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Constructions ground to a halt in Vizag
Construction has almost come to a grinding halt beginning with demonetisation, followed by GST and now the hike in the prices of cement. Over 4,000 building applications for small and bigger projects are pending with Greater Visakhapatnam Municipal Corporation and of them 1500 alone belong to Madhurawada area where even multinational companies have launched their projects
Visakhapatnam: Construction has almost come to a grinding halt beginning with demonetisation, followed by GST and now the hike in the prices of cement. Over 4,000 building applications for small and bigger projects are pending with Greater Visakhapatnam Municipal Corporation and of them 1500 alone belong to Madhurawada area where even multinational companies have launched their projects.
Highlights:
- Spiked notes, GST, RERA, cement prices hold back builders
- Price of a cement bag suddenly shoots up from Rs 233 to Rs 375 per bag
- Builders point out that there has been no hike in cement prices in Telangana State
- Wonder why the AP govt failed to rein in on cement companies and check the cement price
“About 50 per cent of the developers stopped their work soon after the government announced demonetisation on November 8 last year, another 10 per cent for GST and 20 per cent fearing implications of Real Estate Regulation Act. Now the hike in cement prices by Rs 100 to Rs 140 will completely stall the ongoing works,’’ said Madhurawada Builders Association president D Ravi Kumar.
Talking to The Hans India here on Wednesday, Ravi Kumar said the hike in cement prices was like rubbing salt to the wound and blamed the AP government for not reining in the cement companies who have formed into a cartel.
The Chief Minister should take cue from his counterpart in Telangana whose government threatened to withdraw subsidies if the price was not brought down.
“The price of one cement bag in Andhra Pradesh on March 25 was Rs 233 and shot up to Rs 375 on April 8 for no reason. In Telengana the price is still Rs 240,’’ Ravi Kumar said and thanked BJP floor leader in Assembly P Vishnu Kumar Raju who gave a representation to the Chief Minister.Another builder of the city KVN Murthy said a project having 20 flats would need 5,000 bags to complete the project and hike of Rs 100 on each bag would push up the cost by 25,000 for each buyer for each flat.
Market watchers said it was not cement and THE REAL ESTATE (REGULATION AND DEVELOPMENT) ACT, 2016 RERA that the Indian real estate sector has been watching closely. The Goods and Services Tax (GST) and the Benami Property Act will also have a major impact on the builders, they said.
Small time builders said they would be the worst sufferers with the new Act, GST and cement prices. The multinational companies who charge higher prices for their property can cushion these new developments, they added.It’s a big scam, MLA Raju demands probe: BJP floor leader in the Assembly P Vishnu Kumar Raju demanded an inquiry into the hike of the cement prices, which shot up overnight.
Talking to The Hans India, Raju said the price of one cement bag on March 31 was Rs 240 and suddenly rose to Rs 340 per bag the next morning on April 1 reducing the public and the state government to fools.“It is a big scam of recent times. The city needs 50 lakh bags per month and the burden is Rs 50 crore. In all it is Rs 350 crore burden on the people of entire Andhra Pradesh,’’ Vishnu Kumar Raju said.
He said around 26 companies manufacture cement in the State and none of them could explain the reason for hiking the prices overnight though there was no change in the power tariff or tax structure or cost of raw material.
By KMP Patnaik
