KARACHI, Feb 12: Builders and contractors have decided to suspend cement purchase from February 15-22 on countrywide basis to protest against increasing its price to Rs260 per 50-kg bag from Rs210-225 by the manufacturers.
This was announced by Chairman Association of Builders and Developers (ABAD) Hafizur Rahman Butt and chairman All Pakistan Contractors Association (APCA) Ahmed Ghazal Usmani at a joint press conference here on Monday.
Meanwhile, Hafiz Butt told Dawn that the cartel of cement producers had initially spread rumours in small cities about phenomenal jump in prices in future and they managed to jack up the prices to Rs300 in many cities except Karachi.
After that they finally succeeded in building a pressure on the government which fixed the rate at Rs260 despite the fact that cement was selling at low rates between Rs210-225 in major cities, he pointed out.
He said that the cartel was now mulling to increase the rate to Rs300 per 50 kg bag.
He said it was not clear whether construction activities would remain suspended from February 15-22 as builders were still holding sizable stocks of the commodity which they had bought earlier.
He said the one-week suspension of buying would definitely hit the sales of cement makers as contractors and builders were buying over 70 per cent of total cement production.
APCA chairman Ahmed Ghazal, however, ruled out any possibility of halting construction activities as the work would be carried out from old stocks during the week. “But the activities will not continue in case the price issue is not resolved”.
He said the cost of government-funded projects would definitely go up if the cement prices were not brought down to previous levels. Big projects have escalation clauses under which contractors can claim the rising cost of construction from the government.
He stressed the need for
setting up of a committee of common interest under the chairmanship of the vice-chairman Planning Commission which can fix the prices after meeting with stakeholders of the cement sector.
Both the APCA and ABAD officials challenged the cement makers to present written evidences of sales of cement at Rs300 till February 10.
They said cement prices had never touched the Rs300-mark in any part of the country. The cement price had ranged between Rs210-220 till February 10.
They said that there was a need to make Monopoly Control Authority (MCA) a more efficient organisation which could check cartels and monopolies in the country.
They urged Prime Minister Shaukat Aziz to check the cement cartel activities and issue orders for reversing cement rates to Rs210-220 or allow the duty-free import of cement.
Meanwhile, All Pakistan Cement Manufacturers Association (APCMA) Chairman Aizaz Shaikh ruled out any major impact on the financial health of the manufacturers in case builders and contractors suspend purchase for one week.
“There is no need for the builders and contractors to suspend lifting cement as manufacturers are not responsible for pushing up the rates up to Rs300 per 50 kg,” he told Dawn from Lahore.
“Stockists and retailers have actually pushed up the rates up to Rs300 that is why the government has intervened to check further rise in its prices,” he added.
It has been decided that the cement price will not exceed Rs260 in any part of the country. Besides the landed cost at retail stage is less than Rs260 per bag. “It is a very good price,” he said while claiming that cement prices in Pakistan has been cheapest as compared to other countries.
