In an exclusive chat with Indian Cement Review, R.P. Tak, CMD, Cement Corporation of India(CCI), a wholly owned Government of India Enterprise, speaks at length on the domination of the Indian cement industry by the private sector and the cement manufacturing companies in India importing the latest technology from around the world in order to cope with increased demands from all sectors.Can you brief us on the current status of CCI with regard to its various plants, production etc?Cement Corporation (CCI) was incorporated in the year 1965 as a wholly owned Government of India Enterprise and established 11 cement plants starting from the year 1970 to 1990. The total installed capacity of all the 11 plants was 42.48 lakh MT including an ailing plant of Dalmia’s at Charkhi Dadri, Haryana vested with the Company in June, 1981 for rehabilitation. Out of these plants, three plants are in operation and the rest were closed as these plants were unviable. The three operating plants are 1) Rajban (Himachal Pradesh) (2)Bokajan(Assam) and Tandur(Andhra Pradesh) with installed capacity of 2.48 lakh MT, 1.98 lakh MT and 10.00 lakh MT respectively.There were talks of disinvestment of some units? How far has it progressed?
Truly speaking, it is not disinvestment but it is sale of non-operating Units. As per the Sanctioned Scheme approved by Hon’ble BIFR, seven non-operating units were closed and put under sale process through a committee constituted by Hon’ble BIFR. The sale process is under way through e-auctioning and recently the committee has decided for revaluation of the plants through approved valuers. After revaluation of these units, fresh notice of auction will be published in news papers.Does CCI enjoy certain advantages or disadvantages in being a public sector unit?
Of course, certain pros and cons are always there and we are proud to be a public sector unit contributing to the Nation’s development. In 1991, the cement sector was decontrolled resulting in stiff competition from private players. Though CCI is Central Public Sector Undertaking, no significant advantage exists under the present policy after liberalization and globalization of the economy.Is there any kind of uniqueness that CCI brings to the cement sector – by way of technology, marketing or branding, etc?Till 1995, CCI plants were located pan India but after closure of 7 units, presently CCI is operating in the States of Himachal Pradesh, Assam and Andhra Pradesh. CCI Tandur Plant was having its uniqueness in technology and was set up with latest technology during the late eighties.What are your views on the sector in 2011?
The utilization of the production capacity of cement in India during the current financial year 2011-12 is expected to be around 72% owing to slackness in demand from across user industries. For the first half of the current financial year, utilization reduced even further to 71.7%. However, the demand is expected to grow by 5% in 2011-12.What are your predictions for the year 2012?
It is expected that demand for cement will grow at 8% in 2012-13 as against the current 4% to 5%. The Govt. spending on infrastructure and project developments will also determine the consumption of cement in coming years.What are the most crucial aspects that will affect cement sector in 2012?
Cement manufacturer being energy intensive operation, the high cost of power and coal including their availability are likely to affect the cement industry during the coming years.Tell us what has been significant for CCI in 2011?The constant efforts made by the Management and the employees as well has resulted in to the Company getting Turnaround Award from BRPSE for its performance in the last three financial years.How do you think India is placed vis-a-vis its foreign counterparts in adapting new technologies for cement manufacturing?
After opening up of economy in the year 1991 the Indian cement manufacturing companies started importing the latest technology from all-around the world and build up additional capacities to cope with the increased demands from all sectors as Govt. spending on infrastructure were increased manifolds. Presently, the plants set up by the private sector are with the State of the Art technology which is best in the world.Your thoughts on the private sector and the fact that the biggest companies are now owned by foreign entities?
In India cement manufacturing is dominated by private sector and the contribution of Govt. companies is insignificant. Moreover, the merger and acquisitions/takeovers by foreign companies has resulted in their dominance in some parts of the country mainly by cement giants like M/s Lafarge and Heidelberg from France and Germany.