Cement producers turn down FM''s request for price cut

23 Mar 2007

New Delhi: Finance minister P Chidambaram's request to cement manufacturers to come out with proposals to cut prices has been firmly rejected by the companies.

Chidambaram had asked the companies to cooperate with the government to fight inflation, which touched 6.46 pc for the week ended 3 March, with cement prices increasing at the rate of 4.4 per cent.

Official sources said the cement makers have told the Government nothing can be done on reducing prices. The companies also told the Government that they have started doing well only since the later part of 2005 whereas in the previous 15 years they were struggling.
The Finance Minister had called cement manufacturers for the second time after the Budget, which imposed dual excise duty structure on cement to rein in prices.

The budget hiked excise duty to Rs600 a tonne from Rs400 if cement is sold higher than Rs190 per bag of 50 kg and reduced it to Rs350 per tonne if sold up to Rs190. The move, however, failed as cement makers hiked prices by up to Rs12 per 50 kg bag.

Chidambaram said both the government and the industry know how much prices have increased since December 2005.