Big cement manufacturers behind rise in cement price: BAI

Mumbai, May 25 (UNI) Buiders Association of India (BAI) today accused select cement manufacturers for indulging in profiteering by raising cement prices and creating artificial shortage of cement in the country.

''The cement prices have shown tremendous rise since December last from Rs 125-145 per bag to Rs 220-240 per bag despite cost input and freight charges not rising so steeply,'' said Anand J Gupta, Chairman, BAI.

BAI also alleged connivance among the big cement manufacturers Holcim Group owners of ACC and Gujarat Ambuja Cements and Kumar Birla Group owners of Grasim Industries and Ultra Tech Cement accounting for 43 per cent of market share, in influencing price movement.

''Foreign companies who have bought cement companies at very high prices, are trying to recover their investments by hiking prices,'' alleged Mahesh Mudda, vice Chairman, BAI.

BAI was peeved at government endorsing Cement Manufacturers' Assocoation (CMA) proposal to reduce price by five per cent on government purchase.

BAI thought the move was futile because all works authorities such as NHAI, CPWD, PWD, Military Engineering Services (MES) and public sector undertakings had stopped purchases and cement procurement responsibility was passed on to contractors/agencies executing the project.

Moreover, BAI thought steep rise in cement price was slowing down execution of the ongoing projects.

BAI also accused cement manufacturers for under-utilisation of installed capacity as a cause for the rise in cement price, only 82 per cent capacity utilisation took place in 2005-06 in production of 179.25 million tonnes of cement.

BAI called for creation of 'Cement Regulatory Authority' on the lines of SEBI for stock markets and TRAI for telecom sector to control rising cement price.

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