Cement makers hike the prices: Real estate developers to move to CCI
The cement producers are forming a syndicate or cartel and keeping the prices high and the Real estate developers are planning to go to the Competition Commission of India (CCI) to complain against this. CCI had imposed a Rs 6,300 crore fine on 11 cement companies in June 2012 for forming a cartel to keep the prices high and it seems they have taken the same route again.
C Sekhar Reddy the president of real estate body CREDAI (The confederation of Real Estate Developers’ Association of India) mentioned on Wednesday that the builders have also joined hands to put pressure on the cement manufacturers to immediately roll back the price increases which has added more pressure on them.
Reddy also mentioned that the cement manufacturers are following a malpractice and are restricting supply and creating an artificial scarcity. This has resulted in the prices per bag going up by 50% and there is a poor output from the cement manufacturing companies.
The real estate developers have taken a step which might teach a lesson to the cement manufacturers. The joint action committee of builders, comprising around 2,000 large developers and over 1,000 small to medium contractors, will stop buying cement from July 5 for a week to put pressure on the cement makers to roll back prices. Reddy also mentioned that the committee may consider extending the purchase holiday indefinitely if the cement makers don’t bring down the prices.
However, the cement manufacturers denied the charges of cartelisation and mentioned that more than half of the Indian cement industry is in losses and they had to cut down on production to minimise expenses. The increase in price is necessary for the survival of the cement industry.
Source- The Economic Times
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