Cement industry welcomes Interim Budget move

Monday, 9 February 2015 00:00 -     - {{hitsCtrl.values.hits}}

The cement industry has welcomed the proposals outlined in the newly-elected Government’s Interim Budget and the 100-day program. A cement trade spokesperson stated that the sector welcomed the Budget proposal to remove Customs duty on imported cement, which would benefit Sri Lankan companies importing cement from Malaysia, Vietnam and Indonesia, as these countries did not have Free Trade Agreements (FTAs) with Sri Lanka. In a statement, the spokesperson said the Budget proposals would allow cement imported from Malaysia, Indonesia and Vietnam to be able to compete more effectively with cement imported from India and Pakistan, although the two latter countries would continue to maintain a cost advantage due to their existing FTAs with Sri Lanka. Under the FTAs, cement is imported from India and Pakistan without import duties. Moreover, cement is also imported from Malaysia, Indonesia and Vietnam, but cement imported from these countries has been liable to a 7.5% customs duty so far. “As a result, cost of cement from these countries is Rs. 60 to 80 (per bag) higher than imports from India and Pakistan. With the removal of import duty of 7.5% the cost gap of cement will reduced by Rs. 30 to 40 (per bag),” the spokesperson said. Evidently, the current Finance Minister is placing the construction industry as one of its high priority sectors, which is appreciated by the trade, as is the fact that this is a marked improvement from the previous Government which disregarded the concerns of the local cement trade and blindly signed the FTAs which were not advantageous to the local trade. On the whole, the trade has come together to welcome removal of the Customs duty as it would engender a greater level playing field for countries exporting cement to Sri Lanka.