Circular Welded Carbon-Quality Steel Pipe From India: Preliminary Affirmative Countervailing Duty Determination and Alignment of Final Countervailing Duty Determination With Final Antidumping Duty Determination, 19192-19211 [2012-7726]

Agencies

• DEPARTMENT OF COMMERCE
• International Trade Administration

[Federal Register Volume 77, Number 62 (Friday, March 30, 2012)]
[Notices]
[Pages 19192-19211]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-7726]


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DEPARTMENT OF COMMERCE

International Trade Administration

[C-533-853]


Circular Welded Carbon-Quality Steel Pipe From India: Preliminary 
Affirmative Countervailing Duty Determination and Alignment of Final 
Countervailing Duty Determination With Final Antidumping Duty 
Determination

AGENCY: Import Administration, International Trade Administration, 
Department of Commerce.
SUMMARY: The Department of Commerce preliminarily determines that 
countervailable subsidies are being provided to producers and exporters 
of circular welded carbon-quality steel pipe (``circular welded pipe'') 
from India. For information on the estimated subsidy rates, see the 
``Suspension of Liquidation'' section of this notice.

DATES: Effective Date: March 30, 2012.

FOR FURTHER INFORMATION CONTACT: Shane Subler, Thomas Schauer, or David 
Layton, AD/CVD Operations, Office 1, Import Administration, 
International Trade Administration, U.S. Department of Commerce, 14th 
Street and Constitution Avenue NW., Washington, DC 20230; telephone: 
(202) 482-0189, (202) 482-0410, and (202) 482-0371, respectively.

SUPPLEMENTARY INFORMATION:

Case History

    The following events have occurred since the publication of the 
Department of Commerce's (``Department'') notice of initiation in the 
Federal Register. See Circular Welded Carbon-Quality Steel Pipe from 
India, the Sultanate of Oman, the United Arab Emirates, and the 
Socialist Republic of Vietnam: Initiation of Countervailing Duty 
Investigations, 76 FR 72173 (November 22, 2011) (``Initiation 
Notice''), and the accompanying Initiation Checklist.
    On December 16, 2011, the U.S. International Trade Commission 
(``ITC'') published its affirmative preliminary determination that 
there is a reasonable indication that an industry in the United States 
is materially injured by reason of allegedly subsidized imports of 
circular welded pipe from India, the Sultanate of Oman, the United Arab 
Emirates, and the Socialist Republic of Vietnam (``Vietnam''). See 
Circular Welded Carbon-Quality Steel Pipe From India, Oman, the United 
Arab Emirates, and Vietnam, 76 FR 78313 (December 16, 2011).

[[Page 19193]]

    On December 6, 2011, Petitioners \1\ requested that the Department 
postpone the preliminary determination and extend the deadline to 
submit new subsidy allegations. In response to Petitioners' request, on 
December 19, 2011, the Department postponed the deadline for the 
preliminary determination in this investigation until March 26, 2012. 
See Circular Welded Carbon-Quality Steel Pipe from India, the Sultanate 
of Oman, the United Emirates, and Vietnam: Postponement of Preliminary 
Determinations in the Countervailing Duty Investigations, 76 FR 78615 
(December 19, 2011). In conjunction with this postponement, the 
Department also postponed the deadline for the submission of new 
subsidy allegations until February 15, 2012. See Memorandum to the File 
from Joshua S. Morris, ``New Subsidy Allegation Deadline: Circular 
Welded Carbon-Quality Steel Pipe from India, the Sultanate of Oman, the 
United Emirates, and Vietnam, dated December 15, 2011. In response to 
requests from Petitioners for additional extensions of the deadline for 
the submission of new subsidy allegations, the Department subsequently 
extended this deadline to February 24, 2012 and then to February 28, 
2012. See Memorandum to the File from Susan Kuhbach, ``New Subsidy 
Allegation Deadline: Circular Welded Carbon-Quality Steel Pipe from 
India, the Sultanate of Oman, the United Emirates, and the Socialist 
Republic of Vietnam, dated February 6, 2011, and Letter to All 
Interested Parties, dated February 24, 2011.
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    \1\ Allied Tube and Conduit, JMC Steel Group, Wheatland Tube, 
and United States Steel Corporation (collectively, Petitioners).
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    On December 19, 2011, we selected Lloyds Metals and Engineers Ltd. 
(``Lloyds'') and Zenith Birla Ltd. (``Zenith'') as the mandatory 
respondents in this proceeding. See Memorandum to Christian Marsh, 
Deputy Assistant Secretary for Antidumping and Countervailing Duty 
Operations, ``Countervailing Duty Investigation of Circular Welded 
Carbon-Quality Steel Pipe from India: Respondent Selection 
Memorandum,'' dated December 19, 2011. The public version of this 
memorandum and all other memoranda referenced in this notice are on 
file electronically via Import Administration's Antidumping and 
Countervailing Duty Centralized Electronic Service System (``IA 
ACCESS''). Access to IA ACCESS is available in the Department's Central 
Records Unit in Room 7046 of the main Department building.
    On December 22, 2011, we issued a questionnaire to the Government 
of India (``GOI''). See letter from the Department to the GOI, 
``Countervailing Duty Investigation: Circular Welded Carbon-Quality 
Steel Pipe from India,'' dated December 22, 2011. In the cover letter 
of the questionnaire, we specifically requested that the GOI respond to 
Section II of the questionnaire, which applied to the GOI. Further, we 
instructed the GOI to forward the questionnaire to the mandatory 
respondents, Lloyds and Zenith. We requested that either the GOI or the 
mandatory respondents submit a response to Section III of the 
questionnaire, which applied to the mandatory respondents.
    We received responses to the original December 22, 2011, 
questionnaire from the GOI on January 30, 2012 (``GQR''), and from 
Zenith on February 13, 2012 (``ZQR''). Supplemental questionnaires were 
sent to the GOI on February 10 and March 1, 2012. We received a 
response to the former on March 3, 2012 (``G1SR''), and to the latter 
on March 5, 2012 (``G2SR''). We sent supplemental questionnaires to 
Zenith on February 17, and February 28, 2012, and received responses on 
February 21, 2012 (``ZSR''), March 9, 2012 (``Z2SR''), and March 15, 
2012 (``Z3SR'').
    On February 22, 2012, we received deficiency comments from 
Wheatland Tube, one of the petitioners, pertaining to Zenith's February 
13, 2012, questionnaire response.
    On February 28, 2012, Wheatland Tube submitted a new subsidy 
allegation requesting the Department expand its countervailing duty 
(``CVD'') administrative review to include one additional subsidy. On 
March 16, 2012, the Department issued a memorandum recommending 
investigating the new subsidy allegation. See Memorandum to Susan H. 
Kuhbach, Director, Office 1 from David Layton, International Trade 
Analyst, Office 1, ``Analysis of New Subsidy Allegations,'' dated March 
16, 2012.
    We received pre-preliminary comments from Wheatland Tube on March 
19, 2012.

Period of Investigation

    The period for which we are measuring subsidies, i.e., the period 
of investigation (``POI''), is April 1, 2010, through March 31, 2011. 
GOI and Zenith reported this same period as their fiscal year. See GQR 
at 1; see also the cover letter of Zenith's February 13, 2012, 
questionnaire response.

Scope Comments

    In accordance with the preamble to the Department's regulations, we 
set aside a period of time in our Initiation Notice for parties to 
raise issues regarding product coverage, and encouraged all parties to 
submit comments within 20 calendar days of publication of that notice. 
See Antidumping Duties; Countervailing Duties, 62 FR 27296, 27323 (May 
19, 1997), and Initiation Notice, 76 FR at 72173. On December 5, 2011, 
SeAH Steel VINA Corp. (``SeAH VINA''), a mandatory respondent in the 
concurrent CVD circular welded pipe from Vietnam investigation, filed 
comments arguing that the treatment of double and triple stenciled pipe 
in the scope of these investigations differs from previous treatment of 
these products under other orders on circular welded pipe. 
Specifically, SeAH VINA claims that the Brazilian, Korean, and Mexican 
orders on these products exclude ``Standard pipe that is dual or triple 
certified/stenciled that enters the U.S. as line pipe of a kind used 
for oil and gas pipelines * * *'' See, e.g., Certain Circular Welded 
Non-Alloy Steel Pipe from Brazil, the Republic of Korea, and Taiwan; 
and Certain Circular Welded Carbon Steel Pipes and Tubes From Taiwan: 
Final Results of the Expedited Third Sunset Reviews of the Antidumping 
Duty Order, 76 FR 66899, 66900 (Oct. 28, 2011). According to SeAH VINA: 
(i) If the term ``class or kind of merchandise'' has meaning, it cannot 
have a different meaning when applied to the same products in two 
different cases; and (ii) the distinction between standard and line 
pipe reflected in the Brazil, Korean and Mexican orders derives from 
customs classifications administered by U.S. Customs and Border 
Protection (``CBP'') and, thus, is more administrable.
    On December 14, 2011, Allied Tube and Conduit, JMC Steel Group, and 
Wheatland Tube (collectively, ``certain Petitioners''), responded to 
SeAH VINA's comments stating that the scope as it appeared in the 
Initiation Notice reflected Petitioners'' intended coverage. Certain 
Petitioners contend that pipe that is multi-stenciled to both line pipe 
and standard pipe specifications and meets the physical characteristics 
listed in the scope (i.e., is 32 feet in length or less; is less than 
2.0 inches (50mm) in outside diameter; has a galvanized and/or painted 
(e.g., polyester coated) surface finish; or has a threaded and/or 
coupled end finish) is ordinarily used in standard pipe applications. 
Certain Petitioners state that, in recent years, the Department has

[[Page 19194]]

rejected end-use scope classifications, preferring instead to rely on 
physical characteristics to define coverage, and the scope of these 
investigations has been written accordingly. Therefore, certain 
Petitioners ask the Department to reject SeAH VINA's proposed scope 
modification.
    We agree with certain Petitioners that the Department seeks to 
define the scopes of its proceedings based on the physical 
characteristics of the merchandise. See Notice of Final Determination 
of Sales at Less Than Fair Value and Affirmative Final Determination of 
Critical Circumstances: Circular Welded Carbon Quality Steel Pipe from 
the People's Republic of China, 73 FR 31970 (June 5, 2008) and 
accompanying Issues and Decision Memorandum at Comment 1. Moreover, we 
disagree with SeAH VINA's contention that once a ``class or kind of 
merchandise'' has been established that the same scope description must 
apply across all proceedings involving the product. For example, as the 
Department has gained experience in administering antidumping duty 
(``AD'') and CVD orders, it has shifted away from end use 
classifications to scopes defined by the physical characteristics. Id. 
Thus, proceedings initiated on a given product many years ago may have 
end use classifications while more recent proceedings on the product 
would not. Compare, e.g., Countervailing Duty Order: Oil Country 
Tubular Goods from Canada, 51 FR 21783 (June 16, 1986) (describing 
subject merchandise as being ``intended for use in drilling for oil and 
gas'') with Certain Oil Country Tubular Goods From the People's 
Republic of China: Amended Final Affirmative Countervailing Duty 
Determination and Countervailing Duty Order, 75 FR 3203 (January 20, 
2010) (describing the subject merchandise in terms of physical 
characteristics without regard to use or intended use). Finally, 
certain Petitioners have indicated the domestic industry's intent to 
include multi-stenciled products that otherwise meet the physical 
characteristics set out in the scope. Therefore, the Department is not 
adopting SeAH VINA's proposed modification of the scope.

