This is among the first signs of stress in various sectors in the backdrop of lower economic activity amid the Covid-19 outbreak and lockdown. According to developers, prices have increased by Rs 100-120 per 50-kg bag of cement and by Rs 2,000-2,500 a tonne of steel over the past six weeks across states.
The Confederation of Real Estate Developers’ Association of India (Credai) has written to minister for housing & urban affairs Hardeep Singh Puri, seeking urgent measures to control the hike in the prices of cement and steel amid the ongoing pandemic crisis.
“This abrupt increase in the prices is highly unethical and amounts to unfair and restrictive trade practices,” the developers’ body wrote in the letter, a copy of which ET has seen. Controlling the price rise is essential for construction to resume in full swing and to get the country’s economy back on its growth path, it added.
Credai that counts 20,000 realty developers as it’s members across the country has marked copies of the letter, sent on Friday, to commerce and industry minister Piyush Goyal and heavy industries & public enterprises minister Prakash Javadekar, among others.
The housing minister, while interacting with developers on a videoconference on April 17, had expressed surprise over possible price hikes by cement makers in the current scenario when construction activities had come to a standstill.
Responding to developers’ complaint of price rise, Puri had then said such an action would clearly be “an unfair business practice and rates should rather go down as overall economic activity is down”. He had also assured developers that he would take up the issue of raw material pricing with the commerce ministry and antitrust watchdog Competition Commission of India.
Cement prices, usually, move up during the summer season owing to higher construction activity. However, work during this season has come to a standstill due to the Covid-19 crisis and as many labourers have returned to their villages.
