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Cement price hike stumps builders, real estate sector
The Times of India  |  February 6, 2019

Siva G Visakhapatnam

The sudden hike in prices of cement in the two Telugu states in the last five days has led to an uproar in the construction and real estate industries. Representatives from the construction industry are urging the governments to crack down on what they are calling the ‘cement manufacturers’ syndicate’.


Five days ago, a 50-kg bag of cement was priced at Rs 225. The same bag now costs around Rs 310, and at some places it is being sold at Rs 325, revealed chairman of National Real Estate Development Council (NAREDCO), Visakhapatnam, T Sivaji.


“We have been witnessing the same trend every year between January to March end. “This is because the cement companies are forming a syndicate” he alleged. “If we increase the price of flats, we will not get customers and the industry is slowing down anyway, he said.


Currently, around 30,000 constructions of various apartments, commercial structures, various houses and others are underway in Andhra Pradesh and Telangana, according to industry sources. “The governments have taken up various housing projects, some include thousands of units, said a builder, M Rajesh. According to industry sources, consumption of cement in AP and Telangana is more than two crore tonnes annually. The percentage may be higher as construction activities received an impetus after the Telangana Rashtra Samithi retained its power in the state elections in 2018. In Visakhapatnam city alone, more than 400 apartments are under construction.


The construction industry in north Andhra districts has more than 3,500 builders, including 2,000 in Visakhapatnam city alone. Of which around 500 builders are involved in ongoing projects. Owing to the sudden rise in the prices of cement, many builders have suspended operations.


“This has become a kind of routine for the cement manufacturers. The prices of no other raw material has changed. Every four to five months they create a temporary shortage and hike the prices for no reason. We have submitted representations to the government, but so far there has been no response, alleged one of the representative of the Confederation of Real Estate Developers Association of India (Credai) Visakhapatnam, MVV Satyanarayana.