The Cement Manufacturers Association of South India (SICMA), a newly formed group, has dismissed cartel charges and instead urged the government to ensure that builders cut prices by at least 50% to make housing affordable and revitalize aggregate demand in the economy.

In a letter to the Prime Minister, copies of which have been released to the media here, SICMA said the main reason for the weak growth in the housing sector was the efforts of the builders’ lobby to maintain margins of “ over 100 % ” by keeping the prices of apartments / houses at artificially high levels. This led to an unsold inventory of 75 lakh apartments in nine major markets, he said.

“What is hurting our industry, and in turn India’s growth, is low housing growth,” SICMA president N. Srinivasan said at a press conference. “The only reason for the same is the artificially high prices of apartments / houses,” he added.

Considering that pricing apartments at reasonable levels would stimulate the economy and job creation and help the cement industry, which was struggling to use 60% of its capacity, SICMA asked the Center to ask builders to clearly state the costs. “Despite 28% GST and rising raw material prices, cement companies are selling a 50kg bag for ₹ 230 for infrastructure projects,” Srinivasan said.

Mr Srinivasan said cement prices vary by brand. In addition, cement only accounted for 1.5-2% of the construction cost.

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