The growth of cement consumption in various regions of India has changed significantly in FY05. The eastern and western regions have emerged as the fastest growing regions in FY05, whereas cement consumption has actually come down in the southern region in FY05.
On the other hand, cement consumption has decelerated for the northern region. Though a majority of the regions are witnessing strong growth in cement consumption, certain regions have not only been subject to a slow-down in consumption, but have also experienced reduction.
Growth in the eastern and the western regions has increased to 16 per cent and 11 per cent, respectively in FY05 compared to just 3 per cent in FY04. One reason for this is that the base was low in FY04 for these areas.
Economic activity has not been very strong in the Eastern region, and now it is picking up. The Western region has also continued with its strong service sector economic growth. The total cement consumption for the Eastern region was just 17Mt in FY04, compared to 32Mt for the states in the Southern region.
Property prices are poised to surge in these regions, which is heightening construction activity, thereby causing an increase in cement consumption, say industry sources.