Lahore: The Lahore Chamber of Commerce and Industry (LCCI) President Mian Abuzar Shad has called on Prime Minister Shehbaz Sharif to intervene and order the immediate withdrawal of recently issued statutory regulatory orders (SROs) that have raised serious concerns in the cement distribution sector.

In a letter addressed to the prime minister, Mian Abuzar Shad highlighted the negative implications of SRO 578(I)/2025 and SRO 709(I)/2025, following discussions with a delegation from the All Pakistan Cement Distributors Association. The meeting focused on the practical challenges these notifications pose to the sector, particularly regarding compliance and financial viability.

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SRO 578(I)/2025, issued on April 8, mandates that all cement business transactions must be conducted through bank channels, with detailed buyer information recorded. The LCCI president argued that this requirement is impractical given the current economic conditions, where approximately 40 percent of cement sales involve walk-in customers who typically pay in cash. The high bounce rate of cheques and lack of effective legal recourse further complicate adherence to the order.

He added that the remaining 60 percent of sales involve cash recoveries from wholesalers and retailers, especially in rural areas where banking infrastructure is limited. Implementing this SRO, he warned, risks disrupting the documented supply chain and could push compliant businesses towards non-compliance, potentially resulting in closures and financial losses due to input tax disallowances caused by bounced payments.

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The second order, SRO 709(I)/2025, requires system integration with the FBR’s digital platform. Mian Abuzar Shad stressed that this policy overlooks the fact that cement is classified as a third schedule product, already taxed at the maximum retail price during manufacturing. Distributors have minimal influence over downstream documentation and derive no financial benefits from this integration, while the compliance burden remains high.

The LCCI president cautioned that these blanket compliance requirements fail to consider the unique nature of the cement industry. Such measures could inadvertently push the formal distribution network into informality, triggering artificial shortages, disrupting construction activities, and negatively impacting national GDP growth.

Mian Abuzar Shad appealed for the immediate suspension of both SROs as they relate to cement distributors, wholesalers, and retailers. He recommended allowing cement manufacturers to sell exclusively to active, tax-registered buyers to maintain proper documentation without disturbing the market.

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The Lahore Chamber expressed full support for the All Pakistan Cement Distributors Association’s concerns and urged the Prime Minister’s personal involvement to direct the FBR to consult with stakeholders. Mian Abuzar Shad also proposed the creation of special provisions for essential commodity supply chains and called for urgent consultations between the Prime Minister’s Office, FBR, and industry representatives to formulate practical and workable solutions.

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