Construction activity in Pune came to a halt at over 450 sites on Monday when city builders participated in a one-day nation-wide strike to protest against the drastic rise in cement and steel prices.

Kumar Gera, President of the Confederation of Real Estate Developers Association of India (CREDAI), told TNN that the price hike would have an impact on the cost of flats.

“The worst-hit would be the lowest end of the spectrum of consumers. Their entire financial planning would be derailed.” He said.

Typically, a housing project requires cement worth Rs 70 and steel worth Rs 100 per square foot. Therefore, a 40-50 per cent escalation in price would increase the cost of an apartment by around Rs 75 per square foot.

Gera claimed that the steep hike in prices was not market-driven, but the result of a group of leading manufacturers getting together and deciding to jointly increase prices.

On the other hand, members of the Indian Steel Alliance – including Tata Steel, Steel Authority of India and Ispat – have justified the price increase, saying the raw material costs have gone up. Cement manufacturers have also claimed that so far they have been selling below cost price.

“These are realistic prices. We are not obliged to sell at cost minus. We see no possibility of bringing down the prices,” said K C Jain, Senior President of Vasavdatta Cement. Incidentally, one-third of Pune’s cement requirement of 1.8 lakh tones per month is met by this company.