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Gujarat's ceramic industry to shut shops on gas price hike

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Ahmedabad: 
Gujarat's ceramic industry body, Morbi Dhuva Glazed Tiles Association, said on Wednesday it will stop production in all ceramic units from midnight if the state government failed to meet its demands.
 
"Frequent hike in natural gas prices is acting as a major roadblock for the industry and making it difficult for the units to maintain their competitive edge in the domestic as well as the global ceramic tiles market," Chuni Patel, general secretary of Morbi Dhuva Glazed Tiles Association, told reporters in Ahmedabad on Wednesday.
 
In this backdrop, the association recently submitted a memorandum to Morbi District Collector seeking a solution to the pressing issues of the ceramic industry.
 
Morbi's ceramic tiles industry has more than 500 units and claims to contribute around 75 per cent ceramic tiles production in the country.
 
The association has claimed that Gujarat State Petroleum Corporation (GSPC) has hiked gas prices by a whopping 130 per cent in last two years. GSPC has also added a particular clause in the gas supply agreement, which makes consumption of 80 per cent of the total allocated gas quota mandatory, according to the association.
 
"This clause means the units are liable to pay charges for that much amount of gas even if it does not use that much quantity of gas," Mr Patel said.
 
The association has demanded reconsideration in the recent hike in gas prices.
 
Further, the removal of anti-dumping duty on Chinese tiles has raised questions about the survival of the industry.
 
The complicated tax structure on ceramic tiles as compared to marble and granites has, according to Mr Patel, added to the woes of the industry.
 
"The Value Added Tax (VAT) on granite and marble is 5 per cent while the VAT on ceramic tiles is 15 per cent. Similarly, excise duty on ceramic tiles is 12.36 per cent as against 6 per cent on marble and granites," Mr Patel said, seeking parity of tax structure between ceramic tiles and marble and granites.
 
The association further said that repeated representations to the state government have fallen on deaf ears and hence, the industrial body of ceramic unit owners has decided to indefinitely stall production activities from Wednesday midnight.
 
The association has put the initial estimated production loss at around Rs 35 crore.


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