Scope of the Investigation

    This investigation covers welded carbon-quality steel pipes and 
tube, of circular cross-section, with an outside diameter (``O.D.'') 
not more than 16 inches (406.4 mm), regardless of wall thickness, 
surface finish (e.g., black, galvanized, or painted), end finish (plain 
end, beveled end, grooved, threaded, or threaded and coupled), or 
industry specification (e.g., American Society for Testing and 
Materials International (``ASTM''), proprietary, or other) generally 
known as standard pipe, fence pipe and tube, sprinkler pipe, and 
structural pipe (although subject product may also be referred to as 
mechanical tubing). Specifically, the term ``carbon quality'' includes 
products in which: (a) Iron predominates, by weight, over each of the 
other contained elements; (b) the carbon content is 2 percent or less, 
by weight; and (c) none of the elements listed below exceeds the 
quantity, by weight, as indicated:
    (i) 1.80 percent of manganese;
    (ii) 2.25 percent of silicon;
    (iii) 1.00 percent of copper;
    (iv) 0.50 percent of aluminum;
    (v) 1.25 percent of chromium;
    (vi) 0.30 percent of cobalt;
    (vii) 0.40 percent of lead;
    (viii) 1.25 percent of nickel;
    (ix) 0.30 percent of tungsten;
    (x) 0.15 percent of molybdenum;
    (xi) 0.10 percent of niobium;
    (xii) 0.41 percent of titanium;
    (xiii) 0.15 percent of vanadium;
    (xiv) 0.15 percent of zirconium.
    Subject pipe is ordinarily made to ASTM specifications A53, A135, 
and A795, but can also be made to other specifications. Structural pipe 
is made primarily to ASTM specifications A252 and A500. Standard and 
structural pipe may also be produced to proprietary specifications 
rather than to industry specifications. Fence tubing is included in the 
scope regardless of certification to a specification listed in the 
exclusions below, and can also be made to the ASTM A513 specification. 
Sprinkler pipe is designed for sprinkler fire suppression systems and 
may be made to industry specifications such as ASTM A53 or to 
proprietary specifications. These products are generally made to 
standard O.D. and wall thickness combinations. Pipe multi-stenciled to 
a standard and/or structural specification and to other specifications, 
such as American Petroleum Institute (``API'') API-5L specification, is 
also covered by the scope of this investigation when it meets the 
physical description set forth above, and also has one or more of the 
following characteristics: is 32 feet in length or less; is less than 
2.0 inches (50mm) in outside diameter; has a galvanized and/or painted 
(e.g., polyester coated) surface finish; or has a threaded and/or 
coupled end finish.
    The scope of this investigation does not include: (a) Pipe suitable 
for use in boilers, superheaters, heat exchangers, refining furnaces 
and feedwater heaters, whether or not cold drawn; (b) finished 
electrical conduit; (c) finished scaffolding; \2\ (d) tube and pipe 
hollows for redrawing; (e) oil country tubular goods produced to API 
specifications; (f) line pipe produced to only API specifications; and 
(g) mechanical tubing, whether or not cold-drawn. However, products 
certified to ASTM mechanical tubing specifications are not excluded as 
mechanical tubing if they otherwise meet the standard sizes (e.g., 
outside diameter and wall thickness) of standard, structural, fence and 
sprinkler pipe. Also, products made to the following outside diameter 
and wall thickness combinations, which are recognized by the industry 
as typical for fence tubing, would not be excluded from the scope based 
solely on their being certified to ASTM mechanical tubing 
specifications:
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    \2\ Finished scaffolding is defined as component parts of a 
final, finished scaffolding that enters the United States 
unassembled as a ``kit.'' A ``kit'' is understood to mean a packaged 
combination of component parts that contain, at the time of 
importation, all the necessary component parts to fully assemble a 
final, finished scaffolding.

1.315 inch O.D. and 0.035 inch wall thickness (gage 20)
1.315 inch O.D. and 0.047 inch wall thickness (gage 18)
1.315 inch O.D. and 0.055 inch wall thickness (gage 17)
1.315 inch O.D. and 0.065 inch wall thickness (gage 16)
1.315 inch O.D. and 0.072 inch wall thickness (gage 15)
1.315 inch O.D. and 0.083 inch wall thickness (gage 14)
1.315 inch O.D. and 0.095 inch wall thickness (gage 13)
1.660 inch O.D. and 0.047 inch wall thickness (gage 18)
1.660 inch O.D. and 0.055 inch wall thickness (gage 17)
1.660 inch O.D. and 0.065 inch wall thickness (gage 16)
1.660 inch O.D. and 0.072 inch wall thickness (gage 15)
1.660 inch O.D. and 0.083 inch wall thickness (gage 14)
1.660 inch O.D. and 0.095 inch wall thickness (gage 13)
1.660 inch O.D. and 0.109 inch wall thickness (gage 12)
1.900 inch O.D. and 0.047 inch wall thickness (gage 18)
1.900 inch O.D. and 0.055 inch wall thickness (gage 17)
1.900 inch O.D. and 0.065 inch wall thickness (gage 16)
1.900 inch O.D. and 0.072 inch wall thickness (gage 15)
1.900 inch O.D. and 0.095 inch wall thickness (gage 13)
1.900 inch O.D. and 0.109 inch wall thickness (gage 12)
2.375 inch O.D. and 0.047 inch wall thickness (gage 18)

[[Page 19195]]

2.375 inch O.D. and 0.055 inch wall thickness (gage 17)
2.375 inch O.D. and 0.065 inch wall thickness (gage 16)
2.375 inch O.D. and 0.072 inch wall thickness (gage 15)
2.375 inch O.D. and 0.095 inch wall thickness (gage 13)
2.375 inch O.D. and 0.109 inch wall thickness (gage 12)
2.375 inch O.D. and 0.120 inch wall thickness (gage 11)
2.875 inch O.D. and 0.109 inch wall thickness (gage 12)
2.875 inch O.D. and 0.134 inch wall thickness (gage 10)
2.875 inch O.D. and 0.165 inch wall thickness (gage 8)
3.500 inch O.D. and 0.109 inch wall thickness (gage 12)
3.500 inch O.D. and 0.148 inch wall thickness (gage 9)
3.500 inch O.D. and 0.165 inch wall thickness (gage 8)
4.000 inch O.D. and 0.148 inch wall thickness (gage 9)
4.000 inch O.D. and 0.165 inch wall thickness (gage 8)
4.500 inch O.D. and 0.203 inch wall thickness (gage 7)

    The pipe subject to this investigation is currently classifiable in 
Harmonized Tariff Schedule of the United States (``HTSUS'') statistical 
reporting numbers 7306.19.1010, 7306.19.1050, 7306.19.5110, 
7306.19.5150, 7306.30.1000, 7306.30.5025, 7306.30.5032, 7306.30.5040, 
7306.30.5055, 7306.30.5085, 7306.30.5090, 7306.50.1000, 7306.50.5050, 
and 7306.50.5070. Although the HTSUS subheadings are provided for 
convenience and customs purposes, the written description of the 
merchandise under the investigation is dispositive.

Alignment of Final Determination

    On November 22, 2011, the Department initiated an AD investigation 
concurrent with this CVD investigation of circular welded pipe from 
India. See Circular Welded Carbon-Quality Steel Pipe from India, the 
Sultanate of Oman, the United Arab Emirates, and the Socialist Republic 
of Vietnam: Initiation of Antidumping Duty Investigations, 76 FR 72164 
(November 22, 2011). The scope of the merchandise being covered is the 
same for both the AD and CVD investigations. On March 23, 2012, 
Petitioners submitted a letter, in accordance with section 705(a)(1) of 
the Tariff Act of 1930, as amended (``the Act''), requesting alignment 
of the final CVD determination with the final determination in the 
companion AD investigation. Therefore, in accordance with section 
705(a)(1) of the Act and 19 CFR 351.210(b)(4), the final CVD 
determination will be issued on the same date as the final AD 
determination, which is currently scheduled to be issued on August 6, 
2012.

Use of Facts Otherwise Available

    Sections 776(a)(1) and (2) of the Act provide that the Department 
shall apply ``facts otherwise available'' if, inter alia, necessary 
information is not on the record or an interested party or any other 
person: (A) Withholds information that has been requested; (B) fails to 
provide information within the deadlines established, or in the form 
and manner requested by the Department, subject to subsections (c)(1) 
and (e) of section 782 of the Act; (C) significantly impedes a 
proceeding; or (D) provides information that cannot be verified as 
provided by section 782(i) of the Act.
    Where the Department determines that a response to a request for 
information does not comply with the request, section 782(d) of the Act 
provides that the Department will so inform the party submitting the 
response and will, to the extent practicable, provide that party the 
opportunity to remedy or explain the deficiency. If the party fails to 
remedy the deficiency within the applicable time limits and subject to 
section 782(e) of the Act, the Department may disregard all or part of 
the original and subsequent responses, as appropriate. Section 782(e) 
of the Act provides that the Department ``shall not decline to consider 
information that is submitted by an interested party and is necessary 
to the determination but does not meet all applicable requirements 
established by the administering authority'' if the information is 
timely, can be verified, is not so incomplete that it cannot be used, 
and if the interested party acted to the best of its ability in 
providing the information. Where all of these conditions are met, the 
statute requires the Department to use the information if it can do so 
without undue difficulties.
    Section 776(b) of the Act provides that the Department may use an 
adverse inference in applying the facts otherwise available when a 
party has failed to cooperate by not acting to the best of its ability 
to comply with a request for information. Section 776(b) of the Act 
also authorizes the Department to use as adverse facts available 
(``AFA'') information derived from the petition, the final 
determination, a previous administrative review, or other information 
placed on the record.
    For the reasons explained below, the Department preliminarily 
determines that application of facts other available is warranted and 
that an adverse inference is warranted, pursuant to section 776(b) of 
the Act because, by not responding to our requests for information, the 
GOI, Zenith and Lloyds failed to cooperate by not acting to the best of 
their ability.

I. Government of India

    The GOI did not provide information we requested that is necessary 
to determine whether certain programs under investigation constitute 
countervailable subsidies. Specifically, for the programs listed below, 
the GOI did not provide the information necessary to determine whether 
the GOI provided a financial contribution under these programs and 
whether the programs are specific. The GOI provided no information 
based on its contention that no respondent used the programs.
     Government of India Loan Guarantees Program.
     Research and Technology Scheme Under Empowered Committee 
Mechanism With Steel Development Fund Support.
     Special Economic Zones (``SEZ'') Programs.
     Provision of Captive Mining Rights for Coal and Iron Ore; 
the Provision of High-Grade Ore for LTAR.
     Programs Administered by the State Government of 
Maharashtra Programs (Except the Value-Added Tax Refunds Under State 
Government of Maharashtra Package Scheme)
    CVD investigations necessarily rely on information from the 
government regarding the administration of the alleged subsidy 
programs, including information on use of the programs by the 
respondents. As our original questionnaire to the GOI stated, ``The 
government is responsible for providing the information requested (in 
the questionnaire) for each company respondent, for each of the 
respondent's cross-owned companies, and for each trading company 
through which the respondent sells subject merchandise to the United 
States.'' See Section II of the questionnaire, dated December 22, 2011, 
at 2. In its original questionnaire response, the GOI claimed that the 
respondents did not avail themselves of the programs listed above. See 
GQR at 77-80 and 95-110. However, it was not clear whether the GOI 
covered the respondents' cross-owned companies in its response.
    Accordingly, in our February 10, 2012, supplemental questionnaire 
to the GOI, we asked the GOI to confirm that its responses for the 
programs listed

[[Page 19196]]

above covered respondents' cross-owned companies. For example, we asked 
the GOI to ``{c{time} onfirm that your response covers all GOI Loan 
Guarantees that the GOI provided to the mandatory respondents 
(including their responding cross-owned companies) on loans that were 
outstanding during the POI. Please coordinate with the mandatory 
respondents to obtain the names of these cross-owned companies if you 
do not already have them.'' See the Department's supplemental 
questionnaire to the GOI dated February 10, 2012, at 6. The GOI 
responded,

    It has been reported by the Zenith (Birla) Ltd. that neither 
they nor any of their crossowned companies has availed of the said 
scheme. The Government of India would also like to clarify that this 
response is based solely on the declaration of Zenith (Birla) Ltd. 
as the GOI does not maintain any record of the so-called cross-owned 
companies of the mandatory respondents. As regards Lloyds Metals & 
Engineers Ltd., it appears that they have since shut down 
manufacture of the Product under Consideration and they are not 
participating in the investigations. Therefore, the GOI is in no 
position to provide further answers to the queries of the USDOC with 
regard to the cross-owned companies of this particular mandatory 
respondent.

See the G1SR at, e.g., 9.
    After receiving the G1SR on February 10, 2012, we received Zenith's 
ZQR. As we explain in the section below for Zenith, Zenith's response 
in the ZQR indicated that Zenith was cross-owned with many other 
companies. This contradicted the GOI's claim in the GQR and G1SR that 
Zenith had no cross-owned companies.
    Accordingly, on March 1, 2012, we sent a second supplemental 
questionnaire to the GOI. We noted our request to Zenith for responses 
on behalf of certain cross-owned companies, and we requested that the 
GOI update its questionnaire responses for any subsidies these cross-
owned companies received. Thus, for any of the programs identified 
above, the GOI should have updated its response if any responding 
cross-owned companies used the program.
    On March 5, 2012, the GOI responded to this supplemental 
questionnaire. The GOI stated the following:

    The response of the GOI to the First Supplemental Questionnaire 
was based on the information supplied by Zenith. It is presumed that 
Zenith had included all the above companies in their response. The 
Government of India would also like to reiterate that this response 
is also based solely on the declaration of Zenith (Birla) Ltd. as 
the GOI does not maintain any record of the so-called cross-owned 
companies of the mandatory respondents. GOI has nothing further to 
add.

