Past Presidents of Cement Manufacturers’ Association

Shri Dharamsey M. Khatau 1961 to 1964

Shri G.D. Somani 1965 to 1967

Shri V.H. Dalmia 1968 to 1969

Shri R.D. Shah 1970 to 1973

Shri P.K. Mistry 1974 to 1976

Shri A.K. Jain 1977 to 1978

Shri R.P. Nevatia 1979 to 1980

Shri S. Krishnaswamy 1981 to Aug’82

Shri V.L. Dutt Oct’82 to Oct’83

Shri J.R. Birla Nov’83 to Mar’87

Shri M.H. Dalmia Mar’87 to Jul’89

Shri M.N. Mehta Jul’89 to Jul’91

Shri N. Srinivasan Jul’91 to Aug’94

Shri M.C. Bagrodia Aug’94 to Sep’96

Shri N.S. Sekhsaria Sep’96 to Jun’98

Shri A.L. Kapur Jun’98 to Mar’99

Shri Y.H. Dalmia Mar’99 to Aug’99

Shri M. Karnani Aug’99 to Oct’00

Shri T.M.M. Nambiar Oct’00 to Oct’02

Shri B.L. Jain Oct’02 to Sep’04

Shri N. Srinivasan Sep’04 to Dec’06

Shri Manoj Gaur Dec’06 to Jul’07

Shri H.M. Bangur Jul’07 to Oct’09

Smt. Vinita Singhania Oct’09 to Jan’12

Shri M.A.M.R. Muthiah

President

Shri O.P. Puranmalka

Vice President

CEMENT MANUFACTURERS' ASSOCIATION

PRESIDENT

Shri M.A.M.R. Muthiah

VICE PRESIDENT

Shri O.P. Puranmalka

MEMBERS OF THE MANAGING COMMITTEE

Shri Harsh V. Lodha

Shri B.R. Nahar

Shri Rajendra Chamaria

Shri R.K. Vaishnavi

Shri Alok Patni

Shri P.S. Bakshi

Shri M.M.Venkateswar Rao

Ms. Rupa Gurunath

Shri T.S. Raghupathy

Shri Rakesh Singh

Shri V.M. Mohan

Shri R.K. Razdan

Shri Sunny Gaur

Shri Raghavpat Singhania

Dr. Shailendra Chouksey

Mrs. V.L. Indira Dutt

Shri K.C. Jain

Shri Uday Khanna

Shri P.R.R. Rajha

Shri K. Padmakumar

Shri Bhagwat Pandey

Shri M.S. Gilotra

Shri Mahendra Singhi

Shri Rajat Mukerjei

Thiru Ka. Balachandran, IAS

Shri Ratan K. Shah

Shri S.N. Jajoo

Shri K.C. Birla

Shri Krishna Srivastava

PERMANENT INVITEES

Smt. Vinita Singhania

Shri H.M. Bangur

Shri Manoj Gaur

Shri N. Srinivasan

Shri B.L. Jain

Shri Y.H. Dalmia

Shri M.N. Mehta

Shri M.H. Dalmia

Shri V.L. Dutt

SECRETARY GENERAL

Shri N. A. Viswanathan

52nd Annual Report

i

FOREWORD

The 52nd Annual Report of CMA for the year 2012-13 is in your hands. The Report covers

important developments in the Indian economy and reviews the performance of the

Cement Industry during the period under Report.

It has been yet another bad year (2012-13) for the Indian economy when its GDP growth

touched at 5%, an all-time low in the last decade as against 6.5% and 8.4% respectively in

the last two financial years. The Indian economy has been currently facing manifold

problems due to widening Current Account Deficit, increased interest rates, alarming

inflation, low investment climate particularly for infrastructure sector. Although,

Government has taken a number of bold and harsh steps to revive the economy, its

improvement in the current financial year, as per projections by certain expert agencies,

looks somewhat difficult to regain.

The gloomy scenario of the economy has severely dented the Cement Industry too as its

capacity utilization has tamed to around 72% from a comfortable level of 85% a couple of

years back. Today, the surplus cement capacity, due to mammoth mismatch between

demand and supply, is about 100 million tonnes. It means a dead investment of about

Rs.60,000/- crores, if calculated in today’s cost of setting up a million tonne cement plant.

In addition to sluggish cement demand, this Industry has been acutely suffering on

account of spiralling cost of inputs and their transportation, including cement and clinker.

The performance of the Cement Industry depends on regular and consistent supply of

Coal, Power and Railways. All these inputs are in the public sector over which the

Industry has no control.

Coal, being the main fuel, is an important input required in the manufacture of cement.

The Cement Industry continued to suffer on account of inadequate availability of coal.

Coal receipts against linkages have been showing a drop for the last 10 years while the

cement production capacity has been on the rise. The supply of linked coal during 2002-03,

which was as high as 75% of the total fuel consumption, has now come down to 35%. This

has resulted in increased dependence on costly open market purchase and coal imports. It

is, therefore, necessary for the Government that immediate steps are taken to ensure that

Cement Industry’s coal requirement, which is just 5% of the total coal production in the

country, is met in the overall interest of the Nation.

In the context of supply constraints of coal, already a few cement plants are using pet

coke, lignite and other alternate fuels in its place but are experiencing difficulties in their

ii

scaling up due to certain Technical, Policy and Regulatory and Finance related barriers

which need to be urgently addressed by the Government. The Thermal Substitution Rate

in India is very low at 0.5-1% as against 50-60% in other countries and hence usage of

alternate fuels, which entails huge investments, should be incentivized.

Logistics support has been another bottleneck. The Cement Industry has continued to

face the problems in transportation of cement, clinker, coal, fly ash etc. by Rail due to

supply constraints of Rail Wagons, lack of infrastructure facilities at Terminals and

Railway’s Policies not adequately addressing the interest of the Industry/Investors. These

factors have rendered overall transportation cost of cement by Rail costlier than road

transportation which, inter alia, resulted in sharp drop, over the last few years, in the Rail

share for cement to 35% from 57%. There is all the potential to enhance the Rail share

again to at least 50% provided the end transportation cost to the consumer is brought at

par with road transport.

Yet another major constraint for the Cement Industry is Power. Since cement production

is a continuous process, all efforts are being made by the cement plants to ensure

uninterrupted power supply and in that direction have added installed power generation

capacities to the extent of 60% of their requirement and even upto 100% in some cases.

To tide over the power shortages, cogeneration of power through Waste Heat Recovery

needs to be encouraged, and further, this technology should be granted ‘Renewable

Energy’ status for issuance of RE certificates.

Another impediment relates to supply of fly ash. Power plants which were supplying fly

ash to the Cement Industry free of cost as per the earlier Government Notification have

started charging significantly for fly ash from 2009. This has considerably enhanced the

production cost of Portland Pozzolana Cement. Cement Industry, which had already made

huge investments for effective utilization of fly ash by setting up ‘Grinding Units’ nearer

the Power Plants, deserves to be provided fly ash free of cost on the principle of ‘Polluter to

Pay’ basis, which has been adopted the world-over, in the overall interest of the Nation.

The Planning Commission’s Working Group on Cement Industry for the XIIth Five Year

Plan period 2012-17 has fixed the cement production target at 407 Mn.t. for the terminal

year (2016-17). To meet this huge and ambitions target, our Industry needs increased

Government support in respect of all inputs availability, logistics support and reduction in

the high taxation burden which currently rules at 60% of the ex-factory price. This

support to the Industry is all the more necessary if Government’s mission to enhance the

share of manufacturing in the GDP to 25% by 2020 from the present 16% is to be realized.

52nd Annual Report

iii

It gives me pleasure to mention here, that, both CMA and Cement Industry are not only

taking concrete and constructive measures for improving the performance of the Industry,

but are also finding ways to address the current burning issues of the Nation which could

also act as a ‘Growth Engine’ of the economy. One such measure, which has already been

appreciated and acknowledged by the Government, is the adoption of cement concrete

roads and white-topping in the country on large scale, as a Policy in place of the

conventional bitumen roads. What is now required is to allocate at least 50% of the total

road funds for construction of cement concrete roads and also to streamline the regular

and timely flow of funds and execution of cement concrete road projects on time. CMA,

which has brought out a considerable number of technical and promotional publications in

this field, would be happy to provide any technical help in the matter.

The Deptt. of Industrial Policy and Promotion, Ministry of Commerce and Industry, has

been highly supportive of our Industry for which, I am grateful to Secretary, Joint

Secretary, Director and Under Secretary. I am equally indebted to Secretary (Coal), Addl.

Secretary (Coal) and Joint Secretary, Ministry of Coal, Chairman, Railway Board, Member

Traffic, Advisor (T), Executive Director Traffic Transportation (S), Executive Director

Traffic Transportation (R), Ministry of Railways, Secretary, MoRT&H, Chairman, NHAI,

Secretary, Ministry of Environment and Forests, and Chairman, Central Pollution Control

Board, for their esteemed counsel, continued assistance and steady support. I also thank

the Senior Officers of various Ministries, Coal India, Singareni, Bureau of Energy

Efficiency (BEE), and Bureau of Indian Standards (BIS), Institute for Industrial

Productivity, World Business Council for Sustainable Development, Cement

Sustainability Initiative, for their co-operation.

I also wish to thank senior Members of the Managing Committee and various other CMA

Committees for their valuable advice.

Let me also take this opportunity to express my thanks to Shri N.A. Viswanathan,

Secretary General and other Officers and Staff of CMA for their valuable contribution and

continued and dedicated services in the interest of the Industry by providing various

representations, analytical reports, etc. I am sure that they will continue providing such

support in the years to come.

New Delhi (M.A.M.R. Muthiah) November 2013 PRESIDENT

Kind Attention ………

After the Order of June 2012 of the Competition Commission of India (CCI) slapping

huge fines on CMA and a few cement companies, without appropriately appreciating

the ground realities and hard facts presented to the CCI by CMA and concerned

member companies, the smooth and regular flow of statistical data to CMA by its

Members in respect of cement production and despatches became a causality and

the same came almost to a grinding halt.

This has happened for the first time in the history of CMA since its inception in

1961. As a result, CMA has not been able to compile any data concerning the

performance of its member companies for the year 2012-13 and incorporate the

information pertaining to addition of cement capacity and production of its

Members in the 52nd Annual Report of CMA.

However, in order to give a flavour of the Industry’s Pan India performance in

respect of cement production and despatches during the year under review, CMA

has drawn upon and analysed in the Report published/ web-hosted data of the Govt.

organisations, namely, Railways, Coal India, Office of the Economic Advisor, DIPP,

etc. in their respective Websites for the financial year 2012-13, which are available

in public domain.

While analysing this year’s all India cement production data of DIPP with their data

of previous year and also with CMA’s previous year’s data, as given in the Annual

Report, it will be observed that the %age growth in cement production, as per the

two sets of data, vastly differs owing to the difference in their published production

figures of last year. There is, therefore need to strengthen the process of effective

data collection base in the interest of both the Cement Industry and Govt. for their

short, medium and long-term planning.

***

52nd Annual Report

1

CEMENT MANUFACTURERS’ ASSOCIATION

52nd ANNUAL REPORT 2012-13 (Under Rule 49 – Rules & Regulations of CMA)

The Managing Committee is happy to

present its 52nd Annual Report for the

year 2012-13.

THE YEAR AT A GLANCE

Economy

The last two financial years were very

tough and challenging for the Indian

economy like other economies of the

world. In the year 2012-13, the

growth of the Indian economy

decelerated considerably and touched

an all-time low of 5% the lowest in the

last decade, as against 6.5% GDP

growth in 2011-12 and 8.4% in year

2010-11.

The country has been currently facing

widening Current Account Deficit

(CAD), which in turn has led to sharp

rupee depreciation against dollar with

its cascading effect on input costs.

India’s competitiveness, both in the

global and domestic markets, has also

been adversely impacted due to ‘high

cost’ structure arising from a host of

factors, namely, high interest rates,

increasing power and fuel costs, and

more particularly inadequate

infrastructure. With this cost

disadvantage, along with recent Free

Trade Agreements that India has

entered into with various countries,

the Indian Manufacturing Industry is

losing its edge.

The tardy growth of the economy had

impacted various segments of the

Industry. As per the Central Statistics

Office (CSO) data, industrial growth

dropped to 1% in 2012-13 as against

2.9% in 2011-12 and 8.2% in 2010-11.

Similarly, the manufacturing sector

grew by a mere 1% in 2012-13 as

compared to 2.7% in 2011-12 and

7.6% in 2010-11 respectively.

The growth on the Agricultural Sector

was also at a slower rate of 1.9% in

2012-13 as compared to 3.6% in

2011-12 and 7% in 2010-11.

The construction sector grew by 4.3% in

2012-13 as against 5.6% in 2011-12 and

8% in 2010-11.

Since India’s basic economic

fundamentals remain intact it is hoped

that growth will improve in the years

ahead, if bold and positive policy

measures are taken by the Govt.

2

Cement Industry’s Performance

The Cement Sector undeniably plays a

critical role in the economic growth of the

country and in its journey towards

inclusive growth. Cement is vital to the

construction sector and to all

infrastructural projects. The construction

sector alone contributes to over 7% of the

country’s GDP. Because of the lull in the

economy, the year 2012-13 was indeed

not a good year for the Cement Industry.

It may be recalled that the flow of

statistical feedback to CMA practically

dried up consequent upon the Order

dated 20th June 2012 of Competition

Commission of India (CCI) in Case No.

29/2010 “Builders Association of India Vs.

CMA & Ors.”. In the absence of inflow

of statistical data, CMA could not

compile and incorporate the

performance of Member Companies in

the Annual Report.

However, as per the data released by

the Office of the Economic Adviser,

Ministry of Commerce & Industry

(MoCI), the growth rate of the Cement

Industry was 8.9% in 2012-13 as

against 6.7% in the previous fiscal.

Incidentally, it needs to be highlighted

that when DIPP’s cement production

figures of 251.12 Mn.t. in 2012-13 are

compared with the 2011-12 cement

production figures of 247.45 Mn.t. of

CMA, the growth has gone up very

marginally by only 1.48%. This vast

difference in the growth rate between

the two sources only underscores, all

the more, the imperative need to

strengthen the collection and

compilation of the cement data system

in the overall interest of the cement

sector as the very basis of future

planning of the Cement Industry,

Infrastructure growth and

development of the country.

Cement Industry’s Outlook

(2013-14)

The cement sector continues to be

overwhelmed by problems such as under-

utilisation of cement capacity at around

72% due to mammoth mis-match between

the supply and cement demand, and

spiralling input costs in every area,

particularly of coal and diesel together

with the mounting transportation cost of

cement and clinker. This has significantly

enhanced the operating costs of the

Industry.

As per Prime Minister's Economic

Advisory Council (PMEAC) projections,

economic growth rate will be 5.0 - 5.5 per

cent in the current fiscal i.e. 2013-14 on

the expected improvement in the

performance of agriculture and

manufacturing sectors. Government is

also making efforts to remove the

bottlenecks that are delaying

infrastructure projects. If the

recommendations made by the Govt. in its

Twelfth Five Year Plan for National

Manufacturing Policy (NMP); Delhi

Mumbai Industrial Corridor (DMIC)

52nd Annual Report

3

Project and Policy reforms to promote

foreign direct investment (FDI) are

implemented on time, the projected

growth rate would be achieved.

Given the Government's thrust on

inclusive growth and the need to put

infrastructural projects on the Rail again,

cement demand is expected to remain firm

and rise in the near future. While the

short-term does present unique

challenges for the Industry, the mid to

long-term offers, good prospects, for the

cement growth.

PAN INDIA PERFORMANCE OF

CEMENT INDUSTRY

As per CMA As per DIPP Growth %

At the end of

March 2012 At the end of

March 2013

At the end of

March 2012 At the end of

March 2013 CMA

^^

DIPP

Cement Capacity (Mn.t.)

340.44 # - -

-

- -

Cement Production (Mn.t.)

247.45 # - 230.49 @ 251.12 @ 1.48 8.95

Per Capita Consumption (KG) $

202

189

198

# Information collected from various sources by CMA and published in its last Annual Report.

@ From the website of the office of the Economic Advisor, DIPP

$ Per Capita Consumption has been worked out by CMA

^^ Growth has been worked out on DIPP's 2013 figures.

Cement Production

The table above shows that during the

year under review, the Pan India Cement

Production, as per the Office of the

Economic Advisor, DIPP, was 251.12 Mn.t.

as against 230.49 Mn.t. in the previous

Financial Year, registering a growth of

8.95 per cent.

Owing to the reasons mentioned earlier in

the Report, CMA has not compiled the

production data. However, when CMA’s

cement production data of 2011-12,

collected from different sources, was

compared with the 2012-13 production

figures of DIPP, the growth comes to a

mere 1.48 per cent. Pan India cement

production and capacity are reflected in

Annexure-I.

4

MEETINGS OF THE MANAGING

COMMITTEE AND HIGH POWER

COMMITTEE

In order to review and deliberate

on the issues relating to the

problems and growth of the

Cement Industry, Four meetings of

the Managing Committee and an

equal number of High Power

Committee meetings were held

during 2012–13.

CMA COMMITTEES

The following Committees

continued to render assistance to

the Management of the Association

during the year 2012-13 to address

various emerging issues and

problems, affecting the Cement

Industry.

