Most Dungsam cement dealers across the country feel that they should be allowed to supply cement outside their designated areas. The contract agreement between the dealers and Dungsam Cement Corporation says, they are only to deal with customers within the purview.
The issue was once again highlighted, when officials from Dungsam Cement Corporation met with their cement dealers of the western region in Phuentshogling yesterday.
The dealers argue that if they are allowed to supply cement outside their areas, it would work as a marketing strategy.
“Even if I capture that market, as per the agreement, I will not be able to supply, because my dealership is for Thimphu only,” said one of the dealers, Tshering Phuntsho. He says they have to market the product ourselves within Bhutan. “On the other hand we are not allowed to supply, when we actually find a market for it.”
Another dealer, Karma T Jamtsho say most importantly, they will have to meet the demand of the particular area they have applied for. “But after meeting the demand, the surplus, like the practice with Penden cement, if we could supply to places where needed, be it one or two bags or in bulk, then it would benefit us.”
The Chief Executive Officer of Dungsam Cement Corporation, Dorji Norbu, said it is not possible to reconsider the clause because it would be a breach of the agreement between them and the dealers. Moreover, he said, it would not be fair for those who were not selected as dealers for not adhering to the clause.
Dorji Norbu said if they allow a dealer of a particular area to market outside their purview, it would mean encroaching upon another dealer’s area.
On the marketing front, he said, 20 percent of the total cement produced will be supplied to Bhutan while the rest to India.
However, since the Corporation has not received the distribution license from Bureau of Indian Standards and Bhutan Standard Bureau, the supply to India, Indian government funded projects in Bhutan and Bhutanese government funded project have not yet started. Dorji Norbu said as the agreement between the Bhutanese and Indian governments, the cement must have Bureau of India Standards licenses. The agreement is for indefinite period. “So only if we have BIS license then we can sell it to Punatsangchhu, Mangdechhu and other GoI funded projects.”
They expect to get the ad-hoc or temporary license by the second week of next month and the permanent license by March next year.
In the meantime, the corporation has been supplying cement to Bhutanese individuals for private constructions and projects since November 19.
They aim to establish 119 cement dealers across the country. Till date, 32 of them have fulfilled the criteria and signed the contract.
Dungsam Cement Corporation has the capacity to produce more than 4,000 metric tons of three types cement every day.
