The All Pakistan Cement Manufacturers Association (APCMA) has urged the government to clear their long-awaited dues on account of inland-freight subsidy. Chairman APCMA Aizaz Mansoor Sheikh has written a letter to the ministry of finance on the issue. In the letter, Sheikh recalled that the Trade Development Authority Pakistan (TDAP) had allowed inland freight subsidy at the rate of 35 percent for cement exports by sea for the period from March 26, 2010 to June 30, 2010.
The aim of giving subsidy was to boost cement exports of the country as high inland-freight cost had made it impossible for cement makers to compete in the international market.H e said that the cement industry, after fulfilling all conditions, started filing claims for inland-freight subsidy to the TDAP and as of date, cement makers have filed claims worth Rs269.293 million.
Unfortunately, chairman APCMA said, neither any cement maker had so far received any claimed amount from the State Bank of Pakistan nor any intimation had been received from the TDAP regarding clearance of the said dues. “It was learnt that Ministry of Finance has not released any funds yet for the claims,” chairman said in the statement.
He further pointed that cement production capacity in Pakistan is 44.217 million tons per annum. Eight percent of this capacity is situated in the North and 20 percent in the South of the country. During the year 2010-2011, domestic demand for cement was standing at 22.002 million tons and exports were 9.419 million tons, thus leaving substantial production capacity unutilised, he added.
He said that the sprit behind allowing inland freight subsidy was to maximize cement exports via sea and facilitate the cement units located in the north zone in particular.
Keeping in view, the inland-freight subsidy facility, the cement makers had accepted export orders on the assumption that the freight claims would be honored, he added. Chairman APCMA requested the finance secretary to intervene in the matter and issue instructions to ensure immediate clearance of long-awaited inland freight subsidy claims by the cement manufacturers. “Delay in clearing legitimate claims of the cement industry is leading to colossal losses,” he added.
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