Supply shortage will hamper infrastructure development, said Dr PR Swarup, Director General, CIDC
The cement production growth data in June 2010 has shown poor performance with the growth being 3.6%, the lowest in the past 22 months. Steel production data has been erratic for this year. It was 15.3% in January, 0.9% in February, 9.2% in March and 3.2% in June, said a statement released by the Construction Industry Development Council (CIDC). India has also fallen to the 5th position from 3rd in global steel production. This type of situation isn't very good news for the construction industry.
"Construction industry is the main consumer of cement and steel. Shortage in availability of cement and steel will result in slowdown of construction activity which will in turn hamper the efforts to build the physical infrastructure of the nation," said Dr PR Swarup, Director General, CIDC.
The construction industry needs to grow at 10% per year to adhere to the targets set for the building of infrastructure of the nation. The cost of construction will also rise as cost of cement and steel will rise due to demand-supply mismatch. The Construction Cost Indices (CCI) being computed by Construction Industry Development Council (CIDC) for six cities and for eleven sectors has also been rising.
Construction companies are likely to bear all the brunt due to rising prices of input materials as well as shortage of key input materials (cement & steel) which will also result in delay of execution of construction projects.
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