Cement industry experts predict that Telangana state formation which includes requirement of setting up of a new capital would bring opportunities in infrastructure development to the tune of Rs 1 lakh crore. Cement companies said that they don’t expect any operational problem arising out of the Telangana’s split from the united Andhra Pradesh. However, cement company may have to go for fresh registration for sales tax and other purposes.
Among Indian states, Andhra Pradesh is the largest cement producing state with copious limestone deposits that can last for several years. Almost all the leading players have their plants in Andhra Pradesh. There are about 46 plants including some small plants and their capacity comes to 80 million tonne of the total all India capacity of 325 million tonne.
In Andhra Pradesh, the combined capacity of various cement manufacturers in the state is around 80 million tonne. They added that the cement industry stands to gain in case the new State decides to woo the investors and will bring in fresh incentives on new investments and expansions and also take up more infra projects, housing and urban development.
Due to political uncertainty in AP, cement consumption has fallen over by about four per cent to 1.6 million tonne per month due to delay in projects across sectors. Major cement plants in the state were running at less than 50 per cent capacity because the installed capacity was more than doubled in the last five-six years, when local consumption fell.