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Thursday, March 26, 2009
Privacy Policy Revision 1
Tuesday, September 16, 2008
Further Increase in quantity for new licenses to import marble into India. More needs to be done!
What is good to note is that the Government recognises the need for gang saw owners who have invested very heavily in machinery to source good quality blocks. This will go a long way in ensuring that the quality of slabs and tiles produced by these units are of acceptable standards for the domestic market. It is important that our domestic building and construction industry uses materials that are comparable with international standards. After all we are sick and tired of seeing sub standard quality of slabs and tiles in the domestic market even from our indegeniously quarried blocks.
It is high time that marble slabs and tiles sold in India is of acceptable quality and at the same time we should not degrade our environment by quarrying indiscriminately. We need to ensure that our quarries in India also invest adequately in modern quarrying equipments to ensure better quality of blocks and at the same time ensure environmental protection. Henceforth, the Government of India and of the states having viable reserves of marble should frame policies in such a way that quarrying in India is suitably modernized and import of blocks should be free from all controlls by allowing traders also to import and sell blocks to factories. This will help the factories to raise adequate financial resources for sourcing blocks as the factory owners need to ensure that they do not get stuck with dead inventory in case certain colors of blocks have a drop in demand and they could have cancellations of orders for projects that can cause more strains. After all, if a factory has to import blocks, the planning has to be done at least four months prior to the requirement and that translates into a considerable amount of money to be financed and blocked. This causes financial strains to the factory owners.
Tuesday, August 26, 2008
Effects on Indian marble industry with changes in import policy
- Do we have to protect the interest of highly influential quarry owners who have cornered control of majority of the legally available marble mining leases in India, especially in Rajasthan State?
- Should we take measures to ensure that marble processing units that have comitted huge investments are able to deliver acceptable quality processed slabs and tiles at economical prices?
- Should we not take measures to protect our environment by restricting indegenous quarrying?
Whenever most governments frame policies, the person whose interests should be taken into account first is the end user and the ultimate consumer. However, ite seems that the consumers' interest is least important. The end user in India, i.e. the person using marble slabs for his home, office or construction projects should get acceptable quality of slabs / tiles at reasonable prices. What is happening today is that quarry owners in India charge exhorbitant prices for blocks that otherwise fail to meet acceptable standards by a processing unit even in a banana republic. Factories have little choice other than to process sub standard blocks to be able to supply slabs and tiles to consumers at accpetable prices. Indiscriminate quarrying is detrimental to the environment. Now who should governments look after? In my opinion it is the ultimate consumer. Let us hope the new policy changes will have a positive impact for the consumer.
The persons who are adversely affected by this change are the few quarry owners who have cornered large chunks of mining leases as well as those who just have namesake factories (read gang saws) on paper and have been hitherto cornering licences from the initial policy of 140,000 tons per annum. These are the people who are really affected. The former should now think of investing moneys in systematic quarrying techniques and supplying acceptable quality of blocks competitively without degrading the environment. We can do without the services of the latter. They have been cornering licences unjustifiably and selling them at premiums of over Rs.10,000/- per ton. What does this amount translate into? Rs.60 per square feet for a 2cm thick marble slab. If you take a floor price of Rs.14,000 C&F and add the premium, the raw material cost is already Rs.145 per square feet for what should have been Rs.85 (at the port before payment of duty and transportation and processing). This is really very uneconomical. What steps does a factory owner resort to?
- He will saw 18mm thickness and sell as 20mm. Consumer is already compromised at this stage. This is definitely happening.
- He may resort to over invoicing of imports. He may purchase substandard or maybe rejected blocks and have it over invoiced to comply with floor prices. This is detrimental to the economy. In case the processor is relieved of this burden of getting a licence alone for Rs.60 per sq. feet, hopefully he will avoid resorting to such measures.
The consumer is compromised by such measures. It is an accepted fact that the competition is between artificial materials (ceramics, concrete etc.) against the natural stones for use as floor and wall coverings indoors as well as outdoors. The demand for natural stones is very high in India due to the increased construction activities for new projects as well as renovations. The need of the hour is improving supply of raw materials without degrading our environment and the best way is to free imports totally to ensure that our domestic consumers receive acceptable quality of slabs and tiles and our construction projects are of acceptable quality once the materials of uncompromised specifications is supplied.
