India lifts ban on cement exports

India lifts ban on cement exports

New Delhi: India has lifted a ban on cement exports, the trade ministry said, as price pressures eased and domestic demand is depressed due to a slowdown in construction activity.

The Director General of Foreign Trade under the commerce ministry said in a notification on the weekend it had allowed cement exports “with immediate effect".

The government had banned cement exports in May as part of efforts to increase local supplies and check rising prices.

In the past few months, construction activity has slowed down as high interest rates trimmed demand for new homes while companies deferred expansion plans due to a credit crunch.

India’s cement output was 14.34 million tonnes in November, less than 14.76 million tonnes produced in October, according to the Cement Manufacturers’ Association.

Annual inflation slowed to 6.84% in the first week of December from a high of 12.9% in early August, reflecting a slump in oil and other commodity prices.

The Indian economy expanded by 7.6% in the September quarter, and analysts expect Asia’s third-largest economy to end the 2008/09 fiscal year with less than 7% growth compared to 9% of last year.

In December, the authorities announced a slew of steps including interest rate cuts, a massive spending plan and duty cuts including that for cement, to arrest the slowdown.