Cheap Pak cement to hit India

Imports to be up to a third lower than domestic prices.

Cement shipments from Pakistan will hit the Indian markets by the end of the month at prices that are up to a third lower than domestic prices.

Indian representatives of Pakistani cement companies told Business Standard that their brands will soon be available at about Rs 165 per 50-kg bag, transported on rail through Wagah and on ship to Mumbai port.

This will be about 28 per cent lower than the current price of Rs 230 in the north, and about 37 per cent cheaper than Rs 265 in Mumbai.

The price of cement imported from Pakistan would be cheaper because of the rapid rise of the rupee against the dollar, experts said. Since the cement will be imported in dollars, the Pakistani companies can price themselves aggressively to gain market share.

"A 100-tonne sample consignment is arriving in wagons at Amritsar by this weekend. We already have orders of about 15,000 tonnes from some real estate players," said the India representative of Pakistan's Bestaway Cement Company that received the certification of the Bureau of Indian Standards (BIS) about a week back.

"By the month-end, we plan to supply 15,000 to 20,000 tonnes in the domestic market," said the representative of D G Khan Cement Company, another Pakistani firm.

These quantities might be small in the 155 million-tonnes a year Indian market, but the orders could pick up soon on account of their lower prices, industry experts said, and could force Indian cement producers to drop their prices.

The government too hopes this will finally cool cement prices in the country. It has been at loggerheads with the cement industry for over six months now over the issue.

The government has taken several steps to contain prices, including scrapping import duty to giving tax incentives to companies selling, but in vain.

The BIS has granted 18 licences to cement companies in Pakistan, Bangladesh, Dubai and Bhutan after cement import norms were relaxed earlier this year.