Pakistan cement to put pressure on local prices

The government's effort to cool down cement prices is gradually paying off, with 525 tonnes of the commodity landing in Mumbai, and port authorities joining in the efforts to contain inflation by agreeing to forego rentals till the consignment gets quality clearance.

The first consignment of 200 tonnes landed within days of the government bringing down the countervailing duty to zero. The customs duty on cement has already been removed.

"Two more batches of 325 tonnes of cement have landed at the port and are now awaiting quality clearance from the Bureau of Indian Standards, before it is released for sale in the domestic market," said the Department of Industrial Policy and Promotion Secretary Ajay Dua here.

The landed cost of imported cement is around $75 per tonne or Rs 170 per 50 kg bag as against the Rs 240 charged by the domestic producers.

To lend a helping hand to the government's efforts to keep the cement prices under check, the Bombay Port Trust has decided not to charge the importers any rentals for the time the BIS takes to clear the consignments.

Dua said the BIS clearance may take up to five weeks. In the meantime, the BIS has certified 11 cement facilities in Bhutan, Bangladesh and Nepal, which would enable them to sell in India, without going through the lengthy clearance processes.

Apart from imports, seasonal factors are also expected to lead to further softening of cement prices as during monsoon months of June to September the construction activity more or less comes to a halt.

Domestic cement companies, who have so far refused to cut prices, may come under pressure with imports coming at a lower price.