Talking to Business Recorder here on Saturday, a senior member of the Cement Manufacturers Association and Executive Director of the country's biggest cement plant, said that the government had taken this decision at a time when the cement prices had started coming down in a week's time following the ban on export of cement, and withdrawal of duty drawback.
He said that all 20 plus cement units were operating almost to their capacity and supplying 80,000 tons daily to meet the cement demand, which usually increases in these months every year with the stepped up construction activity in spring season.
He said that cement manufacturing units were supplying cement @ Rs 5500 to Rs 5600 per ton ex-factory. However, the retailers were engaged in undue profiteering and fleecing the consumers, therefore it was the distribution system and price control system which need to be improved upon.
He said that though the rate of cement in China on Saturday was $65 per ton against local rate of $95 per ton ex-factory yet the national exchequer would suffer huge losses due to Rs 1200 per ton freight subsidy on imported cement and substantial decline in the collection of sales tax and other duties paid by local manufacturers.
He emphasised that instead of allowing import, the government should have allowed the market forces to bring down the cement prices since demand of cement would have declined in the coming rainy season.
He alleged that some powerful lobbies were working against the domestic cement industry since the government has singled out the cement industry and has not taken similar actions in case of sugar manufacturers who have raised the sugar prices though its supply at reasonable rates was necessary for the consumers.
Sources told Business Recorder that there was in depth discussion in the Economic Co-ordination Committee meeting on Friday over the extraordinary rise of cement prices during the past two months without any economic cause.
They said that though some economic experts were not in favour of unlimited import, freight subsidy etc, yet the Ministry of Industries put forward forceful case to allow the import in order to accelerate reconstruction work in the earthquake areas and complete Public Sector Development Programmes in time.
They said that the government had tried every means and persuasion in the meetings to impress upon the cement manufacturers to bring down the prices, but were left with no option other than to allow import in greater good of the country.