December 03, 2008

BAI urges government to control steel prices

Builders Association of India said that the government should immediately intervene to rein in rising prices of steel, which accounts for 35% of their raw material costs.

Mr Anand Gupta general secretary of Builders Association of India said that "The price of construction grade steel has gone up by 70% in the January to March 2008 period to around INR 50,000 per tonne from INR 31,000 in December 2007. If the government does not intervene immediately, all infrastructure projects will come to a grinding halt."

Mr Gupta said that since steel accounts for 35% of the raw material costs, the commodity itself has caused an additional 20% cost push on the building and construction community, which has the horrendous task of building India's infrastructure and real estate. He added that the government should do away with the taxes and duties levied on the steel industry and allow people to import the commodity as freely as possible.

He is critical with the steel makers as well and said that an inquiry should be made on the rising steel prices. He said "I just can not understand the reasons behind such a stiff rise of steel price in a short span of 3 months when the government has not done anything to tamper the existing rates and duties or for that matter, with any policy."