Product description: Flax Fabric having Flax content of more than 50% (commonly known as Flax Fabric). It is often used as a generic term to describe a class of woven bed, bathtub, table and kitchen textiles because traditionally flax was widely used for towels, sheets etc.  “Flax” or “Linen” are synonymous.

HS Code: Under Chapter 53, sub-heading 5309 (Woven fabric of flax containing 85% or more by weight of flax).

Countries: China PR and Hong Kong

Applicant: M/s Grasim Industries Limited-Jaya Shree Textiles

Date of Initiation: 29.03.2025

Period of Investigation: October 2023 to September 2024

Injury Period: 2021-22, 2022-23, 2023-24 and POI

Margins and recommended duties:

SN	Country	Dumping Margin	Injury Margin	Duty
	China PR	110-120	80-90	$2.36/meter
	Hong Kong	40-50	20-30	$1.14/meter

Key Findings:

1. The product under consideration is woven fabric (having more than 50% flax contents), commonly known as flax fabric, as defined in the original investigation.
2. Since the production of subject goods is widespread in the MSME sector, making it difficult to aggregate data, Authority followed the same methodology for determining Indian production as in the last investigation i.e. to rely on raw material (flax yarn) consumption.
3. The Applicant’s production accounted for 25.73% of domestic production and was held to constitute a major proportion. Further, the application was supported by 22 other producers.
4. The volume of imports from subject countries constituted 95% of total imports of subject goods into India. Volume of imports from China PR, reached an all-time high in the POI.
5. Despite existing duties, price undercutting was positive and significant.
6. The cost of production and selling price of domestic industry increased over the injury period, however, landed price of subject imports which was already below cost of production, decreased further in 2023-24 and the POI. This caused price suppression.
7. Despite increase in demand, production and capacity utilization throughout the injury period, sales of domestic industry which increased till 2022-23, declined thereafter in 2023-24 and the POI.
8. Market share of domestic industry declined, whereas that of subject countries increased significantly throughout the injury period.
9. Average inventories with domestic industry remained significant over injury period.
10. Profitability, cash profits and ROCE declined over injury period and turned negative in the POI. 
11. Growth in terms of profits, cash profits, PBIT and ROCE was negative.
12. The Authority held that despite existing duties, imports reached the highest level in the POI. Therefore, cessation of duties would likely lead to further increase in imports.
13. It was held that producers in subject countries have significant capacities and are highly export oriented.
14. The Authority noted that China PR dominates globally in flax fabric market, supplying 50% of global demand. Cessation of duties, would further divert imports to the Indian market.
15. The Authority concluded that the imposition of duty would be in the larger public interest.