See the G2SR at 1. Thus, the GOI did not update its original responses 
by either providing information on subsidies that the responding cross-
owned companies received or by stating that none of Zenith's cross-
owned companies for which we requested a response had used the program.
    Further, for the Provision of Hot-Rolled Steel by the Steel 
Authority of India (``SAIL'') for Less Than Adequate Remuneration 
(``LTAR''), the GOI claimed in both the GQR and the G1SR that it had no 
involvement in the purchasing decisions of the mandatory respondents 
and refused to provide any information on the program. See GQR at 18 
and G1SR at 16. The GOI did not respond to our questions and did not 
respond to our request in the supplemental questionnaire to explain in 
detail the efforts it made to obtain this necessary information. See 
G1SR at 16.
    Finally, for the Provision of Land for LTAR, the GOI's original 
response stated, ``The Government of India does not have such 
information.'' See GQR at 27. Because information from the GOI in 
response to the questions from our December 22, 2011, questionnaire was 
necessary for our analysis of the program, we asked the GOI again to 
answer our original questions. In response, the GOI stated, ``State 
governments make provisions of land as a part of overall infrastructure 
development and the development of industry which cannot be considered 
as a subsidy under the ASCM.'' See G1SR at 26. The GOI did not respond 
to our questions and did not respond to our request in the supplemental 
questionnaire to explain in detail the efforts it made to obtain this 
necessary information.
    As explained above, section 776(b) of the Act provides that the 
Department may use an adverse inference in applying the facts otherwise 
available when a party has failed to cooperate by not acting to the 
best of its ability to comply with a request for information. Section 
776(b) of the Act also authorizes the Department to use as AFA 
information derived from the petition, the final determination, a 
previous administrative review, or other information placed on the 
record. The Department has determined that an adverse inference is 
warranted, pursuant to section 776(b) of the Act because, by not 
responding to our requests for information with respect to these 
programs, the GOI failed to cooperate by not acting to the best of its 
ability. When the government fails to provide requested information 
concerning alleged subsidy programs, the Department, as AFA, typically 
finds that a financial contribution exists under the alleged program 
and that the program is specific. See, e.g., Notice of Preliminary 
Results of Countervailing Duty Administrative Review: Certain Cut-to-
Length Carbon-Quality Steel Plate from the Republic of Korea, 71 FR 
11397, 11399 (March 7, 2006) (unchanged in the Notice of Final Results 
of Countervailing Duty Administrative Review: Certain Cut-to-Length 
Carbon-Quality Steel Plate from the Republic of Korea, 71 FR 38861 
(July 10, 2006), in which the Department relied on adverse inferences 
in determining that the Government of Korea directed credit to the 
steel industry in a manner that constituted a financial contribution 
and was specific to the steel industry within the meaning of sections 
771(5)(D) and 771(5A)(D)(iii) of the Act, respectively).
    Accordingly, as AFA, we preliminarily determine that the GOI Loan 
Guarantees program, the Research and Technology Scheme Under Empowered 
Committee Mechanism with Steel Development Fund Support, all of the SEZ 
Programs, all of the Input Programs (including the provision of hot-
rolled steel by SAIL for LTAR), and all of the State Government of 
Maharashtra Programs (including the provision of land for LTAR, but 
with the exception of the Value-Added Tax (``VAT'') Refunds under State 
Government of Maharashtra Package Scheme) provided a financial 
contribution within the meaning of section 771(5)(D) of the Act and 
were specific within the meaning of 771(5A) of the Act. For further 
details with respect to these programs, see the ``Analysis of 
Programs'' section, below.

II. Lloyds

    Lloyds did not provide any of the information requested by the 
Department that is necessary to determine a CVD rate for this 
preliminary determination. Specifically, Lloyds did not respond to the 
Department's December 22, 2011, questionnaire. As a result, we have 
none of the required data necessary to calculate a subsidy rate for 
Lloyds. Accordingly, in reaching our preliminary determination, 
pursuant to section 776(a)(2)(A) and (C) of the Act, we have based 
Lloyds's CVD rate on facts otherwise available.
    The Department has determined that an adverse inference is 
warranted, pursuant to section 776(b) of the Act because, by not 
responding to our questionnaire, Lloyds failed to cooperate by not 
acting to the best of its

[[Page 19197]]

ability. Accordingly, our preliminary determination is based on AFA.

III. Zenith

    Zenith did not provide information we requested that is necessary 
to determine a CVD rate for this preliminary determination. 
Specifically, among numerous other deficiencies, Zenith did not provide 
complete responses with respect to its cross-owned companies.
    Our December 22, 2011, questionnaire instructed the respondents 
that they must provide a complete questionnaire response for all cross-
owned affiliates that meet one of the following criteria: (1) The 
cross-owned company produces the subject merchandise; (2) the cross-
owned company is a holding company or a parent company (with its own 
operations) of the respondent; (3) the cross-owned company supplies an 
input product that is primarily dedicated to the production of the 
subject merchandise; (4) the cross-owned company has received a subsidy 
and transferred it to the respondent; (5) the cross-owned company is 
not a producer or manufacturer but provides a good or service to the 
respondent. See Section III of the questionnaire dated December 22, 
2011, at 2. Regarding its ownership, Zenith initially only reported 
that it ``has been a Birla Group Company (under the management of Birla 
family) since incorporation in the year 1960.'' See ZQR at 5. Zenith 
also identified 38 affiliated companies in its initial response, but 
claimed that none were cross-owned companies and provided no response 
for any of them. Id. at 3 and Annexure 1.
    On February 17, 2012, we sent a supplemental questionnaire to 
Zenith to clarify the relationship between Zenith, the affiliated 
companies Zenith identified in Annexure 1 of the ZQR, and Birla Group. 
See the Department's supplemental questionnaire dated February 17, 
2012. In its response regarding the relationship of Birla Group and 
Zenith, Zenith stated, ``Since Mr. Yashovardhan Birla is heading 
(Zenith) and he controls (Zenith) through other his affiliated 
companies and other entities and therefore we recognize all these 
companies and other entities as Yash Birla Group.'' See ZSR at 1. 
Regarding the affiliated companies Zenith identified at Annexure 1 of 
the ZQR, Zenith stated, ``it is clarified that these all affiliated 
companies along with Zenith Birla (India) Limited is controlled and 
managed by Yash Birla Group either through common management or by 
voting rights.'' \3\ Therefore, Zenith's responses indicate that Yash 
Birla Group, or the ``companies and other entities'' that are 
collectively Yash Birla Group, was the parent company of Zenith by 
virtue of its control of Zenith. Furthermore, Zenith's responses 
indicate that Zenith was cross-owned with all 38 affiliated companies 
under 19 CFR 351.525(b)(6)(vi) through Yash Birla Group's common 
control of Zenith and all of its reported affiliates.
---------------------------------------------------------------------------

    \3\ Zenith clarified that the company it referred to as ``Birla 
Group'' in the ZQR was the same as Yash Birla Group (``It is 
clarified that mention of Birla Group here and elsewhere in our 
earlier response refers to Yash Birla Group.'') See ZSR at 1-2.
---------------------------------------------------------------------------

    Despite the instructions in the December 22, 2011, questionnaire 
that Zenith provide a complete response for a parent company (i.e., the 
second criterion indicated above), Zenith did not provide a response 
for the Yash Birla Group, or the ``companies and other entities'' that 
are collectively Yash Birla Group. Based on Zenith's responses to the 
ZQR and ZSR, Yash Birla Group is the parent company of Zenith by virtue 
of its control of Zenith. In addition, we identified at least three 
other cross-owned companies for which Zenith should have provided a 
response based on information in the ZQR and ZSR. Zenith acknowledged 
that one of these companies, Birla Power Solutions Limited, supplied 
raw material to Zenith during the POI. See ZSR at 2. Furthermore, the 
financial statements Zenith submitted with the ZQR indicate that Zenith 
purchased goods and services from ``related parties,'' which indicates 
these related parties potentially met the third and fifth criteria 
indicated above from our December 22, 2011, questionnaire. See ZQR at 
Annexures 3 though 5 and our supplemental questionnaire dated February 
28, 2012, at 4.
    We sent a second supplemental questionnaire to Zenith to request 
responses for all cross-owned companies that meet one or more of the 
criteria identified in our December 22, 2011, questionnaire, as well as 
to address other deficiencies in Zenith's response. Regarding cross-
owned companies, we requested the following:

     We stated that Zenith's responses indicated that Yash 
Birla Group was the parent company, either directly or indirectly, 
of Zenith during the POI. Thus, we requested a complete 
questionnaire response on behalf of Yash Birla Group or the 
collective ``companies and other entities'' to which Zenith referred 
as Yash Birla Group at page 1 of the ZSR.
     We requested a response on behalf of Birla Power 
Solutions Limited, a company cross-owned with Zenith through Yash 
Birla Group's common control. Zenith acknowledged in the ZSR that 
this company provided raw materials to Zenith during the POI. See 
ZSR at 2.
     We requested a response on behalf of Birla Global 
Corporate Pvt. Limited, a cross-owned company under Yash Birla 
Group's common control, because Zenith's financial statements 
indicated that Zenith had charges for services from this company 
during the POI.
     We requested a complete questionnaire response on 
behalf of Tungabhadra Holdings Private Limited (``THPL''). Zenith's 
submitted financial statements indicated that Zenith merged with 
THPL in 2009 and that THPL was the original owner of two of Zenith's 
three plants. Thus, subsidies that THPL received prior to its merger 
with Zenith would be attributable to Zenith.
     The financial statements Zenith submitted with the ZQR 
indicated that Zenith purchased goods and services from ``related 
parties,'' which indicates that these related parties potentially 
met the third and fifth criteria indicated above from our December 
22, 2011, questionnaire. Therefore, we asked Zenith to identify 
these ``related parties'' and to provide responses on behalf of any 
companies within this group that were cross-owned with Zenith 
through Yash Birla Group's common control.
    We requested that Zenith provide complete questionnaire 
responses for any other cross-owned companies that met one or more 
of the criteria identified in our December 22, 2011, questionnaire.

    For a complete list of the questions, see our supplemental 
questionnaire dated February 28, 2012, at 1-5.
    Zenith asked for two extensions of the deadline for responding to 
our February 28, 2012, supplemental questionnaire. See Zenith's letter 
entitled ``Extension Request'' dated March 5, 2012, and Zenith's letter 
dated March 12, 2012. Because of the impending fully extended deadline 
for the preliminary determination, we were only able to grant Zenith a 
partial extension. See our letters to Zenith dated March 6, 2012, and 
March 12, 2012.
    In its response, Zenith filed what it claimed was ``a complete 
response on behalf of Yash Birla Group.'' See Z3SR at 1. Zenith filed 
individual responses on behalf of seven individual companies, which 
Zenith described as follows:

    We wish to clarify that entities mentioned at serial number 1 to 
6 were involved in manufacturing and export of various products but 
not the subject merchandise and all of them have received any of 
various subsidy program as identified by the DOC during the POI and 
therefore we have reported separate response for each of them and 
same is enclosed as Annexure-48 to Annexure-53. As far as (Birla 
Global Corporate Pvt. Limited) is concerned Zenith Birla (India) 
Limited has paid service charges to that entity and therefore we 
have reported

[[Page 19198]]

separate response for that entity and same is enclosed as Annexure-
54.

Id. at 2.

    Zenith also filed one response that it claimed covered 28 other 
companies. In this response, Zenith stated the following:

    We further wish to clarify that all other 28 companies of Yash 
Birla Group as identified in Annexure-56 were neither involved in 
production or sales of subject merchandise nor any of them have any 
export sales and therefore in absence of export sales question of 
export subsidy does not arise at all and therefore we have reported 
a single response for all these companies as Annexure-55.

Id.

