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January 2, 2008
Karunanidhi Threatens to Nationalize
Cement Industry

Chennai
Tamil Nadu Chief Minister M. Karunanidhi threatened Wednesday to nationalise all cement factories in the state unless manufacturers drastically reduced prices.

Karunanidhi revealed his government was all set to import 100,000 tonnes of the product through the joint auspices of the government owned entity Tancem and centre's Minerals and Metals Trading Corporation (MMTC).

The imported cement would be distributed through outlets of the state-owned Tamil Nadu Civil Supplies Corporation, the chief minister said after the conclusion of a high-level meeting.

Tancem would float global tenders for direct import as and when the need arose, a government press communiqué said later.

"If all these steps fail to bring down the price of cement, the government will have no alternative but to take steps to nationalise all cement factories in Tamil Nadu in the interests of the public," Karunanidhi warned.

Cement industry sources, however, pointed out that the measure was highly improbable as its production was fully decontrolled since 1989 by the centre.

"The measure was begun in 1982 itself. The state government has no powers to undo it now," a source said.

A 50 kg bag of cement costs between Rs.260 and 270. With the price of sand (with which it is mixed to create concrete) touching Rs.30 per cubic foot, construction costs have skyrocketed in Tamil Nadu. Contractors building government structures have already overshot the deadlines for dozens of projects.

Incidentally, the price of sand is controlled by the TN government, which took over retail trade a few years ago.

January 2, 2008 

IANS | Top