An alleged monopoly bid held responsible for 3-fold plus rate hike
Morung Express News
Dimapur | September 11
Sand traders from Dimapur and Karbi-Anglong were scheduled to meet on September 12 to discuss the matter arising from the recent price hike of construction grade sand. Traders in Dimapur have temporarily halted import of sand subsequent to the Sand Mahaldar Suppliers Association, Manja, Karbi Anglong announcing an over three-fold increase in price. From the existing Rs 32 per cubic feet (cft) at source, the rate was hiked to Rs 110 per cft sparking a supply crisis in Dimapur. Going by this rate, retailing of sand from Manja would touch Rs 200 per cft in Dimapur.
Construction grade sand from Manja, Deopani and Kanaighat from Numaligarh are widely used in Nagaland. The variant from Manja is said to be in high demand because it is cheaper than the Kanaighat variant and better than Deopani quality-wise. Locally available Dhansiri variant is not preferred because of its fine-grained nature.
According to a source familiar with the trade, the traders on both sides decided to meet and hopefully break the stalemate before the advent of the construction season.
Till last season, the price of sand from Manja was Rs 32-35 at source. Accounting for fuel, labour and transport cost, "gate kharcha" (expenses), statutory tax, the cost of shipping it to Dimapur came to Rs 55-60 per cft before retail.
The source said that the ‘mahaldars’ in Manja have attributed increased labour and transportation costs, besides, statutory taxes as reasons for the unprecedented rate hike.
However, he said that the justification does not make sense "When the economy is down, when the construction sector is down, the price should go down. There is no logic."
He said that earlier, there was a good working relationship when prices were fixed only after consultation of traders from both sides.
But this tradition is said to have changed with the traders at source independently fixing the rate. He said, “They know we have no internal source of high grade sand. They know that we'll be compelled to buy at rates fixed by them.”
Further, he disclosed that the bidding for sand mining in Manja have become extremely competitive, which implies bidders quoting ever increasing rates to outbid competitors.
After winning the bidding war, there is the reality of taxes and royalty, both illicit and statutory.
According to him, the traders here are not to be blamed entirely. However, unscrupulous traders, from here and at source, manipulating the rate, were not ruled out.
Citing information from trade insiders, he said that there was an alleged bid to monopolise the sand business in Dimapur this year by a local trader in connivance with the dealers at source, resulting in the sudden rate spike.
As per the latest information, he said that the monopoly bid was blocked with the unions from both sides agreeing to sit and discuss.
Other sources tip the import of sand from Manja at 70-80 truckloads a day during the “construction season,” which normally starts from October-November till the advent of the next monsoon.
Meanwhile, old stock of sand from Manja was being sold at Rs 75-80 per cft. Despite the temporary halt on import, the sources said that some trucks were still being able to cross the inter-state border through the “black” route.
Another held that the state government authority should intervene instead of simply being a bystander. “I blame it on the district administration. Why is it keeping mum and not addressing it?” questioned a local businessman.