Proposal for subsidy on clinker imports rejected, Pakistan

Proposal for subsidy on clinker imports rejected, Pakistan
Published: 31 July 2006

The Pakistan government is learned to have turned down a proposal of cement manufacturers to provide subsidy on import of clinker, at par with imported cement. Sources said that All Pakistan Cement Manufacturers Association (APCMA) had recently approached the government seek same subsidy on the import of clinker as on cement. 
 
Which they claim would further reduce cement prices in the market. But the government did not agree with the justification given in the proposal. The government is of the view that substantial subsidy has already been given on import of cement and it was not possible to extend it to clinker, sources said. 
 
The said that there was a proposal under consideration to resume rebate on cement export to Afghanistan as cement manufacturers were already earning handsome profit. 
 
"The Government is fully aware that cement manufacturers are earning substantial profit on export to Afghanistan, as 125,000 to 150,000t cement is being exported to Kabul per month," sources said. 
 
With the induction of two more plants recently the total number of cement plants has become 27, with the installed capacity of around 22Mta. All these are in the private sector, except Javedan Cement at Karachi, which is also under privatisation process. The capacity utilisation of cement plants, which was around 85 per cent in March, has increased to 95 per cent. 
 
The growth rate of cement production has been recorded at 17.85 per cent during the financial year 2004-05, and 13 per cent from July 2005 to March 2006.