� CMA High Power Committee.

� CMA Committee on Coal

Matters.

� CMA Technical Committee.

� Energy Task Force.

� Environmental Task Force.

� CMA Finance/ Legal Matters

Committee.

� CMA Committee on Railway Matters.

Names of the Chairmen/Co-chairmen of

the above Committees are indicated in

Annexure-II.

MEETING WITH SECRETARY (DIPP),

MINISTRY OF COMMERCE AND

INDUSTRY

A delegation of CMA, led by our President,

Shri M.A.M.R. Muthiah, called on Shri

Saurabh Chandra, and had an interactive

meeting with him in May 2012, after his

taking over the reins of Secretary (DIPP),

Ministry of Commerce and Industry.

CMA Managing Committee Meeting

held on 16th September 2013

Seated on Dais ( L to R) Shri BL Jain, Past President, CMA, Shri OP Puranmalka,

Vice President, CMA, Shri MAMR Muthiah, President, CMA and Shri NA

Viswanathan, Secretary General, CMA

CMA Managing Committee Meeting

held on 18th December 2012

Seated on Dais ( L to R) Shri NA Viswanathan, Secretary General, CMA, Shri

MAMR Muthiah, President, CMA, Shri OP Puranmalka, Vice President, CMA and

Shri KC Jain, Sr. President, Kesoram and Vasavadatta Cement

52nd Annual Report

5

During the meeting, the President briefed

the Secretary about the overall scenario of

the Indian Cement Industry – Its problems

and prospects; the Industry’s role and

contribution to the infrastructure

development; economic growth and to the

National exchequer through various taxes

and levies and for the amelioration of the

conditions of the weaker sections of the

society through CSR activities in the field

of Education, Health, Environment, Water

Supply, Adoption of Villages, etc. In this

context, CMA had handed over a

“Presentation on Cement Industry” to the

Secretary.

CEMENT INDUSTRY’S PRE-BUDGET

MEMORANDUM – 2013-14

In November 2012, CMA submitted

comprehensive Pre-Budget Memorandum

2013-14 – Cement Industry to Shri P.

Chidambaram, Hon’ble Finance Minister.

The Memorandum covered

comprehensively various issues which are

briefly discussed hereunder:

Uniform and Specific Rate of Excise

Duty on Cement: Elaborating on the long

and established history of specific rate of

excise duty on cement which worked

efficiently up to 28.2.2011, CMA stressed

that the incidence of Excise Duty on

cement continued to be still on the higher

side for consumers, other than

industrial/institutional buyers, as an

additional specific rate of duty of Rs.120/-

per tonne is payable by them. Also the

basis of levying Excise Duty is different i.e.

12% on RSP less 30% of RSP (as

abatement) for packaged cement requires

MRP to be declared and 12% on

Transaction Value for sale to

industrial/institutional consumers. Thus,

the current regime makes for different

sets of duties per tonne of cement payable

by a producer on any given day. The

excise duty rates on Cement are one of the

highest and next only to luxury goods such

as cars. By contrast, other core industries

such as coal and steel attract duty at

around 5%.

It is well-known that the industry suffers

from excess of surplus capacity of cement

in the country and cement market is on a

bearish trend. In order to achieve the

expected growth of the Cement Industry

the Government may kindly reduce excise

Particulars New Duty Structure from

17.03.2012 vide Notification 12/2012

read with entry No. 52 of

Notification 12/2012

dated 22.03.2012

(Packaged

Cement)

- [ (RSP Less 30%

of RSP) x12%]

Add Rs.120 PMT

(Packaged

Cement on

which MRP is

not required to

be declared

and thus not

declared)

Cement cleared

in Bulk to

Industrial /

Institutional

buyers

12% of

Transaction Value

Loose Cement - 12% of

Transaction Value

Clinker - 12% of

Transaction Value

6

duty on cement and clinker and bring it at

par with other core and infrastructure

industries. The excise duty rate be

rationalized from 12% to 6-8% and scrap

the specific rate of duty of Rs. 120/- per

tonne in the interest of common man’s

housing needs. Besides, the duty structure

be simplified to be made applicable either

on specific rate per MT or on ad-valorem

basis and without relating to MRP etc.

Our submissions on other important

issues included:

• Excise Duty on Coal, Lignite, Coke, Fly

Ash etc.: Levy of this duty of

2%(except on Coal, on which duty is

1%) needs to be withdrawn or Cenvat

credit be made available for the duty

paid.

• Customs Duty on Pet Coke, Gypsum

& Other Inputs: Import duty on pet

coke, gypsum (2.5%) and other input

materials used in production of cement

be scrapped.

• Levy of Customs Duty on Cement

Imports: To provide a level-playing

field, basic customs duty be levied on

cement imports into India.

Alternatively, Import duties on goods

required for manufacture of cement be

abolished and freely allowed.

• Withdrawal of Excise Duty on Fly

Ash: There is no change in the process

of generation of fly ash viz. a waste

generated on burning coal in the boiler

(Supreme Court decision in the case of

Union of India Vs. Ahmedabad

Electricity Co. Ltd.). Therefore, the fly

ash generation should not be treated as

manufactured product and no Excise

Duty on fly ash be levied.

• Treatment of Waste Heat Recovery

as Renewable Energy Source: To help

the Industry in its endeavour to

produce more environment-friendly

energy, Waste Heat Recovery Plants

which need substantial capital

investments, be treated as Renewable

Energy Source, to enable Cement

Industry to derive more energy from

the same energy resource which is akin

to green energy.

• Abolition of Import Duty on Tyre

Chips : To increase supply of energy

sources as well as for conserving the

domestic energy sources it is necessary

that import of tyre chips be allowed by

removing it from the Negative list and

also reducing tyre chips by reducing

import duty on the same to ZERO in

the National interest.

• Classifying Cement as “Declared

Goods”: Cement be stipulated as

“Declared Goods” under Section 14 of

the Central Sales Tax Act, so that it is

put on an equal footing with other core

sector goods like coal and steel.

• Tax Exemption to Certified Emission

Reduction (CER) Credits Under

Clean Development Mechanism: To

motivate the corporate sector for

reduction in Carbon Emission, receipt

from the CER credit be exempted from

Tax.

52nd Annual Report

7

• Project Import: Basic Custom Duty rate in case of Project Import be brought down to 3% from the current 5%.

• Goods and Service Tax (GST): Before introduction of GST, Single Rate of Tax; any change in the statute of any state be made only with the concurrence of all states; Criteria/process for availing Input Tax Credit be made simple and unambiguous, Creation of a Common Dispute Resolution Mechanism throughout all the States and One Common Authority for all the States be established for Advance Ruling; after implementation of GST, Continuation of various Central/State Level exemptions and incentives currently being enjoyed under Excise/VAT laws for the remaining unexpired period be continued.

• Stimulus to the Sectors which are

Major Users of Cement:

Fiscal Support to Housing and Roads

- This could accelerate the demand for

cement quite substantially. Given the

housing shortages in rural and urban

areas and given the increase in the cost

of affordable house, income tax relief

for interest paid on the house building

loans be extended from Rs. 1.5 lakh to

Rs. 4 lakh per annum.

Using Cement Concrete Technology

for Roads - All new expansions in the

National and State Highways be made

of Cement Concrete as a Policy. To

begin with, this could be 30% of total

allocations. All existing city roads

having bitumen surface be converted

gradually to cement concrete and new

ones should preferably be constructed

with cement concrete technology. All

connecting roads in villages be done

with cement concrete technology.

Pre-Budget Meeting for Union Budget,

2013-14

The Department of Revenue convened

Pre-Budget meeting with Trade and

Industry Associations to discuss

suggestions/ recommendations in respect

of tax issues pertaining to different sectors

for the Budget 2013-14 under the

Chairmanship of Ms. Praveen Mahajan,

Chairperson of CBEC, Department of

Revenue, Ministry of Finance, Government

of India.

CMA delegation led by President,

Shri M.A.M.R. Muthiah accompanied by

representatives of JK Lakshmi Cement Ltd,

UltraTech Cement, Chettinad Cement,

CMA, India Cements Ltd, JK Cement, etc.

attended the meeting and put forth the

problems/issues and reiterated the

suggestions made in the comprehensive

Pre-Budget Memorandum submitted to

the Hon’ble Finance Minister in November

2012 referred to above.

Meeting by Chairman, CBEC,

regarding Revenue

Performance/Projections

In January, 2013 Chairman, CBEC, had

called a meeting of the representatives of

Cement Industry in the context of revenue

8

performance and provisional revenue

projections for the year 2012-13. The

meeting was attended by the

representatives of CMA, JK Lakshmi

Cement, UltraTech Cement, and Century

Textiles and Inds. Ltd. During the meeting,

conveying the concerns of Hon’ble Finance

Minister about the need for increased

revenue realization of 33% overall

compared to the previous year’s revenue,

Chairman mentioned that for the Cement

Industry the revenue has increased by

27% so far and requested that the

Industry may keep this in mind and co-

operate in increasing the excise revenue

as much as possible to achieve the target

of the Government.

CMA mentioned that CMA has stopped

compiling and providing information of

individual plants in view of the Orders of

Competition Commission of India and its

findings on the issue of cartelization

against CMA and Cement Industry and that

an Appeal against the Order is pending

with the Competition Appellate Tribunal.

CMA further took the opportunity to stress

on the difficulties in the current excise

regime and the reduced growth rate of

Cement Industry as a result of poor

demand due to poor growth in

infrastructure projects. It was also pointed

out that low GDP growth is impacting the

Cement Industry’s growth.

Union Budget 2013-14

Hon’ble Finance Minister, Shri P.

Chidambaram presented the Union Budget

2013-14 in the Parliament on 28th

February, 2013.

A view of CMA Managing Committee Meeting

52nd Annual Report

9

MAJOR HIGHLIGHTS OF UNION BUDGET 2013-14

CONCERNING THE CEMENT INDUSTRY

� Duties on Steam Coal and Bituminous Coal equalised and 2 percent custom duty and 2 percent CVD levied on both kinds of coal.

� Investment allowance at the rate of 15 percent to manufacturing companies that invest more than Rs.100 crore in plant and machinery during the period 1.4.2013 to 31.3.2015.

� Plans for seven new cities have been finalised and work on two new smart industrial cities at Dholera, Gujarat and Shendra Bidkin, Maharashtra will start during 2013-14.

� Delhi-Mumbai Industrial Corridor (DMIC) to be provided additional funds during 2013-14 within the share of the Government of India in the overall outlay, if required.

� Chennai-Bengaluru Industrial Corridor to be developed.

� Preparatory work has started for Bengaluru-Mumbai Industrial Corridor.

� Raising corpus of Rural Infrastructure Development Fund (RIDF) to Rs.20,000 crore and Rs.5,000 crore to NABARD to finance construction for warehousing. Window to Panchayats to finance construction of godowns.

� 3000 kms of road projects in Gujarat, Madhya Pradesh, Maharashtra, Rajasthan and Uttar Pradesh will be awarded in the first six months of 2013-14.

� Allocation of Rs. 80,194 crore in 2013-14 for Ministry of Rural Development marking an increase of 46% over RE 2012-13.

10

Post Budget Memorandum-2013-14

Your Association vide letter of 7th March

2013 to Shri P. Chidambaram, Hon’ble

Finance Minister while congratulating him

on his forward looking approach and the

bold measures announced in the Union

Budget to bring back the GDP on its

normal growth path, also re-stressed that

the overall tax burden on the Cement

Industry has been very high, more than

even luxury items (60% of the ex-factory

price). The Cement Industry was

expecting some taxation relief in the

Budget. However, additional burden has

been imposed on the Cement Industry by

levying 2 per cent custom duty and 2 per

cent CVD on steam coal, the prime raw

material needed in the manufacture of

cement. This levy would further increase

the cost of cement by around Rs. 16 per

tonne in case of units using imported coal.

CMA requested the Hon’ble Finance

Minister to withdraw this levy and also to lower the taxation burden of the Cement Industry by 20-25% from its present level of taxation in the interest of faster growth

of the economy.

It was also submitted that while a good measure has been introduced in Budget 2013-14 by way of investment allowance

of 15% on the assets (plant & machinery) acquired and installed in 2013-14 and 2014-15 and this will definitely help in taking investment decision and revamping of investment cycle in the Indian Economy, the Cement Industry will not be substantially benefited with the condition of assets being acquired and installed in

these two years period, since a cement plant normally takes 3-4 years period for commissioning. To boost the investment in the Cement Sector and to avoid any ambiguity, the Investment Allowance was urged to be made available for the assets (plant & machinery) installed during that year similar to the earlier provision of Section 32 (A), apart from increasing the investment period to 4 years.

It was further highlighted that any matter which goes to Excise/Customs Tribunal takes lot of time in disposal extending to 3-5 years. In a number of cases, the Tribunal gives the stay order up to the

disposal of the cases. However, with the new amendment, all the Stay Orders will stand vacated after 365 days, whether the appellate Tribunal has passed the final order or not. This creates hardship on the part of assessee. CMA, therefore,

requested that either there must be a provision that a matter referred to the Tribunal should be decided within a period of one year or if it is not decided by then, once the stay is granted, it should continue till the final disposal of appeal by the Tribunal, based on the original Stay Order passed by the Tribunal.

Welcoming the thrust and the

considerable fund allocations for the Road

development, including Industrial

Corridors and rural development, CMA

also urged that the funds allocated need to

be used for the construction of Techno-

economically superior Cement Concrete

Roads over conventional Bitumen Roads,

which deteriorate very fast, particularly

after the rains.

52nd Annual Report

11

INCREASE IN INPUT COSTS

Cement manufacturers had to shoulder

the burden of input cost hikes on account

of increase in Cost of Fuel, Railway Freight,

Customs Duty and CVD on Steam Coal, etc.

during the year 2012-13.

INFRASTRUCTURE

Cement is an important material for

any construction and is the most

essential infrastructure input.

Infrastructure development of roads,

housing, ports, airports, etc. heavily

depend on cement. However, there is

no gainsaying that the performance of

the Cement Industry itself depends

critically on regular and consistent

supply of Coal, Power and availability

of Rail transportation and these key

infrastructure inputs for the Cement

Industry are in the public sector

domain over which the Industry has

no control.

Coal is the main fuel required in the

production of cement and power is

essential for various operations of

plants. The Railways provide the

logistics support for inward

transportation of coal, gypsum and

other inputs to the cement factories

and for outward movement of cement

and clinker.

COAL

Coal is of vital importance to the

Cement Industry as coal is the

principal fuel and accounts for

25-30% of the total cost of cement

production.

During the year under review, CMA

and CMA Committee on Coal Matters

had regular interaction with various

Government Authorities on coal-

related issues. These are elaborated

below :

Signing Fuel Supply Agreements

(FSAs) against the Long Term

Linkages

A CMA delegation met with Chairman, CIL

on 8th April 2013 in Kolkata, wherein, the

signing of the FSA with SECL and other

related issues were discussed when other

senior officials were also present.

Chairman, CIL, assured that minor

procedural discrepancies could be

resolved with mutual discussion with

SECL.

As required, our Letter of Assurances

(LOA) holding Member companies/units,

had long back furnished all the necessary

documents against the specified

Milestones. Thereafter, even the revised

documents, as required vide CGM (S&M),

CIL’s letter dated 17.1.2011 were again

submitted in April/May 2011. This was

followed by one-on-one meeting between

the LOA holders and SECL between

1.10.2011 and 15.10.2011 at Bilaspur.

It was expected that after meeting with

Chairman, CIL on 8th April 2013. SECL

would have signed the FSAs with most of

the cement plants but regrettably this did

not happen and the FSAs against these

12

LOAs have not been concluded by SECL till

date. SECL further abruptly issued notices

for withdrawal/cancellation of LOAs and

encashment of “Commitment Guarantee”

and “Additional Commitment Guarantee”

without giving any opportunity to our

member units.

CMA took up this issue with CMD, SECL;

Secretary, DIPP; Secretary, Ministry of

Coal and also held meeting with Joint

Secretary, Ministry of Coal to seek

immediate relief in the matter and

requested for case-to-case review by SECL,

with the concerned LOA holders against

the Notice for withdrawal/cancellation of

LOA. It was also requested not to take any

coercive action for encashment of

“Commitment Guarantee” and “Additional

Commitment Guarantee” pending grant of

an opportunity for a meeting of CMA with

SECL for presentation of their case. The

affected member units also approached

the Hon’ble High Court at Bilaspur with

Writ Petitions. The Hon’ble Court

considered the matter on 10th July 2013

and stayed the operation of the notice of

forfeiture of “Commitment Guarantee” and

“Additional Commitment Guarantee” and

also passed the following order:

“The petitioners are at liberty to

make a fresh representation to

the Committee constituted for

examination of the

representations against

cancellation notices issued in

cement LOA cases, if so advised,

within a period of one week from

today. It is, thus, directed that till

the representations of the

respective petitioners are decided

by the Committee, the impugned

notices dated 11.06.2013 shall not

be enforced. It is for the

respondents to take appropriate

steps in accordance with law,

thereafter.”

Renewal of Fuel Supply Agreement

(FSA)

The FSAs which were signed by our

member Cement Companies with the Coal

Companies and remained in force for a

period of five years expired after March

2013 onwards. Latest Information/inputs

were provided to the Member Cement

Companies for renewal of FSA who were

also apprised of the terms of the FSA

towards their entitlement for the ACQ, in

respect of Cement and Captive Power

Plants.

