The government's threats of price control to the steel & cement sectors have been keeping the prices of shares in these sectors down. If the govt. thinks that these sectors are behaving as a cartel, then there are bigger cartels in other industries. Why doesn't the govt. control prices of real estate? Buying a house has gone beyond the reach of the Indian middle class. Prices of housing have gone up threefold in the last two and and a half years. A flat in Mumbai which used to cost 50 lakhs two years ago, is now quoting at 1.5 crores! It's impossible to buy a 3BHK flat in any decent area of Mumbai for less than 1.5 crores. Can the Indian middle class afford that? To my mind, the whole vicious cycle of inflation started with the sky-rocketing prices of real-estate in India. Everything else followed. Has the govt. taken any action on the Builders' cartel?
There is another cartel in the Pvt. Banking space. The charges these banks are levying from their customers for demat transactions, maintenance and other services are exhorbitant. Has the govt. taken any action on them? There is another cartel in the Food sector. The prices of food items like grains, fruits, vegetables, milk etc. have gone up a lot in the last two years. Has the govt. issued a threat to them for bringing down their prices?
So why is the govt. singling out just the steel and cement sectors for price control? In an overall inflation scenario, which is across the board, such targeting of the steel & cement industries is ridiculous.