The proposed duty structure in the new budget could lead to an increase of Tk15 per bag in cement production costs. However, cement manufacturers are contemplating a retail price hike of Tk30-Tk50 per bag, which would further escalate construction expenses. Builders and contractors fear that this sudden surge in cement prices will compound the already high costs of other building materials, such as rods, adversely affecting projects across the country. The budget for the fiscal year 2023-24 suggests raising the import duty on clinker, the primary raw material for cement, from Tk500 to Tk700 per tonne. Additionally, the specific rate of duty for commercial importers would increase from Tk750 to Tk950.
Cement factory owners and dealers have hinted at potential retail prices of up to Tk580 per bag, compared to the current Tk550, once the new clinker supply enters the market. This situation poses significant challenges to the infrastructural development of Bangladesh and the real estate industry, already grappling with high tax burdens and rising material costs. Contractors express concerns about the financial burden falling on consumers and the impact on ongoing government projects, which were estimated based on previous material costs. The Bangladesh Cement Manufacturers Association (BCMA) has demanded a reduction in the import duty of clinker to Tk200 per tonne, emphasizing its disproportionate nature compared to other imports.
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