Union minister for road transport and highways and micro, small and medium enterprises (MSME) Nitin Gadkari has warned the steel and cement industry against rigging up product prices taking advantage of the current situation. He said there is a cartel in both the steel and cement industries that drive up costs in the real estate sector.
Gadkari said the government has lined up infrastructure projects worth Rs111 lakh crore in the next 5 years but there are bottlenecks owing to rising rates of steel and cement, which he blamed on cartelisation.
“There is a cartel in cement and steel industry. Every steel company has its own iron ore mines and there has been no increase in labour and power costs but they are increasing rates. It is difficult for me to understand (the reason behind it,” said Gadkari during an industry event on Saturday.
“Cement factories are exploiting the situation. It's not in national interests. We're planning to implement infrastructure projects worth Rs 111 lakh crores in next 5 years. If rates of steel and cement continue like this, it'll be very difficult for us,” he added.
He said while the government faces maximum bottlenecks in the real estate industry and it is trying to find solutions, ike steel and cement cartels are trying to add to the bottlenecks. It will be difficult to achieve Prime Minister Narendra Modi's dream of making India a $5 trillion economy if the steel and cement prices keep going up, Gadkari added.
He also said that the Builders’ Association of India has suggested setting up of a regulatory body for the steel and cement industry to address this. He said, he will take suggestions from Prime Minister Narendra Modi and finance minister Nirmala Sitharaman over the matter.
Allegations of cartelisation have been made in the past as well, by both ordinary people and builders as well as these are the main inputs in construction.