- Says tax concessions, reinstatement of CESS and lower furnace oil prices will increase competitiveness
- Wants SLS certification for clay roof tiles for all Govt. construction, housing projects
- Withdrawal of asbestos ban has hit clay roof tile industry
- Calls to fast-track anti-dumping law, says cheap imports from China, India, Indonesia a major threat
- Requests EDB to provide opportunities for local industrialists to participate in and showcase products at international trade fairs
The Sri Lanka Ceramics and Glass Council believes expansion is possible through product diversification and technology transfer to substantially raise export revenue and regain lost ground in international and domestic markets, if provided with Government support.
Listing a number of requests at their 15th Annual General Meeting (AGM), the Sri Lanka Ceramics and Glass Council last Friday called for Government intervention to strengthen and support the industry to move forward.
“In spite of the numerous challenges faced by the ceramics and glass industry, we have been investing in capacity-building and innovation to counter the threats of competition and the high cost of manufacturing, reducing dependency on domestic markets. The Sri Lankan ceramics and glass industry is still working hard to not only survive but is also striving to regain lost ground in international and domestic markets,” Sri Lanka Ceramics and Glass Council President Sanjay Tiwari said while addressing the AGM.
He highlighted that the council was working on many ongoing initiatives with all relevant authorities to help the industry, where major initiatives, including advising and lobbying relevant authorities for the introduction of SLS certification for clay roof tiles for all Government construction and housing projects as well as to reinstate the CESS removed on sanitary ware in 2017.
In addition, he said they were requesting that furnace oil be brought in line with crude prices, noting that around 40% of the production cost consisted of high energy prices.
“The council continued to lobby the Government to consider reducing the price of furnace oil which is used extensively in the ceramics and glass industry. Although the Government had reduced the price of furnace oil from Rs. 90 to Rs. 80 per litre in January 2015, it was later raised to Rs. 92 per litre. It was strongly felt that world market prices were not reflected in finalising the current fuel prices.”
Tiwari emphasised that the council had however recommended introducing global criteria of fixing the fuel prices based on a formula that is linked to world crude oil prices to bring in more transparency and to have a level playing field for the industry.
“We request the intervention of the Export Development Board (EDB) and all relevant ministries to influence this matter to support the industry,” he added.
He said they were also recommending the removal of PAL from the import of Liquefied Petroleum Gas (LPG) allocated mainly for exporters. The industry believes that this will help the two suppliers to offer reduced prices to the ceramics and glass industry.
In terms of the anti-dumping legislation, Tiwari stressed that the regulation had not been able to bear fruit.
“The cheap import of tiles, sanitary ware, glass and tableware from China, India, Indonesia and other Asian suppliers still remains a significant threat to the local industry. Although the council continues to lobby to have anti-dumping legislation enacted, these efforts have so far failed to bear fruit.”
He said the requirement of floor and roof tiles had gone up tremendously in the recent past with the current focus on infrastructure and investments in real estate. However, in the current context of the total requirement of floor and roof tiles, almost 60% of volume was serviced through imports.
“Due to current restrictions and limitations on clay and silica mining, the industry is too restrained to invest in capacity expansion. This has resulted in cheap material getting dumped in the country. We have been informed that the anti-dumping regulations are ready but awaiting parliamentary approval. The current request to bring in anti-dumping regulations will help consumers get quality products at an affordable price,” he stated.
The council also called for EDB intervention towards improving the ceramics and glass industry by increasing the number of international trade fairs where the local industrialists will have the opportunity to participate and also encourage local entrepreneurs to have their products displayed at these exhibitions.
Furthermore, they requested assistance for a technology upgrade as well as to promote overseas visits for council members to learn about the latest global technology in the sector.
“We call to provide grants, concessions, subsidies and tax relief to council members to purchase the latest machinery to carry out their Research and Development (R&D) and boost exports.”
Tiwari insisted that the EDB influence the process of obtaining a transparent formula pricing mechanism for all kinds of energy sources from the Ceylon Electricity Board (CEB), Ceylon Petroleum Corporation (CPC), Litro Gas and Laugfs Gas aligned with global crude oil prices.
The industry also requested to increase import taxes on finished ceramic products, particularly imposing CESS or restrictions on the dumping of low-grade ceramic and glass products in the country
Simplifying the existing system to obtain local mining raw material and solving issues with clay, mining and transport were among some of the related challenges that the industry called on the Government to help overcome.
“Re-enforce the ban on asbestos sheets or increase the taxes on imported asbestos fibre and cement, which is used in sheet production. This will help safeguard the red clay industry, which has already invested heavily in technology and capacity enhancement,” Tiwari pointed out.
Some of the key priorities outlined for next year were increasing the number of red clay roof tiles SLS certification to 50 factories, exploring the possibility of introducing coal power (coal gasification), maximising solar power usage, utilising huge deposits of red clay and sand available in the Yan Oya area in the ceramic and red clay industry.
“During the year under review, our council has been working with all relevant Government authorities to find resolutions to these problems. We are confident that the authorities will heed our concerns and continue to help build a strong industry that can generate substantial revenue from exports,” Tiwari declared.
By Charumini de Silva
DailyFT
