BL reported that cement industry has asked for the simplification and rationalization of excise, duty free import of fuel and raw materials and correction of skewed import policies relating to cement.

According to Mr MAMR Muthiah president of Cement Manufacturers Association, rising cost of imported coal, and raw materials such as gypsum are impacting the industry, which is a key component in infrastructure development. The prevailing policies tax import of fuel and raw materials, but allow duty-free import of the final product cement. The cement industry body is hoping that the Government corrects this imbalance in the 2012-13.

He said that the 5% customs duty on imported coal has to be waived, as also the customs duty on pet coke, gypsum and other inputs. Particularly considering that cement is a core industry, but is not given priority status in coal allocation and is largely dependent on imported coal for more than half its requirement.

Excise duty should also be brought down from the prevailing levels and the levy should be simplified. If steel attracts just 8% why should cement, a closely allied product, be subject to not just a higher excise duty of 10 per cent, but also an additional specific component of around Rs 160 a tonne. This is a complicated system with ad valorem rates and specific rates linked to cement prices. The excise duty should be simplified and limited to either specific rate or ad valorem.

Industry representatives pointed out that the specific component ranges from INR 80 a tonne to INR 160 and on clinker INR 200 a tonne.

(Sourced from BL)