While, the Pakistan government has announced phase-wise free access to Indian traders to its markets, Bureau of Indian Standards (BIS) is using delaying tactics to visit the country for issuance of export licenses to Pakistani cement manufacturers.
Sources told Business Recorder on Thursday several Pakistani cement companies are waiting for Indian inspection to get license and start cement export to India. On the other hand BIS officials are reluctant to visit Pakistan saying that Indian ministry of interior is not granting them the permission to visit Pakistan.
"Four Pakistani companies - Attock Cement, Cherat Cement, DG Khan Cement and Kohat Cement - are unable to export cement to the neighbouring country after their BIS license expired and the officials there have not visited for a long time to renew their licenses," they added.
BIS issues licenses, valid for two years, to Pakistani cement exporters after visiting their factories and carry out lab tests to ensure that the cement exported to India meets their quality standards. A BIS team was scheduled to visit Pakistan in August 2011 to grant license to the four cement factories of Pakistan.
However, despite commitment, the BIS team has not yet visited Pakistan. "The BIS officials claimed that they are seeking NOC from the Indian Ministry of Interior for visit to Pakistan to conduct this quality inspection, according to BIS official, the interior ministry is not granting permission on security grounds," industry sources said.
An Indian trade delegation led by commerce minister had visited Pakistan recently to discuss Free Trade Agreement (FTA) and the visit of Indian delegation was so peaceful, that it reflected that there was no security concern at all, they added.
In order to resolve this issue, Pakistani cement exporters have suggested that BIS should issue certificate valid for maximum time period, and to ensure quality standards, BIS may conduct quality inspections by engaging any international inspection firm operating in Pakistan.
There are many international firms such as Moody's International, SGS, etc. BIS can also check the quality of any exported cement bag in labs in India, they added. Due to inspection delays, Pakistani cement export to India is stalled despite a lot of opportunities in the Indian market. Only Indian Punjab and Haryana, bordering Pakistan, have the capacity to import some 6 to 7 million tons of cement after utilising their domestic production of 4 million tons,. The total cement export to Indian is still less than one million, they added.
Sources said the delay in issuance of license is directly hurting the cement export and during the first eight months of the current fiscal year (July 2011 to February 2012), the country exported 0.447 million tons cement to India. Pakistan has almost 12 million tons surplus cement after meeting domestic, Afghanistan and some African states' requirements. This much cement can also be exported and India is one of the best markets for that, sources added.
Industry sources say that Indian government be requested to simplify the process of certification and the license once issued be considered valid. Attock Cement, Cherat Cement, DG Khan Cement and Kohat Cement should be inspected and licenses issued without any further delay.
Fiscal year 2007-08 was the most favourable year for the cement sector, as during the period a record 0.78 million tons of cement was exported to the neighbouring country, while during the last fiscal year 2010-11, cement exports to India stood at 0.59 million tons. Presently, some 11 Pakistani cement manufactures are exporting the commodity to India and major export is being made through road.