We are pleased with the finance minister and the government’s intervention to control the rise in the cost of raw materials and in turn control inflation as the Indian economy had stayed resilient while grappling with the strains of cost inflation of raw material prices but had disrupted the growth of the real estate sector in the last 18 months. However, a momentous move by the government to reduce import duties on steel products should provide a sigh of relief to all stakeholders.
Additionally, a reduction in import duty of iron ore and steel intermediates will further bolster the availability of raw materials domestically, cool off the prices of steel products, and help tide the rise in prices of projects, strengthening consumer sentiment. The FM’s assurance to improve logistics and help domestic availability of cement and lowering custom duties on coal products used in the production of cement will have a positive impact on the cost of the commodity.
Furthermore, a reduction in prices of fuel tax to pre-covid levels will help bring down the transportation costs of all raw materials and essentials in industries agnostic of their businesses and reduce the pressure on the end consumers.
Going forward, we suggest the state government cut down on state duties on fuel too to have a direct impact on the rise in inflation. CREDAI sincerely hopes that manufacturers will pass on the price cuts to end-users. This will help the real estate developers negate increased construction costs over the last 2 years, which will only help prospective homebuyers.