    Zenith did not provide information we requested that is necessary 
to determine a CVD rate for this preliminary determination for the 
following reasons. First, we requested that Zenith respond on behalf of 
the Yash Birla Group because, as we described above, Zenith's responses 
indicate that Yash Birla Group was the parent company to Zenith. See 
the supplemental questionnaire dated February 28, 2012, at 1-2. In 
response, Zenith filed incomplete responses on behalf of individual 
companies under the control of the Yash Birla Group (see below), but 
filed no response on behalf of the Yash Birla Group. See Z3SR at 2. 
Therefore, we have no response for Yash Birla Group, which is Zenith's 
parent company based on Zenith's responses. Consequently, we cannot 
identify subsidies Zenith's controlling or parent company received that 
may be attributable to Zenith under 19 CFR 351.525(b)(6)(iii).
    Second, we are not able to identify the universe of cross-owned 
companies with subsidies attributable to Zenith. Although Zenith 
initially responded that it has no cross-owned companies, Zenith's 
responses revealed that Zenith is cross-owned with 38 companies through 
Yash Birla Group's common control. See ZQR at Annexure 1. In accordance 
with the instructions in the original questionnaire, Zenith should have 
responded on behalf of any of these companies that may have received 
subsidies attributable to Zenith under our regulations. For example, 
subsidies to a cross-owned input supplier to Zenith are attributable to 
Zenith under 19 CFR 351.525(b)(6)(iv) if production of the input 
product is primarily dedicated to production of the downstream product. 
As we stated above, Zenith's financial statements showed purchases from 
``related parties,'' suggesting that Zenith may have cross-owned input 
suppliers with subsidies attributable to Zenith under 19 CFR 
351.525(b)(6)(iv). Thus, we requested that Zenith identify these 
companies. See the supplemental questionnaire dated February 28, 2012, 
at 4. Zenith did not answer this question. See Z3SR at 5. Consequently, 
we do not know the universe of cross-owned companies for which Zenith 
should have provided questionnaire responses, and we do not know the 
universe of subsidies attributable to Zenith that these cross-owned 
companies received.
    Third, Zenith's responses on behalf of its cross-owned companies in 
the Z3SR are unusable for the following reasons. For 28 of these 
companies, Zenith claimed that none received any of the subsidies under 
investigation. Id. at Annexure 56. Zenith, however, argued that it was 
not required to provide financial statements or tax returns for any of 
these companies because they did have export sales and, thus, the 
question of receiving any subsidy benefit was not relevant. Id. Under 
the Department's regulations, however, the universe of cross-owned 
companies receiving subsidies attributable to Zenith is not limited to 
cross-owned companies that export. See 19 CFR 351.525(b) and (c).
    In the individual responses for seven specific companies in the 
Z3SR, Zenith failed to provide requested worksheets reconciling sales 
to the financial statements. Id. at Annexures 48-54. The sales as 
reported are unusable to calculate the level of subsidy benefits if 
they include intercompany sales with other responding cross-owned 
companies. Because Zenith did not provide the requested 
reconciliations, we cannot determine whether Zenith properly excluded 
these sales.
    Moreover, Zenith did not provide requested documentation and 
benefit amounts for the seven individual companies in the Z3SR on the 
grounds that any benefits the companies received were not related to 
subject merchandise. Id., e.g., at Annexure 48 at 8. Absent a 
determination by the Department that a subsidy is ``tied'' to a 
specific product under 19 CFR 351.525(b)(5), the Department does not 
limit the attribution of a benefit from a subsidy program to a specific 
product. The Department bases these determinations on information on 
the record, including the questionnaire responses of respondent 
companies. Therefore, it is incumbent on Zenith to provide information 
necessary for our determination by submitting complete and timely 
responses to the Department's questionnaires.
    Furthermore, Zenith did not respond with respect to certain 
programs on the grounds that its cross-owned companies had not used the 
program ``during the POI,'' even though we specifically asked for 
reporting during the entire average useful life (``AUL'') period. Id., 
e.g., at Annexure 48 at 20.
    Also, certain cross-owned companies for which Zenith reported no 
subsidy information show subsidies under investigation in their annual 
reports. For example, the 2010-2011 Annual Report of Birla Precision 
Technologies Limited identifies a Sales Tax Deferred Payment Loan, a 
Mahartasha Value Added Tax Credit, an Export Promotion Capital Goods 
Scheme, an Export-oriented Unit, and consumption of steel during the 
POI (indicating that this company purchased steel during the POI). Id., 
Annexure 48, at 31, 32, and 37. All of these items in the Annual Report 
relate to programs under investigation. In its narrative response, 
however, Zenith stated that the questions in the questionnaire were 
``not applicable to us'' and did not report any subsidies or answer any 
of the questions from the December 22, 2011, questionnaire. Id. at 8 
and 11. See also id. at 17 and 20.
    Finally, Zenith also did not provide a complete questionnaire 
response on behalf of itself. Zenith's financial statements show that 
Zenith merged with THPL, which was the previous owner of two of 
Zenith's three plant locations during the POI. See ZQR at Annexure 4 at 
12. Although Zenith later claimed that its response ``includes all the 
benefits received by Tungabhadra Holdings Private Limited in the AUL 
period,'' Zenith provided no requested information (such as financial 
statements or description of operations or benefits received prior to 
its amalgamation with Zenith in 2009) with respect to THPL. This makes 
it impossible to evaluate what subsidies THPL may have availed prior to 
its amalgamation with Zenith which could potentially be attributable to 
Zenith. See Z3SR at 3.
    Furthermore, Zenith responded that it did not purchase land from 
the GOI during the AUL period. Id. at 4. Zenith's response indicates, 
however, that THPL ``acquired Murbad property (held by Sunlight Pipes 
and Tubes Private Limited) from Andhra Bank in a public auction in year 
2005.'' Id. at 4. Publicly available information shows that the 
Government of India owned a majority of the shares of Andhra Bank in 
2005. See Memorandum to file, entitled ``Calculation of the Adverse 
Facts Available Rate for Lloyds Metals and Engineers Ltd. and Zenith 
Birla Ltd.,'' dated March 26, 2012, at Attachment III. Zenith's 
response also indicates that the Tarapur plant was ``acquired by

[[Page 19199]]

Tungabhadra Holdings Private Limited from Podar Tubes and Tyers Private 
Limited and part land (G-39) for Tarapur plant were acquired by the 
Tungabhadra Holdings Private Limited in a public auction by Debt 
Recovery Tribunal in a year 2003.'' Id. at 4. Publicly available 
information shows that Debt Recovery Tribunals are entities constituted 
by the GOI. See Memorandum to file, entitled ``Calculation of the 
Adverse Facts Available Rate for Lloyds Metals and Engineers Ltd. and 
Zenith Birla Ltd.,'' dated March 26, 2012, at Attachment III. Thus, 
Zenith's claim in the Z3QR that its Murbad and Tarapur plants were 
``not acquired from any government authority'' does not take into 
account this information. By not responding to the questions regarding 
land received at less than adequate remuneration, Zenith prevented us 
from evaluating whether these plants received any subsidies which could 
potentially be attributable to Zenith.
    Because of the numerous deficiencies identified above, it is 
impossible to calculate a credible subsidy rate based on Zenith's 
responses. We provided Zenith two chances, including multiple deadline 
extensions, to provide a complete questionnaire response. Zenith filed 
no notification of difficulty in responding to the questionnaire within 
14 days of the date of receipt of the questionnaire, as required by our 
regulations and the questionnaire. See Section III of the questionnaire 
dated December 22, 2011, at 3; see also 19 CFR 351.301(c)(2)(iv). 
Accordingly, in reaching our preliminary determination, pursuant to 
sections 776(a)(2)(A) and (C) of the Act, we have based Zenith's CVD 
rate on facts otherwise available. Moreover, Zenith's failure to 
provide complete responses, as described above, despite our repeated 
requests for such responses, constitutes a failure on Zenith's part to 
cooperate by not acting to the best of its ability. Accordingly, our 
preliminary determination is based on AFA.

Selection of the Adverse Facts Available Rate

    In deciding which facts to use as AFA, section 776(b) of the Act 
and 19 CFR 351.308(c)(1) authorize the Department to rely on 
information derived from (1) the petition, (2) a final determination in 
the investigation, (3) any previous review or determination, or (4) any 
information placed on the record. The Department's practice when 
selecting an adverse rate from among the possible sources of 
information is to ensure that the rate is sufficiently adverse ``as to 
effectuate the purpose of the facts available role to induce 
respondents to provide the Department with complete and accurate 
information in a timely manner.'' See Notice of Final Determination of 
Sales at Less than Fair Value: Static Random Access Memory 
Semiconductors From Taiwan; 63 FR 8909, 8932 (February 23, 1998). The 
Department's practice also ensures ``that the party does not obtain a 
more favorable result by failing to cooperate than if it had cooperated 
fully.'' See Statement of Administrative Action accompanying the 
Uruguay Round Agreements Act, H.R. Doc. No. 316, 103d Cong., 2d Session 
(1994) (``SAA''), at 870. In choosing the appropriate balance between 
providing a respondent with an incentive to respond accurately and 
imposing a rate that is reasonably related to the respondent's prior 
commercial activity, selecting the highest prior margin ``reflects a 
common sense inference that the highest prior margin is the most 
probative evidence of current margins, because, if it were not so, the 
importer, knowing of the rule, would have produced current information 
showing the margin to be less.'' See Rhone Poulenc, Inc. v. United 
States, 899 F.2d 1185, 1190 (Fed. Cir. 1990).
    In assigning net subsidy rates for each of the programs for which 
specific information was required from Lloyds and Zenith, we were 
guided by the Department's approach in prior India CVD reviews as well 
as recent CVD investigations involving the People's Republic of China. 
See, e.g., Certain Hot-Rolled Carbon Steel Flat Products from India: 
Final Results and Partial Rescission of Countervailing Duty 
Administrative Review, 74 FR 20923 (May 6, 2009) (``Fifth HRS 
Review''), and accompanying Issues and Decision Memorandum (``Fifth HRS 
Review Decision Memorandum''), at ``SGOC Industrial Policy 2004-2009'' 
section; see also Circular Welded Austenitic Stainless Pressure Pipe 
from the People's Republic of China: Final Affirmative Countervailing 
Duty Determination, 74 FR 4936 (January 28, 2009), and accompanying 
Issues and Decision Memorandum at ``Application of Facts Available and 
Use of Adverse Inferences'' section.
    It is the Department's practice in CVD proceedings to select, as 
AFA, the highest calculated rate in any segment of the proceeding.\4\ 
In previous CVD investigations of products from India, we adapted the 
practice to use the highest rate calculated for the same or similar 
program in another India CVD proceeding. Thus, under this practice, for 
investigations involving India, the Department computes the total AFA 
rate for non-cooperating companies generally using program-specific 
rates calculated for the cooperating respondents in the instant 
investigation or calculated in prior India CVD cases. Specifically, for 
programs other than those involving income tax exemptions and 
reductions, the Department applies the highest calculated rate for the 
identical program in the investigation if a responding company used the 
identical program, and the rate is not zero. If there is no identical 
program within the investigation, the Department uses the highest non-
de minimis rate calculated for the same or similar program (based on 
treatment of the benefit) in another India CVD proceeding. Absent an 
above-de minimis subsidy rate calculated for the same or similar 
program, the Department applies the highest calculated subsidy rate for 
any program otherwise listed that could conceivably be used by the non-
cooperating companies.\5\
---------------------------------------------------------------------------

    \4\ See, e.g., Laminated Woven Sacks From the People's Republic 
of China: Final Affirmative Countervailing Duty Determination and 
Final Affirmative Determination, in Part, of Critical Circumstances, 
73 FR 35639 (June 24, 2008), and accompanying Issues and Decision 
Memorandum at ``Selection of the Adverse Facts Available.''
    \5\ See, e.g., Lightweight Thermal Paper from the People's 
Republic of China: Final Affirmative Countervailing Duty 
Determination, 73 FR 57323 (October 2, 2008), and accompanying 
Issues and Decision Memorandum at ``Selection of the Adverse Facts 
Available Rate.''
---------------------------------------------------------------------------

    In this case, there is no appropriate information on the record of 
this investigation from which to select appropriate AFA rates for any 
of the subject programs. Although Zenith provided some information for 
some of the programs with respect to itself, it provided no usable 
information on subsidies received with respect to any of its cross-
owned companies, which means we cannot ascertain the total amount of 
subsidies attributable to Zenith's sales. As a result, it is not 
possible for us to calculate an accurate subsidy rate for any of the 
programs alleged. Furthermore, because this is an investigation, we 
have no previous segments of this proceeding from which to draw 
potential AFA rates.
    For the alleged income tax programs pertaining to either the 
reduction of the income tax rates or the payment of no income tax, we 
have applied an adverse inference that the respondents paid no income 
tax during the POI. The standard income tax rate for corporations in 
India is 35 percent. See the petition dated October 26, 2011, at 
Exhibit III-A-18. Therefore, the highest possible benefit for the 
income tax rate

[[Page 19200]]

programs is 35 percent. We are applying the 35 percent AFA rate on a 
combined basis (i.e., the income tax programs combined provided a 35 
percent benefit).
    For programs other than those involving income tax exemptions and 
reductions, we applied the highest non-de minimis rate calculated for 
the same or similar program in another India CVD proceeding. Absent an 
above-de minimis subsidy rate calculated for the same or similar 
program, we applied the highest calculated subsidy rate for any program 
otherwise listed that could conceivably be used by the mandatory 
company respondents.\6\
---------------------------------------------------------------------------

    \6\ See, e.g., Certain Kitchen Shelving and Racks from the 
People's Republic of China: Final Affirmative Countervailing Duty 
Determination, 74 FR 37012, 37013 (July 27, 2009); see also Sodium 
Nitrite From the People's Republic of China: Final Affirmative 
Countervailing Duty Determination, 73 FR 38981, 38982 (July 8, 
2008).
---------------------------------------------------------------------------

    For a discussion of the application of the individual AFA rates for 
programs preliminarily determined to be countervailable, see the 
``Analysis of Programs'' section, below.