Sunday, August 24, 2008
Imports of Marble Blocks in India (Policy Changes)
- The units should have installed marble gang saw machines. (These licenses are specifically unavailable for 100% Export Oriented Units that already have licenses to import rough marble and to units that have already been granted special import licences from the earlier provisions for import of 140,000 tons per annum.)
- All units elegible for these licenses should have indigenous sales turnover of marble slabs/tiles only, of Rs.1.00 Crore (Rupees one Crore only) and above in each of the three financial years 2004-05, 2005-06 and 2006-07.
The floor price for imports is the same as per the special import licences issued. The licences will be issued upto 110,000 tons on a pro rata basis determined by the turnover of the elegibile units. There is still a further ceiling on the licences:-
- Units having one installed gang saw will get a maximum license of 3,000 tons per annum.
- Units having more than one gang saw will get a maximum license of 3,000 tons per annum for the first gang saw and 1,500 tons per annum for each additional gang saw.
Import is on an actual user basis and as usual returns will have to be filed and a pass book maintained.
For both the licences (140,000 tons and 110,000 tons) a Chartered Accountants certificate will have to be submitted certifying the elegibile turnover.
This change in policy was most needed as the manufacturers will have options of importing good quality rough blocks for processing, thereby making it economically viable and of acceptable quality. This will to some extent improve the quality of processed marble slabs and tiles available in India as many units can save the cost of Rs.10,000 to Rs.11,000 per ton on the licenses and use the amount in importing better quality first choice blocks.
However, this still seems to be a half hearted gesture by the government and more should be done by the government regarding imports of marble blocks in India. Marble blocks are very expensive and to ensure smooth running of the units the inventory required is very large. For a unit to maintain so much inventory it is very costly. The Government should ideally free the imports of marble into the country. This will to a large extent reduce the pressure on quarrying operations in India and we can have a safe environment policy and conserve our resources. Trading in imported marble blocks should also be allowed. This way our manufacturing units will find little need to commit vast financial resources in blocks and can source blocks readily from traders as and when needed to fulfil orders. Currently, a manufacturing unit will have to import blocks well in advance considering procedural delays and can also get stuck with inventory that will be lying idle and wasting huge financial resources and costs. Flexibility of sourcing raw materials is the key to economically viable processing and will ultimately benefit the domestic end users who are currently paying through their noses for imported junk.
Marble Blocks import into India
- These licenses are not applicable to 100% Export Oriented Units or Units in Special Economic Zones that are eligible to import rough marble blocks and slabs for processing export orders directly or as deemed exports.
- A passbook is maintained for the imports and the importer has to file monthly returns with the licensing authorities to keep record of the amount of imports and balance available.
- Import of Dolomite is banned against these licences. Therefore what is known as Thassos White Marble cannot be imported in rough blocks or slabs form other than by 100% export oriented units. For domestic consumption in India, Thassos White marble has to be imported in cut and polished form only.
In case an elegible importer fails to use his full entitlement he sells his licence in the open market. Currently the rate for these licences is approximately Rs.10,000 - Rs.11,000 per ton depending on the demand / availability.
The floor price of imported marble (the minimum import price) should be not less than US$325 per ton c&f for blocks and US$500 per ton c&f for slabs.
Marble manufacturers associations have made a representation to the licensing authorities to review the licensing regime. In my next post I will discuss about the salient features of the review.
The endless journey
- Problems faced by the Building & Construction Industry in using Indian natural stones.
- Problems faced by the Indian natural stone industry in general during course of their business.
- Government policies of the Indian Government as well as the Regional State Governments specific to or affecting the natural stone industry in India.
- Suggestions for application of natural stones.
- Suggestions for end users for proper maintenance and care of natural stone products.
Visitors are welcome to leave comments on the posts. In case you wish to make any suggestions for a new post or wish to contribute to posts on this blog, you are welcome to submit the feedback form or use any other contact options available in the Stone International website http://www.stoneint.in/contact.htm and I will immediately respond with more ideas. If you specifically authorise the label of the post will bear your name / contact as desired by you in the post.
Once again I welcome you to this journey of stone through time. This journey started millions of years back at the time of formation of our dear planet earth, and it continues till today when we use the natural stones for various applications that outlive us and still continue throughout the journey that never seems to end.
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