AP Real Estate Construction Sites Slowed Down By Hikes in Input Costs

Construction sites for real-estate projects across Andhra Pradesh have slowed down or even come to a grinding halt due to the sharp increase in raw material and input costs over the last 3 months. The main problem is believed to be non-availability of sand which had a market price of approximately ₹350 per metric ton at sand reaches. The sand shortage is mainly due to shortage of sand in the Krishna district due to floods along the Krishna river, the floods have made it impossible to extract sand from the sand reaches.

As the availability of sand from river sand reaches has been scarce, an agency appointed by the Andhra Pradesh Mineral Development Construction (APMDC) is currently retailing sand from stock yards. Few sand trucks were washed away due to the floods at Chevitikallu sand reach along the Krishna river. The agency appointed by the APMDC is selling the sand at a price of ₹680 per metric ton, which is almost twice that of the price for a ton of sand at sand reaches before the floods.

Members of the Capital Region Builder Association (CRBA) have stated that it is currently not feasible for them to buy sand from stock yards, one builder stated that about 10 tons of sand from Keesara stock point to Vijayawada cost them about ₹12,000. As the price of sand increases, most of the builders/developers have paused their projects as buying sand at these inflated rates will cause a huge dent in their budget. The cost of a bag of cement has also crossed the ₹400 mark and the CRBA has urged the state government of Andhra Pradesh to help resolve these issues.

Daily wage labourers, masons, carpenters, painters, iron smiths etc. have also been indirectly affected by the rising input costs. As the costs increase and builders stall their projects, these labourers and skilled labour also lose their employment & are left without a source of income. These workers have resorted to doing smaller projects at a domestic level to earn their livelihood. Builder’s associations like the CRBA have brought up these issues with the state government and expressed their displeasure with the current supply of sand from stock points at inflated rates.

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