Compulsory Purchase of 25%

Higher Grades of Coal

Cement plants, receiving the coal through

FSA, are being obliged to compulsorily

purchase 25% of higher Grades of coal for

their Kilns and CPPs and accordingly the

revised clauses are being included in the

renewed FSAs. For supply of higher grades

of coal of 1 tonne, adjustment of 1.5

tonnes of lower grades of coal shall be

made and the ACQ will be reduced

accordingly. Non acceptance of higher

52nd Annual Report

13

grades of coal shall be considered as

“Deemed Delivered Quantity” by the Coal

Company.

CMA raised this issue before CMD SECL,

Director Marketing, CIL, Kolkata, Secretary

(DIPP), Ministry of Commerce & Industry,

Secretary, Ministry of Coal, Cabinet

Secretary, & for modification of the

aforesaid directives of CIL and acceptance

of higher grades made optional for the

purchaser. CIL has since reviewed the

aforesaid clause of compulsory purchase

of 25% of higher grade of coal and

clarified to all the subsidiary companies

that no quantity adjustment for the supply

of higher grade of coal wherever available

to the non-power companies is to be

made. Thus, the obligation of compulsory

purchase of 25% higher grade of coal has

been modified.

Coal Supplies to the Extent of 80%

of the Entitled Quantity for Booking

of Coal by Cement Sector

SECL, Bilaspur, restricted coal supplies to

the extent of 80% of the entitled quantity

for booking of coal by Cement Sector with

effect from 1st April 2013. This issue was

taken up with Chairman, CIL; Director

(Mktg.), CIL; CMD, SECL; Ministry of

Commerce & Industry, DIPP; and Ministry

of Coal to review trigger/materialization

level for supplies to cement sector during

2013-14.

Your Association’s efforts in this regard

bore fruit and SECL was constrained to

restore 100% booking with effect from

1st June 2013.

Coal Blocks for Cement Industry

CMA and the Cement Industry had taken

up with the Ministry of Coal and other

authorities, time and again, for specifically

earmarking coal blocks for allocation to

Cement Industry. Ministry of Coal by its

Notice of 30th May 2012 earmarked only 7

coal blocks for allocation exclusively for

the Cement Industry. These are listed at

Annexure-III.

Third Party Sampling Agency for

Sampling and Analysis of Coal for

the CMA’s Member Cement Cos.

In the Conference on “Power Sector – A

Way Forward” held in February 2013 at

New Delhi, Hon’ble Minister of State

(Independent Charge), Ministry of Power,

Shri Jyotiraditya Madhavarao Scindia

stated that there is a proposal of the

Ministry of Coal to engage independent

Third Party Sampling Agency for sampling

and analysis of coal in view of the demand

from the public sector power utilities and

power generating Companies.

In this context, CMA in its letter of March

2013 addressed to Secretary, Ministry of

Coal, highlighted the serious concern our

Member Cement Companies have been

consistently expressing about the poor

quality of coal being supplied by the coal

companies (Coal India Ltd., as also by

Singareni Collieries Co. Ltd)., and the

extensive variation in the declared GCV

14

and the actual GCV measured at the

cement plant being observed as a regular

feature.

CMA, therefore, requested the authorities

to extend the proposed facility of

engagement of independent third Party

Sampling Agency for sampling and

analysis of coal for cement sector

consumers as well, subject to their option,

for such facility without any embargo on

the minimum quantity of 4 lakh tonnes.

Strict Regulatory and Monitoring

Mechanism of Coal for Benefit of the

Consumers

In September 2012, Ministry of Commerce

& Industry sought CMA’s comments on the

“observations” made in the recent Report

of Comptroller and Auditor General of

India (CAG), “that there is need for strict

regulatory and monitoring mechanism to

ensure that the benefit of cheaper coal is

passed on to the consumers” in cases

where coal blocks have been allocated to

companies engaged in the production of

cement.

Based on the views of the Member

Companies, CMA replied on 26th

September 2012 as under :

• The assumption that the coal obtained

from coal block will be cheaper is not

correct; more so when against the

limited coal blocks allotted to Cement

Sector, clearances of various statutory

authorities are still pending at various

stages, despite deadlines having been

set by Ministry of Coal, for commencing

of production of cement from such coal

mines. The situation has been further

compounded by the coal companies

resorting to reduction in FSA quantity

by 25% by quoting a scheme of

tapering of linkages. Instead of taking

a realistic view about the ground

realities regarding delay in clearances,

the aforesaid cut on linkages has been

applied. In fact, compared to the

notified prices of coal supplied through

FSA, the coal from a coal block could

cost more and it may even vary from

time to time and area to area.

• In view of the short availability of

linked coal supplied under FSA, the

cement cos. have, presently, to source

more than 60% of its fuel requirement

in the form of E-auction coal, Imported

coal, and pet coke etc. The

procurement cost of fuel from other

sources is very high, as compared to

notified prices of CIL/SCCL.

Consequently, the input cost of fuel not

only becomes high but keeps on

fluctuating. Thus, the average cost of

fuel is much higher than the notified

price of coal supplied through FSA.

This aspect also needs to be kept in

mind.

• Cement is sold in open market and its

prices are accordingly governed by

market forces. Reduction in cost of

production of cement on account of

input costs, including transportation,

etc., will automatically bring a

downward impact on market prices in

a competitive market.

52nd Annual Report

15

In the light of the above, CMA contended

that any regulatory and monitoring

mechanism for such market driven

commodities does not appear feasible or

practicable.

Fuel Consumption and Coal Receipt

against FSA/Linkage

Coal receipt against FSA/Linkage by

Member Units of CMA was 10.38 Mn.t. in

2012-13 as against 10.45 Mn.t. in 2011-12.

Month-wise coal receipts are given in

Annexure-IV.

The percentage supply of linked coal has

been gradually declining year after year

and to meet the industry’s growing

requirement of coal/fuel, the Cement

Industry has to resort to procuring the

same from other sources i.e. through

imports, e-auction, market purchase, pet

coke usage, lignite and other alternate

fuels. This increases the input cost.

The total fuel procurement by Member

units was 29.82 Mn.t. in 2012-13 as

against 29.80 Mn.t. in 2011-12. While the

total fuel consumption by Member units,

during the year 2012-13 was 27.37 Mn.t.

as against 28.30 Mn.t in 2011-12.

E-auction/Open Market

Procurement of Coal

The Cement Industry, because of shortage

of coal/fuel, is required to buy substantial

quantities from open market/e-auction. A

total of 3.93 Mn.t. of e-auction/open

market coal was purchased during

2012-13 as against 4.51 Mn.t. during

2011-12.

The percentage increase of E-Auction

bidding price over notified coal price from

CIL sources with respect to the Spot E-

Auction was 50% and Forward E-Auction

was 26% during the year under review, as

against 67% and 87% respectively during

the financial year 2011-12. The decreasing

trend in the E-Auction price is due to

increase in the Notified Price and decline

in the imported coal price.

Details of year wise

procurement and

consumption of fuel,

including for Captive

Power Plants, are given in

Annexure-V.

It will be seen therefrom

that during the year 2012-

13 only about 35% of the

coal against total

consumption of fuel was

supplied as linked coal

16

against FSA. The supply of

linked coal during 2002-03

was as high as 75% of the

total consumption.

The reduction in terms of

percentage of coal supply can

be attributable to (a) First,

change in Coal Distribution

Policy due to which only 75%

of the normative

requirement of the Cement

Industry is to be met through

FSA/linkage instead of 80%

earlier; (b) secondly, Delay in signing of

FSA between LOA Holders (cement

companies) and coal companies; and (c)

thirdly, Not holding Standing Linkage

Committee (LT) meeting since November

2007 for sanctioning of linkage to

new/enhanced cement capacities. The

decline in the supply of linked coal is also

due to increase in the fuel consumption

by 153.5%.

Coal Imports

The coal imported by Member units was

9.27 Mn.t. during 2012-13 as against 9.40

Mn.t. during 2011-12.

Steam coal was fully exempted from the

basic custom duty during the year

2011-12. Most of the steam coal imports

for cement companies are from South

Africa and Indonesia, which attracted

Basic Custom Duty (BCD) @ 5% and

Countervailing Duty (CVD) @ 1% up to

31.3.2012. The BCD was exempted with

effect from 1.4.2012 for steam coal.

Exemption on basic custom duty on steam

coal financially helped the Cement

Industry, which has now been abolished.

In the Union Budget 2013-14, applicability

of BCD and CVD on bituminous and steam

coal has been equalized to 2% each.

Pet Coke

Pet coke is widely used as a

supplementary fuel in the Cement

Industries in many countries, including

India. Pet coke (Petroleum Coke) is a

residual product of the crude oil refining

process. It has a high calorific value, but

low volatile content, thus leading to poor

ignition characteristics. It is a black solid

obtained as an end product from the

distillation of heavier petroleum crudes.

Pet coke has higher levels of sulphur and

nitrogen as compared to coal.

The main source of supply of pet coke is

from refineries of Reliance Industries Ltd.

(RIL) at Jamnagar, Gujarat and Indian Oil

Corporation (IOC) at Panipat and some

52nd Annual Report

17

quantity of imported pet

coke from USA (Gulf). Pet

coke is also now available

from the new refineries of

Essar at Jamnagar, Gujarat

and from Guru Govind Singh

Refinery at Bhatinda in

Punjab.

A large number of the

cement plants have now

been using pet coke as fuel

in the kilns as also in Captive

Power Plants to some extent.

During the year under

review, the Cement Industry consumed

5.18 Mn.t. of pet coke as against 4.70 Mn.t.

during 2011-12.

Lignite

A quantity of about 0.71 Mn.t. of Lignite

was used in the financial year 2012-13 as

fuel mainly in the cement plants of

Southern and Western Regions as against

0.48 Mn.t. during 2011-12. The trend is

expected to continue in coming years also.

Other Fuels

In view of the increasing requirement and

short availability of coal/fuel of the Cement

Industry, for using other alternative fuels

like husk/municipal wastes/biomass etc.

was kept a pace and the industry

consumed 0.35 Mn.t. in 2012-13 as against

0.28 Mn.t. in 2011-12.

Coal Loading by Rail

Average loading of linked coal for the

entire Cement Industry, during the year

2012-13, was 1050 Four Wheelers (FWs)

per day, as against 1110 FWs per day in

2011-12 i.e. a decrease of 60 FWs per day

over last year.

Coal Requirement for 2013-14

The Cement Industry, would need about

51 Mn.t. of coal for kilns and 19.6 Mn.t. for

captive power plants totalling 70.6 Mn.t.

(assuming 170 kg of coal consumption per

tonne of cement production) to achieve

the most optimistic estimates of cement

production target of nearly 300 Mn.t. by

the Working Group on Cement Industry

for the year 2013-14.

Coal supplies against linkage through FSA

will continue to be inadequate.

Consequently, substantial procurement of

imported coal, pet coke and open

market/e-auction coal is expected to be

continued during 2013-14.

Box-N Rakes - Coal Supplies against

FSA Quantity

In case of movement of coal by Rail,

programme for movement of coal in terms

18

of rakes is submitted by the cement

companies. A quantity of 3894 tonnes

(59 x 66) is discounted from the monthly

quantity of FSA for each rake

programmed. In reality, however, the

actual quantity moved is generally much

less.

In its representation to Director

(Marketing), Coal India Ltd., in December

2012, CMA pointed out that in case of

supply by road the procedure is quite

simple as the delivery of coal is made

directly against the money deposited by

the cement plants with the Coal Cos. The

consumer lifts the entire quantity stated in

the delivery order in his own trucks. As

the FSA quantity is 7788 tonnes, the

consumer should receive the same

quantity to satisfy the provisions of the

FSA.

It was brought to the notice of the

authorities that there has been short

supply of coal in each rake dispatch from

the SECL colliery. Similar loss of

programmed-quantity is being

experienced in other Coal Companies/

Coalfields also. CMA proposed that the

difference between the notional rake

quantity of 3894 tonnes (59 x 66) and the

actual RR/Billed Quantity of that rake

should be accumulated over a period of

time and this accumulated quantity moved

as an additional rake to the

consumer/purchaser. Further, the mode

of movement of the differential quantities

could be allowed to be decided by the

purchaser as per his convenience.

Sanction of Long Term Coal

Linkages to New Capacities &

Resolution of the Pending Cases

Our Member cement plants were

sanctioned long term linkages in the last

SLC (LT) meeting held on 20th November

2007 for kilns. Since then, no meeting has

been held for the cement sector even to

review the status of the existing coal

linkages /LOAs and other related matters.

During this period a large number of

Cement plants have submitted their

applications for the Cement Kilns and

CPPs to Ministry of Coal for sanction of

new LT Linkages. As per the website of

Ministry of Coal, a total of 1590

applications for LOAs from Power Steel

and Cement have been received by the

Ministry of Coal as on December 2012, for

a coal requirement of 3200 Mt per annum.

Out of the total requirement, applications

for 164 Mt for Cement plants per annum

are pending with the Ministry of Coal. It

has been decided by the Ministry of Coal

that receipt of fresh application for LOAs

for power sector be kept in abeyance for a

period of two years.

While the Power Sector SLC (LT) meetings

are being held regularly to review the

status of existing coal linkages /LOAs and

other related matters and to see if the

directions /recommendations of SLC(LT)

are also implemented, Cement Sector,

regardless of being equally important in

building infrastructure, is being

completely ignored.

52nd Annual Report

19

In addition to letter to Secretary (DIPP),

Ministry of Commerce & Industry; and

Secretary, Ministry of Coal, Cabinet

Secretary has also been requested to issue

instructions to Ministry of Coal, for

holding SLC (LT) meeting for Cement

Sector at the earliest for sanction of Long-

Term Linkages against the pending

applications and also for resolution of

pending cases, which are already in

production but were required to come

through the LOA route due to

implementation of NCDP and for

developing a system of regular review of

the status of progress of the existing coal

linkages on similar lines as available to

Power Sector for Cement Sector as well.

TRANSPORTATION – RAILWAYS

During the year under review, Cement

Industry continued to face the problems in

transportation of Cement, Clinker, Coal,

Fly Ash, etc., by Rail due to a host of

reasons particularly with regard to supply

constraints of Rail Wagons, lack of

infrastructure facilities at Terminals and

Railways Policies not taking care of the

interest of the Industry/Investors. As a

result, the total logistics cost of Rail

Transportation continues to be much

higher than the Road Transport despite

the fact that Rail transport is an ideal

mode of transport for Cement Industry.

Cement and Clinker Transportation

by Rail and Revenue Generation

As per the Official figures of the Railways,

uploaded on their website, loading of

cement and clinker by Rail for 2012-13

was 105.82 Mn.t. as against 107.57 Mn.t. in

the previous year, a contraction by 1.63%

over last year. However, the total earnings

generated by the Railways from the

Cement Industry went up by 22.52% over

last year, from Rs. 6719.72 crores in

2011-12 to Rs. 8233.37 crores in 2012-13.

This is a clear indication that the Rail

transportation cost has gone up

considerably.

The Cement Industry, with its ever-

increasing Rail transportation cost, has

now become the 2nd largest Revenue

Contributor and even with just 35% Rail

share, is the 3rd largest freight customer

for the Railways. This revenue

contribution would go up significantly to

the Railways if movement of input

materials like coal, fly ash, gypsum, slag,

etc. by Rail are also factored in.

Railway Zone-wise Performance

Out of 16 Railway Zones, the Cement and

Clinker loading in 11 Zones was either flat

or negative, whereas in the 5 Zones the

1.6

3%

22

.52

%

20

growth was positive, as can be seen from

Chart below. Details are at Annexure-VI.

Rail-share as a percentage of the total

despatches of cement continued to remain

at 35% of the total despatches of cement

as opposed to 57% a couple of years back.

Enhancement in Transportation

Cost

The Hon’ble Minister of Railways in his

Railway Budget Speech for 2013-14 had,

inter alia, adopted a Fuel Adjustment

Component (FAC) from 1stApril, 2013

which would be dynamic in nature and

freight charges would be revised twice a

year based on changes in input fuel cost.

Railways had increased the Busy Season

Charge from 10% to 12% from 1st October

2012. In addition, Service Tax is also

being levied on 30% of the total

chargeable freight inclusive of all charges

like Busy Season

Charge, Development

Charge, etc.

As a result of above

policies, transportation

cost of cement, clinker,

etc. by Rail has become

further dearer. This

was perhaps one of the

reasons that for the first

time in many years,

cement loading by Rail

in volume as such has

declined during the year

under report, which is a

matter of great concern.

CMA addressed a representation on 28th

February, 2013 to Shri Pawan Kumar

Bansal, the then Hon’ble Minister of

Railways and a representation on 1st

October 2012 to Shri K.K. Srivastava,

Member (Traffic), Railway Board urging

them not to enforce the above hikes as it

would result in cost implications and also

complicate procedural work with the

Railways and Industry as well. It added

that the cement transportation cost is

approx. 18% of the operating cost in India

as against 8% to 9% in other

developing/developed economies. Hence,

there is need to lower the overall

transportation cost of cement/clinker by

Rail.

