The real estate industry on Saturday hit out at steel and cements companies for cartelisation, saying it has increased the cost of construction and affected the affordability to consumers.
“There is a cartelisation in cement and steel industries,” National Real Estate Development Council (NAREDCO) Senior Vice President Pradeep Jain said, when asked whether the industry body subscribe to the government’s views.
“Steel manufacturers have short supplied by making a cartel,” Jain, who is also the Chairman of real estate firm Parsvnath Developers, alleged.
The statement comes close on the heels of Finance Minister P Chidambaram’s remark in Parliament that steel and cement companies were behaving like a cartel.
NAREDCO is a real estate development and promotion council under the aegis of Ministry of Housing and Urban Poverty Alleviation.
NAREDCO President Rohtas Goel said the sharp rise in the prices of steel and cement have increased the construction cost by Rs 230 per sq ft.
Goel, who heads the real estate firm Omaxe, regretted that iron ore – the key input for steel manufacturing – is still being imported.
“Increase in the cost of land, steel and cement has made the housing unaffordable for middle and lower middle class,” he added.
The developers have started negotiating for import of steel and cement, Jain said.
Asked whether the industry was witnessing any slowdown due to high interest and inflation, he said: “There is no slowdown. I do not think there is any softening of prices.” Softening of prices is next to impossible as input cost, interest rate and land prices have increased substantially, Jain added.