What is the meaning of Countervailing duties?

Countervailing duties are imposed for the protection of domestic producers as they counter the negative impact of import subsidies.  The government of the land usually imposed these duties on the import of foreign products which have been subsidized by the overseas producers. Latter generate an apparent shift in the domestic demand for cheap foreign goods. This severely hits the domestic production.

Thus this helps in raising the price of the products which renders domestic goods equally attractive and competitive. This is known as cushioning the domestic businesses. These are also known as anti-dumping duties and are imposed under the specifications of WTO.