52nd Annual Report

21

CMA Committee on Railway Matters

In the last one year, CMA Committee on

Railway Matters, under the Chairmanship

of Shri Rajeev Mehta, Executive President

(Logistics), UltraTech Cement Ltd., had

Meetings with Chairman, Member

(Traffic), Member (Commercial), Advisors,

Executive Directors and other senior

officers of the Railway Board to keep them

abreast of Cement Industry’s Rail-related

problems along with suggestions for their

amicable solution. Some of the Meetings

were attended by senior officials from the

Zonal Railways also.

With the relentless efforts put in by the

Committee, CMA succeeded in getting the

Terminal Development Charges of Rs. 40/

pmt withdrawn from 1st April, 2013,

although the benefit of this was almost

negated by the imposition of upward

adjustments in freight rates from the same

date by the Railways. Further, the

Industry’s long-pending request for

reactivating the Rail Cement Co-ordination

Group had also been accepted by the

Railways.

Rail Cement Co-ordination Group

At the meeting of the Rail Cement Co-

ordination Group (RCCG), held under the

Chairmanship of Shri Manoj Akhori,

Executive Director – TT (F), Railway Board

on 17th June, 2013, Chairman sounded

positive. This was reflected in his

following replies to the issues raised by

RAIL BUDGET 2013-14 – MAJOR HIGHLIGHTS CONCERNING CEMENT INDUSTRY

� Fuel Adjustment Component (FAC)-linked revision for freight tariff to

be implemented from 1st April 2013. Under the Fuel Adjustment

Component (FAC), the freight tariff would be revised twice in a year, to

be implemented from 1st April, 2013. In the first FAC, the freight rate

for cement went up by around 6%.

� Proposal for setting up of Railway Tariff Regulatory Authority

formulated and at inter-ministerial consultation stage.

� Freight loading target of 1047 MT, 40 MT more than 2012-13

22

the Industry representatives at the

meeting.

� Railways would consider and examine Industry’s request for 25 to 30% freight rebate for short-lead movement of cement say upto 450 kms. to encourage shifting of present cement traffic from Road to Rail which is about 40 to 50% of the total despatches.

� Before making any announcement of any Scheme whose implementation will impact the Cement Industry,

Railways would first invite the inputs from the Cement Industry and thereafter would also discuss with them the Draft Policy concerning cement.

� Terminals would be given priority for development.

� Retention as well as incremental traffic in cement loading by Rail would be given equal importance by the Railways for granting freight incentives.

Representations/Presentations to

the Railways

In order to encourage and enhance Rail

share for movement of cement, clinker and

input materials by Rail, CMA, on behalf of

the Cement Industry, made the following

submissions to the Railways, from time to

time, in its various meetings,

representations and presentations:

• Classification Slab for Cement and

Clinker be lowered to Slab 140 from

the present Slab 150.

• A freight incentive of at least 25-30%

be accorded to the cement dispatches

upto a distance of 450 kms. to enable

the Railways to capture huge cement

business from Road which is estimated

to be about 50% of the total cement

dispatches of the Industry.

• Freight Rates be fixed for a period of at

least one year and during this period

no outside adjustments i.e. Surcharge,

etc. should be made.

• Dynamic Pricing Freight Policy of the

Railways be scrapped for Cement

Industry as various Policy Decisions

under this Scheme have significantly

enhanced the overall transportation

cost of Cement by Rail. This has led to

steady shift to Road transportation.

• The Infrastructure facilities at

Terminals, handling cement, be made

world-class.

• The Railways should consider CMA’s

suggestion to give freight rebate for a

period of at least two years to capture

and retain the short lead cement

business.

• Two point and Mini rakes should be

considered even upto 500 kms. lead for

all important desired pair of points by

cement manufacturers.

• Steep penal and wharfage charges

being levied should be avoided to the

maximum extent.

• Immediate withdrawal of the increase

in Busy Season Surcharge.

52nd Annual Report

23

• The Modified Wagon Investment

Scheme (MWIS) and Liberalized Wagon

Investment Scheme (LWIS) would be

made more attractive; and

• Activation of Cement Rail Co-

ordination Committee on priority basis

for long term solution on freight

policies and infrastructure.

Problems in Claiming Cenvat Credit

on Service Tax on Cement

Transportation by Rail

The Railway Board by its Rate Circular of

28th September 2012 had issued

instructions to all Zonal Railways in the

matter of collection/documentation of

Service Tax on Transportation of Goods by

Rail. This has increased paper work

considerably and has impacted working of

member cement companies of CMA.

Accordingly, CMA made the following

submissions to the Railway Board:

• The Railways need not insist on

monthly written requests, as envisaged

in the Rate Circular from major

customers like cement, as this is a

recurring matter. Instead, the Railways

may routinely issue the Consolidated

Certificate for a given month, by the 3rd

of the following month, to enable

timely Cenvat Credit adjustment

against Service Tax paid by the

customer. This cut off time-line is

important as Central Excise Duty dues

of a given month are to be paid by

5th/6th of the following month.

• Alternately and preferably, the

Railways should issue an extra copy of

the “Railway Receipt”, which can be

treated as Service Tax Certificate. This

has already been envisaged by ED

(Accounts), Railway Board in his letter

of 29.6.2012 to FA&CACO’s of their

Zonal Railways.

• Apart from the primary Railway

Freight, other charges like Demurrage,

Wharfage, Under Charges, Penal

Charges, etc., also attract levy of

Service Tax. In the case of Demurrage

& Wharfage, the original “Money

Receipt” has to be submitted along

with Waiver Applications to the

Railways. As such, an extra copy of the

“Money Receipt” need to be provided

by the Railways, for the purpose of

available Cenvat Credit.

CMA brought the above submissions to the

notice of the Member (Traffic), Railway

Board in October 2012 and again in

November 2012 with a request, inter alia,

to recommend to the Ministry of Finance

that the Cement Industry be exempted

from the Service Tax for Transportation of

cement and clinker by Rail like other

essential commodities viz. petroleum

products and gases; food grains; chemical

manures; etc.

Bulk Movement of Cement

In order to encourage and enhance the

bulk movement of cement in the country,

which is about 2% of the total installed

24

capacity, CMA continued to request the

Railways to suitably bring down the Rail

Classification Slab for bulk cement and

also provide attractive freight discount to

all those who purchase Special Purpose

Wagons for bulk movement of cement and

fly ash, for the entire life of wagons, which

is 35-40 years.

POWER

Cement is a continuous process Industry

requiring un-interrupted power supply. As

a thumb rule, the requirement of power is

20 MW for a million tonne plant. Cement

plants are making all out efforts to ensure

availability of uninterrupted and quality

power in their manufacturing operations,

since power constitutes a major cost item

in cement manufacture.

Most of the cement units have now

installed captive power generation

capacities to the extent of 60% of their

requirement, and even 100% in some

cases. Normally, expansions and new

projects have also to be equipped with

captive power supply. Captive power

generation capacity which was approx.

118 MW in 1982-83 rose to nearly 3000

MW, both Diesel and Thermal in 2011-12

and has further gone up during the year

under review. In addition, the Cement

Industry has installed Wind Farms of

around 237 MW. Capacity of Waste Heat

Recovery (WHR) based power generation

was more than 115 MW during the year.

The Industry produced 0.78 Mn.t. or 3% of

total cement production in 1982-83 by

using captive power, which has

substantially gone upto nearly 145 Mn.t.

or 59% of total production in 2011-12.

This augurs well with the need to release

pressure on Grid Power. Unfortunately,

the data in respect of 2012-13 are not

available with CMA in the background of

the restraint Order of CCI dated 20.06.2012

in case No. 29/2010 “Builders Association of

India Vs. CMA & Ors.”.

The Industry has placed significant focus

on improving energy efficiency in plant

operation over the years and it is an

ongoing process. The Cement Industry’s

average electrical energy consumption is

expected to come down to 78 kWh/t

cement from 80 kWh/t cement and the

average thermal energy consumption to

about 710 kcal/kg clinker from 725

kcal/kg clinker by the terminal year of

XIIth Plan (Year 2016-17). The best

electrical energy consumption presently

achieved by the state-of-the-art cement

plants is nearly 67 kWh/t cement and

thermal energy of about 667 kcal/kg

clinker, which are comparable to the best

reported figures of 65 kWh/t cement and

660 kcal/kg clinker in a developed

country like Japan. The Industry’s

proactive participation in the ongoing

implementation of the PAT (Perform,

Achieve and Trade) Scheme of Bureau of

Energy Efficiency (under the National

Mission for Enhanced Energy Efficiency-

one of the Eight Missions of the Prime

Minister’s National Action Plan on Climate

52nd Annual Report

25

Change) is expected to drive further

reduction in energy consumption in our

cement plants.

Certain contentious issues that creep in

while the Industry makes efforts for

further energy efficiency improvement,

that merit due attention of the authorities,

are highlighted below:

(i) Use of Alternate Sources of

Energy: The Cement Industry is proactive and to tide over power requirement threatened by coal

supply constraints, has been using alternate/waste derived fuels (WDF) including hazardous combustible wastes (HCW). At present, a number of cement plants are already utilizing pet coke to the extent of 60-100% and agricultural wastes such as rice husk and bamboo dust to the extent of 10-15%, also for captive power generation. The Industry deserves suitable incentivisation for such usage of alternate fuels. In this regard, the Tariff Commission had conducted a study as desired by the Department Related Parliamentary Standing Committee on Commerce (DRPSC) on ‘Review of Performance

of Cement Industry’ for the year 2010-11, with special emphasis on the cost of production of cement including normative cost of production. The Chapter 8 on ‘Findings and Conclusions’ of the Study Report, uploaded on the website of DIPP under the link of ‘Discussion Papers’, seeking

views/comments of the stakeholders/public, has made similar observations, and stated, while there is a need to increase the linkage of domestic coal, use of alternative fuel in the kiln as a substitute will also reduce the dependence on coal, specifically suggesting in Para 8.5 that “policy measures like capital and interest

subsidy to cement units using bio-wastes/fuel in the manufacture of cement can be thought about to encourage such initiatives by the cement units, since use of bio-wastes/fuels in the cement manufacture is an environmental friendly measure”. Such constructive suggestion coming from an Apex Government Agency of the country greatly inspires and reinforces the initiatives the Industry has already taken in increasing the usage of alternative fuels and raw materials in Cement plants.

CMA, on the basis of feedback

received from its Member

Companies, responded to the

aforesaid observations and

suggestions made by the Tariff

Commission on ‘Use of Alternate

Fuel’ as sought for by DIPP,

submitted a representation to DIPP

on 16th August 2013. The key points

raised in our representation are:

• XII Plan Working Group Report

on Cement Industry has also

recommended an Incentive

Policy.

26

• A specially prepared ‘Technology Roadmap: Low-Carbon Technology for the Indian Cement Industry’ by Cement Sustainability Initiative/World Business Council for Sustainable Development-Geneva & International Energy Agency-Paris and released by them in New Delhi on 25th February 2013 has focused on the need for implementation of five major emissions reduction levers, namely, Co-processing of alternative fuels and raw materials, improved thermal and electrical efficiency, clinker substitution, waste heat recovery, and newer technologies.

• We have requested

incentivisation for alternative

fuels usage in the Cement sector,

in respect of huge capital

investment as well as higher

regular expenses in the areas of

AFR pre-processing, storage,

handling & feeding system, for

hassle-free import of alternate

fuels, for considering promotion

of ‘Polluters’ Pay’ principle, and

for providing an enabling

environmental regulatory

mechanism to facilitate

increased usage of alternative

fuels.

(ii) Cogeneration of Power through

Waste Heat Recovery System:

Another noteworthy effort the

Cement Industry has been making is

the cogeneration of power through

Waste Heat Recovery (WHR).

Twelve cement plants have been

equipped with this technology to

generate power, and more are

initiating steps towards harnessing

WHR for cogeneration. The

potential exists in almost all cement

plants having kiln capacity of 3000

tpd (1 mtpa) and more. It has been

empirically established that an

average generation of about 4 MW

is possible from a plant of 1 mtpa

capacity. The main barrier to the

large-scale adoption of the

cogeneration technology in Cement

Industry is the high investment cost

of about Rs. 10 crore per MW as

compared to Rs. 4 to 5 crore/MW

for CPP (Coal based Thermal) and

even lesser for CPP (Diesel). CMA

has been for long representing to

the Authorities to treat WHR

qualifying as Renewable Energy, as

also enshrined in the Section

86(1)(e) of the Electricity Act 2003.

Needless to mention, promotion of

Alternative Fuels usage, Waste Heat

Recovery based cogeneration of power,

etc. in the Indian Cement Industry will go a

long way in further reduction of the

Carbon Footprint of the Industry and

thereby facilitate achieving the CO2

emission and Carbon Intensity Reduction

Targets under the Prime Minister’s

National Action Plan on Climate Change

(NAPCC).

52nd Annual Report

27

EXPORT

As mentioned in the previous year’s

Report, cement and clinker exports have

been scaling down continuously, mainly

because of high level of State levies and

royalties for which there is no Cenvat

Credit, infrastructure constraints; high

transportation cost from plants to border

points/ports; in addition to Government’s

encouragement of import of cement with

no custom duty, thus distorting the level-

playing field needed for the domestic

producers to establish its competitiveness

via-a-vis imported cement.

The Govt. of Nepal had significantly

enhanced over the years the Custom Duty

on the import of cement and clinker from

India. As a result, there has been a steady

decline in the export of cement and clinker

from India to Nepal. CMA, through its

representations to the Secretary, DIPP and

First Secretary (Commerce), Embassy of

India, Kathmandu requested to take up the

matter with the Govt. of Nepal for

reduction in custom duty appropriately

because Govt. of India allows duty-free

import of cement. Therefore, the same

logic and principle of reciprocity is

expected from the neighbouring countries

as well insofar as Indian trade is

concerned.

To make the Indian Cement/Clinker

competitive in the International Market

and with a view to giving afresh boost to

the Export of Cement and Clinker, CMA

has been making the following the

submissions to the Govt., from time to

time:

� Classification of cement for rail freight

be reduced from 150 as of today to

140. Differential classification of goods

for domestic and export purposes is

already in vogue for iron ore, where

transportation for export purposes

attracts a higher classification. In case

of cement, the classification for export

purposes needs to be reduced.

� The royalty paid on limestone should

be neutralized for export of cement.

This is consistent with the approach

that domestic taxes are not exported.

� Duty Drawback should be enhanced to

3% (i.e. erstwhile DEPB rates) to

sustain exports.

� There is no import duty on import of

Cement into the country. This tax

anomaly puts domestic manufacturers

at a disadvantage. Thus such

differences in tax treatment need to be

removed to offer a level playing field to

domestic production vis-à-vis imports.

The import of cement should also be

with a duty of 5 per cent along with the

applicable CVD.

� Cement/clinker export is subject to

high customs/port/bunker charges.

Exemption from these charges will give

a fillip for exports.

� Investments made for decongesting

our National ports by developing

28

private jetties/ports for export of

cement and clinker be allowed a higher

rate of depreciation.

PROMOTIONAL ACTIVITY: ADVOCACY

AND AWARENESS GENERATION

Cement Concrete Roads

As Members are aware, one of the

important items in the Charters for CMA is

generation of awareness about diversified

and new uses of cement and dissemination

of correct method of application to achieve

optimum results. The CMA and its

constituent Member Companies stepped

up their efforts in this direction during the

year under review 2012-13.

In this endeavour, CMA has, for long, been

pursuing consistently with the Central and

State Governments, Local-Self

Governments and other authorities for

construction of Cement Concrete Roads

and White-Topping in Urban and Rural

India, as also Highways. It may be recalled

that CMA has brought out several

technical publications – some of which are

of landmark projects like Mumbai-Pune

Expressway, Yamuna Expressway, etc., as

a part of propagation and documentation.

Over the years, National Seminars/

Workshops have been organized, inter-

active meetings held, and

representations/presentations made to

authorities. These sustained efforts of

CMA and its constituent Member

Companies have borne fruits in the form of

change in the mind-set of engineering

fraternity, officers and decision makers in

Government and Semi-Government Bodies

in favour of Cement Concrete Roads and

White-Topping.

Seminars/Workshops by CMA

During the period under review the

following Seminars/Experience Sharing

Workshops on Cement Concrete

Roads/White-Topping were organized

with the help of Nodal Cement Companies

for popularizing Cement Concrete Roads

and White-Topping.

• CMA and Central Road Research

Institute (CRRI) jointly organized a

Seminar on “Cement Concrete Roads

and White-Topping” on 24th August,

2012 at New Delhi. Lt. Gen. S.

Ravishanker, Director General Border

Roads was the Chief Guest. Dr. S.

Gangopadhyay, Director, CRRI

delivered the Welcome Address and

Shri N.A. Viswanathan, Secretary

General, CMA delivered the Theme

Address. There were Six presentations

by the experts on different aspects of

Cement Concrete Roads/White-

Topping including presentation on

Design and construction of Yamuna

Expressway with Cement Concrete

(6 lane – 165 kms) – A Case Study by

Col. (Retd.) A.K. Bhasin, Jaiprakash

Associates Ltd.

