To control the cost of construction and make home prices work for the common man, the Confederation of Real Estate Developer’s Associations of India (Credai) has moved the Competition Commission of India (CCI) against cement manufacturers “who have been unduly increasing the cost of cement.”
According to a press release, Credai has also highlighted the violation by cement manufacturers of the commission’s “cease and desist” order of 2012. The order had held that the cement manufacturers had formed a price cartel and were fined nearly Rs 6000 crore by the regulator.
In its submission to the commission, Credai has pointed out that the cost of raw material used in manufacturing cement has come down from January 2015 to September 2015 but cement companies never passed on this benefit to their customers. Instead, they seemed to be working together in controlling supply and prices, it said.
Credaihas said that the real estate sector is under pressure currently with a consequent decrease in cement demand. It is also estimated that housing and other real estate sectors account for nearly half of the cement demand in the country.
The confederation complained that there seems to be no ground for supply restriction and the recent price increase in cement given the low demand.
Despite the low demand, the prices of cement have jumped by 20-40 per cent in top cities pan-India in the last couple of months. “It is notable that the cost of raw material for cement production has come down significantly during January, 2015 to September, 2015. It is unfair that the cement manufacturers indulge in practices that control the prices of cement. CCI has warned CMA in the past as well but it is unfortunate that they seem to be continuing with their price and market manipulation” said GetamberAnand, President, Credai National.