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Pakistan’s domestic ceramic tile manufacturers have approached the government to increase the import trade price of Chinese tiles by 30 percent to support the local industry.

Import trade price is the value on which duty and taxes are applicable. Although, the cost of manufacturing has been increasing persistently in China, the government continuously decreased import trade price of the commodity.

“Domestic tiles industry comprises only seven independent tiles manufacturing units, of which one of the units, Emco Industries Limited, has already shut down its tile manufacturing plant due to unfair competition,” submitted All Pakistan Ceramic Tiles Manufacturers Association.

Pakistan’s tiles manufacturing industry was facing a precarious situation due to massive influx of imported tiles on abnormally under-invoiced values. “There is an urgent need for remedial actions to offset the unfair and illegal trade practices of tile importers, which are causing losses to the national exchequer, as well as damaging the domestic tile industry,” the association noted.

The association, in its application submitted that a declaration disclosing full and accurate details relating to the value of imported tiles was not being made in a bid to evade payment of due taxes and duties.

As a direct consequence, losses were being faced by the national exchequer in terms of revenue foregone, while injury was being caused to the domestic industry producing similar products, which compete directly with the tiles imported from China.

The importers were able to undercut the prices due to the margin available to them, because full and correct customs duty and other taxes were not being paid.

“The domestic tiles Industry is a vibrant sector with potential for growth and generation of employment and export revenues. However, as a result of an on-going organised campaign to import Chinese manufactured tiles at abnormally low transaction values, the viability of the entire Industry has become doubtful,” the association said.

According to the association’s estimates, under-invoicing and non-payment of leviable duty and taxes was causing a loss of Rs400 million to the exchequer annually.    

“One unit has completely ceased production and others may be contemplating the same or have moved to also importing and selling the dumped tiles in view of the influx of Chinese tiles which are being sold in Pakistan at very low prices as full and correct customs duty is not being paid thereon."

It would seem that difficult times remain for a struggling tile sector…

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