52nd Annual Report

29

A view of participants at the Workshop on Cement Concrete Roads and White-Topping held on 15th June 2013 at Dehradun

• Workshop on

“Construction and

Performance Aspects

of Cement Concrete

Roads” was organized

jointly by Task Force

for Quality Assurance

in Public Construction,

Govt. of Karnataka and

CMA on 28th March

2013 at Bengaluru. The

event was supported by

UltraTech Cement Ltd.,

the Nodal Company for

popularizing the

Cement Concrete

Roads/White-Topping

for Maharashtra, Gujarat, Goa and

Karnataka.

• CMA and UltraTech Cement Ltd.

jointly organized a Workshop on

“Cement Concrete Roads and

White-Topping” on 15th June 2013 at

Dehradun. Shri Amit Singh Negi, IAS,

Addl. Secretary, PWD, Dehradun

inaugurated the Workshop as Chief

Guest. During the Technical Session

three presentations were made by the

experts on different aspects of Cement

Concrete Roads and White-Topping.

In these Seminars/Workshops, the

participants evinced keen interest and the

discussions that followed showed open

mind of the Engineers and Officers of State

Governments and other authorities

towards adoption of new

technologies. These

Workshops have been well

attended by decision

makers, Senior Officers of

Government and Semi-

Government bodies, Stake-

holders, etc. These are not

one-off exercises, but a step

in a long and enduring

association to follow in the

cause of creation of world-

class infrastructure.

Seated on Dais in the Centre : Shri Amit Singh Negi, IAS, Addl. Secretary, PWD,

Uttarakhand. To his left: Shri K.R. Bhati, IAS (Retd.), Ex-Chairman, State Administrative

Tribunal, Uttarakhand & Formerly Addl. Secretary, Ministry of Road Transport and

Highways; Dr. L.R. Kadiyali, Chief Executive, M/s. L.R. Kadiyali & Associates; Shri Binod

Kumar, Scientist, CRRI. To his right: Shri N.A. Viswanathan, Secretary General, CMA;

Shri Lalit Mohan, Engineer-in-Chief, PWD, Uttarakhand; Shri Shashi Gaggar, Asstt. Vice-President, UltraTech Cement Ltd.

30

The focus of these Seminars/Workshops

has, inter alia, been on Concrete

Roads/White-Topping for Sustainable and

Cost Effective Development, Construction

& Maintenance of Concrete Roads, Modern

Technology in Concrete Roads and White-

Topping, Shifting of Utilities, Use of CMA

Software for Design. These Experience-

Sharing Workshops have provided an

excellent opportunity and a useful

interactive platform to all the stake-

holders to exchange valuable experience.

CMA publications on Cement Concrete

Roads were distributed at the Workshops.

Workshops/Seminars Participated

in/Sponsored by CMA

During the period under report, CMA

sponsored/participated in the

Workshops/Seminars related to cement

concrete roads which were organized by

other organizations such as Global

Management & Investment (GMI) Forum &

Prescon, UK, Kerala PWD, ICI- Kochi

Centre and ASAPP Media Information

Group. A Detailed list of Workshops and

Seminars on cement concrete roads CMA

participated in /sponsored is at

Annexure-VII.

Presentations/Meetings/

Communication

CMA officials along with cement

companies held meetings and organized

presentations with a number of Central

and State Govt. Officials and City

Development Authorities, etc. for

promotion of Cement Concrete

Roads/White-Topping. A list of

Presentations and Meetings organised is at

Annexure-VIII.

These Presentations covered technical

aspects and cost comparison of cement

concrete roads and bituminous roads.

CMA addressed letters to the Members of

Parliament, Chief Ministers, Ministers of

PWD, Rural Development and Urban

Development of different States and other

authorities, highlighting the advantages of

building road network in cement concrete.

CMA also requested the authorities to take

Policy Decision to construct Urban Roads,

Rural Roads, State Highways and National

Highways with Cement Concrete to avoid

heavy expenditure on maintenance of

existing bituminous pavements.

Technology Demonstration Project

To showcase the advantages of Cement

Concrete Road Projects/White-Topping,

cement companies have funded three

Demo Projects. Out of these, the one at

Bengaluru and the other at Jaipur have

already been completed in August 2010

and May 2011 respectively. Work on the

Third Demo Project (Velachery main road

at Chennai) flagged off by Hon’ble Mayor

of Chennai in June 2012, was completed in

August 2012 and opened to traffic.

The feedback is that all the three projects have been performing very well and have been appreciated by the users and decision makers. After the success of the projects these Governments are planning

52nd Annual Report

31

to construct more and more cement concrete roads in their States.

Cement Concrete Pavement and

Ambient Temperature

Your Managing Committee at its Meeting

held in September 2012 discussed the

news report regarding Ambient

Temperature. As a follow up, CMA got in

touch with several resource personnel,

accessed the internet and also took the

help of experts from Member Companies

as well. It has been overwhelmingly

established from the literature and

technical papers accessed that cement

concrete roads do NOT increase the

ambient temperature at all. On the

contrary, the rate of increase of ambient

temperature is actually reduced by

adoption of cement concrete roads.

Tender Notices for Cement

Concrete Roads

CMA has been obtaining details of the

tender notices for construction of cement

concrete roads invited by various State

Government and other

Authorities. In order to ensure

proper quality control

measures during construction

of such roads, CMA has been

addressing letters to the

concerned authorities and

forwarding its publication

“DOs and DONTs” to them for

guidance.

CMA Publications

Supplement on “Technology Demo

Project – White-Topping”

CMA brought out a Supplement “Technology Demo Project – White-

Topping” along with the January 2013 issue of Journal ‘CEMENT’.

The Supplement, inter alia, has covered important aspects of White-Topping;

Technology Demo Projects on White-Topping by Cement Companies in Bengaluru (Karnataka), Jaipur (Rajasthan) and Chennai (Tamil Nadu); Highlights of Comparative Advantages of Cement Concrete Roads/White-Topping; Effects of Cement Concrete Pavements on Ambient Temperature; Tests on Concrete and Pavement; Stages in Construction of White-Topping; White-Topping Technology implemented in Other Cities i.e. Indore (Madhya Pradesh), Pune, Pimpri-Chinchwad, Thane, Mumbai, Nagpur (Maharashtra) and Bangalore-Mysore Infrastructure Corridor Project at Bangalore developed by M/s. Nandi Infrastructure Corridor Enterprise Ltd. (NICE).

Technology Demo Project Chennai

32

51st Annual Session of CMA – 18th December 2012

Seated on Dais in the Centre: Chief Guest, Dr. S. Jagathrakshakan, Hon’ble Minister of State for

Commerce and Industry, Govt. of India. To his right : Shri MAMR Muthiah, President, CMA and Shri NA

Viswanathan, Secretary General, CMA. To his left : Shri OP Puranmalka, Vice President, CMA and Shri

KC Jain, Sr. President, Kesoram and Vasavadatta Cement

Shri MAMR Muthiah, President, CMA delivering Welcome Address.

Seated on Dais (L-R) Shri NA Viswanathan, Secretary General, CMA, Dr. S. Jagathrakshakan,

Hon’ble Minister of State for Commerce and Industry, Govt. of India, Shri OP Puranmalka, Vice

President, CMA and Shri KC Jain, Sr. President, Kesoram and Vasavadatta Cement

52nd Annual Report

33

51st Annual Session of CMA – 18th December 2012

Chief Guest, Dr. S. Jagathrakshakan, Hon’ble Minister of State for Commerce and Industry,

Govt. of India, delivering Inaugural Address. Seated on Dais (L-R) Shri NA Viswanathan,

Secretary General, CMA, Shri MAMR Muthiah, President, CMA, Shri OP Puranmalka, Vice

President, CMA and Shri KC Jain, Sr. President, Kesoram and Vasavadatta Cement

Chief Guest, Dr. S. Jagathrakshakan, Hon’ble Minister of State for Commerce and Industry,

Govt. of India, releasing the CMA Publication “165 km Yamuna Expressway in Cement Concrete through PPP Mode in Uttar Pradesh”

34

51st Annual Session of CMA – 18th December 2012

51st Annual Session of CMA – 18th December 2012

Shri MAMR Muthiah, President, CMA, presenting a Memento to Chief Guest, Dr. S.

Jagathrakshakan, Hon’ble Minister of State for Commerce and Industry, Govt. of India

Shri OP Puranmalka, Vice President, CMA, delivering Vote of Thanks.

Seated on Dais (L-R) Shri NA Viswanathan, Secretary General, CMA, Shri MAMR Muthiah,

President, CMA, Dr. S. Jagathrakshakan, Hon’ble Minister of State for Commerce and Industry,Govt. of India and Shri KC Jain, Sr. President, Kesoram and Vasavadatta Cement

52nd Annual Report

35

51st Annual Session of CMA – 18th December 2012

A view of participants at the 51st Annual Session of CMA

Another view of participants at the 51st Annual Session of CMA

36

165 km Yamuna Expressway in

Cement Concrete

CMA brought out a new Publication “165

Km Yamuna Expressway in Cement

Concrete.” The Publication was released

by the Chief Guest, Dr. S. Jagathrakshakan,

Hon’ble Union Minister of State for

Commerce and Industry on the occasion of

CMA’s 51st Annual Session held on 18th

December 2012 at New Delhi.

The Publication was widely circulated to

Road Construction Departments, Chief

Secretaries, Principal Secretaries of Public

Works and Urban Development

Departments of the States and also MPs

and MLAs.

The Publication has been very well

received and appreciated by the important

leaders of the Country, Authorities,

Engineers, etc. To quote a few of them are

Shri Ashok Gehlot, Hon’ble Chief Minister

of Rajasthan; Shri Chhagan Bhujbal,

Hon’ble PWD Minister, Government of

Maharashtra; Dr. C.S. Viswanatha,

Chairman, CIVIL-AID Technocraft Pvt. Ltd.,

Bengaluru and Past President, Indian

Concrete Institute; Shri V. K. Kanitkar, Vice

President, STUP Consultants Pvt. Ltd., Navi

Mumbai; Dr. J.D. Bapat, Independent

Professional, Pune; and Shri Suresh

Deolalkar, Director, Deolalkar Consultant,

Hyderabad.

TECHNICAL MATTERS

CMA Technical Committee under the

Chairmanship of Shri S.K. Wali, Whotetime

Director, JK Lakshmi Cement, the Task

Force on Environment under the

Chairmanship of Shri L. Rajasekar,

Executive President (Technology &

Research Centre), UltraTech Cement Ltd.

and the Task force on Energy under the

Chairmanship of Shri D. Sivagurunathan,

Advisor (Technical), The India Cements

Ltd., had regular quarterly joint meetings

during the year. Besides the members of

the Committee and Task Forces, the

meetings also provided an opportunity, to

the concerned plant Technical officers of

the member companies to share their

views on technical and other issues of

importance concerning the performance

of the Cement Industry.

The two Sub-Groups: (a) on Environment

and (b) on BIS & Quality, constituted by

the Technical Committee to ensure follow

up and review of the status and progress

on the various decisions taken by the

Technical Committee, had also regular

meetings in various Regions to ensure

participation from all cement clusters.

The Sub-Group on Environment met in

September 2012 at Gandhinagar, in

November 2012 at Hyderabad and in

February 2013 at Raipur. Some of the

important issues transacted during these

meetings included the process of

developing emission Standards (SO2, NOx,

PM), Environmental Standards for Mining

of Limestone, Installation of Continuous

Ambient Air Quality Monitoring Standards

(CAAQMS), facilitating increased Use of

Alternate Fuel Usage in Cement Plants,

Measurement of Mercury Emissions, and

the National Water Policy etc.

52nd Annual Report

37

The Sub-Group on BIS/Quality Issues met

thrice during the period September,

December 2012 and March 2013. The

meetings of the Sub-Groups also

witnessed participation of younger

executives from Cement Plants in line with

the objectives of a greater participation to

express their views in the deliberations

particularly on the development of new

standards and scope/need for revisions/

modification in the existing

standards. The Fourth Sub-

Group meeting held on 14th

June 2013 at JK Lakshmi

Cement Office, New Delhi,

considered inter-alia, the

three project proposals

submitted by NCB for

conducting detailed studies

on ‘Development of Portland

Limestone Cement (PLC)’,

‘Use of Performance

Improvers (PI)’ and ‘Testing

of Cement at Normal

Consistency’ as suggested by

BIS before considering

development of Standards for

these. These proposals were

subsequently discussed at the

57th Technical Committee

Meeting held on 5th July 2013

at Chennai. The detailed

scope of these Project

proposals is being finetuned

to proceed further.

Bureau of Energy

Efficiency (BEE) – PAT

Scheme

Consequent on the issue by the Bureau of

Energy Efficiency (BEE), Ministry of

Power, Government of India, of the

Gazette Notification of 30th March 2012 for

the implementation of the PAT Scheme,

BEE constituted a Normalisation

Committee to look into various issues

raised by Designated Consumers (DCs)

while implementing the Scheme and work

56th Meeting of CMA Technical Committee

in progress at Kolkata on 4th January 2013

Meeting of CMA Sub-Group-Environment Meeting (Southern Region)

in progress at Hyderabad on 27th November 2012

38

out necessary correction factors, for

various issues and parameters impacting

the target achievement. The Normalisation

Committee met at frequent intervals

during 2012-13. The specific

parameters/issues considered, inter alia,

included changes in power mix/fuel mix,

production with respect to the baseline,

drop in capacity utilization due to external

situation, increased fly ash injection,

increase/decrease in export of power etc.,

for arriving at correction factors. After

receiving the feedback from Cement

Companies, the Normalisation Committee

considered the parameters affecting the

Normalisation of Specific Energy

Consumption (SEC) and crystallized the

specific methodology to address them for

further consideration. These include -

• Clinker heat rate and clinkering

electrical energy versus clinker

capacity utilization of the kiln.

• Gross Calorific Value (GCV) vs. Captive

Power Plant (CPP) heat rate.

• Specific heat rate to be considered for

export of Power from Cement Plant

CPP.

• Specific heat rate of kiln for calculating

Notional energy of imported clinker

should be based on GCV and Net

Calorific Value (NCV).

• CPP heat rate versus Plant Load Factor

(PLF).

• Effect of the raw material quality.

• Change of major product and change of

clinker factor of the minor products

(Baseline period versus assessment

year).

• Energy losses due to frequent outage of

the grid power.

• Non-availability of Biomass.

• Mandatory usage of

industrial/municipal waste which are

having adverse impact on specific

thermal energy.

• Use of raw slurry with variable

moisture content.

• Differential Renewal Energy

Import, and

• Full or Partial plant/mines shutdown

due to statutory directives during the

PAT cycle (2012-15), etc.

The Normalisation Committee in its

meeting on 20th March 2013 finetuned the

parameters identified in the previous

meetings affecting normalization of SEC in

the Cement Sector. The findings were

thereafter placed before the Sectoral

Expert Committee of BEE. The

normalization factors arrived at will be

circulated by BEE to all Designated

Consumers (DCs) for their views before

these are formally notified by it for

necessary implementation in the First

Cycle.

Environment

During the year, CMA continued its efforts

to pro-actively follow up on the various

environmental issues impacting the

Cement Industry with the Government

authorities like Ministry of Environment

52nd Annual Report

39

and Forests (MoEF), Central Pollution

Control Board (CPCB), State Pollution

Control Boards (SPCB), Department of

Industrial Policy and Promotion (DIPP),

etc.

Emission Standards for Cement

Industry

CMA participated in the meeting of the

Expert Committee of MoEF under the

Chairmanship of Dr. Rashid Hassan,

Advisor (CP Divn.), MoEF convened on 8th

February 2013 to discuss the emission

standards developed by CPCB and

articulated the concerns of the Industry

about the need for fixing realistic and

practically achievable standards taking

into consideration the differences in

processes, products, Quality of the raw

materials, fuel, power and the vintage of

machinery, etc. Accordingly, CMA pleaded

for setting realistic standards for NOx

emission as against those recommended

by CPCB. The comparative details are

tabulated below:

NOx (mg/Nm3)

Plants

Recommended

by Authorities

(CPCB)

Proposed

by

Industry

Existing Plants

(after 3 years)

1000

800

1200

1000

New Plants 600 800

CMA further suggested that for New

plants, the standards should come into

force after 3 years (after the date of

Notification), with additional one year

time generally required for stabilization.

A separate standard for White Cement

plants based on a study was requested to

be formulated.

Subsequently, CMA separately approached

Secretary, Ministry of Environment and

Forests (MoEF) and Secretary (DIPP),

Ministry of Commerce & Industry with the

concerns of the Industry, along with the

chronological development of evolving

these Environmental Standards and the

impact the CPCB recommended Standards

would have on the performance of the

Industry and revisiting the same. CMA also

organized a meeting with Secretary

(DIPP), wherein senior representatives

from the Member Companies also

participated to apprise the Ministry on the

need for a consideration. Secretary (DIPP)

observed that since MoEF had already

taken a decision on the issue raised, a

detailed discussion at this stage would not

serve any purpose. He sought to know the

norms being followed by largest cement

manufacturers in other countries. In

response, it was informed that China is yet

to have any standards for emission.

Concluding the meeting, Secretary, DIPP

observed that the notification should be

awaited and the matter reviewed by

Industry in light thereof. A request was

also submitted to Hon’ble Minister, MoEF

for a review before issue of the

Notification. The Notification is still

awaited.

