April 17, 2007	Tuesday	Rabi-ul-Awwal 28, 1428

KARACHI, April 16: The Monopoly Control Authority (MCA) has sought views and comments of the builders and developers on the reasons which they believe could be behind frequent price hikes in cement in the last few months.

The recent re-birth of MCA appears to have taken contentious issues for consideration, which include rise in cement prices and formation of cartels.

“We have received a letter from the MCA containing 10-12 questions. This is the first time that builders have received such a letter from the government,” chairman Association of Builders and Developers (Abad) Hafiz ur Rahman Butt told Dawn on Monday.

Some of the questions sought by the authority include whether cement makers operate under a cartel to raise the prices or there is a problem due to higher raw material cost.

The MCA wants to know if cement makers are deliberately creating artificial shortage in the market by controlling production. The authority has also asked about the role of dealers that could control the market, he said.

The MCA, he said, has also asked the associations to provide some other information, if they have, which could lead to the price surge in cement. “We are preparing the reply and will dispatch it in two to three days,” Abad chief said.

He said that the committee led by Federal Industries Minister Jehangir Tareen is reported to have handed over the responsibility to the MCA to take stock of reasons that led to increase in cement prices. Besides, the MCA is trying to involve the market stakeholders who feel the pinch of price hike.

Before MCA chief fastens his seatbelt in taking action against the powerful cement cartel, manufacturers have already increased the prices by Rs10-15 per 50 kg bag. According to Abad chief cement price was hovering between Rs230-235 in the market.

Without giving actual rate of increase, Butt said that it was agreed in the meeting with Jehangir Tareen that local cement would first be consumed in the country and only surplus production will be shipped to foreign destinations. But the cement makers had made handsome export shipments while keeping aside the demand of local markets.

He said he had written letters to the prime minister and Industry minister to take notice of increase in cement prices otherwise manufacturers are set to push up the rates to Rs300 per 50 kg bag. Meanwhile, convener Karachi Cement Dealers Association (KCDA) Shaukat Hussain also confirmed the increase in prices but he believed that price hike was Rs5 per 50 kg bag and not Rs10-15 per bag.

He said the wholesale rate of Falcon Cement has been enhanced to Rs245 from Rs 240 while Dadabhoy cement is tagged at Rs220 as compared to Rs 215. Dealers charge Rs5 to Rs10 per 50 kg bag depending on the orders from the customers.

Executive Director Lucky Cement, A.R. Thaplawala rejected the claim of builders and dealers and said that cement makers have not increased the prices. It is dealers who are fleecing consumers after seeing demand spurt in the market.

He said that the MCA had not contacted the cement makers on price issue. “We are already providing price list to the government and MCA every month informing them about daily price fluctuation,” he added.