Venkaiah Naidu: Slow growth in cement industry short-term

New Delhi, Feb 22: The slowing cement industry will improve in the coming years with the government's aggressive infrastructure development programmes, Urban Development Minister Venkaiah Naidu said today.

"The slow growth in cement sector is only a short-term phenomenon with the government's focus on constructing 50 million houses under Housing For All scheme by 2022. "Then there is 100 smart cities, AMRUT cities as well as infrastructure development of ports, roads, bridges, freight corridor, etc and also other initiatives.

The performance of the cement industry is bound to improve in the years to come," Naidu said here addressing the annual session of the Cement Manufacturers Association (CMA). The minister said India is lagging behind in per capita cement consumption at 202 kg against the world average of 543 kg even as it accounts for seven per cent of the global production, but there is ample scope for growth.

Indian cement industry has been doubling its capacity every 10 years and is second largest in the world and the government is willing to solve all its problems, he said. "But, I also want to tell you that there is sometimes sudden fall in the prices and sometimes steep rise in them with no clear reason. I think the industry needs to check such sudden movement in prices," Naidu said.

The CMA today also elected JK Lakshmi Cement's Whole-time Director Shailendra Chouksey as its president. Chouksey said his focus will be to bring about effective collaboration between the industry and various stakeholders, primarily the government, to improve health of the sector that has been reeling under sluggish demand growth and remunerative cement prices for last 2-3 years.

He exuded confidence that despite recessionary global economic trends, the cement industry can be brought out of the lull if immediate steps are taken working closely with the government. On the fluctuating prices of cement, he said they would "not only affect health of the industry but can have a cascading impact on the future availability of cement."

Investment into cement sector in the present scenario does not look attractive for building capacities for future requirement and the number of companies that are currently on the block for sell-off is a testimony to this harsh reality, Chouksey rued.

The CMA has urged the government to relook at the taxes, duties and levies on cement and said that the critical inputs such as coal, power, gypsum, fly ash need economic availability. Besides, rail freights need rationalisation and industry needs better availability of rakes and wagons.

PTI