Cheaper cement from Pakistan shakes domestic industry

Ambika Sharma

Tribune News Service

Solan, September 11

Hit by cheaper cement imports from Pakistan, domestic manufacturers, particularly cement units based in Himachal Pradesh and Punjab, have demanded immediate tariff and non-tariff protection against the dumping from across the border.

Domestic cement manufacturers are facing a glut because of imports from Pakistan, rendering their capacity idle, industry executives said. According to an industry estimate, the country’s current unutilised cement capacity is around 100 million tonnes.

A cement major, which has units in Punjab and Himachal Pradesh, could utilise only 75 per cent of its capacity, said a company executive requesting anonymity. Against a demand of about 8 million tonnes per annum in Punjab alone, imports are as high as 1.5 million tonnes, the executive added. An official data showed an unprecedented 24 per cent growth in imports in just one quarter ending March 2018.

“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 unit. The state has a presence of major cement manufacturers such as Ambuja Cements, Ultra Tech and ACC. Pakistan exporters are resorting to predatory pricing, executives said. While cement is sold in Pakistan at $100 per metric tonne, it is dumped in India at $63-65 per metric tonne, they added.

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

Pakistan’s cement export to India has become more aggressive after it is losing its grip in the Afghanistan market due to intense Iranian competition, experts said.

The unbridled import from Pakistan to India would hamper the domestic industry, which is also against the spirit of ‘Make in India’, Indian cement manufacturers said adding that the impact of the dumping is spreading in other parts of the country.

Manufacturers are demanding a level-playing field by imposing an 11 per cent customs duty, besides other levies. They have also suggested capping of entry points and ports for cement imports into India as additional safeguards against the dumping.