PCMA offers subsidised cement to government

PCMA offers subsidised cement to government
Published: 12 August 2005

Pakistan Cement Manufacturers Association (PCMA) has offered to sell cement directly to the government at the rate of Rs 245-250 per 50-kg despite considerable increase in cost of production, industry sources told Business Recorder here on Thursday.  The sources said that a five-member delegation of the association, led by its President Tariq Sehgal, held a meeting with Federal Secretary Industries Salman Ghani on Tuesday and discussed with him the current cement prices controversy. 

The sources added that the PCMA delegation suggested that the government should open its own outlets on the pattern of Utility Stores Corporation countrywide, and sell cement on control rates to the builders and general public.  They made it clear that cement prices after the budget was increased by dealers and not by manufacturers because of sudden surge in demand. In a month’s time, the retail prices have come down from Rs 330 to Rs 280 per bag in all markets and will come down further in the near future, they added. 

They argued that there was only 4.91 per cent increase in the cement prices from 2000-01, as compared to prices of other building materials, like iron bars/sheets of 82.34 per cent and timber 41.02 per cent 

About government’s intention of levying regulatory duty on cement exports and allowing import to bring down prices in the local market, a highly respected member of the PCMA told this scribe that this would irreparably damage the cement industry which had taken several decades of hard work, heavy investment and balancing, modernisation and renovations (BMR) to come up to this enviable stage. 

He said that the country’s cement industry had carved out a place for itself in Afghanistan with great difficulty over the past three years and exported sizeable amounts of cement during 2004-05, in addition to meeting all requirements of domestic construction industry.  Any restrictions on the exports will help our competitors, including Iran and India, to capture the Afghanistan market, the APCMA member warned. 

Talking to reporters about the current cement prices, a senior official of the finance ministry, who deals with the issue, said: "the government does not want to harm cement industry. What it wants is that the cement prices should come to the pre-budget level of about Rs 259 per bag, so that the construction activities do no slow down and the government’s development programmes are completed on time."