Corroboration of Secondary Information

    Section 776(c) of the Act provides that, when the Department relies 
on secondary information rather than on information obtained in the 
course of an investigation or review, it shall, to the extent 
practicable, corroborate that information from independent sources that 
are reasonably at its disposal. Secondary information is defined as 
``information derived from the petition that gave rise to the 
investigation or review, the final determination concerning the subject 
merchandise, or any previous review under section 751 concerning the 
subject merchandise.'' See SAA at 870. The SAA provides that to 
``corroborate'' secondary information, the Department will satisfy 
itself that the secondary information to be used has probative value. 
See SAA at 870. The Department will, to the extent practicable, examine 
the reliability and relevance of the information to be used. The SAA 
emphasizes, however, that the Department need not prove that the 
selected facts available are the best alternative information. See SAA 
at 869-870.
    With regard to the reliability aspect of corroboration, unlike 
other types of information, such as publicly available data on the 
national inflation rate of a given country or national average interest 
rates, there typically are no independent sources for data on company-
specific benefits resulting from countervailable subsidy programs. With 
respect to the relevance aspect of corroboration, the Department will 
consider information reasonably at its disposal in considering the 
relevance of information used to calculate a countervailable subsidy 
benefit. The Department will not use information where circumstances 
indicate that the information is not appropriate as AFA. See, e.g., 
Fresh Cut Flowers From Mexico; Final Results of Antidumping Duty 
Administrative Review, 61 FR 6812 (February 22, 1996). In the instant 
case, no evidence has been presented or obtained that contradicts the 
relevance of the information relied upon in a prior India CVD 
proceeding. Therefore, in the instant case, the Department 
preliminarily finds that the information used has been corroborated to 
the extent practicable.

Analysis of Programs

A. Export Oriented Unit Schemes

1. Duty-Free Import of All Types of Goods, Including Capital Goods and 
Raw Materials
    The GOI reported that an export oriented unit (``EOU'') ``may 
import without payment of duty all types of goods, including capital 
goods and raw material, as defined in the Policy, required by it for 
manufacture, services, trading or in connection therewith.'' See GQR at 
26. Accordingly, we preliminarily determine that this program provides 
a financial contribution in the form of revenue forgone within the 
meaning of section 771(5)(D)(ii) of the Act. The GOI also reported that 
``{u{time} nits undertaking to export their entire production of goods 
and services, except permissible sales in the Domestic Tariff Area, as 
per this policy, may be set up under the EOU Scheme for manufacture of 
goods.'' See GQR at 26. Accordingly, we preliminarily determine that 
this program is contingent upon export and, therefore, is specific 
within the meaning of section 771(5A)(B) of the Act.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 14.61 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any segment of any 
proceeding involving India. See Notice of Final Affirmative 
Countervailing Duty Determination: Polyethylene Terephthalate Film, 
Sheet, and Strip (PET Film) From India, 67 FR 34905 (May 16, 2002) 
(``PET Film Investigation''), and accompanying Issues and Decision 
Memorandum (``PET Film Investigation Decision Memorandum'') at the 
``DEPS'' section.
2. Reimbursement of Central Sales Tax (``CST'') Paid on Goods 
Manufactured in India
    The GOI reported that ``Export Oriented Units (EOUs) and units in 
Export Processing Zones (EPZs), Electronic Hardware Technology Park 
(EHTP), Software Technology Park (STP) and Special Economic Zones (SEZ) 
will be entitled to full reimbursement of Central Sales Tax (CST) paid 
by them on purchases made from the Domestic Tariff Area (DTA), for 
production of goods and services as per Exim Policy.'' See GQR at 27. 
Accordingly, we preliminarily determine that this program provides a 
financial contribution in the form of revenue forgone within the 
meaning of section 771(5)(D)(ii) of the Act. The GOI also reported that 
``{u{time} nits undertaking to export their entire production of goods 
and services, except permissible sales in the Domestic Tariff Area, as 
per this policy, may be set up under the EOU Scheme for manufacture of 
goods.'' See GQR at 26. Accordingly, we preliminarily determine that 
this program is contingent upon export and, therefore, is specific 
within the meaning of section 771(5A)(B) of the Act.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 3.09 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any segment of any 
proceeding involving India. See Final Results of Countervailing Duty 
Administrative Review: Certain Hot-Rolled Carbon Steel

[[Page 19201]]

Flat Products from India, 71 FR 28665 (May 17, 2006), and accompanying 
Issues and Decision Memorandum (``Second HRS Review Decision 
Memorandum'') at the ``State Government of Gujarat Tax Incentives'' 
section.
3. Duty Drawback on Fuel Procured From Domestic Oil Companies
    The GOI reported that ``{f{time} uels procured from the depots of 
domestic oil companies on payment of excise duty by EOU/EHTP/STP/BTP 
will be eligible for reimbursement in the form of terminal excise duty 
in addition to drawback rates notified by DGFT from time to time 
provided the recipient unit does not avail CENVAT credit/rebate on such 
goods.'' See GQR at 27-28. Accordingly, we preliminarily determine that 
this program provides a financial contribution in the form of revenue 
forgone within the meaning of section 771(5)(D)(ii) of the Act. The GOI 
also reported that ``{u{time} nits undertaking to export their entire 
production of goods and services, except permissible sales in the 
Domestic Tariff Area, as per this policy, may be set up under the EOU 
Scheme for manufacture of goods.'' See GQR at 26. Accordingly, we 
preliminarily determine that this program is contingent upon export 
and, therefore, is specific within the meaning of section 771(5A)(B) of 
the Act.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 14.61 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any segment of any 
proceeding involving India. See PET Film Investigation Decision 
Memorandum at the ``DEPS'' section.
4. Exemption From Income Tax Under Section 10A and 10B of Income Tax 
Act
    The GOI reported that ``Section 10A of the Income-tax Act provides 
for a five-year total tax holiday to industrial undertakings which 
manufacture or produce any article or thing and are set up in notified 
Free Trade Zones (FTZs)'' and that ``section 10B of the Income-tax Act 
allows a five-year tax holiday to approved 100% export-oriented 
undertakings (EOUs) which manufacture or produce any article or 
thing.'' See GQR at 28. Accordingly, we preliminarily determine that 
this program provides a financial contribution in the form of revenue 
forgone within the meaning of section 771(5)(D)(ii) of the Act. The GOI 
also reported that ``{u{time} nits undertaking to export their entire 
production of goods and services, except permissible sales in the 
Domestic Tariff Area, as per this policy, may be set up under the EOU 
Scheme for manufacture of goods.'' See GQR at 26. Accordingly, we 
preliminarily determine that this program is contingent upon export 
and, therefore, is specific within the meaning of section 771(5A)(B) of 
the Act.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    As explained above, for the alleged income tax programs pertaining 
to either the reduction of the income tax rates or the payment of no 
income tax, we are applying the 35 percent AFA rate on a combined basis 
(i.e., the income tax programs combined provided a 35 percent benefit).
5. Exemption From Payment of Central Excise Duty on Goods Manufactured 
in India and Procured From a Domestic Tariff Area
    The GOI reported that ``{t{time} he EOUs can procure goods from DTA 
without payment of Central Excise duty subject to following of the 
Chapter X procedure of erstwhile Central Excise Rules.'' See GQR at 29. 
Most of the products manufactured in India are assessed excise duties 
at the rate of 16 percent. However, manufactured goods purchased 
domestically qualify for exemption from this excise duty under this 
program. Accordingly, we preliminarily determine that this program 
provides a financial contribution in the form of revenue forgone within 
the meaning of section 771(5)(D)(ii) of the Act. The GOI also reported 
that ``{u{time} nits undertaking to export their entire production of 
goods and services, except permissible sales in the Domestic Tariff 
Area, as per this policy, may be set up under the EOU Scheme for 
manufacture of goods.'' See GQR at 26. Accordingly, we preliminarily 
determine that this program is contingent upon export and, therefore, 
is specific within the meaning of section 771(5A)(B) of the Act.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 14.61 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any segment of any 
proceeding involving India. See PET Film Investigation Decision 
Memorandum at the ``DEPS'' section.
6. Reimbursement of CST on Goods Manufactured in India and Procured 
From a Domestic Tariff Area
    The GOI reported that ``{t{time} he EOUs can procure goods from DTA 
without payment of Central Excise duty subject to following of the 
Chapter X procedure of erstwhile Central Excise Rules.'' See GQR at 29. 
Accordingly, we preliminarily determine that this program provides a 
financial contribution in the form of revenue forgone within the 
meaning of section 771(5)(D)(ii) of the Act. The GOI also reported that 
``{u{time} nits undertaking to export their entire production of goods 
and services, except permissible sales in the Domestic Tariff Area, as 
per this policy, may be set up under the EOU Scheme for manufacture of 
goods.'' See GQR at 26. Accordingly, we preliminarily determine that 
this program is contingent upon export and, therefore, is specific 
within the meaning of section 771(5A)(B) of the Act.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this

[[Page 19202]]

program during the POI. Therefore, as AFA we find that both Lloyds and 
Zenith used and benefitted from this program within the meaning of 
section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 3.09 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any segment of any 
proceeding involving India. See Second HRS Review Decision Memorandum 
at the ``State Government of Gujarat Tax Incentives'' section.

B. Export Promotion Capital Goods Scheme

    The GOI reported that ``{t{time} he scheme allows import of capital 
goods for pre production, production and post production at 5% Customs 
duty subject to an export obligation equivalent to 8 times of duty 
saved on capital goods imported under EPCG scheme to be fulfilled over 
a period of 8 years reckoned from the date of issuance of license.'' 
See GQR at 41. Thus, under this program, Indian companies may import 
capital equipment at reduced rates by fulfilling certain export 
obligations. Accordingly, we preliminarily determine that this program 
provides a financial contribution in the form of revenue forgone within 
the meaning of section 771(5)(D)(ii) of the Act. Moreover, because this 
duty reduction is subject to an export obligation, we preliminarily 
determine that this program is specific within the meaning of section 
771(5A)(B) of the Act.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 16.63 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for the same program in any segment of any 
proceeding involving India. See Final Affirmative Countervailing Duty 
Determination: Certain Hot-Rolled Carbon Steel Flat Products From 
India, 66 FR 49635 (September 28, 2001), and accompanying Issues and 
Decision Memorandum (``HRS Investigation Decision Memorandum'') at the 
``Export Promotion for Capital Goods (EPCGS) Scheme'' section.

C. Duty Exemption/Remission Schemes

1. Advance License Program
    The GOI reported that ``{a{time} n Advance Authorization is issued 
to allow duty free import of inputs, which are physically incorporated 
in export product (making normal allowance for wastage). In addition, 
fuel, oil, energy, catalysts which are consumed/utilized to obtain 
export product, may also be allowed.'' See GQR at 45. Accordingly, we 
preliminarily determine that this program provides a financial 
contribution in the form of revenue forgone within the meaning of 
section 771(5)(D)(ii) of the Act. The GOI also reported that 
``{d{time} uty free import of mandatory spares up to 10% of CIF value 
of Authorization which are required to be exported/supplied with 
resultant product are allowed under Advance Authorization.'' See GQR at 
26. Accordingly, we preliminarily determine that this program is 
contingent upon export and, therefore, is specific within the meaning 
of section 771(5A)(B) of the Act.
    The GOI initially claimed that the respondents had not availed 
themselves of any benefits under this program. See GQR at 47. Zenith 
reported that it used this program. See ZQR at 12-14.\7\ However, for 
Zenith, we cannot determine the level of benefit within the meaning of 
section 771(5)(E) of the Act because Zenith did not report necessary 
information for its cross-owned companies.
---------------------------------------------------------------------------

    \7\ The GOI subsequently acknowledged that Zenith used Advanced 
Authorization licenses during the POI that were issued before the 
POI. See G1SR at response to Question 18.
---------------------------------------------------------------------------

    Absent the cooperation of Lloyds and Zenith with respect to its 
cross-owned companies, we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
we find that Zenith and Lloyds used and benefitted from this program 
within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 0.50 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for the same program in any segment of any 
proceeding involving India. See Certain Hot-Rolled Carbon Steel Flat 
Products From India: Final Results of Countervailing Duty 
Administrative Review, 73 FR 40295 (July 14, 2008) (``Fourth HRS 
Review'') and accompanying Issues and Decision Memorandum (``Fourth HRS 
Review Decision Memorandum'') at the ``Advance License Program (ALP)'' 
section.
2. Duty Free Import Authorization Scheme
    The GOI reported that ``DFIA is issued to allow duty free import of 
inputs, fuel, oil, energy sources, catalyst which are required for 
production of export product.'' See GQR at 46. Accordingly, we 
preliminarily determine that this program provides a financial 
contribution in the form of revenue forgone within the meaning of 
section 771(5)(D)(ii) of the Act. Moreover, because this program is 
limited to exports, we preliminarily determine that this program is 
contingent upon export and, therefore, is specific within the meaning 
of section 771(5A)(B) of the Act.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 0.50 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any segment of any 
proceeding involving India. See Fourth HRS Review Decision Memorandum 
at the ``Advance License Program (ALP)'' section.
3. Duty Entitlement Passbook (``DEP'') Scheme
    The GOI reported that the ``{o{time} bjective of DEPB is to 
neutralize incidence of customs duty on import content of export 
product.'' See GQR at 46. Under this program, exporting companies earn 
import duty exemptions in the form of passbook credits rather than 
cash. All exporters are eligible to earn DEP credits on a post-export 
basis. DEP credits can be applied to subsequent imports of any 
materials, regardless of whether they are consumed in the production of 
an exported product. Accordingly, we preliminarily determine that this

[[Page 19203]]

program provides a financial contribution in the form of revenue 
forgone within the meaning of section 771(5)(D)(ii) of the Act. 
Moreover, because this program is limited to export product, we 
determine that this program is contingent upon export and, therefore, 
is specific within the meaning of section 771(5A)(B) of the Act.
    Zenith reported that it used this program. See ZQR at 15-17. 
However, for Zenith, we cannot determine the level of benefit within 
the meaning of section 771(5)(E) of the Act because Zenith did not 
report necessary information for its cross-owned companies.
    Absent the cooperation of Lloyds and Zenith with respect to its 
cross-owned companies, we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
we find that Zenith and Lloyds used and benefitted from this program 
within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 14.61 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for the same program in any segment of any 
proceeding involving India. See PET Film Investigation Decision 
Memorandum at the ``DEPS'' section.

