Sri Lankan tile industry awaiting better policies
The Sri Lankan tile industry is in a fix awaiting better policies to go forward with investments.
The government should come up with educated, game-changing policies to give a fillip to this industry, top officials said. “Over the years, politicians have singled out the tile industry, as one that made unreasonable amount of money. But the reality is that it has made less than 5 per cent return on investment at the best of times,” Mahendra Jayasekera, Managing Director, Lanka Tiles PLC told The Sunday Times Business on Friday. He said his factories are running at 50 per cent of their capacity due to the low demand for tiles.
“Home building has not picked up. The per capita income should increase for home building to start. The migration mentality is very much in the people’s minds. This is one of the main reasons that people will not put up houses. There should be better policies and mechanisms to retain people in this country and curtail migration,” he added.
He also pointed out that tile imports can be opened up, but the due revenue should be collected by the government. Noting that the government should look into whether imports are coming at the right price, Mr. Jayasekera noted that the majority of importers do not pay VAT at the selling price. “VAT should be collected at the point of imports that would be available for future set off.”
He also said as the rupee has appreciated, the industry costs are now higher. “The exports are less competitive and the imports are less costly. Going forward, we will have to be content with lower margins.”
However, he was cautiously optimistic that the government would come up with pragmatic policies in terms of construction and related industries.
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