Jul 26, 2008

Business - Colour TVs to become costlier

NEW DELHI: A steep rise in prices of colour television is on the cards with manufacturers gearing up to pass on the burden of anti-dumping duty imposed on imported colour picture tubes by the government. "The prices of colour television are set to go up due to imposing of anti-dumping duty," Consumer Electronic Appliances Manufacturer Association (Ceama) president R Zutsi said. Government on Friday slapped a steep anti-dumping duty on imported picture tube for colour TVs from China, Malaysia, Thailand and Korea after it found that these countries were "dumping" it into India. The punitive duty will range between Rs 878 and Rs 4,369 on a cathode ray colour picture tube (CPT) depending on the size of screen. Zutshi, who is also the Deputy MD of Samsung India, said the impact would differ depending on the size of colour televisions. "It could be as high as 12% for a 21-inch colour television, while it could be 22% in case of CTV set of 29-inch," he said. Korean rival LG Electronics is already planning an increase in prices. "We are increasing the price of colour television sets by around 3-4% from August 1 to pass on some burden to consumers," LG Electronics business group head, consumer electronics, Amitabh Tiwari said. He said the anti-dumping duty imposed is very steep and would impact production costs. "For every increase of Rs 800 in raw material cost, the end price of the product will go up by around Rs 1,450. Thus import duty of such magnitude would definitely have adverse impact on the prices of CTVs," Tiwari added. The government has imposed anti-dumping duty on imported colour picture tubes from countries such as Malaysia, Thailand, South Korea and China. The companies affected by a notification of the department of revenue include Samsung (Malaysia), LG Philips (Korea), Irico Group Electronics (China), Shenzen Samsung (China). The consumer electronic players, who are already struggling to push sales due to negative market sentiments, will have to face a double-whammy now. "We cannot pass whole burden entirely to consumers as this would result into slump in sales but some of these impacts will definitely have to pass on to the consumers," Tiwari said. When contacted Western Electronic also said they have to go for the price hike. "With the imposing of anti-dumping duty, we have no other option but to pass on it to the consumers," Western Electronic V-P marketing Sunil Shetty said. The decision to impose the anti-dumping duty was based on preliminary findings of the designated authority in the commerce ministry. The findings showed that the goods were being exported to India below their normal value causing "material injury to the domestic industry". It was also found that the "injury had been caused by the dumped imports from the subject countries".

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