Concrete

A new phase of structural adjustments prompted by Bullwhip

Published

5 years ago

March 5, 2021

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The latest data on the 2020-21 Q4 GDP shows a growth of 1.6 per cent over 2019-20 Q4, which in absolute numbers looks like Rs 38.96 lakh crore, as against Rs 38.33 lakh crore in Q4 of 2019-20. If anyone wants to see this in dollar terms, the dollar made a steep fall against the Rupee (Rs 75 v/s Rs 72.5) over this period, thus making the growth look like 5 per cent instead of 1.6 per cent. Despite these aberrations, the Indian economy weathered a major storm last year and both Q3 (0.5 per cent) and Q4 (1.6 per cent) have been two quarters of growth thus signaling a ??oming out??from the technical recession that was caused in Q1 and Q2 of 2020-21.

The drivers of growth however have shifted majorly in Q4, if one sees the sectorial data, the biggest unit of rise came from the government consumption expenditure increase of 28.3 per cent in the same period over last year. If we start with gross value added (GVA) growth (GDP growth minus product taxes), the manufacturing sector accelerated to 6.9 per cent in the fourth quarter of 2020-21 compared to a contraction of 4.2 per cent a year ago and construction grew by 14.5 per cent against 0.7 per cent, while both agricultural growth (down 3.1 per cent from 6.8 per cent) and hospitality and transport (down -2.3 per cent from 5.7 per cent) showed markedly lower numbers. We must keep in mind that only a week was lost in production activity in the corresponding quarter of last year, due to lockdowns, thus the two periods in terms of economic flow are not out of whack in comparison.

The crucial question is what we now expect the economy to perform, given that 66 per cent of the time in Q1 2021-22 is mired in semi-lockdowns, the informal sector is impacted heavily and working capital is locked in unforeseen inventories of all kind and debt moratoriums are being requested for another extended period of time over the previously allowed one. The question cannot be about comparing period numbers alone. Last year?? similar period was worse off with national lockdowns and the expectation at the start of the quarter was to achieve 22 per cent growth over that quarter. This looks a tall ask given the current state of the economic activities.

Let us move to some other dampening factor, perhaps more ominous than the stalling of economic activities through lockdowns. It is the rising commodity prices, which has seen no calming effects, either from the government or trade interventions, left to its own, the prices have spiraled into an orbit; many are calling this a precursor to the super cycle for commodities.

I am however of the view that the rise in global commodity prices, which finally impact every citizen of every country, were actually fueled by rising international logistics cost, global shipping to start with and followed by the inland full truckload freight costs, which later spilled over to every aspect of commodity prices.

The global barometer of logistics costs, the Baltic Dry Index stands at 2750 today, compared to 400 at the start of the crisis and the Shanghai containerised freight index stands at 3500 against 1000 at the start of the crisis last year. These numbers portray how many times the shipping costs have soared to move commodities from oil, coal, pet coke, to agricultural commodities to intermediate products to finally finished goods. The dollar weakness in the same period did adjust in some normative ways to counteract, but it is nowhere close to fully compensate for the deluge.

Every household item has moved several notches up in terms of prices, if they have not then sellers are simply absorbing the brunt of the increase from the input side.

This is what I call the supply side structural shift that every economy has to weather for the next several quarters. It all started with a shipping disruption, where vessels were stranded in high seas, which later moved to ports in form of congestion and then later impacted loading and unloading of vessels as people were not available. The final nail was the concentration of big five shipping lines that shared space among their carriers thus making the supply side even more tight, thus raising prices.

The structural shift needs to be seen from the point of what supply chains grapple with, the Whiplash effect, or the more commonly known Bullwhip effect. This essentially means that in a multi-echelon supply chain, for a small change in supply or demand conditions at the downstream part of the chain could translate to a much bigger change in the supply or demand conditions at the upstream part of the chain.

For an economy as diverse as India, with several supply chains crisscrossing each other, the disruptions in supply conditions in one part of the chain moves up or down the chain in varying degree of ripple effects, that are caused due to asymmetry of information, error propagation, ship-set mismatches and a host of financial woes travelling in multiple directions, working capital, inventory and cash flows being the key ones.

The supply chains in India have to adjust in these conditions and create new rules so that they are able to reconfigure their outputs and flows such that the new varying degrees of demand can be matched with varying supply conditions under constraints. This is the task that will be able to respond to price conditions better, something that will determine the next phase of GDP growth, not only for India, but for the globally connected markets as well.

Footnote:

ABOUT THE AUTHOR:

Procyon Mukherjee is an ex-Chief Procurement Officer at LafargeHolcim India.

Concrete

Ramco Cements’ Hard Worker Campaign Wins Seven Awards

Campaign earns honours for direction, editing and cinematography

Published

2 hours ago

June 15, 2026

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The Hard Worker campaign by The Ramco Cements has secured seven honours at the Good Ads Matter Awards 2026, adding to its growing list of accolades and reinforcing its standing among the year’s most recognised advertising campaigns.

The awards were presented during the Good Ads Matter Awards Night 2026 held at Mehboob Studios in Mumbai. The campaign received recognition across multiple categories, highlighting excellence in direction, editing, cinematography and storytelling.

Among the honours, the campaign won Silver in the Campaign of the Year – Direction category, while filmmaker Prakash Varma was named Director of the Year for the films Tortoise & Hare and Eco Plaster. Tortoise & Hare also received Silver awards for Best Editing and Best Colour Grading, along with a Bronze award for Best Cinematography. Eco Plaster earned Bronze awards in the Best Direction – Narrative and Best Direction – Humour categories.

Both films extended their award-winning run, with Eco Plaster being recognised for its narrative centred on water conservation through innovative construction solutions, while Tortoise & Hare was honoured for its storytelling and craft execution.