D. Pre-Shipment and Post-Shipment Export Financing

    The GOI reported that the Reserve Bank of India ``sets the ceiling 
interest rate that banks may charge under the Preshipment Export 
Financing Scheme through circulars that are issued periodically.'' See 
GQR at 55. Accordingly, we preliminarily determine that the GOI's 
issuance of financing at preferential rates constituted a financial 
contribution pursuant to section 771(5)(D)(i) of the Act. The GOI also 
reported that ``{e{time} ligibility for export finance is contingent 
upon export performance.'' See GQR at 56. Accordingly, we preliminarily 
determine that this program is contingent upon export and, therefore, 
is specific within the meaning of section 771(5A)(B) of the Act.
    Zenith reported that it used this program. See ZQR at 17-19. 
However, for Zenith, we cannot determine the level of benefit within 
the meaning of section 771(5)(E) of the Act because Zenith did not 
report necessary information for its cross-owned companies.
    Absent the cooperation of Lloyds and Zenith with respect to its 
cross-owned companies, we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
we find that Zenith and Lloyds used and benefitted from this program 
within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 2.90 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for the same program in any segment of any 
proceeding involving India. See PET Film Investigation Decision 
Memorandum at the ``Pre-Shipment and Post-Shipment Export Financing'' 
section.

E. Market Development Assistance

    The GOI reported that ``{r{time} ecognised Export Promotion 
Councils (EPCs) on product grouping basis, Commodity Boards and Export 
Development Authorities are eligible for MDA assistance for development 
and promotional activities to promote exports of their products and 
commodities from India. All exporters are eligible for assistance under 
MDA scheme for bonafide overseas marketing promotion activities to 
explore new markets for export of their specific product(s) and 
commodities from India in the initial phase through activities like 
participation in trade fairs/exhibitions/BSMs/Trade Delegations and 
publicity through printed material abroad.'' See GQR at 63. 
Accordingly, we preliminarily determine that this program provides a 
direct financial contribution within the meaning of section 
771(5)(D)(i) of the Act. Moreover, because this program is limited to 
exporters, we determine that this program is contingent upon export 
and, therefore, is specific within the meaning of section 771(5A)(B) of 
the Act.
    Zenith reported that it used this program. See Z2SR at 10. However, 
for Zenith, we cannot determine the level of benefit within the meaning 
of section 771(5)(E) of the Act because Zenith did not report necessary 
information for its cross-owned companies.
    Absent the cooperation of Lloyds and Zenith with respect to its 
cross-owned companies, we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
we find that Zenith and Lloyds used and benefitted from this program 
within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 6.06 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any segment of any 
proceeding involving India. See HRS Investigation Decision Memorandum 
at the ``The GOI's Forgiveness of SDF Loans Issued to SAIL'' section.

F. Market Access Initiative

    The GOI reported that ``Market Access Initiatives (MAI) Scheme is 
an Export Promotion Scheme envisaged to act as a catalyst to promote 
India's export on a sustained basis. The scheme is formulated on focus 
product-focus country approach to evolve specific market and specific 
product through market studies/survey. Assistance would be provided to 
Export Promotion Organizations/Trade Promotion Organizations/National 
Level Institutions/Research Institutions/Universities/Laboratories, 
Exporters, etc., for enhancement of export through accessing new 
markets or through increasing the share in the existing markets.'' See 
GQR at 70. Accordingly, we preliminarily determine that this program 
provides a direct financial contribution within the meaning of section 
771(5)(D)(i) of the Act. Moreover, because this program is limited to 
exporters, we preliminarily determine that this program is contingent 
upon export and, therefore, is specific within the meaning of section 
771(5A)(B) of the Act.
    Absent the cooperation of Lloyds and Zenith, including its cross-
owned companies, we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 6.06 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any

[[Page 19204]]

segment of any proceeding involving India. See HRS Investigation 
Decision Memorandum at the ``The GOI's Forgiveness of SDF Loans Issued 
to SAIL'' section.

G. Government of India Loan Guarantees

    The GOI did not respond to our requests for information with 
respect to this program. The Department has previously determined that 
this program is countervailable. See, e.g., Certain Hot-Rolled Carbon 
Steel Flat Products From India: Final Results of Countervailing Duty 
Administrative Review, 75 FR 43488 (July 26, 2010) (``Sixth HRS 
Review''), and accompanying Issues and Decision Memorandum (``Sixth HRS 
Review Decision Memorandum''). Specifically, the Department determined 
that the GOI's loan guarantees under this program provide a financial 
contribution in the form of a potential direct transfer of funds or 
liabilities and are specific to a limited number of industries within 
the meaning of sections 771(5)(D)(i) and 771(5A)(D)(iii)(I) of the Act, 
respectively. Id. No new information or evidence of changed 
circumstances has been provided with respect to this program. 
Therefore, as AFA, we find this program to be countervailable.
    Absent the cooperation of Lloyds and Zenith, including its cross-
owned companies, we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 2.90 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any segment of any 
proceeding involving India. See PET Film Investigation Decision 
Memorandum at the ``Pre-Shipment and Post-Shipment Export Financing'' 
section.

H. Status Certificate Program

    The GOI reported that ``{t{time} he objective of the scheme is to 
recognize established exporters as Export House, Trading House, Star 
Trading House and Super Star Trading House with a view to building 
marketing infrastructure and expertise required for export promotion,'' 
and that ``{t{time} he amount of the assistance provided is determined 
solely by established criteria found in the law, regulation or other 
official document.'' See GQR at 81 and 85, respectively. Accordingly, 
we preliminarily determine that this program provides a direct 
financial contribution within the meaning of section 771(5)(D)(i) of 
the Act. The GOI also reported that ``{t{time} he eligibility criterion 
for such recognition shall be on the basis of the FOB/NFE value of 
export of goods and services.'' See GQR at 81. Accordingly, we 
preliminarily determine that this program is contingent upon export 
and, therefore, is specific within the meaning of section 771(5A)(B) of 
the Act.
    Zenith reported that it used this program. See Z2SR at 11. However, 
for Zenith, we cannot determine the level of benefit within the meaning 
of section 771(5)(E) of the Act because Zenith did not report necessary 
information for its cross-owned companies.
    Absent the cooperation of Lloyds and Zenith with respect to its 
cross-owned companies, we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
we find that Zenith and Lloyds used and benefitted from this program 
within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 2.90 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any segment of any 
proceeding involving India. See PET Film Investigation Decision 
Memorandum at the ``Pre-Shipment and Post-Shipment Export Financing'' 
section.
I. Steel Development Fund Loans
    The GOI reported that ``Steel Development Fund (SDF) was created in 
1978 to add an element to the ex-works prices of the main producers'' 
and that ``{t{time} his fund thus provides financial assistance to the 
industry from the interest of SDF corpus for taking up projects like, 
technology upgradation, measures connected with pollution control, 
activities related to Research & Development.'' See GQR at 81 and 85, 
respectively. Accordingly, we preliminarily determine that the GOI's 
provision of Steel Development Fund loans under this program provide a 
financial contribution in the form of a direct transfer of funds within 
the meaning of section 771(5)(D)(i) of the Act. Moreover, because this 
program is limited to a single industry, we preliminarily find it to be 
specific within the meaning of section 771(5A)(D)(iii)(I) of the Act.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 0.99 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for the same program in any segment of any 
proceeding involving India. See HRS Investigation Decision Memorandum 
at ``Loan from the Steel Development Fund (SDF) Fund'' section.

J. Research and Technology Scheme Under Empowered Committee Mechanism 
With Steel Development Fund Support

    The GOI did not respond to our requests for information with 
respect to this program. According to Petitioners' allegation, the GOI 
has set aside certain funds, from the interest proceeds of the Steel 
Development Fund loans to be used for the financing of research and 
development proposals received from the iron and steel industry and 
that the assistance is likely in the form of grants or loans. Based on 
the description alleged in the petition, as AFA, we determine that this 
program provides a financial contribution in the form of a direct 
transfer of funds within the meaning of section 771(5)(D)(i) of the 
Act. In addition, as AFA, we determine that this program is specific to 
an industry within the meaning of section 771(5A)(D)(iii)(I) of the 
Act.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this

[[Page 19205]]

program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 0.99 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any segment of any 
proceeding involving India. See HRS Investigation Decision Memorandum 
at ``Loan from the Steel Development Fund (SDF) Fund'' section.

K. Special Economic Zones (``SEZ'') Programs

1. Duty-Free Importation of Capital Goods and Raw Materials, 
Components, Consumables, Intermediates, Spare Parts and Packing 
Material
    The GOI did not respond to our requests for information with 
respect to this program. The Department has previously determined that 
this program is countervailable. See Polyethylene Terephthalate Film, 
Sheet, and Strip From India: Final Results of Countervailing Duty New 
Shipper Review, 76 FR 30910 (May 27, 2011) (``PET Film NSR'') and 
accompanying Issues and Decision Memorandum (``PET Film NSR Decision 
Memorandum''). Specifically, the Department determined that this 
program provides a financial contribution pursuant to section 
771(5)(D)(ii) of the Act through the foregoing of duty payments. Id. 
The Department also determined that program is specific within the 
meaning of sections 771(5A)(A) and (B) of the Act. Id. No new 
information or evidence of changed circumstances has been provided with 
respect to this program. Therefore, as AFA, we find this program to be 
countervailable.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 14.61 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any segment of any 
proceeding involving India. See PET Film Investigation Decision 
Memorandum at the ``DEPS'' section.
2. Exemption From Payment of CST on Purchases of Capital Goods and Raw 
Materials, Components, Consumables, Intermediates, Spare Parts and 
Packing Material
    The GOI did not respond to our requests for information with 
respect to this program. The Department has previously determined that 
this program is countervailable. See, e.g., Sixth HRS Review and Sixth 
HRS Review Memorandum. Specifically, the Department determined that 
this program provides a financial contribution that is specific within 
the meaning of sections 771(5)(D) and 771(5A)(B) of the Act, 
respectively. Id. No new information or evidence of changed 
circumstances has been provided with respect to this program. 
Therefore, as AFA, we find this program to be countervailable.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 0.53 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for the same program in any segment of any 
proceeding involving India. See Pet Film NSR Decision Memorandum at 
``Exemption from Payment of Central Sales Tax (CST) on Purchases of 
Capital Goods and Raw Materials, Components, Consumables, 
Intermediates, Spare Parts and Packing Material'' section.
3. Exemption From Electricity Duty and Cess Thereon on the Sale or 
Supply to the SEZ Unit
    The GOI did not respond to our requests for information with 
respect to this program. The Department has previously determined that 
this program is countervailable. See PET Film NSR and PET Film NSR 
Decision Memorandum. Specifically, the Department determined that the 
electricity duty and cess exemptions provide a financial contribution 
in the form of revenue foregone by the State Government of Madhya 
Pradesh pursuant to section 771(5)(D)(ii) of the Act. Id. The 
Department also determined that program is specific within the meaning 
of sections 771(5A)(A) and (B) of the Act. Id. No new information or 
evidence of changed circumstances has been provided with respect to 
this program. Therefore, as AFA, we find this program to be 
countervailable.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 3.09 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any segment of any 
proceeding involving India. See Second HRS Review Decision Memorandum 
at the ``State Government of Gujarat (SGOG) Tax Incentives'' section.
4. SEZ Income Tax Exemption Scheme (Section l0A)
    The GOI did not respond to our requests for information with 
respect to this program. The Department has previously determined that 
this program is countervailable. See PET Film NSR and PET Film NSR 
Decision Memorandum. Specifically, the Department determined that the 
GOI provides a financial contribution in the form of revenue forgone 
pursuant to section 771(5)(D)(ii) of the Act. Id. The Department also 
determined that program is specific within the meaning of sections 
771(5A)(A) and (B) of the Act. Id. No new information or evidence of 
changed circumstances has been provided with respect to this program. 
Therefore, as AFA, we preliminarily find this program to be 
countervailable.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and

