A STUDY ON EMPLOYEE WELFARE MEASURES
INDUSTRY PROFILE
ABOUT THE INDUSTRY
India in 1994 has become the 4th largest producer of cement in the world .Thisimpressive record owes its origin to the progressive policies of the government since late70’s and enabled on assured 12% post tax return on Net worth (77).The economicreforms of July ’91 gave a further fillip by abolishing the licensing system for setting upcement plants. Since then innumerable technological development took place in cement production enabling cost reduction and mass production. The wet kilns of the late 70’swere replaced by dry kilns which reduced the fuel cost by 30% thermal efficiency wasimproved by installing pre-heaters, followed by the addition of pre-ealcinators. Optimalusage of fuel and power we achieved through computerization and quality control of rawmaterials.In a developing country like India the requirement of housing and so the demandelasticity of cement with respect to G.D.P. of 1.6% is also high.By comparing the per capita consumption consumption and consumption density(D) of India with rest of the world, the latent demand for cement can be estimated at77Kg for India and 240Kg for the rest of the world.The cement sector has recorded an impressive increase in production capacities.The production has grown up by 9.5% over the previous years to 76.22 million tones. Theconsumption, on The other hand, has logged behind having grown by 7.9% over the previous year to 67.93 million tones. Capacity utilization has been 81% for the large plants. Thus, even at the end 98-99 there was an excess capacity by about 27 milliontones. (Comparing total capacity and demand).
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A STUDY ON EMPLOYEE WELFARE MEASURES
The current financial year is expected to add 10 million tones further. Productionfor the full year to be expected to be raised by 10-12%. Of this, south is to be themaximum gainer with around 10% growth.The cement industry witnessed a contraction. In operating profit marginsnationally. In the year ended March’97 due to a slowdown in demand growth rate, higher supplies for new commission capacitates and cost increases. Housing sector is yielding aminimum cement demand growth rate, of 6%.The Rakesh Mohan committee has forecast the investment outlays oninfrastructure to rise to 4000-4500billion rupees over the next 5 years. Beyond 2003-2004, these requirements would be in the range of 7500 billion rupees. The industrialgrowth rate too is expected to rise from 8 to 8.5% in the past 10-12%.The per capital consumption is expected to touch 85Kg by 2004 by possibly 13Kgin 2012. If the present growth trend continues. To achieve even 75% of world average oninvestment of 40,000 Crores rupees on plants besides additional investment of same order on adequate infrastructure will be required over 10-15years. The demand by 2012 is placed at 140 million -150 million tons in the wake of the industrial and economic growthunleashed by the liberalization process. The growth prospects of the industry are thusassured.
India’s Stand in the world
India is the 4th largest cement producer worldwide, following china, Japan andU.S.A. India’s percaptia consumption is only 78Kg as compared to the world average of 251 Kg by the turn of the century. India’s capacity is expected to crores 100 milliontones. The Industry has 59 companies owning 115 plants. In the matter of exports, theGovernment considers cement as an extreme focus area.
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A STUDY ON EMPLOYEE WELFARE MEASURES
However, Industry experts comment that exports are mainly for keeping a check on the domestic prices, which get adversely affected due to exam production. In theglobal market. India cement is not very competitive due to high power and fuel costs. Inorder to improve its position in the International market, technological up gradation isessential in terms of process, product diversification, cost reduction quality control andenergy savings.
CEMENT INDUSTRY HIGHLIGHTS
The Indian cement industry has high Return on Investment. There exists a largemarkers which are not yet been completely tapped. With the existing levels of supply andgrowing demand the prices tend to rise. But the industry being a fast growing one, many players are attracted. Every year new capacities are added raising the supply, pricestability is thus maintained and the high profits are observed by new entrants.The per capital consumption of manufacture commodities like steel, power andcement ate indicators of the economic state of a country. Of the total output nearly 95% isaccounted for only 90%, while the Government sector accounts for 10%. The housingactivity accounts for 55% of total consumption. Nearly 47% of the total costs, most of which are administrated prices are beyond the control of cement units. The cost elementsinclude limestone, coal, transport freight, power consumption and excise duty.
Production and Consumption Pattern of Cement
In the case of cement production regional imbalances continue. Cement plants aregenerally put up where limestone id available. This because, to produce 1 tons of cement1 ½ tones of limestone is required. Also it is easier to transport cement than limestone.Cement is mainly produced in the Western and Southern regions. Hence, only half of the cement produced is consumed within the region. Cement is usually transportedfrom south to west is the most surplus region. Although, west is a surplus regions, cement
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