The Hindu Business Line : SIEMA urges PM's intervention to check rising input prices

THE Southern India Engineering Manufacturers' Association (SIEMA), Coimbatore has urged the Prime Minister, Dr Manmohan Singh, to intervene to rein in the prices of key industrial raw materials.

It expressed the fear that if the continued raw material prices spiral is not arrested, it might erode the competitiveness of industry in the global markets.

Mr C.R. Swaminathan, President, SIEMA, in a representation to the Prime Minister, pointed out that the price of S.S. sheet has gone up from Rs 1.05 lakh/tonne in January 2003 to Rs 1.55 lakh/tonne now. The price of pig iron has nearly doubled during this period - from Rs 10,300 per tonne to Rs 19,500.

The price of CRNO electrical steel sheets has moved up from Rs 32,000 a tonne in January 2003 to Rs 44,500/tonne now and the copper rod's price has zoomed from Rs 1.20 lakh a tonne to Rs 1.74 lakh per tonne in the last 20 months. The price of raw materials such as SS rod, tor steel, angle and flats also have skyrocketed.

He said apart from the increase in the price of important industrial raw materials, the increase in the price of petroleum products has led to increased transportation cost and the all-round increase in production cost has come at a time when Indian manufacturers are facing stiff competition from countries such as China and Taiwan to remain price-competitive.

Mr Swaminathan said that if the trend of frequent increases in the price of raw materials is not arrested, it would throw a spanner in the working of the small-scale industries that played a crucial role in providing employment to a large number of people.

Apart from the engineering industry, the construction industry, domestic equipment suppliers and the automobile sector, which has lately been emerging as a global outsourcing hub, have also been hit.

He urged the Prime Minister to immediately intervene and `bring in a sort of discipline by curtailing the day-to-day increase' in the price of raw materials.

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