With prices of cement skyrocketing over the past six months, the Confederation of Real Estate Developers Association of India (CREDAI-National) knocked on the doors of Competition Commission of India (CCI) highlighting the continued scarcity of cement and unprecedented prices.
CREDAI has 9,000 members across India, including 450 in Karnataka. Its members consume about 25 per cent of total cement production in the country. Bengaluru is biggest consumer in south India, industry source said.
R. Nagaraj, President, CREDAI-Karnataka, says, “The demand-supply ratio is totally mis-matched. We have learnt that cement units are working at 30 per cent capacity. Prices have been hiked over the last few months. So, CREDAI have approached CCI. What has irked us is the fact that manufacturers have allegedly signed an MOU with contractors of national highways for supply at Rs. 120 (ex-factory) per bag. Why are private builders treated differently?”
According to CREDAI, 200 allied sectors would experience a ripple effect if the real estate industry slows down.
Import of cementCREDAI-Karnataka and Builders Association of India, Bengaluru are toying with the idea of importing cement from West Asian countries. “The landed cost would be Rs. 250, but there are other hurdles,” Mr Nagaraj said.
Complaint against cement manufacturersBarely three years after the Competition Commission of India slapped a penalty of more than Rs. 600 crore on cement companies, builder’s association CREDIA-National has lodged another complaint.
According to the complaint, cement manufacturers have not released stock for construction purposes for the past six months. This has led to the retail price of Portland cement (50 kg.) going up from Rs. 250 to Rs. 375 in six months.
In 2012, CCI slapped a penalty of Rs. 6,307 crore on 11 cement companies for cartelisation. Following an appeal, the Competition Appellate Tribunal directed them to pay 10 per cent of the penalty.