[[Page 19206]]

Zenith used and benefitted from this program within the meaning of 
section 771(5)(E) of the Act.
    As explained above, for the alleged income tax programs pertaining 
to either the reduction of the income tax rates or the payment of no 
income tax, we are applying the 35 percent AFA rate on a combined basis 
(i.e., the income tax programs combined provided a 35 percent benefit).
5A. Discounted Land and Related Fees in an SEZ
    The GOI did not respond to our requests for information with 
respect to this program. The Department has previously countervailed 
discounted land fees in the state of Madhya Pradesh. See PET Film NSR 
and PET Film NSR Decision Memorandum. Specifically, the Department 
determined that the State Government of the State of Madhya Pradesh 
provides a financial contribution in the form of revenue forgone 
pursuant to section 771(5)(D)(ii) of the Act. Id. The Department also 
determined that program is specific within the meaning of sections 
771(5A)(A) and (B) of the Act. Id. No new information or evidence of 
changed circumstances has been provided with respect to this program. 
Therefore, as AFA, we find this program to be countervailable.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 3.09 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any segment of any 
proceeding involving India. See Second HRS Review Decision Memorandum 
at the ``State Government of Gujarat (SGOG) Tax Incentives'' section
5B. Land Provided at LTAR in an SEZ
    The GOI did not respond to our requests for information with 
respect to this program. According to Petitioners' allegation, under 
the authority of the GOI's Land Act, land is provided at LTAR to 
investors who locate in the SEZs. Based on the description alleged in 
the petition, as AFA, we determine that this program provides a 
financial contribution in the form of land sold for LTAR within the 
meaning of section 771(5)(D)(iii) of the Act. In addition, as AFA, we 
determine that this program is specific within the meaning of sections 
771(5A)(A) and (B) of the Act consistent with the other SEZ programs.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 18.08 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any segment of any 
proceeding involving India. See Fourth HRS Review Decision Memorandum 
at the ``Captive Mining Rights of Iron Ore'' section.

L. Input Programs

1. Provision of Hot-Rolled Steel by the Steel Authority of India for 
LTAR
    The GOI did not respond to our requests for information with 
respect to this program. According to Petitioners' allegation, the SAIL 
is a government authority and is likely to supply hot-rolled steel, the 
primary input in the production of subject merchandise, for LTAR. Based 
on the description alleged in the petition, as AFA, we determine that 
this program provides a financial contribution in the form of a 
provision of a good as defined under section 771(5)(D)(iii) of the Act. 
In addition, as AFA, we determine that this program is specific within 
the meaning of section 771(5A)(D)(iii)(I) of the Act because the actual 
recipients are limited to industries that use hot-rolled steel.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 16.14 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any segment of any 
proceeding involving India. See Fifth HRS Review Decision Memorandum at 
``Sale of High-Grade Iron Ore for LTAR'' section.
2. Provision of Captive Mining Rights
    The GOI did not respond to our requests for information with 
respect to this program. The Department has previously determined that 
this program is countervailable. See, e.g., Sixth HRS Review and Sixth 
HRS Review Memorandum. Specifically, the Department determined that 
this program provides a financial contribution in the form of a 
provision of a good and is specific to a limited number of industries 
within the meaning of sections 771(5)(D)(iii) and 771(5A)(D)(iii)(I) of 
the Act, respectively. Id. No new information or evidence of changed 
circumstances has been provided with respect to this program. 
Therefore, as AFA, we find this program to be countervailable.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 18.08 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any segment of any 
proceeding involving India. See Fourth HRS Decision Memorandum at the 
``Captive Mining of Iron Ore'' section.
3. Captive Mining Rights of Coal
    The GOI did not respond to our requests for information with 
respect to this program. The Department has previously determined that 
this program is countervailable. See, e.g., Sixth HRS Review and Sixth 
HRS Review Memorandum. Specifically, the Department determined that 
this program provides a financial contribution in the form of a 
provision of a good and is specific to a limited

[[Page 19207]]

number of industries within the meaning of sections 771(5)(D)(iii) and 
771(5A)(D)(iii)(I) of the Act, respectively. Id. No new information or 
evidence of changed circumstances has been provided with respect to 
this program. Therefore, we continue to find this program to be 
countervailable.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 3.09 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for the same program in any segment of any 
proceeding involving India. See Fourth HRS Decision Memorandum at 
``Captive Mining Rights of Coal'' section.
4. Provision of High-Grade Ore for LTAR
    The GOI did not respond to our requests for information with 
respect to this program. The Department has previously determined that 
this program is countervailable. See, e.g., Sixth HRS Review and Sixth 
HRS Review Memorandum. Specifically, the Department determined that the 
GOI continues to provide a direct financial contribution in the form of 
a provision of a good as defined under section 771(5)(D)(iii) of the 
Act, which is specific within the meaning of section 771(5A)(D)(iii)(I) 
of the Act because the actual recipients are limited to industries that 
use iron ore, including the steel industry. Id. No new information or 
evidence of changed circumstances has been provided with respect to 
this program. Therefore, as AFA, we find this program to be 
countervailable.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 16.14 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for the same program in any segment of any 
proceeding involving India. See Fifth HRS Decision Memorandum at ``Sale 
of High-Grade Iron Ore for Less Than Adequate Remuneration'' section.

M. State Government of Maharashtra (``SGOM'') Programs

1. Sales Tax Program
    The GOI did not respond to our requests for information with 
respect to this program. The Department has previously determined that 
this program is countervailable. See, e.g., Sixth HRS Review and Sixth 
HRS Review Memorandum. Specifically, the Department determined that 
this program provides a financial contribution in the form of revenue 
forgone and is specific because it is limited to only those companies 
investing in a specified developing area within the meaning of sections 
771(5)(D)(ii) and 771(5A)(D)(iv) of the Act, respectively. Id. No new 
information or evidence of changed circumstances has been provided with 
respect to this program. Therefore, as AFA, we find this program to be 
countervailable.
    Zenith reported that it ``availed sales tax deferred payment loan 
facility from State Government of Maharashtra before the POI.'' See ZQR 
at 32. However, for Zenith, we cannot determine the level of benefit 
within the meaning of section 771(5)(E) of the Act because Zenith did 
not report necessary information for its cross-owned companies.
    Absent the cooperation of Lloyds and Zenith with respect to its 
cross-owned companies, we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 0.59 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for the same program in any segment of any 
proceeding involving India. See Fourth HRS Review Decision Memorandum 
at ``State Government of Maharashtra (SGOM) Programs Sales Tax 
Program'' section.
2. VAT Refunds Under SGOM Package Scheme
    The GOI reported that ``Any industry new or expansion fulfilling 
the eligibility criteria (Para 3.5, 3.6 & 3.10 of the Scheme) are 
granted incentives in accordance with the classification of the block/
taluka in which it is located.'' See GQR at 113. Under the Maharashtra 
Package Scheme of Incentives and the Maharashtra New Package Scheme of 
Incentives, the SGOM offered tax incentives including VAT tax refunds 
to companies that are located or invested in certain developing areas 
in the State of Maharashtra. Accordingly, we preliminarily determine 
that this program provides a financial contribution in the form of 
revenue forgone within the meaning of section 771(5)(D)(ii) of the Act. 
The GOI also reported that ``{t{time} he main objective of the Scheme 
is to encourage dispersal of industries to the industrially less 
developed areas of the State so as to achieve higher and sustainable 
economic development with balance regional development. The talukas/
blocks in the State are classified in to {sic{time}  six (06) zones 
depending up on their industrial backwardness. The graded scale of 
incentives are offered to the industrial units being set up in such 
backward areas with a view to compensate their difficulties faced by 
them on account of gap in infrastructure facilities vis-a-vis the 
developed areas of the State.'' See GQR at 111. Accordingly, we 
preliminarily determine that this program is limited to only those 
companies investing in a specified developing area and, therefore, is 
specific within the meaning of section 771(5A)(D)(iv) of the Act.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 3.09 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any

[[Page 19208]]

segment of any proceeding involving India. See Second HRS Review 
Decision Memorandum at the ``State Government of Gujarat (SGOG) Tax 
Incentives'' section.
3. Electricity Duty Scheme Under Package Scheme Incentives 1993
    The GOI did not respond to our requests for information with 
respect to this program. The Department has previously determined that 
this program is countervailable. See, e.g., Sixth HRS Review and Sixth 
HRS Review Memorandum. Specifically, the Department determined that 
this program provides a financial contribution in the form of revenue 
forgone and are regionally specific within the meaning of sections 
771(5)(D)(iii) and 771(5A)(D)(iv) of the Act, respectively. Id. No new 
information or evidence of changed circumstances has been provided with 
respect to this program. Therefore, as AFA, we find this program to be 
countervailable.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 3.09 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any segment of any 
proceeding involving India. See Second HRS Review Decision Memorandum 
at the ``State Government of Gujarat (SGOG) Tax Incentives'' section.
4. Octroi Refunds
    The GOI did not respond to our requests for information with 
respect to this program. The Department has previously determined that 
this program is countervailable. See, e.g., Sixth HRS Review and Sixth 
HRS Review Memorandum. Specifically, the Department determined that the 
indirect tax savings under this program provide a financial 
contribution in the form of revenue forgone and are regionally specific 
within the meaning of sections 771(5)(D)(i) and 771(5A)(D)(iv) of the 
Act, respectively. Id. No new information or evidence of changed 
circumstances has been provided with respect to this program. 
Therefore, as AFA, we find this program to be countervailable.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 3.09 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any segment of any 
proceeding involving India. See Second HRS Review Decision Memorandum 
at the ``State Government of Gujarat (SGOG) Tax Incentives'' section.
5. Octroi Loan Guarantees
    The GOI did not respond to our requests for information with 
respect to this program. The Department has previously determined that 
this program is countervailable. See, e.g., Sixth HRS Review and Sixth 
HRS Review Memorandum. Specifically, the Department determined the 
SGOM's loan guarantees under this program provide a financial 
contribution within the meaning of section 771(5)(D)(i) of the Act 
through a potential direct transfer of the Octroi refund to pay off 
loans. Id. The Department also found that these loan guarantees are 
specific within the meaning of 771(5A)(D)(iii)(I) of the Act because 
only companies eligible for the Octroi scheme can receive these loan 
guarantees. Id. No new information or evidence of changed circumstances 
has been provided with respect to this program. Therefore, as AFA, we 
find this program to be countervailable.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 2.90 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any segment of any 
proceeding involving India. See PET Film Investigation Decision 
Memorandum at the ``Pre-Shipment and Post-Shipment Export Financing'' 
section.
6. Infrastructure Assistance for Mega Projects
    The GOI did not respond to our requests for information with 
respect to this program. The Department has previously determined that 
this program is countervailable. See, e.g., Sixth HRS Review and Sixth 
HRS Review Memorandum. Specifically, the Department determined that the 
program constituted a financial contribution in the form of a direct 
transfer of funds within the meaning of section 771(5)(D)(i) of the 
Act. Id. The Department also found that the program is limited to firms 
investing in Mega-Projects and, therefore, is specific within the 
meaning of section 771(5A)(D)(i) of the Act. Id. No new information or 
evidence of changed circumstances has been provided with respect to 
this program. Therefore, as AFA, we find this program to be 
countervailable.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning net subsidy rates of 3.09 
percent ad valorem for indirect tax and 6.06 for grants percent ad 
valorem, which correspond to the highest above de minimis subsidy rates 
calculated for similar programs in another segment of this proceeding. 
See Second HRS Review Decision Memorandum at the ``State Government of 
Gujarat (SGOG) Tax Incentives'' section and HRS Investigation Decision 
Memorandum at the ``The GOI's Forgiveness of SDF Loans to SAIL'' 
section.

