Commerce Minister Humayun Akhter told a meeting of worried bed-linen exporters in Islamabad last Tuesday that the European Commission has offered to review its decision to slap anti-dumping duty on Pakistani bed-linen.
As it happened, a while ago the EC imposed the anti-dumping duty at as high a rate as 13 percent, without undertaking a proper verification exercise.
The inspection team that it had sent to Islamabad to carry out sample verification chose to inspect only two of the six companies selected for inspection. It left in a hurry, without completing the verification process, citing security threat.
Notably, soon after this unsavoury episode, another EU team came to Islamabad to verify dumping complaints against the textile industry, and went back only after completing its assigned task.
The bed-linen exporters, hence, are not to blame when they accuse the EC of having acted unjustly in their case.
Any response to the new EC offer must be formulated after a careful examination of all aspects of the issue such as due fulfilment of the verification requirement as well as the choices that are available to Pakistan to obtain a fair resolution of the dispute.
The country now has two options to deal with the issue. One is to accept the review offer; and the second, to file an appeal with the WTO against the EC decision.
The government must carefully weigh the pros and cons of both options. The review process may take 15 months, and still at the end of the day, the EC may decide to retain the levy at the present level or even to increase it further.
WTO, on the other hand, has a somewhat longish appeal processing period, about two years, but if Pakistan has a strong case there is no chance of an increase in duty. Either it will accept or reject the appeal.
In other words, there is a possibility of the duty being quashed altogether. It is this eventuality which seems to have pushed the EC to make the review offer.
So far the tendency in Islamabad has been to adopt a tame position in such circumstances. It may be recalled that when a similar situation arose back in 1997, after the EU had imposed a punitive levy on textile imports from Pakistan, India and Egypt, both Pakistan and Egypt decided to remain passive victims of big player heavy-handedness.
Creditably for it, India resolved not to give up without a fight. It went into appeal against the punitive action in WTO and won the case, benefiting the other two parties as well.
Going by its track record the government may yet again be inclined to take the easy way out, which may not lead to a desirable result.
During his meeting with the exporters in Islamabad, the Commerce Minister told them that the Pakistan embassy in Brussels is soon to be directed to collect more information from the EC about some technical aspects of the issue.
Of course, it is important to be equipped with all the relevant facts and figures before taking up the issue.
Such information would also be needed in case the country decides to seek WTO intervention against the EC decision.
However, if for some reason the government chooses to accept the review proposal, it must ask for suspension of the punitive levy for the duration of the review process.
In the event no such respite is available, it would be advisable to seek justice from WTO's dispute resolution forum.
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