India’s non-tariff barriers, NATO withdrawal haunt Pakistan’s cement exports

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Although cement exports marked a record increase of 15.40 percent in February, local sales remained almost stagnant showing a nominal growth of 1.16 percent compared to the preceding month of January. The country’s overall cement despatches increased by 4.01 percent to 21.207 million tonnes during the first eight months of FY13 compared to the corresponding period of FY12. The growth, according to industry experts, is not enough to provide comfort to cement manufacturers. In February, cement units located in the northern part of the country dispatched 1.556 million tonnes of cement to the domestic market and exported 0.444 million tonnes, most of it to Afghanistan and other destinations through sea, while exports to India were only 0.032 million tonnes. The south-based mills provided the domestic market with 0.397 million tonnes of cement while its exports were 0.209 million tonnes. The total cement despatches in February was 2.610 million tonnes which was nominally lower than the January 2013 figure of 2.646 million tonnes. Industry experts are pinning hopes on economic revival to spur cement consumption after the elections. “The cement industry was established to fulfil local demand, based on projections of growth in 2003,” said a cement manufacturer. Unfortunately, he said, the growth remained much below projections after 2008 that resulted in huge idle capacities. He said India was not in the feasibilities when industries were planned. However after thaw in relations between the two countries it looked like the best prospect for cement exports. He said much has been said about the impediments to exports to India most of which need action from the Indian side. Unfortunately, he added, the Pakistani trade negotiators have been unable to convince Indians to remove their non-tariff barriers and mindset towards Pakistani products. The manufacturer said Afghanistan remained a good market for Pakistani cement but with the gradual withdrawal of western forces from the country, prospects of growth had diminished. Taha Khan Javed, an analyst at Taurus Securities, said the increase in exports was a welcome change after low exports numbers witnessed in January.