40

Development of Environmental

Standards for Mining of Limestone

Your Association participated in the

Meeting called by CPCB on 16th November

2012, on the presentation of the study

carried out by CIMFR, Dhanbad on the

development of environmental standards

for Mining of Limestone. Based on the

presentation, feedback received from the

Members Companies and the discussions

held, CIMFR was persuaded to undertake

measurement at 5 more mines to generate

adequate and more representative data.

Accordingly, the measurements have since

been conducted during March–May 2013

in five select plants of CMA Member

Companies. The report of CIMFR is

awaited.

Low-Carbon Technology Road Map

for the Indian Cement Industry

Cement Sustainability Initiative (CSI)

under the World Business Council for

Sustainable Development (WBCSD) in

cooperation with The International Energy

Agency (IEA) formally released the

Technology Roadmap in New Delhi on 25th

February 2013, outlining low-carbon

growth pathway for the Indian Cement

Industry.

According to the Roadmap, India’s fast

growing Cement Industry has the

potential to reduce its carbon emissions

by nearly half by 2050. The Report

outlines the way for the Indian Cement

Industry to reduce its CO2 compared to a

“business-as-usual” scenario. The savings

roughly equal the total CO2 emissions of

Thailand in 2009. This transition will also

result in energy benefits, reducing energy

consumption by at least 375 petajoules –

which is as much as the current annual

energy consumption in Sri Lanka.

Recognizing the Indian Cement Industry

as one of the most efficient in the World,

making strong efforts to reduce its carbon

footprint, the Report identifies

opportunities for further improvements

and sets outs milestones in the roadmap to

enhance the country’s energy security by

limiting the growth in energy

consumption i.e. in absolute emissions to

just a doubling or at most a 240%

increase, with a further reduction in the

direct CO2 emissions intensity (to 0.35 t

CO2/t Cement) by about 45% from current

levels by 2050.

While the Report recognizes the targeted

reduction as ambitious, it has identified

decisive action by all stakeholders as

critical to realizing the vision by achieving

the proposed levels of efficiency

improvements and emissions reduction.

For this, the Government, the Industry,

Financial Institutions and Research

Institutes must join hands to take

collaborative action in creating an

investment climate that will stimulate the

scale-up of the financing required.

52nd Annual Report

41

Bureau of Indian Standards (BIS) –

Revised Limits of SO3 in the Indian

Standards for OPC

The 19th Meeting of Cement and Concrete

Sectional Committee of BIS on 19th and

20th April 2012 adopted the revised limits

of SO3 at 3.5% in cement. This has been an

achievement for Cement Industry and for

your Association which has been

continuously pressing this matter. BIS has

since issued the revised Standards

incorporating the revised limits.

Other Initiatives

Increasing Thermal Substitution

Rate (TSR) in Indian Cement

Industry

CMA signed Phase-I of the Consulting

Agreement with Institute for Industrial

Productivity (IIP) for the IIP-funded

project on “Increasing Thermal

Substitution Rate (TSR) with increased

usage of Alternate Fuel and Raw materials

in the Indian Cement Industry” CMA is the

Anchor for the Project. A Forum of

Regulators and an Advisory Group were

constituted to provide necessary guidance.

The First meeting of the Forum of

Regulators was held at Gandhinagar on 5th

November 2012 under the Chairmanship

of Shri Hardik Shah, Member Secretary,

Gujarat State Pollution Control Board,

wherein it was resolved to seek necessary

clearance and support from Government

agencies to meet the ambitious target set

in the XIIth Plan for 5% TSR in Cement

Plants through increased usage of

Alternate Fuels. In the Second Meeting of

the Forum held at Vikram Cement Plant,

Neemuch, Madhya Pradesh on 21st

December 2012 under the Chairmanship

of Dr. B. Sengupta, Former Member

Secretary of CPCB, it was proposed that

MoEF would be approached for passing

executive orders with respect to attending

to some of the critical issues identified in

the Forum of Regulators. Discussions in

these Forum Meetings focused on

identification and prioritization of waste

for co-processing and alternative raw

material and blending material for cement

manufacture, inventorisation of waste,

transportation, health and safety

measures, etc.

The First Meeting of the Advisory Group

was held on 15th November 2012 with Shri

S.K. Wali, Wholetime Director of JK

Lakshmi Cement Ltd. in Chair. Based on

the deliberations at the Forum meetings

and the feedback received from the

Member Cement Plants, four select States

of Andhra Pradesh, Gujarat, Rajasthan and

Tamil Nadu were chosen and carried out

for Techno-economic feasibility studies on

the use of identified Alternate Fuels in 4

plants in the selected States.

The meeting of the Second Advisory Group

was held on 8th February 2013, wherein

the findings of the techno-economic

feasibility studies on the potential

availability and TSR undertaken in Cement

Plants in above four selected states, were

presented.

42

Seated on Dais (L to R)

Mr. Philippe Fonta, Managing Director, World Business Council for Sustainable Development,

Cement Sustainability Initiative, Switzerland

Dr. Jigar V. Shah, Executive Director, Institute for Industrial Productivity, Washington DC

Mr. M.A.M.R. Muthiah, President, Cement Manufacturers’ Association

Mr. B.K. Chaturvedi, Member, Planning Commission, Govt. of India

Mr. Saurabh Chandra,Secretary (DIPP), Ministry of Commerce and Industry, Govt. of India

Mr. N.A. Viswanathan, Secretary General, Cement Manufacturers’ Association

Mr. Ratan K.Shah, Group Executive President & Chief Manufacturing Officer, UltraTech Cement Ltd.

Phase-I of the Project resulted in an

implementable Action Plan for increasing

the usage of Alternate Fuel.

Conferences, Seminars &

Workshops

During the year, CMA jointly

organized/participated in the

following Events with a view

to promoting and sharing

new developments and

technical innovations with

different stakeholders in the

long-term interest of the

Industry:

International Conference

on Enhanced Usage of

Alternate Fuels and Raw

Materials – Co-processing

in Cement Plants

As a sequel to the successful

completion of the Phase-I,

CMA-IIP Consulting

Agreement for Phase-II was

entered into which envisaged

holding of an International

Conference for sharing the

outcome of Phase-I.

Accordingly, the above

International Stakeholders’

Conference on the outcome of

the Project was held on 7-8

August 2013 with a view to

analyzing the most promising

areas covering Technical,

Policy, Regulators and

Financial issues in order to

have a tangible outcome for

implementation.

The Conference, comprising four Technical

Sessions besides the Inaugural and

Concluding Sessions was Inaugurated by

Chief Guest, Mr. BK Chaturvedi, Member, Planning Commission, Govt. of India,

lighting the auspicious Lamp

52nd Annual Report

43

Shri B.K. Chaturvedi, Member – Planning

Commission and the Key Note Address

was made by Secretary, DIPP,

Shri Saurabh Chandra. A CMA-IIP joint

publication “Action Plan for Enhancing the

Use of Alternate Fuels and Raw Materials

in Cement Industry” was formally released

by the Chief Guest, Shri B.K. Chaturvedi.

Some of the leading International Experts

who spoke on the occasion and actively

participated in the deliberations include

Dr. Jigar V. Shah, Executive Director, IIP,

Washington DC; Mr. Philippe Fonta,

Managing Director – Business Application,

CSI, Switzerland; Dr. Kare Helge

Karstensen, Chief Scientist, SINTEF,

Norway; Mr. Pavel Cech, Regional Vice

President, Industrial Ecology, Lafarge

West and South East Asia. More than 200

delegates representing cross-section of

experts from the State and Central

Regulatory Authorities, Cement Industry,

Service Provider, Universities etc.

participated.

CMA and Cement

Sustainability Initiatives (CSI)

Having become the CSI

Communication Partner recently,

CMA’s Secretary General, Shri N.A.

Viswanathan and Dr. S.K. Handoo,

Advisor (Technical) participated in

the 6th Plenary Meeting of CSI held

at Guangzhou and Beijing during

3-6 September 2012. The meeting

provided an opportunity to interact

with representative heads of the

leading Cement Associations of

Europe (Cembureau), Canada, Australia,

Brazil and China, and to exchange views

on present issues related to the

development in the areas of environment

and energy efficiency. Besides CMA,

representatives from a number of CMA

Member Companies – UltraTech Cement

Ltd., Jaiprakash Associates Ltd., Dalmia

Cement (B) Ltd. etc. also participated. The

formal agreement of CMA becoming

communication partner with CSI was also

signed during the Meeting on 5th

September 2012 in the presence of Chief

Executives of a number of leading World

Cement Associations.

9th Green Cementech

CMA-CII have been jointly organizing

Annual International Conference on

Cement Technologies Green Cementech

for the past five years. This year too, CMA

joined hands as a Co-Partner in the 9th

Green Cementech held on 16-17 May 2013

at Hyderabad. The Theme of the

Shri N.A. Viswanathan, Secretary General, CMA delivering

Special Address at Green Cementech 2013.

Seated on the Dais (L to R) : Shri S. Raghupathy, ED, GII-Godrej GBC,

Shri K.N. Rao, Co-Chairman, Green Cementech 2013 & Director, ACC

Limited, Shri G. Jayaraman, Chairman, Green Cementech 2013 & Executive

President, Birla Corporation Ltd. and Shri K.S. Venkatagiri, Principal

Counsellor, CII – Godrej GBC

44

Conference was “Make Indian Cement

Plants World-Class in Green”. The

Conference broadly covered Recent

Trends in Pyro-processing and PAT

updates, Waste Heat Recovery Systems,

Environment Management, Latest

Development in Grinding System, AFR

Utilization, Energy Efficiency

Improvement Opportunities, Climate

Change and Sustainability.

Secretary General, CMA delivered a Special

Address at the Inaugural Session, besides

chairing the Master Speakers’ Session on

16th May 2013. The Session on RPO

Requirement was Chaired by Dr. S.K.

Handoo, Advisor (Technical), CMA.

Follow up and Monitoring

The other issues, which are at different

stages, related to collecting technical

information from cement plants on Waste

Heat Recovery, Status of Installation of

Continuous Ambient Air Quality

Monitoring Station (CAAQMS), Data on

Measurement of Mercury Emission, Data

on Water Consumption etc. in relation to

National Water Policy, Views on

Classification of Project Categories by

MoEF, suggestion to DIPP on incentivizing

the use of alternate fuel in Cement

Industry, etc. are regularly being pursued

by the Association.

Interaction with Service Providers

on Energy and Environment to

Cement Industry

In order to have an update on the various

innovative and the availability of various

equipments and services, CMA Technical

Committee provided opportunity for a

brief presentation by Service Providers

before the Technical Committee on the

latest technical developments. Some of

these include Kiln Tyre & Support Roller

for Cement Industry, Energy Efficiency

Solutions and Air Pollution Control

System.

Additionally, a presentation was also

made on National Waterways Project,

before the Technical Committee.

The project envisages networking of rivers

in India, covering Himalayan, Central and

Southern Waterways. The project is

claimed to be beneficial to the Cement

Industry on account of increasing cement

usage for construction of dams etc.

The mammoth project proposal includes

constructing 15000 km of balancing

reservoir and navigation canal running

parallel, and with a cross section of 120m

x 10m covering the entire country. The

project will also include cross over,

bridges, hydraulic structures, culverts,

aqueducts, irrigation development works,

hydro power plants (with a total installed

capacity of 60000 MW) inland ports,

fishing harbors, link canals and express

ways along the Smart Waterways.

As per the project indications, it is

estimated that more than seven hundred

million tonnes of cement will be

52nd Annual Report

45

required to complete the project. At a time

when the consumption of cement in the

country has plastered partly due to the

problem of water scarcity and economic

slowdown, the Smart Waterways Project

should offer a window of opportunity for

the Cement Industry.

Technological Information

Dissemination & Publications

During the year under review, CMA

published three issues of the Quarterly

Journal, “Cement, Energy and

Environment”. The Journal continues to

serve as an excellent medium of

communication and dissemination

amongst the ground level technical

personnel and executives of the Member

Cement Companies on rapidly advancing

spheres of technology and developments

across the world including energy,

environment, climate change and

sustainability issues bearing huge impact

on the Cement Industry. Articles from

eminent National and International

Experts dealing with these subjects are

regularly published. A number of papers

are being regularly contributed by our

Member Companies in addition to sharing

their technical experience and

achievements. Alongside, there are regular

insertions of summary of important

articles, news briefs and events summary

culled from reputed journals, published

brochures and newspapers and magazines

covering technical developments

impacting the Cement Industry.

COMPETITION COMMISSION OF INDIA

Appeals before the Competition

Appellate Tribunal: against the

Orders of Competition Commission

of India in -

(i) Appeal No. 103/2012 (against Case No. 29/2010); and

(ii) Appeal No. 122/2012

(against RTPE No. 52/2006)

As already informed last year, the

Competition Commission of India vide its

Order dated 20.06.2012 in case No.

29/2010 “Builders Association of India Vs.

CMA & Ors.” had held 10 Cement

Companies guilty of limiting and

controlling supplies in the market and of

determining prices through anti-

competitive agreement detrimental to the

cause of consumer and the economy and

found CMA guilty of providing a platform

for exchange of sensitive information on

production and prices of the competing

parties in contravention of the provisions

of Section 3(3)(a) and 3(3)(b) read with

Section 3(1) of the Act.

Based on its conclusion as above, the 10

cement companies were imposed a

penalty of 0.5 times of their net profit for

the years 2009-10 and 2010-11. In the

case of CMA, holding the Association guilty

of providing a platform to the cement

companies and facilitating cartelization,

the Commission imposed a penalty of 10%

of the receipt in terms of Section 27(b) of

an amount of Rs.73.00 lakh. Further, the

Commission also issued the following

directions:

46

“(i) The Opposite Parties should “Cease and desist” from indulging in any activity relating to agreement, understanding or arrangement on prices, production and supply of cement in the market;

(ii) CMA should disengage and disassociate itself from collecting wholesale and retail prices through the member cement companies and also from circulating the details on production and dispatches of cement companies to its members.”

Additionally, the Competition Commission in RTPE No. 52/2006 “Builders Association of India Vs. CMA & Ors.” vide its Order dated 30.07.2012 mentioned that parties in Case No. 29 of 2010 and in the instant case are the same except M/s. Shree Cement Ltd., which was not a party in Case No. 29 of 2010. In Case No. 52/2006 “Builders Association of India Vs. CMA & Ors.” the Commission imposed a penalty on M/s. Shree Cement Ltd. at the rate of 0.5 times of its net profit for the years 2009-10 and 2010-11 aggregating to Rs.397.51 Crores.

As decided by the Management, CMA filed an Appeal (Appeal No. 103/2012) before the Competition Appellate Tribunal on 27th August, 2012, including prayer for complete Stay of the operation of the Competition Commission’s Order dated 20.06.2012. Since the Commission held CMA also guilty in the second case No. 52/2006, CMA filed Appeal (Appeal No. 122/2012) in this matter as well before the Competition Appellate Tribunal on 27th September, 2012 seeking relief to set aside the Order of the CCI passed in RTPE No.52/2006 on 30.7.2012.

The Appeals were taken up by the

Competition Appellate Tribunal(CAT). By

its Order dated 13.09.2012 the CAT

directed that no coercive steps should be

taken against the appellants for the

recovery of the penalty ordered by the CCI.

Regarding some common issues

pertaining to the very validity of the order

passed by the CCI, on the request of all the

counsels of various parties that common

issues be addressed first and thereafter

Appeal be argued individually and heard

on the basis of the individual facts

pertaining to that particular appellant, the

interim protection granted was extended

up to 29th January, 2013 by the Tribunal.

The submissions made before the CAT on common points by the counsels appearing on behalf of Appellants as well as CCI counsel started on 18th February 2013 which continued on a daily basis on all the working days of the Tribunal till 4th March 2013.

The following common issues were

presented during the hearing:

• Principle of Natural Justice - Hearing before the CCI is adjudicatory and therefore the Principle of Natural Justice has to be followed. Internationally right to cross examine and principles of natural justice have been accepted as part of fairness of procedure.

• Impropriatory of Chairman of the CCI in not participating in deliberation process and affixing his signature on the impugned order dated 20.6.2012.

• Standard of Proof required to be followed by the CCI to be in line

52nd Annual Report

47

with the requirements of quasi criminal proceedings.

• Inspection by the Appellants of the important documents relied upon by the CCI, sought was not allowed. Even certified copies of the same were refused.

• Some reports of the Economic Committee of CCI were quoted by the DG in his Report & were accepted by the CCI in its Order. Since the report was of the CCI itself and one of the members presided over the preparation of the said Report, the Commission’s hearing is vitiated inasmuch as the members have acted on their own Report and thus have acted as Judge in their own cause.

• Right of Cross Examination, which is fundamental, was not given.

CMA, in addition to the submission made by the other Appellants, and also addressed the Tribunal on the impact of the first part of the directions of the Commission on ‘Cease and Desist’ and second part of the same which reads as under :

“ii) CMA should disengage and disassociate itself from collecting wholesale and retail prices through the member cement companies and also from circulating the details on production and dispatches of cement companies to its members.”

