Print Edition - 2015-05-16 | MONEY
Zinc sheets in short supply
May 15, 2015-
Eastern Nepal has been hit by a shortage of zinc sheets even as prices of construction materials have risen sharply in recent days.
Pawan Kumar Sarada, president of the Morang Trade Association, said they had been unable to get hold of the product.
“We have not been able to procure zinc sheets for distribution to earthquake victims,” said Sarada. The government needs to waive customs duty on construction materials in order to increase their supply, he added.
With the start of rehabilitation programmes for earthquake victims, demand for construction materials like zinc sheets, iron rods and bricks has gone up.
Artificial shortages and abnormal price rises have also appeared in the market due to the demand created by a massive rehab effort.
The government has imposed a ban on the export of zinc sheets besides freezing their prices.
There are four domestic producers of zinc sheets, namely Arati Steels in Biratnagar, Hulas Metal in Simara and Rajesh Metal and Bhagawati Metal in Birgunj.
Arati Steels manufactures 400 tonnes of zinc sheets daily, 80 percent of which are exported to India. The import duty on raw materials is 5 percent while the government charges 30 percent customs duty and 13 percent VAT on the import of finished products.
Similarly, the government charges a heavy customs duty on the import of iron rods while the import duty on bricks is 30 percent.
The artificial shortage of construction materials has been blamed on the absence of effective government monitoring. Manufacturers are reported to have cut output citing power shortages due to the earthquake and continuing aftershocks.
The shortage of zinc sheets is likely to affect the government’s plan to provide shelters to earthquake victims before the start of the rainy season. The government has planned to construct homes or provide zinc sheets directly to the victims.
Sarada said the government should waive customs duty on the import of construction materials for the time being. “This will help the government to implement its plan,” Sarada said.
Published: 16-05-2015 11:22