The installed and unutilised capacity of cement industry in Pakistan could be effectively exploited through exports to India that is being granted the status of Most Favored Nation (MFN) provided the non tariff barriers are abolished by the New Delhi.
A spokesman of the Association of Pakistan Cement Manufacturers (APCMA) said Islamabad must pursue the case of cement industry which has been facing problems due to non-tariff barriers in India despite increasing demand. He said that cement is one of the industries having potential to help bridging the gap between the volumes of trade between the two countries in which Pakistan’s exports are far less than possible.
Hence it will be a win-win situation for the both countries in future if their exports are level and local industries are encouraged to meet the demand of each other’s market through their strong sectors, they added.
The spokesman urged that both governments should avail the opportunity and strengthen each other, as Pakistan is best cement provider to India having lots of demand in the construction sector while its production units are running full capacity. It is an irony that Pakistan liberalized its trade with India last year short-listing few items in the negative list but Indian government, on the other hand, has not fulfilled its promise to withdraw all non-tariff trade barriers, causing hurdles in the free flow of trade between the two countries.
According to Chairman APCMA Aizaz Mansoor Sheikh Pakistan’s cement exports to India contracted by 16 percent in the first quarter of current fiscal year to 137,742 tons as against 163,340 tons exported during the corresponding quarter of last year.
Sheikh said Pakistan’s cement was preferred by Indians because of high quality and cement sector was expecting a quantum jump of at least 0.5 million tons in last fiscal on easing of NTBs by India, but it did not happen.
“Exports to India in fact have been on constant decline ever since the two countries opened their borders for liberal bilateral trade,” he said. The decline is not due to lack of cement demand in India but because of very stringent non tariff barriers erected by our neighbor,” he said adding Pakistan’s cement was preferred by the Indians because of better quality.
Cement exporters having potential to export a big quantity to Indian market are facing a strict resistance by the Indian government as NTB are not removed even after having been specifically mentioned during different rounds of official and unofficial talks between the two countries.
The exporters’ issues, including a complex six to seven months process to obtain a certificate from Indian authorities should be resolved on the priority basis because it was committed by the Indian government for having a status of MFN from Pakistan.
They mentioned the quality certificate for cement exporters is valid for one year period merely, despite of six to seven months procedural duration. But none of the exporters is allowed to continue their exports after expiry of certificate limit that are needed to get renewal in a brief period.
The complicated process of quality certificate holds on cement exports of many companies at a time hence the exports quantity shrinks gradually, they mentioned. The procedures have not been eased by the Indians and the certification cost is very high as the exporters have to bear heavy expenses for the visit and stay over of Indian inspectors.
They pointed out that Pakistani and Indian railways could exchange the same number of wagons for transportation of goods exports however the Pakistani wagon could not carry big cement orders due to restriction by Indian government as a rule of reciprocal. The railways wagons from the Indian side are limited for cement exporters which increases their cost of cement transportation heavily, cement exporters said.
The cement manufacturers said Pakistan should cement trade ties with India on equality basis rather than giving easy access to Indian company in the exchange of nothing in the presence of NTBs. They demanded the government to raise the issues of NTBs before Indian government for immediate solution and allow Pakistani cement makers to explore markets in all potential provinces on priority basis.
Cement exports blocked by NTBs
