A Parliamentary panel reviewing the performance of the cement industry today suggested that the government set up a statutory regulatory body to check the possibility of cartelisation and price rise.
"The government should establish a statutory regulatory authority to regulate cement prices to curb the tendencies of market dominance, under-utilisation of capacity and to check the possibility of cartelisation," Shanta Kumar, the Chairman of the Parliamentary Standing Committee on Commerce, told reporters after unveiling the report.
The committee found that cement prices in India are rising and are higher than the rates in neighbouring countries. "One of the reasons for price rise of cement is the profit motive of the cement companies," he said.
Besides setting up a regulatory body, the committee also recommended that the government strengthen the Competition Commission of India (CCI) by enabling it to take suo motu action in all cases of unfair trade practices.
The Parliamentary panel further suggested that the government should order an independent study on the existence of cartelisation in the cement industry. The CCI may also be asked to look into the matter, he said.
"The government should take adequate penal measures so that no cartelisation takes place," he noted.
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Recommending that the government construct cement-concrete roads in border areas and highways, Kumar said, "Only 2% of the country's roads are made of cement-concrete as compared to 60-70% abroad. Cement-concrete roads help in saving fuel consumption vis-a-vis bituminous roads."
"The committee strongly recommended that the percentage of cement roads under the scheme Pradhan Mantri Gram Sadak Yojana should be increased," he said.
He also noted that cement-concrete roads do not require maintenance for 30-40 years and the additional cost of making such roads is not more than 10-15% vis-a-vis conventional bituminous roads.