Cement exports in the month of February 2018 have gone up by 18.41 percent as compared to same month last year, which gives a glimmer of hope to the industry that is suffering due to declining exports for years. Though the local cement consumption continued to grow robustly and stood at 9.38 percent in February but the percentage of increase in exports were even higher than domestic consumption for the first time in current fiscal.

Cement sector is experiencing dream growth particularly in the domestic market for the last three years. According to data released by All Pakistan Cement Manufacturers; Association (APCMA), this fiscal the cement despatches have crossed three million tons in the eight months period (July-Feb). In two of these months, cement despatches crossed 4 million tons. The total cement despatches in the first eight months of this fiscal stood at 30.106 million tons compared with despatches of 26.339 million tons during the corresponding period of last year. This is an increase of almost 4 million tons in eight months. Overall the sector grew by 14.30 percent during this period.

In the month of February, the total cement despatches were 3.781 million tons. Out of this, despatches in the North were 3.052 million tons while cement despatches in Southern part amounted to 0.729 million tons. The exports from North based mills amounted to 0.181 million tons and from South based mills was 0.120 million tons. The increase in exports was 18.41 percent compared with an increase of 9.38 percent recorded in domestic consumption. The capacity utilization in the first eight months of this fiscal was 91.34 percent of the total installed capacity of the cement sector.

The spokesman of APCMA said that, cement industry is among the highest contributors to the national exchequer over the last few years. The contribution has increased to Rs. 117 billion in 2016-17 from Rs. 39 billion in 2012-13. During the year 2016-17, per ton impact of duties & taxes was Rs. 3,082/- i.e. Rs. 154 per bag. This incidence of high taxation negatively affects domestic consumption. Presently, FED on cement is Rs. 1,250 per ton i.e. Rs. 62.5 per bag. Government should keep its promise and gradually reduce FED to “Zero” to encourage cement off take as this would support housing and infrastructural development of the Country and create more employment.

The spokesman of APCMA, attributing domestic growth in the sector to the policies of the government and its thrust on mega infrastructure projects, said that the local production could increase substantially if the smuggling of this commodity from Iranian border is checked. Moreover, he appealed to the government to eliminate the mafia that is bringing in Iranian cement at engineered low rates to save government levies including sales tax. “Iranian cement would not be able to stand against Pakistani cement in quality and price if the import rules are strictly followed. Customs duty on import of both clinker and cement should increase to a uniform rate of 35% in order to support the local cement industry. Moreover, import of cement should not be allowed until Pakistan Standards and Quality Control Authority certifies the quality of cement being imported into the Country,” he added.