rapidly progressing infrastructure sector in India can help us achieve what we have done in the last 60 years in a span of just six years now. We urge the Government to focus aggressively on infrastructure development by way of increasing the investments in, and incentivising, the industry. This will accelerate the growth in cement industry and will go a long way towards overall economic development.
The industry also wants the value added tax (VAT) rate on cement brought from 12.5 per cent to 4 per cent in line with other important construction materials such as steel. Further, the industry expects cement to be included in the “Declared Goods” such as steel.
We seek the support of the Central and State governments to promote concrete roads instead of bituminised roads. The maintenance cost of concrete roads is quite low compared to the bituminised roads. Moreover, the erosion is low and they have a longer life. Also the wear and tear of motor vehicles is low when they ply on concrete roads. The move will also bring in fuel cost savings.
There is no impact on inflation (weightage of cement in WPI is 1.7 per cent only). Lifting of export ban will encourage investment in new capacities. Indian cement industry will otherwise lose out the opportunity in West Asia to other countries such as Pakistan.
Coal linkages and allocation of coal blocks: Supply of coal at linkage price to cement industry was cut to 75 per cent recently. Coal India modified the commitment in the fuel supply agreement (FSA) to 45 per cent at linkage rates, which will further increase the energy costs. Many cement plants are completely dependent on imported coal. The Government should immediately restore 100 per cent coal linkages and allocate coal plants to cement industry (both existing and new) on priority basis
Puneet Dalmia,
Managing Director, Dalmia Cement (Bharat) Ltd
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