[[Page 19209]]

7. Provision of Land for LTAR
    The GOI did not respond to our requests for information with 
respect to this program. The Department has previously determined that 
this program is countervailable. See, e.g., Sixth HRS Review and Sixth 
HRS Review Memorandum. Specifically, the Department determined that 
this program constitutes a financial contribution in the form of land 
sold for LTAR within the meaning of section 771(5)(D)(iii) of the Act. 
Id. The Department also found that the program is limited to 
enterprises purchasing land outside of the Bombay and Pune area, and 
therefore, is specific within the meaning of section 771(5A)(D)(iv) of 
the Act. Id. No new information or evidence of changed circumstances 
has been provided with respect to this program. Therefore, as AFA, we 
find this program to be countervailable.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 18.08 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any segment of any 
proceeding involving India. See Fourth HRS Review Decision Memorandum 
at ``Captive Mining Rights of Iron Ore'' section.
8. Investment Subsidies
    The GOI did not respond to our requests for information with 
respect to this program. The Department has previously determined that 
this program is countervailable. See, e.g., Sixth HRS Review and Sixth 
HRS Review Memorandum. Specifically, the Department determined that 
this program constitutes a financial contribution in the form of a 
direct transfer of funds within the meaning of section 771(5)(D)(i) of 
the Act. Id. The Department also found that the program is limited to 
firms operating outside of the Bombay and Pune metropolitan areas and 
thus, is specific within the meaning of section 771(5A)(D)(iv) of the 
Act. Id. No new information or evidence of changed circumstances has 
been provided with respect to this program. Therefore, as AFA, we find 
this program to be countervailable.
    Absent the cooperation of Lloyds and Zenith (including its cross-
owned companies), we preliminarily determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 6.06 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any segment of any 
proceeding involving India. See HRS Investigation Decision Memorandum 
at ``Forgiveness of SDF Loans to SAIL'' section.

N. Waiving of Interest on Loan by the State Industrial and Investment 
Corporation of Maharashtra Ltd (``SICOM'')

    In prior investigations, the Department has determined that SICOM 
is a public body and found that waived interest on ``intercorporate 
deposits'' was countervailable. See PET Film Investigation and PET Film 
Investigation Decision Memorandum. Specifically, the Department 
determined that a financial contribution was provided by SICOM, a 
public entity, pursuant to section 771(5)(D)(i) of the Act, in the 
amount of the waived interest. Id. The Department also found that the 
waived interest was specific to the respondent pursuant to section 
771(5A)(D)(i) of the Act. Id. No new information or evidence of changed 
circumstances has been provided with respect to this program. 
Therefore, we find this program to be countervailable.
    We initiated an investigation into this program on March 16, 2012. 
See Memorandum to Susan Kuhbach, Director, Office 1, ``Analysis of New 
Subsidy Allegation,'' dated March 16, 2012. Although we did not send a 
questionnaire to Zenith on this program prior to this preliminary 
determination, Zenith's annual reports on the record indicate that 
Zenith may have benefited from this program during the POI. See ZQR at 
Annexure 3, 2008-2009 Annual Report at 27; and Annexure 4, 2009-2010 
Annual Report at 32. Moreover, because of the deficiencies in Zenith's 
response as a whole, we would be unable to determine what level of 
benefit Zenith received even if we had a complete questionnaire 
response on this program from Zenith. For example, as we stated above 
under the ``Use of Adverse Facts Available'' section, Zenith did not 
provide necessary information on the sales of any of its cross-owned 
companies. This information is necessary to determine the level of 
benefits Zenith may have received under this program.
    Therefore, absent the cooperation of Lloyds and Zenith (including 
its cross-owned companies), we determine that the respondents' 
submissions do not constitute complete and verifiable evidence, within 
the meaning of sections 782(e)(3) and (2) of the Act, respectively, 
demonstrating that the respondents or any of their cross-owned 
affiliates did not benefit from this program during the POI. Therefore, 
as AFA we find that both Lloyds and Zenith used and benefitted from 
this program within the meaning of section 771(5)(E) of the Act.
    For this program, we are assigning a net subsidy rate of 2.90 
percent ad valorem, which corresponds to the highest above de minimis 
subsidy rate calculated for a similar program in any segment of any 
proceeding involving India. See PET Film Investigation Decision 
Memorandum at the ``Pre-Shipment and Post-Shipment Export Financing'' 
section.

Summary of Programs Preliminarily Determined To Be Countervailable

    As AFA, we are making the adverse inference that Lloyds and Zenith, 
including their cross-owned companies, each received countervailable 
subsidies under each of the subsidy programs that the Department 
included in its initiation as well as the additional subsidy program 
that the Department initiated on March 16, 2012. Listed below are the 
AFA rates applicable to each program.

------------------------------------------------------------------------
                         Program                           Subsidy rate
------------------------------------------------------------------------
A. Export Oriented Unit Schemes:
    1. Duty-free import of all types of goods, including           14.61
     capital goods and raw materials....................
    2. Reimbursement of Central Sales Tax (``CST'') paid            3.09
     on goods manufactured in India.....................

[[Page 19210]]

 
    3. Duty drawback on fuel procured from domestic oil            14.61
     companies..........................................
    4. Exemption from income tax under Section l0A and             35.00
     l0B of Income Tax Act..............................
    5. Exemption from payment of Central Excise Duty on            14.61
     goods manufactured in India and procured from a
     Domestic Tariff Area...............................
    6. Reimbursement of CST on goods manufactured in                3.09
     India and procured from a Domestic Tariff Area.....
B. Export Promotion Capital Goods Scheme................           16.63
C. Duty Exemption/Remission Schemes:
    1. Advance License Program..........................            2.55
    2. Duty Free Import Authorisation Scheme............            2.55
    3. Duty Entitlement Passbook Scheme.................           14.61
D. Pre-shipment and Post-shipment Export Financing......            2.90
E. Market Development Assistance........................            6.06
F. Market Access Initiative.............................            6.06
G. Government of India Loan Guarantees..................            2.90
H. Status Certificate Program...........................            2.90
I. Steel Development Fund Loans.........................            0.99
J. Research and Technology Scheme Under Empowered                   0.99
 Committee Mechanism with Steel Development Fund Support
K. Special Economic Zones (``SEZ'') Programs:
    1. Duty-Free Importation of Capital Goods and Raw              14.61
     Materials, Components, Consumables, Intermediates,
     Spare Parts and Packing Material...................
    2. Exemption from Payment of CST on Purchases of                3.09
     Capital Goods and Raw Materials, Components,.......
    3. Exemption from Electricity Duty and Cess thereon             3.09
     on the Sale or Supply to the SEZ Unit..............
4. SEZ Income Tax Exemption Scheme (Section l0A) \8\
5A. Discounted Land and Related Fees in an SEZ..........            3.09
5B. Land Provided at Less Than Adequate Remuneration in             8.08
 an SEZ.................................................
L. Input Programs:
    1. Provision of Hot-Rolled Steel by the Steel                  16.14
     Authority of India For Less Than Adequate
     Remuneration (``LTAR'')............................
    2. Provision of Captive Mining Rights...............           18.08
    3. Captive Mining Rights of Coal....................            3.09
    4. Provision of High-Grade Ore for LTAR.............           16.14
M. State Government of Maharashtra (``SGOM'') Programs:
    1. Sales Tax Program................................            0.59
    2. Value-Added Tax Refunds under SGOM Package Scheme            3.09
    3. Electricity Duty Scheme under Package Scheme                 3.09
     Incentives 1993....................................
    4. Octroi Refunds...................................            3.09
    5. Octroi Loan Guarantees...........................            2.90
    6. Infrastructure Assistance for Mega Projects--                3.09
     indirect tax.......................................
    Infrastructure Assistance for Mega Projects--grants.            6.06
    7. Provision of Land for LTAR.......................           18.08
    8. Investment Subsidies.............................            6.06
N. Waiving of Interest on Loan by the State Industrial              2.90
 and Investment Corporation of Maharashtra Ltd
 (``SICOM'')............................................
------------------------------------------------------------------------

     
---------------------------------------------------------------------------

    \8\ The rate is not separately listed because the maximum 
benefit for this program and the Exemption from income tax under 
Section l0A and l0B of Income Tax Act under Export Oriented Unit 
Schemes is 35 percent. Accordingly, 35 percent is listed under the 
latter program.
---------------------------------------------------------------------------

Summarizing these rates yields a total CVD subsidy rate of 285.95 
percent ad valorem.

Suspension of Liquidation

    In accordance with section 703(d)(1)(A)(i) of the Act, we 
calculated an individual rate for each producer/exporter of the subject 
merchandise individually investigated.
    With respect to the all-others rate, section 705(c)(5)(A)(ii) of 
the Act provides that if the countervailable subsidy rates established 
for all exporters and producers individually investigated are 
determined entirely in accordance with section 776 of the Act, the 
Department may use any reasonable method to establish an all-others 
rate for exporters and producers not individually investigated. In this 
case, the rate calculated for both of the investigated companies is 
based entirely on facts available under section 776 of the Act. There 
is no other information on the record upon which to determine an all-
others rate. As a result, we have used the AFA rate assigned for Lloyds 
and Zenith as the all-others rate. This method is consistent with the 
Department's past practice. See, e.g., Final Affirmative Countervailing 
Duty Determination: Certain Hot-Rolled Carbon Steel Flat Products From 
Argentina, 66 FR 37007, 37008 (July 16, 2001); see also Final 
Affirmative Countervailing Duty Determination: Prestressed Concrete 
Steel Wire Strand From India, 68 FR 68356 (December 8, 2003).
    We preliminarily determine the total estimated net countervailable 
subsidy rates to be:

------------------------------------------------------------------------
                                                             Net subsidy
                   Exporter/manufacturer                        rate
------------------------------------------------------------------------
Lloyds Metals and Engineers Ltd...........................        285.95
Zenith Birla Ltd..........................................        285.95
All Others................................................        285.95
------------------------------------------------------------------------

    In accordance with sections 703(d)(1)(B) and (2) of the Act, we are 
directing CBP to suspend liquidation of all entries of circular welded 
pipe from India that are entered, or withdrawn from warehouse, for 
consumption on or after the date of the publication of this notice in 
the Federal Register, and to require a cash deposit or bond for such 
entries of merchandise in the amounts indicated above.

U.S. International Trade Commission (``ITC'') Notification

    In accordance with section 703(f) of the Act, we will notify the 
ITC of our determination. In addition, we are making available to the 
ITC all non-privileged and non-proprietary information relating to this

[[Page 19211]]

investigation. We will allow the ITC access to all privileged and 
business proprietary information in our files, provided the ITC 
confirms that it will not disclose such information, either publicly or 
under an administrative protective order, without the written consent 
of the Assistant Secretary for Import Administration.
    In accordance with section 705(b)(2) of the Act, if our final 
determination is affirmative, the ITC will make its final determination 
within 45 days after the Department makes its final determination.

Disclosure and Public Comment

    In accordance with 19 CFR 351.224(b), we will disclose to the 
parties the calculations for this preliminary determination within five 
days of our announcement. We intend to release a letter to all 
interested parties that establishes the deadline for submission of case 
briefs. See 19 CFR 351.309(c)(i) (for a further discussion of case 
briefs). Rebuttal briefs must be filed within five days after the 
deadline for submission of case briefs, pursuant to 19 CFR 
351.309(d)(1). A list of authorities relied upon, a table of contents, 
and an executive summary of issues should accompany any briefs 
submitted to the Department. Executive summaries should be limited to 
five pages total, including footnotes. See 19 CFR 351.309(c)(2) and 
(d)(2).
    Section 774 of the Act provides that the Department will hold a 
public hearing to afford interested parties an opportunity to comment 
on arguments raised in case or rebuttal briefs, provided that such a 
hearing is requested by an interested party. If a request for a hearing 
is made in this investigation, the hearing will be held two days after 
the deadline for submission of the rebuttal briefs, pursuant to 19 CFR 
351.310(d), at the U.S. Department of Commerce, 14th Street and 
Constitution Avenue NW., Washington, DC 20230. Parties should confirm 
by telephone the time, date, and place of the hearing 48 hours before 
the scheduled time.
    Interested parties who wish to request a hearing, or to participate 
if one is requested, must electronically submit a written request to 
the Assistant Secretary for Import Administration using IA ACCESS, 
within 30 days of the publication of this notice, pursuant to 19 CFR 
351.310(c). Requests should contain: (1) The party's name, address, and 
telephone; (2) the number of participants; and (3) a list of the issues 
to be discussed. Oral presentations will be limited to issues raised in 
the briefs. See id.
    This determination is published pursuant to sections 703(f) and 
777(i) of the Act.

    Dated: March 26, 2012.
Paul Piquado,
Assistant Secretary for Import Administration.
 [FR Doc. 2012-7726 Filed 3-29-12; 8:45 am]
BILLING CODE 3510-DS-P