| India allows four more Pak firms to export cement |
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The sources said BIS officials had visited the Pakistan cement manufacturers’ plants recently and had collected samples for quality standards test. After the test results, BIS had issued certificates to the Pakistani cement manufacturers, they added.
The manufacturers are Attock Cement, Bestway Cement, DG Khan Cement and Zeal Pak Cement. Earlier, the Indian government had granted permission to Lucky Cement, Maple Leaf and Pakistan Cement to sell cement to India, the sources said.
The sources said BIS would complete its certification process for the other cement companies soon and would also issue certificates for the export of cement to India.
The managing director of a leading cement company said after visiting the plants in Pakistan, BIS, the authority to certify the quality of cement to be sold in India, whether domestically manufactured or imported, had cleared another four Pakistani cement brands.
He, however, added freight would remain an issue till the trucking problem between the two countries was solved. “If the two governments agreed to allow trucking across the border, then the freight issue would also be resolved,” he remarked.
People in the cement industry believe that if the two governments agreed to allow trucking among the two countries, then around three million tonnes of cement would be exported to India through land route. Extensive export to India trough rail route is not possible due to logistic problems for both the countries.
Some Pakistani cement firms had sent a few shipments during the previous financial year, which were withheld by the Indian customs at ports due to lack of required certification.
Later, these consignments were released on guarantees furnished to the authorities by their buyers in India. But clearance from the Indian customs took 30-40 days which increased cost for the Indian buyers.
According to an estimate of the cement industry, Pakistani cement factories had sufficient capacity to ship 8,000-10,000 tonnes of cement a day to India. The domestic producers charge around Indian Rs240 per 50-kg bag as against Indian Rs170 that is the landed cost of cement imported from Pakistan. Even if another 30 Indian rupees is added as transport cost, Pakistani cement will be available for 200 Indian rupees.
Now the Pakistani cement industry has the capacity to produce around 34 million tonnes and the domestic demand is around 22 million tones, so the industry has a surplus of 10-12 million tonnes.
Cement manufacturers in central Punjab are better positioned to export to India as they are nearer to that country than other places in Pakistan. This gives them advantage in terms of freight charges. The factories situated in NWFP and further north are better suited to export cement to Afghanistan. The factories in Sindh have the advantage of sea routes and export through sea is a better option for them.
On expectations of cement export to India, the price of the commodity in the domestic market has gone up from Rs205 to Rs210 for a 50-kg bag. Earlier, the price of a 50-kg cement bag was Rs195-200. Dealers said increasing cement prices despite low sales defied the laws of economics.
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