Pakistan losing Afghan cement market due to high cost

LAHORE  -  The cement industry has urged the government to increase custom duty on import of clinker to support the local manufacturers, besides reducing cost of doing business in the country to encourage the local sale.

The industry stakeholders said that Pakistan has been losing major chunk of its market in Afghanistan to Iranian cement. The high energy cost has made the cement more expensive as cement is an energy intensive sector.

The cost of electricity and gas in Pakistan is the highest in the region while additional duties on coal imports have nullified the lower cost of coal in the global markets. On the domestic front, high government levies have encouraged some unscrupulous elements to import under-invoiced Iranian cement, resulting in drop in domestic sale.

According to the latest data, domestic consumption has dropped by almost 14 percent after a long period of three years. The domestic cement dispatches in the first two months of current fiscal declined by 5.31 percent. In the North zone cement dispatches declined by 8.80 percent while in south zone it declined by 10.91 percent. They said that in July 2018 the overall growth in the industry was 5.1 percent while in August 2018 the overall growth was negative 8 percent.

The industry recommended that the imports of cement should not be allowed until the importers register themselves with Pakistan Standards and Quality Control Authority to certify the quality of their cement in line with the Indian government as well as all other importing countries’ authorities, the industry representatives demanded. They said that exports are down not only because of high cost of doing business but also due to the lax attitude of the regulators who are ignoring malpractices in imports.


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