The Hard Worker campaign was built around the idea that hard work deserves recognition and respect. Through culturally rooted and emotionally engaging stories, the campaign has connected with consumers, engineers, masons and the wider construction community across the country.

Commenting on the achievement, A V Dharmakrishnan, CEO of The Ramco Cements Limited, said that the continued recognition across leading creative platforms reflects the company’s commitment to meaningful and authentic communication rooted in the values of the people it serves.

Balaji K Moorthy, Executive Director – Marketing, The Ramco Cements Limited, said the awards recognise the craftsmanship behind the storytelling, from direction and cinematography to editing and narrative execution.

Following recognition at both the Kyoorius Creative Awards and the Good Ads Matter Awards, the Hard Worker campaign continues to demonstrate the impact of purpose-driven storytelling combined with strong creative execution and consumer relevance.

Concrete

Cement Makers Reaffirm Commitment to Sustainable Growth

Published

1 week ago

June 5, 2026

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World Environment Day spotlight on innovation and circularity

On World Environment Day, the Indian cement industry reiterated its commitment to supporting India’s climate ambitions through sustainable manufacturing, resource efficiency and the adoption of cleaner technologies.

The Cement Manufacturers’ Association (CMA) said the sector remains aligned with the Government of India’s Net Zero commitments and is accelerating efforts to reduce its environmental footprint while supporting the country’s infrastructure and development agenda.

Parth Jindal, President, CMA and Managing Director, JSW Cement, said the industry is increasingly adopting cleaner technologies, improving energy efficiency and expanding the use of alternative fuels and raw materials. He also highlighted the growing importance of circular economy practices, where industrial by-products and waste streams from one sector are utilised as resources in another.

“The Indian Cement Industry is aligned to the Government’s commitments on carbon mitigation and is accelerating the adoption of cleaner technologies, resource efficiency and circular economy practices while actively exploring the potential of Carbon Capture, Utilisation and Storage (CCUS) as a critical pathway for deep decarbonisation,” said Jindal.

He added that coprocessing industrial waste and by-products helps conserve natural resources, reduce disposal requirements and lower the environmental footprint across multiple sectors.

According to Jindal, sustainability is no longer limited to manufacturing processes but is increasingly influencing investment decisions, innovation strategies and long-term growth plans within the industry.

Echoing similar views, Dr Raghavpat Singhania, Vice President, CMA and Managing Director, JK Cement, said sustainable development extends beyond emissions reduction and must also focus on responsible resource utilisation and waste minimisation.

“Sustainability in the built environment cannot be measured by emissions alone. It is equally about how efficiently we use resources, how effectively we minimise waste and how responsibly we create the infrastructure that will serve future generations,” said Singhania.

He noted that the cement industry is advancing its sustainability agenda through greater resource efficiency, increased circularity, technological innovation and continuous improvements in manufacturing practices. As a key contributor to India’s infrastructure development, the sector has a critical role to play in balancing economic growth with environmental responsibility.

On the occasion of World Environment Day, industry leaders reaffirmed their commitment to supporting India’s climate goals while delivering the materials required for resilient, durable and sustainable infrastructure.

Concrete

Building a Greener Future Together

Published

2 weeks ago

June 4, 2026

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Environmental sustainability requires immediate action, not just long-term commitments and discussions. Recycling, circular economy practices, and technology-driven waste management can help industries reduce environmental impact while supporting sustainable growth.

Author: Jignesh Kundaria, Director and CEO, Fornnax Technology

World Environment Day serves as an important reminder that environmental sustainability can no longer remain confined to discussions, reports, or long-term commitments. The environmental challenges facing the world today demand immediate, measurable, and collective action. Across industries and communities, waste generation continues to outpace our ability to process it responsibly, placing increasing pressure on ecosystems, natural resources, public health, and the well-being of future generations.

One of the most significant shifts required today is a change in how society perceives waste. Rather than being viewed as a material to be discarded, waste must be recognised as a valuable resource that can contribute to both economic growth and environmental protection when managed through the right technologies and systems. This mindset forms the foundation of the circular economy model that countries across the world are increasingly adopting to reduce landfill dependence, recover valuable materials, and create more sustainable industrial ecosystems.

India has made meaningful progress in strengthening awareness around sustainability, recycling, and environmental responsibility over the past decade. Significant efforts are being made to formalise the recycling sector through improved infrastructure, technology adoption, policy implementation, and broader stakeholder participation. These developments are creating a stronger foundation for responsible waste management and resource recovery across the country.

However, achieving long-term environmental impact requires collaboration from all stakeholders. Industries, policymakers, technology providers, and communities must work together with greater accountability to strengthen recycling ecosystems, encourage responsible waste management practices, and create sustainable outcomes through consistent execution rather than temporary interventions.

As someone closely associated with the recycling industry, I firmly believe that technology will play a decisive role in addressing future environmental challenges. Advanced recycling systems have the potential to recover valuable resources, reduce pollution, minimise landfill burdens, and conserve energy, creating a more sustainable future for generations to come. This belief is deeply reflected in Fornnax’s motto, “Committed to Create a Green Future,” which embodies our commitment to building long-term environmental value through innovation and responsible action.

At the same time, technology alone cannot deliver meaningful change. Real progress requires intent, awareness, participation, and a shared sense of responsibility. Sustainable development can only be achieved when innovation is supported by collective action and a genuine commitment to environmental stewardship.

On this World Environment Day, let us move beyond conversations and take meaningful steps towards creating a cleaner, greener, and more sustainable planet. By embracing innovation, strengthening recycling ecosystems, and acting responsibly today, we can create lasting environmental impact and secure a better future for generations to come.