Real estate developers bat for checking rising prices of raw material

Visakhapatnam In a rare show of strength, realtors representing different associations like, CREDAI-AP, CREDAI-Visakhapatnam chapter, Builders Association of India (BAI), National Real Estate Development Council (NAREDCO), Architects Association (AA), Licensed Technical Persons (LTP) and SABCA (State of Andhra Pradesh Building Contractors Association) observed a daylong work holiday and strike to protest against the steep hike in prices of all materials used in construction industry on Saturday.

This work holiday was observed across Andhra Pradesh. The representatives jointly addressed a media conference here to voice their hardship asserting that it is not against any government or any industry but only to highlight their problems and seek redressal for all their problems from State and Central Governments and others concerned. They threatened that they will be forced to intensify their protest in future if there is no response from the authorities concerned.

CREDAI-Visakhapatnam president K.S.R.K Raju gave details of enhanced prices of all materials and asserted that this will damage not only the construction industry but also have a negative impact on the revenue of the governments and job opportunities of laborers because of stoppage work by builders. If one rupee is spent on construction activity, 43 paise of this will go to the State Government in the form of various taxes, he said.

CREDAI-AP president B. Raja Srinivas said that the construction sector is second in providing jobs and third in contributing to GDP. But its problems remain unsolved and manufacturers of various materials used for construction are permitted to have a field day and enhance prices, pointing out that the prices of steel has gone up from Rs.40,000 to Rs.90,000 a tonne and cement from Rs.250 to Rs.400 a bag, and there seems to be no end to this hike,

Raja Srinivas said It is nothing short of looting, he asserted. The Centre could help the industry by reducing the present rate of GST from 28 percent to either 5 or 12 percent slab and the State Government could ensure availability of cement to builders at a reduced/subsidized price. The State Government is getting cement at the rate of Rs.250 a bag from the manufacturers, he pointed out.

He said that because of lack of work, laborers could migrate to the rural areas and this reverse migration will have a negative impact. The GST rate the world-over is just 5 percent, he pointed out.

A. Ramesh Babu (NAREDCO) and C. Rama Kotaiah (BAI) said that manufacturers of cement and steel, two main components for construction, have been hiking prices at will and wanted the government to regulate them. The price hike is not the problem of builders alone, it is the problem of people, because finally the customer will have to bear the burden.

Because of the increase in the prices of materials, the cost of construction has gone from Rs.1000 to Rs.2500 per sqft. Builders use nearly 160 items for construction and a price hike in all items will push the industry to

doldrums, he said, adding that this will lead to reduced contribution to the GDP and revenue to the State. Governments will be responsible for the sorry state of affairs, Ramakotaiah asserted.

M.V.S. Surya Prakash (SABCA) and K. Ravi Kumar (LTP) wanted GST slabs to be reduced from the present 28 percent.