Submissions were advanced by CMA’s Counsel for modification of the said part of the Order. It was urged before the Tribunal that CMA being an Association of

the cement manufacturers has to take up with the Government and other statutory authorities issues of common interest of the Industry. The same relate to taxation, availability of railway rakes for transport of coal and cement, availability of coal, electricity etc. It was also urged that in order to achieve the said purpose collection of data by CMA is utmost necessary and unless it has the data

available with it, it cannot take up the common issues with the appropriate authority(ies) which are necessary to create appropriate infrastructure required for growth of the Industry. It was further pointed out that ‘Planning Commission’ also requires data as, cement is one of the basic raw material for the growth of infrastructure. The Government also requires CMA to furnish data to answer Parliamentary Questions if and when tabled by members of Parliament. In view of the foregoing, it was argued that it is utmost necessary that CMA be permitted to collect data of production and despatches of cement as, in the absence of such data, CMA would not be in position to function effectively. Modification of the

second part of the Order, it was pleaded, is also necessary because CMA functions through its Committees which comprise of its members. In order to take up any issue appropriately with the Government or any other Authority data must necessarily be furnished to the said committee to put forth the case of Industry before such authority. If such data is handed over to a member of the Committee, the said act by itself can be interpreted as circulation of details inasmuch as the said member would have then access to the data of not

48

only his company but of other companies as well.

On 4th March, 2013, after hearing the

submissions, the Hon’ble Members observed that they may or may not decide on common issues and since the application for stay was also pending, each party should make their individual submissions on their stay applications as well. Accordingly, Sr. Advocates on behalf of their Appellants, argued the matter on 13th, 14th, 15th and 18th March, 2013.

The Hon’ble Competition Appellate

Tribunal passed an Order on 17th May,

2013 disposing of the stay applications in

the Appeals filed against CCI’s Order dated

20.6.2012 in case no. 29/2010 and dated

30.7.2012 in RTPE No. 52/2006.

The Ld.Tribunal in its aforementioned

Order pointed out that it cannot be denied

that very substantial points have been

raised by the appellants and these points

have also been substantially met by the

learned counsel appearing for the CCI as

also by the Counsel appearing for Builders’

Association, informant in the matter and a

very substantial issue would be required

to be decided in the light of rival

contentions by the parties on the exact

role of CCI in respect of its adjudicatory

functions, in addition to its regulatory and

advisory functions.

The Tribunal further held that it needs to be tested whether the CCI would be bound

by the judicial discipline and the norms or it would only be an advisory, regulatory or an expert body, so as not to be bound by the strict judicial norms. This being a very

complex question would require not only the consideration of Section 22, but also Section 15 and the General Regulations, which also were amended.

In view of the foregoing, the Tribunal held that there is a prima-facie case for granting of stay, at least in respect of the penalties and accordingly granted stay to the penalties with a condition that the appellants deposit 10% of the penalties

inflicted. The Tribunal further made it clear that the deposit of the penalty should be within one month from the date of order i.e. 17.5.2013 and that if the penalties are not deposited, the appeal shall be treated as dismissed without further reference to the Court. As regards the orders of ‘cease’ and ‘desist’ the Tribunal refused to stay that order against the appellants, including the Cement Manufacturers Association stating that they do not find anything wrong at least prima-facie.

CAT also clarified that the aforementioned Order will govern all the Appeals filed by 11 Appellants (except the Appeal filed by Shree Cement Ltd. against the CCI order dated 30.7.2012 in RTPE No. 52/2006)

and fixed the matter for further hearing on 21st August, 2013.

In compliance of the above Order, CMA deposited 10% penalty amounting to Rs.7,30,000/- with the Competition Commission of India on 14th June, 2013.

The other Appellant Cement Cos.(except

JK Cement Ltd.) filed Appeals before

Supreme Court of India against the above

Order of CAT. The Apex Court by its Order

dated 12.7.2013 modified the Order of the

52nd Annual Report

49

Tribunal to the extent that 10% amount

towards penalty be deposited with the

Tribunal by each Company and the

Tribunal will ensure that a separate

account is opened in a nationalized bank

with a provision that the said amount is

kept in a short term fixed deposit in the

name of the company which will be

initially for a period of six months

renewable after the end of its expiry, if

necessary. The principal amount and the

interest which is fetched by the account

holders will be dealt with in the manner

which would be considered appropriate

by the Tribunal at the relevant stage of

disposal of the appeals pending before it.

The Apex Court also extended the time for

depositing the 10% penalty from 16th

June, 2013 to 24th June, 2013.

The matter was listed before the Tribunal

on 21st August 2013. Since some part

heard matters were going on and it was

not possible for the Tribunal to take up the

hearing in the matter on a day to day basis

hence the matter has been adjourned to

18th November 2013.

SERVICE TAX ON MEMBERSHIP

SUBSCRIPTION

Members may kindly recall that CMA had received two Show Cause Notices (SCNs)CNo.1-26(494) ST/Adt./Gr.-B-III/ CMA/ 09 dated 21.10.2010 amounting to Rs.3,84,07,363 (including Cess) for the period 04/2005 to 09/2009 and C.No. D-1/ST/R-IV/CMA/ SCN/ 42/ 2012/ 6607 dated 20.04.2012 amounting to Rs.6,43,55,835/-(including Cess) for the period 10/2009 to 09/2012. from Commissioner, Service Tax

Commissionerate, New Delhi stating that the amount recovered by the CMA as Subscription are in the nature of value of taxable services provided by the Association to its members in terms of provisions of the Service Tax Act and Rules and as to why the above amounts of Service Tax should not be demanded and recovered from CMA along with interest and penalties applicable under various sections of the Finance Act, 1994.

CMA filed its replies, as drafted by M/s. Lakshmikumaran & Sridharan, to the above SCNs with the Commissioner, Service Tax, Delhi, in June, 2011 and August, 2012 respectively. Further, based on the Legal Opinions of M/s. Lakshmikumaran & Sridharan and Shri N Venkataram, Chennai based Advocate, CMA registered itself in September, 2011 with the Service Tax Department for payment of Service Tax on Membership Subscription. After registration, CMA has been collecting Service Tax from Members on Membership Subscription and depositing the same, under protest with the department regularly.

In August, 2012 the Office of the Commissioner, Central Excise & Service Tax, Panchkula informed CMA that above mentioned SCNs had been transferred to Commissioner, Central Excise & Service Tax, Panchkula. Personal hearing in the matters was fixed on 11.09.2012 which was attended by the Advocate of M/s. Lakshmikumaran & Sridharan on behalf of CMA.

Commissioner, Central Excise & Service

Tax, Panchkula, thereafter passed an Order in original No.25-26/Commr./

50

PKL/2012-13 dated 31.10.2012 against the above two Show-cause Notices confirming Service Tax amounting to Rs.1,24,78,600/- (including cess) in respect of SCN CNo.1-26(494)ST/ Adt./Gr.-B-III/CMA/09 dated 21.10.10 for the period 01.04.2008 to 30.09.09 and Service Tax amounting to Rs.72,98,813/-(including Cess) in respect of SCN C. No. D-I/ST/R-IV/ CMA/ SCN/ 42/ 2012/ 6607

dated 20.4.2012 reducible by Rs.21,57,850/- as tax liability subject to the verification of the amount deposited by CMA.

In addition, interest on the above confirmed amount of tax under Section 75 of the Finance Act, 1994 was demanded and Penalty of Rs.10,000/- was also imposed under Section 77 of the Act in addition to Penalty of Rs.1,24,78,600/- and Rs.72,98,813/- in respect of the first and second SCNs respectively.

The Order provided for reduction in the penalty amount of Rs.21,52,580/-(Service Tax already deposited with Service Tax Department by CMA) to CMA subject to verification of tax realised in the time frame fixed for payment of tax.

The total amount payable by CMA as Service Tax was confirmed as Rs.1,76,24,833 (Rs.1,97,77,413 less Rs.21,52,580/-(tax already paid by CMA). An equal amount of penalty i.e. Rs.1,76,24,833 was also levied in addition to penalty of Rs.10,000/- u/s 77. This works out to a total amount of Rs. 3,52,59,666 besides interest as against the original demand of Rs.10,27,63,198/- with an equal amount of penalty and interest applicable on tax demanded up to the date of payment of tax.

As advised by M/s. Lakshmikumaran &

Sridharan, Legal Experts, CMA filed two Appeals (for each SCN) in February 2013 before the Customs, Excise and Service Tax Appellate Tribunal praying to (a) set aside the impugned Order-in-Original dated 31.10.2012 passed by the Ld.Commissioner (Adjudication), C.E. Commissionerate, Panchkula and allow the appeal in full with consequential

reliefs; (b) set aside the service tax demand alongwith interest & penalty and stay its recovery till the disposal of the appeal; and (c) grant a personal hearing etc.

The matter for grant of stay was listed

from time to time but did not reach before

the bench for hearing. The matter is now

listed for 23rd September, 2013.

In the meantime in July, 2013 CMA

received a letter from the Office of the

Asstt.Commissioner of Service Tax

regarding Recovery of Government dues

stating that since the CESTAT has not

granted any stay, CMA should deposit the

Government dues confirmed vide the

Order-in-Original dated 31.10.2012.

In reply, CMA as advised by its

Consultants, informed the department that

stay applications were listed for hearing

before the Hon’ble CESTAT on 1.7.2013.

Since the matter could not be heard the

same has now been adjourned to

23.09.2013. As the stay applications are

unheard, CMA requested the office of the

Asstt. Commissioner of Service Tax to

await the outcome of the stay applications

and not to initiate any recovery action

during the pendency of the matter.

52nd Annual Report

51

In January, 2013 CMA received another

Demand-cum-Show Cause Notice Calling upon CMA to show cause as to why (a) Service Tax amounting to Rs.34,42,775/- (including cess) should not be demanded and recovered from CMA for the period October 2011 to March 2012 and above Service Tax paid by the CMA should not be appropriated towards the payment of service tax as the service tax already paid

by the CMA; and (b) interest as applicable on the amount mentioned above and (c) penalty under Section of the Act should not be imposed upon on CMA inasmuch as CMA failed to pay the due service tax and Cess in time.

CMA in consultation with M/s. Lakshmikumaran & Sridharan, Legal Experts, sent a reply to Service Tax department stating that since the service tax in respect of “Club or Association Service” has been already paid “under Protest” as Tax to the Government for the period October 2011 to March 2012, the

question of appropriation of service tax, which stands already paid by the Association to the Government, does not arise. CMA further added that our

payment “Under Protest” cannot be

construed as non-payment of tax and, therefore, the proceedings initiated under the present SCN dated 12th January, 2013 may be dropped and the entire demand proposed in the SCN be set aside.

INDUSTRIAL RELATIONS

Your Managing Committee is glad to report that the Industrial Relations in the Member Cement Companies continued to be cordial, harmonious and healthy, as

hitherto, during the period under review.

Members may kindly recall that in

February, 2011 CMA on behalf of Member Companies /Units, who had authorized CMA to negotiate with Workmen’s Federations/Unions on the demands raised by them, had signed a Memorandum of Settlement (MOS) dated 11th February 2011, which is valid for a period of 4 years from 1.4.2010 to 31.03.2014.

In December, 2012, CMA received a letter, jointly signed by the representatives of the Workmen’s Federations/Unions viz. INCWF (INTUC), ABCMS (BMS), AICWF (AITUC), HMS, CITU and LPF, and addressed to President, CMA for a meeting to understand and appreciate the progress in the implementation of the Memorandum of Settlement and related issues.

Since Shri N Srinivasan, Past President, CMA and Vice Chairman & Managing Director, The India Cements Ltd., had settled the Wage Negotiations culminating

in signing of the aforementioned MOS, President, CMA, requested Shri Srinivasan to kindly have this representation also examined under his guidance. It was decided that in the background of a long history of cordial, harmonious and healthy relations the Industry has had with the workmen’s Federations so far, it would be appropriate to meet the workmen’s representatives as a gesture of goodwill, although there was no commitment for such a mid-term meeting.

Accordingly, Shri N Srinivasan and

Shri Uday Khanna, Chairman, Lafarge

India Pvt. Ltd. had a meeting with the

workmen representatives in March, 2013

52

in CMA Office in Mumbai. During the

meeting, matters of common interest and

the position of the Cement Industry as also

the progress of the implementation of

Settlement was reviewed and discussed.

Shri Srinivasan also took the opportunity

to highlight and explain to the

representatives of Workmen’s

Federations/Unions the current downturn

the Cement Industry is witnessing and the

adverse impact the ever increasing cost of

inputs is having on this Industry.

RECONSTITUTION OF DEVELOPMENT

COUNCIL FOR CEMENT INDUSTRY

In exercise of the powers conferred by

Section 6 of the Industries (Development

& Regulation) Act, 1951 (65 of 1951), the

Deptt. of Industrial Policy and Promotion,

Ministry of Commerce and Industry,

reconstituted the Development Council for

Cement Industry (DCCI) under the

Chairmanship of Shri M.A.M.R. Muthiah,

President, CMA, for a period of 2 years

from 31st October 2012.

Apart from Thirteen Sr. Members of

Cement Industry, the Council is being

represented by eleven Members from

other important Organisations viz.

National Council for Cement & Building

Materials (NCCBM), Indian Cement &

Allied Workers Federation, Asbestos

Cement Products Manufacturers

Association, Consumer Coordination

Council, Deptt.of Industrial Policy &

Promotion, Ministry of Commerce and

Industry, Railway Board, Deptt. of Coal,

Ministry of Rural Development, Ministry of

Urban Development & Poverty Alleviation

and National Highway Authority of India

(NHAI).

REVISION OF CESS RATE ON CEMENT

DIPP vide their letter No. No.17(1)2012-Cem/106 dated 5th February, 2013 sought CMA’s comments/suggestions on the proposal on enhancement of Cess on Cement from existing Re. 0.75 per tonne to Rs.3.50 per tonne for more allocation of funds to NCBM for carrying out their Research and Development activities.

CMA, after consolidating the comments/suggestions received from the Member Companies and as decided by the Managing Committee, submitted the following views to the DIPP:

� In 1993, the DIPP had fixed the rate of Cess at Re 0.75 per MT of cement on the recommendation of Development Council of Cement Industry. As such, the proper forum for considering the revision of Cess would be the Development Council for Cement Industry only.

� In the last 20 years, there has been an increased collection of Cess from Cement Industry. Out of Rs. 16 crores collected as Cess from the Industry last year, about 50% only was released to NCBM for meeting their administrative expenses and hardly any R&D work of any significance was carried out from this fund by the NCBM for the benefits of the Industry.

� Currently, a large surplus from Cess fund is available with the Govt. in addition to the substantial funds in Cement Regulation Account of the Industry.

52nd Annual Report

53

� The revision of Cess rate on cement would be detrimental to the interest of the Industry which continues to grapple with various challenges.

� CMA should not agree for any increase in the current Cess of 75 paise/MT. In fact, there is a case for reduction in the rate of Cess from Re 0.75 to Re 0.40 per MT.

XII PLAN REPORT – FOLLOW-UP

ACTIONS

As mentioned in the last year’s Report, Planning Commission (Industries

Division) by its Office Memorandum dated 29th April 2011 constituted a Working Group on Cement Industry for the XIIth Five Year Plan (2012-2017) under the Chairmanship of Secretary, Department of Industrial Policy & Promotion (DIPP), Ministry of Commerce and Industry with other stake holders including President, Cement Manufacturers’ Association as Member. The Group had submitted its Report to the Planning Commission in December 2011 containing cement capacity and production targets together with various recommendations.

During the year, CMA had followed- up these Recommendations with various concerned Govt. Departments/Ministries independently and also requested Industry’s Nodal Ministry, DIPP to kindly take them up appropriately further with the

concerned authorities for their

implementation so that cement capacity and

production targets of 479 Mn.t. and 407

Mn.t. respectively fixed for the terminal year

of the XIIth Plan (2016-17) by the Working

Group would be achieved.

CMA PUBLICATIONS/PERIODICALS

During the year 2012-13, CMA brought

out/ updated the following publications/

periodicals:

� CMA Directory

� Indian Cement Industry - Statistics

� 165 km Yamuna Expressway in Cement Concrete through PPP Mode in Uttar Pradesh

� Supplement “Technology Demo Project – White-Topping” along with the January 2013 issue of Journal ‘CEMENT’

� Cement, Energy and Environment – Quarterly

� Cement Journal – Quarterly

� Cement News Digest – Weekly

A detailed list of CMA publications is given

in Annexure-IX.

AUDIT

The Accounts of the Association for the

year ended 31st March 2013 have been

audited by M/s K.S. Aiyar & Co., Chartered

Accountants.

