Pakistani Cement exports threaten Indian suppliers

September 13, 2018 (MLN): India’s cement manufacturers, suppliers to the second largest market for Pakistani cement exports after Afghanistan, have called for an 11 percent duty on imports from Pakistan as the industry fears cement dumping from Pakistan amidst subdued demand in the country.

Cement plants in Himachal Pradesh and Punjab, India say capacity utilization for their plants has fallen down to 75 percent. “The (Indian) industry had built capacity in anticipation of increased demand due to the impetus given to housing and infrastructure sectors. The demand scenario, however, remains subdued,” said an executive of a Himachal Pradesh-based cement plant.

Indian manufacturers have complained that Pakistani exporters are resorting to predatory pricing with respect to the cement dispatches sent to their country, which according to them, is being dumped in India at $63-65 per ton, while it sells at around $100 per ton in Pakistan.

Besides increased duties, they have called for the capping of entry points and ports for cement imports into India to safeguard the industry against these practices.

Of a total cement demand of 8Mta in Punjab, imports are now as high as 1.5Mta, rising by 24 percent YoY in the quarter ended March 2018. The majority of imports are from Pakistan's cement producers.

India is Pakistan's second largest export market for cement after Afghanistan, which allows imports without basic customs duty since 2007. However, Pakistan imposes 11 percent duty on imports from India, the industry experts said.

Pakistan's exports to Afghanistan have fallen in the outgoing financial year due to competition from Iranian exporters, and if the duties are increased, Pakistani cement exports in India may be heading for a free fall as well, which have already reduced to 67,760 tons in July 2018, from 99,519 tons in the month before that, according to All Pakistan Cement Manufacturer’s Association.

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Posted on: 2018-09-13T16:53:00+05:00