Top cement makers meet Gadkari, extend support towards fair pricing for cement
[In a meeting with Nitin Gadkari, cement manufacturers have assured their complete support in evolving a practical approach towards transparent pricing for NHAI.]
Indian cement manufacturers have assured the minister for road, transport and highways of their full support to the government in evolving a “pragmatic approach towards arriving at a transparent pricing for NHAI.
Gadkari had embarked on an ambitious journey of building roads at the rate of 41 km per day in 2016-17 and had concerns that with rising demand for cement in road construction and expansion, there was a perception that cement makers were increasing prices even though the input costs remained flat, making the price hike unjustified.
In addition to showing support to the ministry and National Highways Authority of India (NHAI) over cement pricing, the delegation that included the heads of leading cement companies like Ultratech Cement, Ambuja Cement, Shree Cement, Dalmia Cement and the Cement Manufacturers Association (CMA), gave clarifications to the minister and sought the government’s support for their problems.
The current cost of cement, contrary to public perception, was lower than its cost in 2015. Also, in the last five years, there has been a CAGR increase of only 1% as against an inflation of 6%-7% and with over 40 brands available in the marketplace for prices between Rs 240 and Rs 380 per bag, consumers are spoilt for choice in the market.
Apart from the supply-demand dynamics, what is irking the cement makers is the inequality in the duty structure particularly in relation to Pakistan, which allowed Pakistan to export cement surplus to India at nil customs duty while the Indian cement industry has to pay an export duty of almost 17% in its exports to Pakistan. The industry urged for reciprocity on this issue.
ET
Indian cement manufacturers have assured the minister for road, transport and highways of their full support to the government in evolving a “pragmatic approach towards arriving at a transparent pricing for NHAI.
Gadkari had embarked on an ambitious journey of building roads at the rate of 41 km per day in 2016-17 and had concerns that with rising demand for cement in road construction and expansion, there was a perception that cement makers were increasing prices even though the input costs remained flat, making the price hike unjustified.
In addition to showing support to the ministry and National Highways Authority of India (NHAI) over cement pricing, the delegation that included the heads of leading cement companies like Ultratech Cement, Ambuja Cement, Shree Cement, Dalmia Cement and the Cement Manufacturers Association (CMA), gave clarifications to the minister and sought the government’s support for their problems.
The current cost of cement, contrary to public perception, was lower than its cost in 2015. Also, in the last five years, there has been a CAGR increase of only 1% as against an inflation of 6%-7% and with over 40 brands available in the marketplace for prices between Rs 240 and Rs 380 per bag, consumers are spoilt for choice in the market.
Apart from the supply-demand dynamics, what is irking the cement makers is the inequality in the duty structure particularly in relation to Pakistan, which allowed Pakistan to export cement surplus to India at nil customs duty while the Indian cement industry has to pay an export duty of almost 17% in its exports to Pakistan. The industry urged for reciprocity on this issue.
ET
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