Cement export to India has been started with 1500t cement exported by a leading cement manufacturer. According to the first capital research report, for the first time D G Khan Cement dispatched 1500t cement to India, as a sample, by sea route, at C&F price of around $90 per ton.
The report said that this has also been proved by a bulk of inquiries from India to local cement manufacturers, received by Indian importers for the import of commodity. Head of first capital research, Muhammad Rehan Khan, said that huge capacity augmentations by the cement industry of Pakistan have 7 million tons excess capacity which is expected to reach at 14Mt by the end of FY08.
"We believe India, beside Afghanistan and UAE, to be the most feasible country for exporting Pakistan’’s excess cement capacity," he said.
Later, after significant price hike, thus invited the government’’s intervention to improve the situation in the form of banning export and encouraging imports by abolishing duty from 12.5 per cent to Zero-rate.
In this scenario of India supply and demand, there are several factors that ranked Pakistan to be most feasible cement exporting country for India, he said, and added that the current demand-supply situation in Pakistan cement sector indicates excess cement production capacity of around 7-7.5Mt, while there is no big gap in the cement prices of the two countries.
He said that there is huge demand from Indian buyers for cement and D.G Khan Cement has started export and it has become first exporter of cement to India. Other cement companies are also all set to meet India’’s cement demand, he added. He said that additional capacities of domestic cement manufacturers are almost completed, thus placing themselves to reap the possible benefits from the Indian cement demand.
"In this regard, we consider Lucky Cement to be the top beneficiary of the situation on the back of its presence in the region of the country as well as its timely and cost-effective completion of expansions," he said.