KARACHI, Nov 30: Iranian cement is finding its way to Quetta and other parts of Balochistan through informal channels and is selling below the price of locally produced cement.

A cement maker said that Iranian cement (Khash) is selling at Rs400-430 per 50kgs in Quetta, Rs350-380 in Gwadar, Rs330 in Khuzdar and Rs345 in Turbat, while locally produced cement bag carries a price of Rs460 in Punjab, Rs445-460 in Balochistan and Rs445-450 in Sindh.

He said that smuggling of Iranian cement in Pakistan got underway from the first week of November and on Nov 28 four trucks carrying 200 tons arrived from Taftan in Balochistan.

Giving an example, he said out of 100 tons arrival a day, no taxes are paid. There is no import duty on cement import and only federal excise duty (FED) and sales tax are charged.

He said the local industry has been paying Rs1,500 per ton FED and sales tax to the national kitty.

All Pakistan Cement Manufacturers Association chairman Aizaz Mansoor Sheikh told Dawn that our members are making quality check of Iranian cement.

Keeping in view the production capacity of local cement manufacturers, he said the APCMA would take up the matter with the government besides suggesting imposition of import duty to safeguard the local industry.

Another cement maker said input material used in cement making is cheaper in Iran and even oil products.

As the neighboring country is facing US sanctions, cement is landing here at cheaper rates.

He claimed that quality of Iranian cement is inferior than locally produced cement which may pose a serious threat to construction projects.

He said that the grade of Iranian cement is 32.5 N while Pakistani cement has a grade of 42.5 N.

He said that Iraq and Afghanistan are two principal markets of cement export from Pakistan and constitute 50 per cent of total export of nine million tons per year from Pakistan. Annual export to South Africa and India was 800,000 and 600,000 tons per annum, respectively.

Due to US sanctions on Iran and devaluation of Iranian currency, surplus Iranian capacity has posed direct threat to Pakistani cement in these two markets, he said.

At present, Iran has a capacity of 66 million tons and after sanctions its local capacity utilisation has dropped to 50 per cent.

Therefore, Iranian cement has created unfair price competition in these markets.