The present government in contrary to its claim has taken firm measures to kill the indigenous ceramic industry in Pakistan by increasing tax and duties on import of its raw material while reducing customs duties on finished goods. "It is a double blow to the local industry as the FBR in its quest to squeeze the local manufacturing units that were already running under capacity or even closing down due to rampant smuggling and mis-declaration by the importers," said the ceramic industry sources.
They said that a couple of ceramic industries have already been shut down while the rest of the tiles' industries are operating under production due to the reason and a petition is pending before National Tariff Commission (NTC). The NTC initiated anti-dumping investigation under new laws against dumped imports of wall and floor tiles from China.
The NTC has also issued notice of dumping investigation against dumping of tiles from China under the shelter of the FTA that has broken the industry's back while on the other hand massive inflow of tiles is continuing from Iran through smuggling via border.
Now the Minister of Finance, Ishaq Dar has announced to reduce Customs duties on import of finished items particularly imported finished and granite tiles from 25 per cent to 20 per cent and reduced corporative rate of income tax from 33 per cent to 32 per cent.
Resultantly, the import of tiles from China that was subject to 5 percent customs duty under the FTA would now be duty-free providing a totally free access of dumping of poor-quality ceramic and granite tiles in the local market.
The customs duties on import of almost all raw materials including chemicals, printing inks, plaster of Paris, Roll clay, refractory material, kaolin, glass frit, moulds, bricks/rollers, ceramics diluting agent, Zircobit Mo, Zircon flour, alumina balls, ball clay, boric acid, barium carbonate, roll fix 62, zinc oxide, alumina oxide, lamovil ES, Alumina hydroxide, CMC, piston pump, colours, seiroil 606, Seigraphic chemical, machinery and press from 3 to 5 percent, 15 to 20 percent and 15 to 16 percent.
The industry sources said that this could be the biggest punishment for any industry and in this situation, most of the ceramic tiles industries are seriously thinking of a big shutdown in the history of Pakistan leaving over a hundred of thousands workers jobless and a loss of about Rs 100 billion to the investors besides a revenue loss to the national exchequer running into billions of rupees.
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