The All Pakistan Cement Manufacturers Association (APCMA) has announced to move court against the government if duty-free import of cement is allowed. APCMA chief Tariq Sehgal was of the view that duty-free import of cement was totally illogical in a regime wherein local manufacturers were paying the government around Rs 70 per bag in the form of duty and taxes.
He said that the APCMA will react sharply if the government decided to allow duty-free import of cement.
The APCMA chief said "We would not accept such decision of the government and move court as soon as it is taken."
Sehgal called for level playing field for the local cement manufacturers so that they could keep the ball rolling. He said that permission to the private sector for duty-free import of cement will give serious blow to the local industry and also put negative impact on the investment climate of the country.
Sehgal added that the cement prices were already showing downward trend and this could not be made a reason for duty-free import. He claimed that cement rates were ranging between Rs 265 and 270 and these are going to further come down in the next few days.
The ministry of Industries and Production has recommended to the Economic Co-ordination Committee (ECC) of the Cabinet that it should cut duty on import of cement to zero for the private sector in order to have an additional source of getting cement at reasonable price.
The cement prices showed upward trend in June and July, disturbing the policy makers who did not anticipate any such increase.
This led to polarisation between the government and cement manufacturers. After series of meetings, the authorities conveyed to the industry bigwigs that high prices of cement were not acceptable to them, and gave a specific deadline to bring the prices down to pre-budget 2005-06 level when a bag was available at Rs 259.
This warning did not come up to the expectations of the authorities who later decided to open the channel of import by reducing duty to zero.