Price rise: building sector calls for govt. intervention

The sudden and steep rise in building material, including cement, sand, steel and bricks, has caused concern in construction sector in Madurai.

Civil engineers, building material dealers, work force and consumers are baffled by the steep rise.

The price of cement bags has risen to ₹520 from ₹330 per bag. Steel, which was earlier available at ₹55,000 per ton, now sells at ₹75,000 per ton. Likewise, the price of bricks and M-sand too has gone up by 40% and consumers claim that fly-ash bricks are unavailable.

Speaking to The Hindu, members of Builders' Association of India (Madurai Chapter) and those affiliated with CREDAI, Tamil Nadu Chamber of Commerce and Industry and other organisations have appealed to the State government to form a high-level monitoring panel immediately to regulate prices.

When there are regulators fixing prices for agricultural produce, drugs and others, building materials too should be brought under the fold. The price of cement has witnessed a steep rise only in Tamil Nadu, while it is selling at ₹330 per bag in Andhra Pradesh and Karnataka.

At a time, when the COVID-19 pandemic has led to total lockdown, where is the need for cement manufacturers to inflate the price so much and that too in Tamil Nadu only, ask the stakeholders. The government should intervene as many consumers have been affected due to rise in prices.

Tamil Nadu Chamber of Commerce and Industry president N. Jegatheesan said on Sunday that the building industry had been given permission to begin activities by the State government from Monday (June 21). Under such circumstances, the steep rise had come as a dampener.

The cement manufacturers' association in TN should consider the pandemic situation and give sufficient time to stakeholders before the price hike as it may help builders and the consumers to plan accordingly, said K.R. Gnanasambandan, former TANSTIA president.

By forming a high-level panel involving all stakeholders, the price mechanism can be regulated, an office-bearer in the CREDAI said and added that the inflation in cement price was felt only in TN. "The cartel in the cement sector is responsible," he charged and the government should not remain a mere spectator in this issue.

A civil engineer-cum-building contractor V. Vijayaragukula Pandian in Madurai said that the steep hike in cement had stalled the work abruptly in many sites. " My clients, who have taken home loans from banks and NBFCs, have already raised eyebrows over the rise in price," he noted. People building homes on 1,200 square feet may have to either arrange for additional loans or reduce the carpet area, he suggested and for the time being, they have stalled the works.

Echoing his views, an ex-banker A Subramanian, who is a consultant on home loans in Madurai said that the home loan agreements, which were signed a month ago, cannot be altered that easily as the banks had sanctioned the quantum of loan component and disbursals were in process. Hence, the clients have to either wait for the government's intervention or arrange for private loans to bridge the gap.

A cement dealer, who is importing portland cement from countries like Pakistan and Indonesia through sea, said that the imported cement cost around ₹200 to ₹215 per bag. Claiming that the pandemic had stalled the imports temporarily, he however, said that the public can procure cement from States like Andhra Pradesh or get from government owned cement companies, where the price hovered around ₹300 per bag.

A top official in the government, seeking anonymity, said the Chief Minister was aware of the rise in prices and very soon a solution may be there as not only domestic construction had been hit, but many government welfare schemes such as Green Houses for the economically weaker sections too had been affected.

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Printable version | Jul 24, 2021 5:04:03 AM |

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