Glass and Paint Industries seek excise sops

High on hopes on the upcoming budget, the All India Glass Manufacturer’s Federation (AIGMF) demand a total waiver on the custom duty on import of soda ash.  The Federation in a memorandum to the Finance Minister, Pranab Mukherjee, claimed that the soda ash comprising 30 per cent of the production cost is the major price escalating factor in the Rs. 4,500 crore glass manufacturing industry. 

Citing an instance the AIGMF said that some major manufacturers fixing the price of soda ash in tune with landed cost of imported soda ash and urged the government to reduce the customs duty on imports, which will in turn result in reducing the landed cost reducing prices by indigenous manufacturers.  Reiterating the need to fix the price of soda ash at international rates, the body further pointed out that imposing of safeguard duty on imports of soda ash from China will also result in increase in price of imported sodas ash.  The memorandum also urged the government to ensure the uninterrupted supply of both the inputs as glass being a continuous process industry and any interruption in supplies would result in damage of furnace causing heavy losses.

Similarly, the Indian Paint Association (IPA) in its pre-budget presentation also demanded a softer excise duty regime on paint products to lift the badly battered real estate sector from its current slowdown mode.  The move would enable a higher compounded annual growth rate (CAGR) for the paint industry and further be a blessing in disguise to Rs. 1,50,000 anti-corrision and weathering prevention expenditure incurred by industry including home market segments, said the governing body member, IPA, Ramakanth V Akual.

The IPA reiterated that a softer excise tariff and lower tax rates coupled with lower income tax charges on interest towards housing loans would kick start the growth cycle in realty thereby creating a sustainable demand for paint goods.  Besides tax breaks, low-cost housing initiatives by the government would generate a housing boom concomitantly spurring a greater demand in volumes for the paint industry. The industry with annual turnover of about Rs. 70,000 crore recorded a 18 per cent calculated annual growth rate since the past 3 years but  the prevailing downturn condition is expecting a decline of  about 15 per cent this year, however it is likely to remain strong in terms of volume sales growth.