The sector needs more regulation
One fails to understand why has the government decided not to intervene in the decision of the steel companies to change prices. As the agreement between the steel companies and the government culminates on August 7, 2008, experts suggest that the companies would indeed increase prices, which would further increase inflation.
Steel and steel products contribute 21% to inflation and steel prices have already shot up by around 50%. And as Pawan Burde, Metal, Mining and Cement Analyst, Angel Broking, suggests to B&E, “Following the global steel prices’ upward trajectory, the domestic players have already announced a price hike thrice this year taking the price to Rs.40,000 per tonne.” Domestic prices have been suppressed by Rs.10,000-15,000 as compared to international prices by the government and are expected to rise as the demand within the country continues to rise.
One fails to understand why has the government decided not to intervene in the decision of the steel companies to change prices. As the agreement between the steel companies and the government culminates on August 7, 2008, experts suggest that the companies would indeed increase prices, which would further increase inflation.
Steel and steel products contribute 21% to inflation and steel prices have already shot up by around 50%. And as Pawan Burde, Metal, Mining and Cement Analyst, Angel Broking, suggests to B&E, “Following the global steel prices’ upward trajectory, the domestic players have already announced a price hike thrice this year taking the price to Rs.40,000 per tonne.” Domestic prices have been suppressed by Rs.10,000-15,000 as compared to international prices by the government and are expected to rise as the demand within the country continues to rise.
Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
and Arindam Chaudhuri (Renowned Management Guru and Economist).
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