Cement makers irked over lifting of addl customs, CVD

Chennai: The cement manufacturers have expressed concern over the Centre's decision to do away with countervailing duty and additional customs on imported Portland cement. However, the impact is likely to affect investor sentiment and capacity creation rather than encouraging imports, they say.

According to Mr Puneet Dalmia, Vice-President, Dalmia Cement (Bharat) Ltd, the decision brings down the price spread between imported cement and domestic product. The price difference is about Rs 25-35 a bag.

With the Government doing away with the 16 per cent countervailing duty, amounting to Rs 600 a tonne, the difference drops by Rs 30 and the lifting of additional customs duty means an impact of another Rs 1-2.

Effectively, the prices of imported cement and domestic cement are brought on par with each other. This could have some marginal impact on prices in the coastal areas, but prices elsewhere will not be affected because of the logistics cost. Another leading cement manufacturer based in the South said that it was regrettable that the Government had decided on the move despite cement prices being stable for the last month or two. It is the market that is deciding the prices.

For instance, in Andhra Pradesh where prices were ruling around Rs 215 a bag, consumption had hit a peak in March. The normal monthly consumption is about 11-12 lakh tonnes and, in March, this increases by about one-lakh tonnes because of year-end pressure. But last month, Andhra Pradesh consumption had shot up to 16 lakh tonnes putting the State among the leading cement users, the manufacturer said.