By Duc Nguyen, South East Asia Correspondent
India’s Directorate General of Trade Remedies (DGTR) has launched an anti-dumping probe into imports of nylon filament yarn from China and Vietnam, potentially escalating tensions in global textile trade. This move, based on complaints from Indian manufacturers, could disrupt supply chains and affect export revenues for Vietnamese businesses, amid ongoing efforts to bolster regional economic resilience.
The investigation highlights growing concerns over unfair trade practices in the textiles sector, a key driver of employment in Asia. If dumping is confirmed, it might lead to tariffs or restrictions, impacting Vietnam’s export-oriented economy. However, no evidence has yet confirmed the allegations, and the outcome remains uncertain. 
Background: The Rise of Anti-Dumping Measures in Global Trade
Anti-dumping investigations have become a common tool in international trade disputes, allowing countries to protect domestic industries from goods sold below fair market value. In this case, the DGTR’s probe targets nylon filament yarn— a versatile, lustrous fibre used in producing textiles, apparel, and industrial fabrics. The product falls under specific Harmonised System (HS) codes, including 54021910, 54021990, 54023100, 54023200, 54024500, 54025110, 54026100, and 54021920.
The complaints were filed by three Indian companies: Century Enka Private Limited, Gujarat Polyfilms Private Limited, and Oriilon India Private Limited. These firms allege that imports from China and Vietnam are undercutting local prices, potentially causing injury to the domestic market. The investigation period for dumping spans from 1 April 2023 to 30 June 2024, while the injury assessment covers financial years from 1 April 2020 to 31 March 2023, extended to include the dumping period.
This development is not isolated. India has initiated over 1,000 anti-dumping investigations since 1992, with a significant focus on Asian exporters. Vietnam, as one of the world’s leading textile exporters, has faced similar scrutiny in the past. For instance, in 2022, the US imposed anti-dumping duties on Vietnamese steel products, illustrating the broader risks for countries reliant on manufacturing exports. According to data from the World Trade Organization (WTO), anti-dumping actions have increased globally, with developing nations like India using them to safeguard against perceived imbalances.
Vietnam’s Trade Remedies Authority has advised local businesses to engage proactively, reviewing the initiation notice and submitting comments by 9 January 2025. This includes proposing product classification codes for accurate price comparisons, as none were suggested by the complainants. Failure to respond could result in decisions based on incomplete data, potentially harming Vietnamese exporters.
Details of the Investigation and Stakeholder Involvement
The DGTR has set a tight timeline for responses, requiring stakeholders to submit comments within 15 days of the initiation date, or by 17 January 2025 at the latest. Communications must be directed to specific email addresses: adg16-dgtr@gov.in, adv11-dgtr@gov.in, jd11-dgtr@gov.in, and dd19-dgtr@gov.in. This process underscores the importance of transparency in trade remedies, as mandated by WTO rules.
Vietnamese associations and companies involved in nylon yarn production and export are urged to act swiftly. The Trade Remedies Authority of Vietnam recommends that businesses request necessary documents from the DGTR, respond to investigation questionnaires, and adhere to confidentiality obligations. Public disclosure of information to other stakeholders is also encouraged to foster collaboration.
Nylon filament yarn plays a crucial role in Vietnam’s economy, contributing to the country’s textile and garment industry, which employs millions and generates billions in export revenue annually. In 2024, Vietnam exported over $30 billion worth of textiles, with a significant portion directed to markets like the EU, US, and India. If tariffs are imposed, Vietnamese exporters could face higher costs, potentially reducing competitiveness and affecting jobs in manufacturing hubs such as Hanoi and Ho Chi Minh City.
From an Indian perspective, the investigation reflects domestic pressures to protect local industries amid economic slowdowns. India’s textile sector, valued at around $150 billion, has struggled with rising imports, exacerbated by global supply chain disruptions following the COVID-19 pandemic. The complainants argue that dumped imports have led to market distortion, though evidence must be rigorously verified.
Economic Implications for Vietnam and Regional Trade Dynamics
Should the investigation confirm dumping, Vietnam could face retaliatory measures, including provisional duties that might increase import costs by 10-30% or more, based on historical cases. This could strain bilateral trade relations between India and Vietnam, which have otherwise strengthened through agreements like the ASEAN-India Free Trade Area. In 2023, bilateral trade between the two nations exceeded $15 billion, with textiles forming a key component.
However, if the allegations are not substantiated, Vietnam might emerge with enhanced credibility in global markets, potentially leading to stronger trade partnerships. Economic analysts suggest that such investigations can serve as a catalyst for domestic reforms, encouraging Vietnamese firms to innovate and reduce reliance on price-based competition. For instance, shifting towards sustainable textiles or value-added products could mitigate future risks.
The broader geopolitical context adds layers of complexity. Vietnam’s “bamboo diplomacy”—a strategy of balancing relations with major powers—could be tested if this probe escalates into a wider trade war. India, as a key partner in the Quadrilateral Security Dialogue (Quad), shares strategic interests with Vietnam against regional assertiveness in the South China Sea. Yet, economic frictions might complicate this alliance. If confirmed, the investigation may result in diverted trade flows, with Vietnam potentially redirecting exports to alternative markets like the EU or Japan, where demand for eco-friendly fabrics is growing.
Experts from the Vietnam Chamber of Commerce and Industry have noted that anti-dumping cases often highlight vulnerabilities in supply chains. In a hypothetical scenario, if reforms in Vietnam’s export practices reduce costs through better efficiency, it could strengthen the country’s position. Nonetheless, no evidence currently confirms such outcomes, and any analysis remains speculative.
Analysis: Potential Outcomes and Global Trade Trends
The nylon yarn investigation is emblematic of evolving global trade trends, where protectionism is rising amid economic uncertainties. According to a report by the WTO, anti-dumping measures have doubled in the past decade, driven by factors such as inflation, supply chain bottlenecks, and geopolitical tensions. For Vietnam, this probe could prompt a reevaluation of trade policies, including greater engagement with the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
If the DGTR imposes duties, Vietnamese exporters might seek WTO dispute settlement, as has occurred in previous cases. This could prolong the process, with potential appeals extending beyond 2026. Conversely, a favourable ruling for Vietnam would reinforce the benefits of free trade, encouraging investment in sectors like sustainable manufacturing.
From a consumer perspective, higher prices on nylon products could affect affordability in India, potentially impacting low-income households reliant on affordable clothing. In Vietnam, the economic fallout might include job losses or reduced foreign direct investment, though these outcomes are not guaranteed and depend on multiple variables.
Analysis drawing on verified data, suggests that while anti-dumping probes can protect domestic industries, they risk fragmenting global trade. Policymakers in Hanoi are already discussing strategies to diversify exports, such as investing in high-tech fibres or forming alliances with Southeast Asian neighbours. If these efforts succeed, Vietnam could turn this challenge into an opportunity for growth.
