An Article from B and C
FACEAT&P* President Er.S.Rajendran’s Message
Profession; Let us show solidarity
in protecting ourselves
President’s Message
Dear FACEAT&P members,
I am glad to be back interacting with you again through this
journal.
I am forced to talk here about cement and sand again.
I have already discussed in this column during July (2013)
on this subject. And the way the prices of cement behave
and the crisis in sand availability, I am constrained to
discuss them
strongly here again and in public forum.
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| President Er.S.Rajendran |
That is how I happened to give interview on these issues
recently to
a national daily. In the interview, myself and Mr. V
Rajagopal, State president of (Builders
Association of India) have expressed concern over the
increase in price of cement and have appealed to Chief
Minister Jayalalithaa to take steps to contain the price in
the interest of people.
We pointed out that a 50- kg cement bag, which was selling
at
Rs.250 to Rs. 275 two months ago, is now selling at Rs.335
to Rs. 360, an increase of
35%. It is quite appalling that when the government owned
factories can
produce and supply good quality cement at a relatively low
price of
Rs.275 per 50 kg bag, private producers could not.
And the limited production in the government units
restricts availability and supply to the market. Cement
being sold at exorbitant
price is inexplicable and deplorable given the fact that the
government is
supplying raw material for cement production at a cheaper
rate and uninterrupted
power supply is ensured.
Now let me present below how the cement price is fixed at
the market
from the production point. Tax is worked out on ex-factory
price and VAT on total value posttaxation.
Excise duty of 12 percent, higher education cess of two
percent,
secondary education cess of one percent, and VAT on the
total
value at 14.5 percent works out to a total tax to the tune
of Rs 70 to Rs. 80 that
has to be paid for a bag of cement to the state and central
governments.
Over the past three months, there has been no perceptible
increase in
the price of raw materials or / taxes while uninterrupted
power supply is
maintained. Yet there is fluctuation upward in the cement
prices thanks
to extraneous factors including influential forces from all
strata of administration.
That said, we demanded during the interview increase in
production of
cement by government factories, encouraging imports, direct
supply of
cement by the government to government contractors, and
fixation of
stable price through yearly negotiations with cement
producers.
Here I could not miss out the opportunity to point out the
difference
in the selling price of cement from place to place that
defies logic. Cement
produced by private companies in Ariyalur is sold for Rs.350
per 50 kg bag in Thanjavur and the same cement at Rs.310 in
Chennai.
Pennar Cement produced in Andhra Pradesh is selling at
Rs.310 in
Thanjavur, while the cement produced in Tamil Nadu is
selling at
Rs.350 in the same Thanjavur.
And the fluctuation is so erratic that cement prices have
gone up a
number of times within a span of nine months that resulted
in us losing
heavily monetarily as well as on repute. As we would have
signed an
agreement, the client would wash off his hands in such
circumstances.
It is heartening to note that the Tamil Nadu government is
initiating
setting up of solar units in the houses, for which subsidies
have also been announced, as a measure
towards saving environment. But, the government should take
note of
the importance of cement, the vital and inevitable element
of construction,
given that even solar unit installation may require cement
and the house required for solar unit is
made of mainly cement and mortar.
When I say mortar, sand immediately comes to our mind. Here
I would like to bring to all of your notice that sand
resources are being
exploited excessively and quarrying and stocking are being
carried
out with a long term perspective and profit motive.
At times, sand is being transported to 2-3 districts
adjacent
to the sourcing location. Alarming truth in sand quarrying
is depletion of resources of the state and on the river
beds. Excessive
quarrying leads to dipping hydrostatic pressure resulting in
sinking
water table and drying water resources. That would be
hazardous
to environment. Hence current situation warrants a
regulatory body for building materials, specifically cement
and sand to
monitor and keep the prices of these materials under
control. The body
should be represented by fora such as BAI, FACEAT&P,
etc.
The regulator may have authority in line with
that of Competition Commission of India which fined last
year 11 major
cement manufacturers for manipulating supplies and prices.
All said, I would like to state that this is a wakeup call
to the government
for it to act promptly in wriggling out the cement and sand
crises. And it must.
Concluding, time has come for us to show our solidarity and
stress the government to take steps to check
the abnormal rise in cement prices and sand movement.
Otherwise, our profession may be crushed.
I believe the Deepavali, the day of celebration of the
festival of light, would have shown you all the
brightest and most prosperous beginning from now on.
Have a nice time
Thank you
Er.S.Rajendran
Email: rajendraneng29@gmail.com
* Federation of All Civil Engineers
Association of Tamil Nadu & Puducherry
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