It is nine years since government took control of sand quarrying

Come October, it will be nine years since the State government took control of sand quarrying. An order issued by the State Industries Department in October 2003 stated that one of the objectives behind the decision was to ensure “availability of sand at affordable prices to the common public, thereby effecting reduction in the cost of construction.”

But, what remains a moot point even now is whether this objective has been accomplished. Apparently, end users have not received the benefit intended by the authorities. This is despite the government maintaining the cost of sand per lorry load (two units) at Rs. 600 for the last eight years. In fact, when the government took over sand quarrying, the original rate in October 2003 was Rs.1,000.

In the situation that prevails in the State, sand is available only through “second sales,” even though, on paper, one should be able to get it straight from the Public Works Department, the sole licensee for quarrying. The present rate of two units (or 200 cubic feet) of sand, sold through “second sales,” is Rs. 2,600 – Rs. 3,000. Besides, an end user in Chennai has to shell out around Rs. 9,000 more towards transportation cost, says Mu Mohan, chairman of the Tamil Nadu and Puducherry Chapter of the Builders’ Association of India (BAI).

Eventually, the cost comes to Rs. 12,000, which “we have no option but to pass on to our customers,” Mr. Mohan adds. In October 2003, a lorry load of sand cost Rs. 3,000 to Rs. 4,000.

The BAI functionary explains that a city-based real estate developer has to procure sand from Villupuram or Panruti, about 160 km from here. It takes three days for a vehicle to come back with sand, as there are long queue of lorries waiting for their turn.

According to figures available with the government on the costs per 200 cubic feet of sand in different parts of the State, prior to the Madras High Court’s last month order that led to the closure of 27 sand quarries on the Cauvery-Coleroon basin, the approximate prices were Rs. 6,000 in Chennai; Rs. 4,000 in Tiruchi and Rs. 8,000 in Madurai. After the order, they are in the range of Rs. 8,000 to Rs. 12,000 in these places.

Through an order issued by the Industries Department in February 2011, guidelines were framed for regulating storage and transportation of sand, facilitating “second sales.”

An elaborate procedure had been prescribed for the private parties to secure licence for storage and transportation.

An official says that the PWD has approached the State Environment Impact Assessment Authority (SEIAA) for setting up 44 new sand quarries and running 21 existing quarries. Once the nod comes, the prices will come down, the official expresses the hope.

Even though the prices of sand in the “open market” have risen sharply over the years, the government does not gain much, another official explains. Of the rate of Rs. 630 (including five per cent Value Added Tax) per lorry load, the department pays Rs. 137 to a contractor towards loading charges and Rs. 170 to local bodies towards seigniorage.

The department feels there is a case for upward revision of the official price of sand.

Mr. Mohan feels that instead of allowing the present arrangement of “second sales” through private licence holders, the government itself should set up stock yards in places closer to cities such as Chennai or Coimbatore. This would greatly help bringing down the cost as end users do not have to spend much on transportation, he says, appreciating the government’s move for promoting M-sand (or manufactured sand from crushed granite), as an alternative to river bed sand.

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