTO (World Trade Organisation) schedule of concessions agreed to by India. It was stated the landed cost of imported starch was much lower than the domestic product. This resulted in large imports, affecting domestic industry, which in turn affected tapioca farmers, particularly in Tamil Nadu and other southern States.