Naredco urges govt to check rising prices of raw materials

Business gamers stated costs of key uncooked supplies like metal, cement and bitumen have risen considerably within the final one 12 months, which poses challenges for a number of sectors, particularly infrastructure and actual property. These two are nonetheless reeling from the influence of the pandemic and the following lockdowns.

Actual property builders’ affiliation Naredco on Friday urged housing and concrete affairs secretary DS Mishra to test the rising costs of key uncooked supplies, particularly metal and cement, which, coupled with provide constraints, are impacting development timelines.

Business gamers stated costs of key uncooked supplies like metal, cement and bitumen have risen considerably within the final one 12 months, which poses challenges for a number of sectors, particularly infrastructure and actual property. These two are nonetheless reeling from the influence of the pandemic and the following lockdowns.

“Building prices have gone up over the previous 12 months with uncooked supplies, significantly metal, cement, aluminium and copper, exhibiting a pointy improve … Actual property builders are unable to move on the hike in prices to residence consumers and the pressure on undertaking viability is all too obvious,” Naredco nationwide president Niranjan Hiranandani stated.

Naredco stated the business seems to be ahead to applicable steps by authorities in opposition to what appears to be cartelisation.

Business insiders stated costs of assorted grades of metal have elevated within the vary of 60-100% between July 2020 and Might 2021. Following the hike in Might 2021, the value of scorching rolled coil rose to Rs 72,000 per tonne, the very best since 2008. In July 2020, scorching rolled coil was priced at Rs 36,500 a tonne.

Equally, cement costs elevated 50-70% from 2020 to 2021. The typical retail value of cement is Rs 420 a bag at current, whereas in FY20 it was Rs 280. It’s more likely to improve additional within the coming months, many concern.

Naredco instructed that metal exports be banned for 2 years until the difficulty of excessive costs and availability in home markets is resolved. It additionally really useful that costs of metal and cement be regulated until provide is restored.

“Import responsibility of metal needs to be decreased from 7.5% to zero for a interval of two years and use of imported cement needs to be allowed,” it stated.

Mishra assured the builders’ physique that the ministry will look into these points and focus on them with the ministries involved.