Cement manufacturers to maintain prices | Pakistan Today

Cement manufacturers to maintain prices

Cement manufacturers are maintaining cement prices although the taxation measures announced by the government in the federal budget have dampened their spirits as expected cost escalations are quite high, reliable resourced confided to Pakistan Today.

Industry experts pointed out that expected capacity utilization for the year 2013-14 will be around 80 per cent as cement sector has posted over three million tons despatches during each of the past three months. The industry is well poised to produce another three million tons plus despatches in the month of June and the overall despatches of cement in 2013-14 would be all time high. They said going forward the sector expected the domestic cement demand to further increase due to some turnaround in the economy. The development projects launched by federal and provincial governments, they added, would further boost cement consumption.

Experts, however, warned that industry would not be able to absorb the high costs of inputs for long. They said the prices had been capped by the manufacturers in the best national interest so that the buoyancy in construction sector was not disturbed.

Industry experts have expressed concerns that instead of reducing excise duty on cement in line with stated government policy, it has levied further Rs 50 per ton excise on cement manufacturers.

The industry sources mentioned that “policy makers have been informed about a number of issues which are impeding the growth of cement sector much before the preparation of the budget and the concerned circles assured that the genuine concerns of industry would be addressed. But regrettably the government chose to ignore the issues and imposed measures that would jack up the cement prices.”

The experts indicated that the additional excise duty on cement will add rupees 2.5 per bag to the cost and the duty on coal will further increase the prices substantially as fuel is the major cost of production. Electricity rates have already been increased to historically high level further worsening the overall situation.

Cement is the integral part of almost all the activities undertaken by the construction sector which is the main source of employment for the unskilled labour force in the country. In such a situation where construction sector has been experiencing double digit growth, it would have been prudent to further facilitate the construction-related industries in order to accelerate this attained growth.



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