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Online at: http://politicalaffairs.net/article/view/7051/1/340/
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Archives - Dates and Topics
2008 – online
May – June 2008
Jun. 16 – Jun. 22
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6-20-08, 10:47 am
The Central Secretariat of the Communist Party of India which met on 6/12/2008 decided to intensify the campaign against price rise of Cement and Steel. It has called upon all Party units and mass organizations to organize protest all over the country.
On Rising Price of Cement
Indian Cement Industry is controlled by private sector.
The rise in the price of cement was from Rs. 135 a bag of 50 Kg in December 2005 to around Rs. 245 per bag as on today and is expected to rise more.
Even though as a result of talks with Minister Kamal Nath the manufacturers have agreed to reduce prices for government purchases by 5%, it should be seen that government is a very minor purchaser of cement.
Seeing the very tight demand supply situation due to heavy demand in housing and infrastructure sectors, the cement manufacturers have earned huge profits by steeply hiking cement prices by over 50%.
Further the greedy cement manufacturers are eyeing more concessions by asking for reduction in excise duty or sales tax and reduction in limestone royalties.
The cement price rise hits the common people severely since the cost is transferred to them in the housing sector and infrastructure sector.
Ultimately these are the results of liberalization and privatization the government started. Ever since the UPA government took over cement prices are on the rise.
Most important factor is that the inputs in cement manufacturing increased by only 10-15% while the cement prices increased by more than 50% in the last 2 years.
The common people are struck by the price rise of all essential commodities, rising inflation and now even the most important inputs for housing and infrastructure such as steel and cement.
It is time that UPA government reverses the trends of liberalization, privatization and globalization which have not helped the common people and only increased their miseries. It is time that the government initiates steps to nationalize all the cement factories and control the cement.
On Rising Prices of Steel
The government has failed completely to check the rising steel prices. The inflationary impact, both direct and indirect, of this phenomenon can be seen in the prices of consumer products.
Despite having a full-fledged Ministry for Steel, Government does not even have a policy for control of steel prices nor does it have a price stabilization mechanism in place. Worst is that it does not even have control on its own undertakings to ensure effective doses of corrective measures.
The government is hiding behind the argument that steel sector in the country is deregulated and therefore the prices are determined by the steel producers depending upon the market conditions and therefore Government does not decide the selling price of steel. It claims that the steel producers, sharing the concern of the government towards rising inflationary tend in the country, voluntarily reduced the price products used by the common man for housing by amount ranging Rs. 4000-5000 per ton. The trickle down of this to the common man is yet to be felt in the market.
Whatever government has done by way of increasing the export duty on the long steel products from 10% to 15% and ad valorem duty on iron ore export is too little.
The measures taken up by the government over the last few months are nothing but short-term fire-fighting stunts. There is no clear strategy in the minds of policy makers who have wasted 4 years of precious time in office.
From the Communist Party of India
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