The government on Thursday conveyed to the cement manufacturers to either bring down prices back to pre-budget level in 10 days to avoid concessional duty regime on cement import. An official, who was part of the government team, which conveyed the government's concern to the All Pakistan Cement Manufacturers Association (APCMA) during a meeting held here on Thursday, told Business Recorder that the manufacturers have been asked to bring down the prices at June 9 level to avoid concessional duty regime on cement import.
According to the official, the cement prices were Rs.259 per bag on June 9 and the manufacturers in connivance with the dealers raised the rates by Rs.100 per bag in three instalments in the last three weeks.
The APCMA was informed that the government could allow duty-free import of cement if the local industry could not bring down the prices by Rs.75 per bag.
The government side was of the view that cement prices should not exceed Rs.259 per bag. The meeting took strong notice of irrational increase in cement prices during the last few weeks and termed it unacceptable and uncalled for.
Industries and Production Minister Jahangir Tareen, while rejecting the APCMA point of view that the retailers were responsible for increase in the prices to over Rs.300 has demanded that they should ensure availability of cement in the open market at some reasonable price.
The sources said that the APCMA chairman assured the meeting that cement prices would come down considerably within stipulated time.
They said the minister informed the APCMA delegation that the government would monitor cement prices on daily basis and review the progress in the next meeting to be held on the expiry of the deadline of 10 days.
The cement prices have gone all-time high and a cement bag is now available for Rs.330 and in some areas even at Rs.345. This invited sharp reaction from the government.
The government is actively working on two-pronged strategy to discourage rising trend in cement rates in the local market. It is seriously considering restricting cement export to Afghanistan, besides allowing duty-free import.
The authorities are convinced that there was no logic in cement export when it was being sold locally at much higher prices and the new duty regime would discourage its export to improve supply in the open market.
The government conducted a survey in many major cities to have average price of cement bag.
According to the survey, the manufacturers were minting fabulous profit of Rs.1400-1500 per tonne that was the highest in the region.
The authorities feel that high rates can impede pace of progress of the housing and construction sector and the situation created by the profiteers demands government's immediate intervention.
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