On Friday, developers in Mumbai's real estate sector called for an inquiry into the escalating steel prices, warning that unchecked increases could jeopardize plans for the Commonwealth Games 2010 and adversely impact residential construction activities. A meeting took place where members of the Builders Association of India (BAI) voiced their concerns, seeking a probe from the directorate general of commercial intelligence to investigate the reasons behind the "unprecedented increase in steel prices from 2004 to March 2008, especially following the Union Budget 2008."
Mr. Mahesh Mudda, chairman of BAI in Mumbai, remarked, "The continuous rise in steel prices will serve as a barrier to our ambitious plans for the Commonwealth Games 2010. Additionally, it is noteworthy that the Central Public Works Department (CPWD), the primary authority handling construction work related to the games, has not received any bids for two tenders floated in the previous ten days."
During a recent BAI meeting in Delhi, representatives from various builders' associations, including the Confederation of Real Estate Developers Association of India (CREDAI), the Construction Federation of India (CFI), the Construction Industry Development Council, and the National Highway Builders Federation (NHBF), expressed a unanimous concern regarding steel firms' practices, claiming they are "arbitrarily jacking up the prices."
Most builders assert that this manipulation of steel pricing stems from a concentration of power, where just five steel plants control approximately 65 percent of the nation’s steel production. These plants collaborate within an entity known as the Indian Steel Alliance to manage pricing effectively. Furthermore, Mr. Mudda underscored that the construction sector utilizes only about 33 percent of the total steel produced domestically.