As cement prices are witnessing northward movement, the State government has advised the Civil Supplies Corporation to intensify retail sale of cement.
At present, the Corporation is selling at Rs. 200 a bag to retail customers. On an average, in the last few years, around 4.5 lakh tonnes were sold annually. However, this move has not brought about any tangible effect on the price level of cement in the open market, says a senior member of the Builders’ Association of India.
It is against this backdrop that the government’s renewed focus on retail sale of cement at concessional rates assumes relevance.
This comes in the wake of the recent spurt in the prices that has caused concern among stakeholders, particularly those in construction industry.
S. Ayyanathan, chairman of the southern centre of the BAI, says that the price of cement, which was around Rs. 250 a bag a couple of weeks ago, has shot up to Rs. 300 a bag. “There is no ostensible reason for such a rise,” he argues.
Such a rise is worrisome in times of economic downturn as cement is an essential input for infrastructure industry, says J. Sethuramalingam, managing trustee of the BAI.
As a solution to the tendency of rising prices, the BAI wants the Union government to create a regulatory mechanism. “When there are regulators for power, telecommunication and stock markets, why can’t there be a regulator for cement, which is a core sector?” asks Mr Ayyanathan.
Mr. Sethuramalingam believes that if there is a regulator, the cement manufacturers will not be able to increase prices at their will.