. /.WORLD TRADE
ORGANIZATIONG/SG/54
18 September 2002
(02-4955)
Committee on Safeguards Original:  English
TRANSITIONAL PRODUCT SPECIFIC SAFEGUARD ON IMPORTS OF
INDUSTRIAL SEWING MACHINE NEEDLES INTO INDIA FROM
THE PEOPLE'S REPUBLIC OF CHINA
Request for Consultations from India
The following communication, dated 11 September 2002, has been received from the
Permanent Mission of India.
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1. My authorities have instructed me to request consultations with the People's Republic of
China pursuant to Section 16 of the Protocol on Accession of the People's Republic of China and
Paragraph 245-250 of the Report of the Working Party on the Accession of China, with a view toseeking a mutually satisfactory solution regarding market disruption caused to the domestic producers
by increased imports of Industrial Sewing Machine Needles (ISMN) originating from the People's
Republic of China into India.
2. An application has been filed before the Director General (Safeguards) under Rule 5 of the
Customs Tariff (Transitional Product Specific Safeguard Duty) Rules 2002 by M/s. Altek Lammertz
Needles Ltd., Chennai (hereafter referred to as Altek) for imposition of safeguard duty on imports ofISMN into India from the People's Republic of China to protect the domestic producers of ISMN
against market disruption caused by the increased imports of ISMN into India.
3. The applicants have alleged market disruption caused to the domestic producers by the
increased imports of ISMN origin ating from the People's Republic of China into India.  The imports
of ISMN in general from all countries put together increased from 116,470 kg. in 1997-98 to
181,981 kg. in 2001-02 (annualized).  The imports of ISMN from the People's Republic of China have
shown an increase in absolute terms as well as compared to domestic production.
4. The increased imports of ISMN have caused/th reatened to cause market disruption to the
domestic producers of ISMN as indicated by the following factors:
(a) Prices of ISMN originating from China, P.R. have been falling steadily.  To keep up
with the decline in prices of ISMN originat ing from China, P.R. and to retain their
market share, the domestic producers had to reduce their prices of ISMN.  As aconsequence their realization has declined considerably and resulted in loss to the
domestic producers;
(b) The capacity utilization of the domestic producers has declined in recent years;G/SG/54
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(c) The market share of domestic producers of ISMN has shown a decline in recent
years.  The domestic producers have been able to retain even this reduced market
share only at the cost of reduction of their sales prices.
5. It appears that prima facie  increased imports of ISMN from the People's Republic of China
have caused/threatened to cause market disruption to the domestic producers of ISMN.
6. The Government of India reserves its right to raise further issues during the course of
consultation.
7. We look forward to receiving your reply to the present request and to fixing a mutually
convenient date for consultations.
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