Proposal to export cement via Gwadar declined

Proposal to export cement via Gwadar declined
Published: 01 December 2008

Cement manufacturers in Pakistan have turned down the government’s proposal to export cement through Gwadar, industry sources said. They termed it a costly and unsustainable activity due to high cost of transportation. A meeting of cement manufacturers and government officials was held in Islamabad in the second week of November, in which representatives of cement industry completely rejected the government proposal, they added.

On last Thursday also a meeting of cement manufacturers was held in Lahore for election of new office bearers, wherein they again unanimously refused the proposal and demanded more facilities at Port Qasim and Karachi. Major General Rehmat Khan, newly elected Chairman of All Pakistan Cement Manufacturers Association (APCMA) also confirmed that cement manufacturers had rejected the proposal due to unsupportable infrastructure at Gwadar port and rise in cost.

He said that the export through Gwadar port would increase cost of cement export making it unviable, as at present there is no facility of cement export available at Gwadar. "We are already exporting cement at lowest margin due to high competition in the world market and shrinking construction industry in the Middle East and United Arab Emirates (UAE)," he said.

He said that cement export through Gwadar would put additional burden of some 6-8 dollars per ton cement, which is unsuitable for the industry. However, he added that if the government agreed to pay some subsidy on cement export and provided facilities at Gwadar, "then we will consider the proposal". The APCMA Chairman said that industry would support the government to make Gwadar port operational, but at preset when the country is facing adverse balance of payments situation and needs foreign exchange, this decision would hurt cement export.

He said that that the immediate requirement of wheat has been met in the country. Therefore its import of remainder quantity could be shifted through Gawadar. However, cement export through Gwadar port without subsidy and infrastructure is not viable for the cement manufacturers, APCMA chairman said.

He urged the Government to facilitate cement export by providing dedicated berths at Port Qasim and Karachi port, which would be supportive for the cement industry and benefit the country.