Most imported ceramics are rejected goods, says SL Ceramics and Glass Council Chief
The Ministry of Industries has seen four ministers in the last two years but it hasn’t been able to deploy long term consistent policies for the ceramics and glassware industry. Sri Lanka needs to have stable policies, if not people will not invest in buying locally manufactured products, says Sri Lanka Ceramics and Glass Council, President, Anura Warnakulasooriya.
Mr. Warnakulasooriya made these comments to the Business Times on the sidelines of a panel discussion organised by the council at the Hilton Colombo last week.
He said, “Ceramic manufacturers who are producing for the local market are going through difficult times. The Ministry of Industries seems to be keen on deploying consistent stable policies for at least five to 10 years but this is possible as long as they don’t keep changing from time to time when a new minister takes office. The ministry has had four ministers in the last two years.”
Some 80 per cent of raw materials are sourced in Sri Lanka while the remaining 20 per cent is imported. “The only reason imported ceramics are cheaper is because they are exported to developing countries by big developed countries that are produced in bulk quantities and they are second grade ceramics. They are rejected goods sold at 20 per cent of the normal value and sold here because there are no proper standards requirement in Sri Lanka for testing,” he added.
Sri Lanka’s exported ceramics are subject to all possible international standard tests as per the requirement of the foreign importer. Locally manufactured ceramics are certified by the Sri Lanka Standards Institute and sent to Japan for testing for it to meet the standards of the export market. “Ceramics that are imported to Sri Lanka have no test standards, anything can be imported at a very low price. It is difficult for the local manufacturers to compete with second grade ceramics. But if you are on the same playing field, the price won’t have much of a difference,” noted Mr. Warnakulasooriya.
Commenting on the tax structure and the social security contribution (SSC) levy introduced by the government, Mr. Warnakulasooriya stressed, “The tax structure is still not clear as to how it will affect the price formula for ceramics and bathware. The SSC levy on exporters is 2.5 per cent. But some bathware manufacturers will have to import raw materials paying 2.5 per cent SSC levy and when they sell locally they have to pay another 2.5 per cent, which is not recoverable. The SSC levy will make the price of ceramics go up significantly,” he noted.
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