Cement exports back to normal

[Naveed Yaseen]

New Delhi: Cement imports from Pakistan, which took a hit during January- February on account of a weakening rupee and re-imposition of countervailing duty (CVD), has jumped back to its normal monthly levels of around 60,000 tonnes.

Imports had dipped to a mere 11,000 tonnes in January. Imports in long-term are likely to continue at similar levels since imported cement is cheaper by around 10 percent than domestic produce.

Cement imports from Pakistan started in September 2007 after India removed import duty while it also did away with CVD and special additional customs duty. These steps were taken to augment domestic demand-supply gap, which now stands largely corrected with addition of new capacities.

Since then, Pakistani firms have exported 1.2 million tonnes of cement to India. This does not account for even 1 percent of the country’s annual consumption of over 200 million tonnes.

Though volume of import from Pakistan is small to impact pricing of Indian companies, cheaper import has certainly affected domestic sales in pockets like Amritsar and Mumbai.

The imported cement is selling at Rs 220-225 a bag (50 kgs) in Amritsar vis-a-vis Rs 245-250 for indigenous cement. Cement import was rendered unattractive due to weakening rupee. Plus, the government had re-imposed the CVD. It was only after Pakistani companies agreed to cut prices by over $10 a tonne to $54 that import has resumed, said an Amritsar-based importer. Domestic companies raised prices by Rs 3-7 a bag earlier this month.

These imports need to conform to quality specifications laid down by Indian Bureau of Standards BIS. As of now, 24 Pakistani cement companies have obtained BIS licence to export cement to India.

Though companies in Bangladesh. Bhutan and China also secured BIS licence, import is mainly taking place from Pakistan. ppi

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