54

New Delhi (M.A.M.R. Muthiah)

November 2013 President

52nd Annual Report

55

LIST OF ANNEXURES

ANNEXURE-I Pan India Performance of Cement Industry

ANNEXURE-II Chairmen/Co-Chairmen of CMA Committees

ANNEXURE-III List of Coal Blocks Identified for Allocation to Cement Industry by Ministry of Coal vide its Notice No.13016/47/2008-CA-I(Pt.) Dated 30th May 2013

ANNEXURE-IV Month-wise Coal Receipts against FSA/Linkage

ANNEXURE-V Procurement and Consumption of Fuel including for Captive Power Plants

ANNEXURE-VI Cement and Clinker Loading – Railway Zone-wise

ANNEXURE-VII List of Seminars/Workshops on Cement Concrete Technology Co-Sponsored/Participated by CMA

ANNEXURE-VIII List of Presentations/Meetings regarding Cement Concrete Roads and White-Topping

ANNEXURE-IX List of CMA Publications/Periodicals

*****

56

ANNEXURE-I

PAN INDIA PERFORMANCE OF CEMENT INDUSTRY (Information collected directly and indirectly from different sources by CMA)

(Mn.t)

Year

Capacity at

the Year End Cement

Production

VII Plan

1989-90 (Terminal Year) 61.74 45.42 Annual Plans 1990-91 64.55 48.90 1991-92 66.98 53.61 VIII Plan

1992-93 70.61 54.08 1993-94 77.38 57.96 1994-95 84.22 62.35 1995-96 96.18 69.64 1996-97 105.68 76.22 IX Plan

1997-98 110.93 83.16 1998-99 116.98 87.91 1999-00 120.16 100.45 2000-01 133.04 100.11 2001-02 146.04 106.90 X Plan

2002-03 150.48 116.35 2003-04 157.05 123.50 2004-05 164.70 133.57 2005-06 171.10 147.81 2006-07 178.89 161.64

XI Plan

2007-08 209.20 174.31 2008-09 232.54 187.60 2009-10 294.32 217.44 2010-11 323.02 227.80 2011-12 340.44 247.45 2012-13 @ - 251.12

@ From website of the Office of the Economic Advisor, DIPP

52nd Annual Report

57

ANNEXURE-II

CHAIRMEN/CO-CHAIRMEN OF CMA COMMITTEE

CMA HIGH POWER COMMITTEE

Shri M.A.M.R. Muthiah Chairman President, CMA & Managing Director Chettinad Cement Corpn. Ltd

Shri O.P. Puranmalka Co-Chairman Vice President, CMA & Wholetime Director UltraTech Cement Ltd

CMA COMMITTEE ON COAL MATTERS

Shri Arun Daga Chairman

Sr. Vice President Head - Central Procurement Cell UltraTech Cement Ltd Cement Manufacturing Division

Shri C.G. Sudarshan Co-Chairman General Manager (Mtls.) Madras Cements Ltd

CMA COMMITTEE ON RAILWAY MATTERS

Shri Rajeev Mehta Chairman

Executive President (Logistics) UltraTech Cement Ltd

Shri Sunil Agarwal Co-Chairman

Sr. Vice President (Mktg.) JK Lakshmi Cement Ltd

CMA FINANCE/LEGAL MATTERS COMMITTEE

Dr. Shailendra Chouksey Chairman Wholetime Director JK Lakshmi Cement Ltd

58

ANNEXURE-II (Contd.)

CMA TECHNICAL COMMITTEE

Shri S.K. Wali Chairman Wholetime Director JK Lakshmi Cement Ltd Shri L. Rajasekar Co- Chairman Executive President (Technology & Research Cell) UltraTech Cement Ltd

CMA ENERGY TASK FORCE

(Part of Technical Committee)

Shri D. Sivagurunathan Chairman Advisor (Technical) India Cements Ltd Shri R. Bhargava Co-Chairman Jt. Vice President (Environment) Shree Cements Ltd

CMA ENVIRONMENTAL TASK FORCE

(Part of Technical Committee)

Shri L. Rajasekar Chairman Executive President (Technology & Research Cell) UltraTech Cement Ltd Shri P.L. Subramaniam Co-Chairman Sr. President (Operations) India Cements Ltd

52nd Annual Report

59

ANNEXURE-III

LIST OF COAL BLOCKS IDENTIFIED FOR ALLOCATION TO CEMENT INDSUTRY

BY MINISTRY OF COAL VIDE ITS NOTICE NO.13016/47/2008-CA-I(PT.)

DATED 30TH MAY 2012

Sl.No. Coalfield Block Area

(Sq.km)

Tentative

Depth

Range (m)

Total

Reserve

(MT)

General

Grade

Status of

Detailed

Exp.

OC/UG Ultimate

capacity

mty.

1. Kamptee Bokhara 3.5 Incorp-315 26 A-G Detailed OC

2. Kamptee Tonda Khairi-Khandala

7.8 Incorp-500 59.67 C-F Semi Detailed

UG

3. Sohagpur Bicharpur East

6 165-300 40 B-D Regional UG

4. Raniganj Andal-Babuisole

3.7 20-600 101.29 B-E Explored OC/UG 0.50

5. Pench-Kanhan

Rawanwara East

4 500-300 46.00 B-F Explored UG 0.50

6. Pench-Kanhan

Dhau North 4 100-600 22.00 B-E Explored UG 0.30

7. Kamptee Dahegaon Dhapewada

28 200-650 341.90 A-F Not Explored

UG 1.0

60

ANNEXURE-IV

MONTH-WISE COAL RECEIPT AGAINST FSA/LINKAGE (2008-09 to 2012-13)

(Mn.t.)

Month 2012-13 2011-12 2010-11 2009-10 2008-09

April 0.85 0.97 0.90 0.91 1.09

(1.36) (1.31) (1.18) (1.15) (1.54)

May 0.98 0.92 0.96 0.86 0.99

(1.36) (1.31) (1.18) (1.15) (1.54)

June 0.95 0.94 0.92 0.83 1.16

(1.36) (1.31) (1.18) (1.15) (1.54)

July 0.92 0.90 1.06 0.92 1.05

(1.37) (1.31) (1.18) (1.23) (1.50)

August 0.75 0.92 1.15 1.00 1.05

(1.37) (1.32) (1.18) (1.23) (1.50)

September 0.76 0.74 1.02 0.85 1.09

(1.37) (1.32) (1.18) (1.23) (1.50)

October 0.92 0.65 1.24 0.98 1.24

(1.37) (1.32) (1.28) (1.23) (1.54)

November 0.81 0.85 1.01 0.95 1.32

(1.37) (1.34) (1.28) (1.23) (1.54)

December 0.99 0.97 0.97 0.78 1.36

(1.37) (1.34) (1.28) (1.23) (1.54)

January 0.90 0.80 1.03 0.89 1.49

(1.37) (1.34) (1.30) (1.22) (1.54)

February 0.75 0.82 0.73 0.93 1.23

(1.37) (1.34) (1.30) (1.22) (1.54)

March 0.80 0.97 0.91 0.89 1.22

(1.37) (1.34) (1.30) (1.22) (1.54)

Total 10.38 10.45 11.90 10.79 14.29

(16.41) (15.90) (14.82) (14.49) (18.36)

Figures in brackets pertain to FSA Quantity/Linkage

There may be small difference in figures indicated elsewhere due to rounding off.

52nd Annual Report

61

ANNEXURE-V

PROCUREMENT AND CONSUMPTION OF FUEL INCLUDING

FOR CAPTIVE POWER PLANTS (1992-93 to 2012-13)

(Mn.t.)

Year

Procurement

Total

Procurement Actual Fuel

Consumption Receipt

against

Linkage

E-auction/

Open

Market

Imported

Coal

Lignite, Pet

Coke and

other Fuel

VIII Plan

1992-93 10.49 1.27 0.09 0.80 12.65 12.05

1993-94 10.34 0.86 0.12 0.70 12.02 12.78

1994-95 10.28 2.32 0.71 0.80 14.11 13.29

1995-96 10.06 2.80 1.30 0.80 14.96 14.25

1996-97 10.45 2.48 1.65 0.70 15.28 15.03

IX Plan

1997-98 9.61 1.62 3.52 0.42 15.17 14.98

1998-99 8.24 0.77 4.66 0.20 13.87 13.98

1999-00 9.01 0.63 6.04 0.05 15.73 15.42

2000-01 9.74 0.79 4.40 0.42 15.35 15.37

2001-02 11.09 0.87 3.37 0.96 16.29 15.81

X Plan

2002-03 12.35 0.77 3.66 1.09 17.87 17.83

2003-04 13.35 1.03 3.18 1.52 19.08 18.85

2004-05 14.84 1.27 3.63 2.63 22.37 21.21

2005-06 14.81 1.55 3.40 2.98 22.74 22.39

2006-07 14.43 2.94 4.96 2.92 25.25 25.02

XI Plan

2007-08 14.56 5.00 6.08 3.20 28.84 27.33

2008-09 14.29 6.17 6.97 2.77 30.20 29.57

2009-10 10.79 4.36 6.95 4.15 26.25 25.80

2010-11 11.90 4.92 8.48 3.54 28.84 28.06

2011-12 10.45 4.50 9.40 5.46 29.80 28.30

XII Plan

2012-13 10.38 3.93 9.27 6.24 29.82 27.37

62

ANNEXURE-VI

CEMENT/CLINKER LOADING - RAILWAY ZONE-WISE

(Figures in Mn.t.)

Zones

(1)

2012-13

(2)

2011-12

(3)

Negative/Flat

Growth

%Change

(4)

Positive

Growth

%age Change

(5)

Central 7.06 7.75 -8.90

Eastern 2.39 2.49 -4.02

Northern 2.71 2.99 -9.36

North Central 1.68 1.68 0.00

North Eastern 0.00 0.03 -100.00

Northeast Frontier 0.06 0.12 -50.00

North Western 6.47 8.09 -20.02

Southern 2.83 3.98 -28.89

South Eastern 13.72 14.42 -4.85

Western 8.16 8.78 -7.06

West Central 20.07 20.84 -3.69

East Central 2.44 2.21 10.40

East Coast 1.28 1.10 16.36

South Central 27.63 24.71 11.82

South East Central 8.51 7.86 08.27

South Western 0.81 0.52 55.77

52nd Annual Report

63

ANNEXURE-VII

LIST OF WORKSHOPS/SEMINARS ON CEMENT CONCRETE TECHNOLOGY

PARTICIPATED/SPONSORED BY CMA

• A Seminar on “Construction and Quality Control of Cement Concrete Roads” was organized by

UltraTech Cement Ltd. on 30th June 2012 at Gurgaon for the Engineers and contractors of Municipal

Corporation of Gurgaon. The Seminar was inaugurated by Shri Sudhir Rajpal, IAS, Commissioner,

Municipal Corporation of Gurgaon. Shri Rajpal was very much in favour of constructing cement

concrete roads. He apprised that they are already constructing cement concrete roads in Gurgaon

and requested the UltraTech Cement Ltd. officials to organize further such seminars to educate the

engineers and contractors engaged in this work.

The Presentations were made by Dr. LR Kadiyali, Shri MC Venkatesha, Shri Shashi Gaggar and Shri

Ram Avtar, on different aspects of construction maintenance and economics of cement concrete

roads.

• Cement Business and Investment India 2012 – CBI India (2012) Conference was organized by the

Global Management & Investment (GMI) Forum & Prescon, UK on 10-11 October, 2012 in Mumbai.

The Conference focused around the theme of “Shift from West to East”. CMA supported the

Conference.

• CMA participated in the three day Seminar titled “Infrastructure Conference 2012” and

Exhibition organized by Kerala, PWD from 6 – 8 December, 2012 at Kochi. CMA participated in the

event with a stall at exhibition where several exhibits depicting various aspects of cement concrete

roads/white-topping and Cement Industry were displayed.

• The ASAPP Media Information Group organized an Indian Cement Review Conference – 2013 with

the theme “Enhancing Operational and Logistical Efficiencies” on 23rd April, 2013 at Mumbai.

The Conference was supported by the CMA with no financial liability.

• Indian Concrete Institute, Kochi Centre, organized a National Workshop on “Sustainable Concrete

Pavements : Practices, Challenges and Directions” on 1st June 2013 at Kochi. The Workshop

was supported by providing technical publications of CMA for distribution to the delegates.

*****

64

ANNEXURE-VIII

LIST OF PRESENTATIONS/MEETINGS REGARDING

CEMENT CONCRETE ROADS AND WHITE-TOPPING

• On 4th May, 2012 CMA officials met Brig Rajesh Tyagi, Dy. Director General – Works (Design),

Directorate of Works, Army Head Quarters, New Delhi and discussed the issues relating to cement

concrete roads and white-topping, etc. and requested the Army Authorities to consider to opt cement

concrete roads/white-topping for roads in the areas of Army Headquarters and Army Commands –

Northern, Eastern, Western and Southern.

• On 14th June, 2012, CMA officials, Shri N.A. Viswanathan, Secretary General and Shri SV Joshi along with

representatives of UltraTech Cement Ltd. Dr. V. Ramachandra, Vice President & Zonal Head Tech.

(South), and other officers met Hon’ble Chief Minister, Goa and discussed on the issues related to

cement concrete roads/white-topping. Minister for Tourism, Shri Dilip Parulekar was present at the

Meeting.

• CMA team comprising S/Shri A.K. Jain, Technical Advisor, Satyaki Sarkar, Vice President of UltraTech

Cement Ltd. and Ram Avtar of CMA met Shri Anup Kumar Ghosh, Director General (Oprns.), Kolkata

Metropolitan Development Authority (KMDA) and his team of officers on 28th June, 2012.

During the meeting two informative and technical presentations were made by Shri A.K. Jain of

UltraTech Cement Ltd. and Shri Ram Avtar, CMA.

• CMA team comprising Shri A.K. Jain, Technical Advisor, UltraTech Cement Ltd, Shri Ram Avtar,

Consultant, CMA and Shri Dinesh Sharma, J.K. Cement Ltd. had a meeting on 11th July, 2012 with Shri

R.S. Sandhu, Technical Advisor, Punjab Infrastructure Development Board (PIDB) and his team at

Chandigarh. S/Shri A.K. Jain and Ram Avtar made presentations on different aspects of Cement Concrete

roads/White-Topping. Engineers took keen interest and they were of positive view towards adopting

cement concrete roads.

• On 23rd July, 2012 officials from CMA and UltraTech Cement Ltd had discussions with Shri Lalit Mohan,

E-in-C, PWD Uttrakhand and apprised him about the superiority of Cement Concrete Roads and White-

Topping. Application of software was also explained by CMA official. CMA officials also proposed to

organize an Experience Sharing Workshop at Dehradun.

• On 24th July 2012 officials of CMA and UltraTech Cement Ltd. met with Secretary, Mussoorie Dehradun

Development Authority (MDDA) at Dehradun. CMA officials made presentation to the engineers of

MDDA on various advantages of cement concrete roads and also explained the application of the

software. MDDA is developing new areas therefore, CMA Officials requested them to construct cement

concrete roads instead of bituminous once.

• On 24th June, 2013, Secretary General, CMA along with Shri AK Jain, Dr. V. Ramachandra and Shri G.

Srinivasa of UltraTech Cement Ltd. met Shri Arun Kumar Misra, Secretary, Housing and Urban Poverty

Alleviation (HUPA), Govt of India, New Delhi. Shri Brij Kumar Agrawal, Jt. Secretary, HUPA and Dr.

Shailesh Kumar Agrawal, Executive Director, Building Materials and Technology Promotion Council

(BMTPC) were also present in the meeting. Dr. Ramachandra made detailed presentation on Rapid

Monolithic Disaster Proof (RMD) Technology, its advantages over conventional construction of Low Cost

Housing.

****

52nd Annual Report

65

ANNEXURE-IX

LIST OF CMA PUBLICATIONS/PERIODICALS

A. Brought out/Updated during 2012-13

� CMA Directory

� Indian Cement Industry - Statistics

� 165 km Yamuna Expressway in Cement Concrete through PPP Mode in Uttar Pradesh

� Supplement “Technology Demo Project – White-Topping” along with the January 2013 issue of Journal ‘CEMENT’

� Cement, Energy and Environment – Quarterly

� Cement Journal – Quarterly

� Cement News Digest – Weekly

B. Other Important Publications

� Basic Data on Indian Cement Industry

� DOs and DONTs for Cement Concrete Road Construction

� White-Topping of Roads—Concrete Overlay Technology

� Handbook on Cement Concrete Roads (Revised)

� City Concrete Roads …. (Modified and Enlarged)

� Cement Concrete Roads – A Long Lasting Gift to Nation

� Construction, Maintenance and Upkeep of Concrete Building

� Building Lasting Homes

� Cement Concrete Canal Lining

� Cement for Construction – A Consumer Guide (In Different Languages – English, Hindi, Tamil, Telugu, Malayalam, Bengali, Marathi, Kannada, Punjabi and Gujarati)

� Four Laning of Satara-Kolhapur-Kagal, NH4 (Updated)

� Handbook on Cement Concrete Canal Lining

� Precast Concrete Block Paving

� Fuel Savings on Cement Concrete Pavements

� Concrete Roads - 'Why' & 'How'

� Concrete for the Sustainable Development in the 21st Century

� Handbook of Ready Mix Concrete

� India's First Access Controlled Expressway - Mumbai-Pune

� Cement Concrete Pavements for City Roads, Bus Stands & Depots

� Cement in Service of The Nation

***

66

MEMBER COMPANIES OF CEMENT MANUFACTURERS' ASSOCIATION (As on 31.3.2013)

1. Anjani Portland Cement Ltd

Anjani Cement Centre Plot No. 7 & 8 D.No.8-2-248/1/7, Nagarjuna Hills Main Road, Punjagutta Hyderabad 500 082 (A.P.)

2. Bagalkot Cement & Inds. Ltd

Stadium House, Block No 1, 6th floor, Veer Nariman Road, Churchgate. Mumbai - 400 020

3. Binani Cement Ltd

706, Om Towers, 32, Chowringhee Road, Kolkata - 700 001

4. Birla Corporation Ltd

(Cement Division)

Birla Building 9/1, R.N. Mukherjee Road, Kolkata 700 001

5. Cement Corporation of India Ltd

(A Govt. of India Enterprise)

Scope Complex, Core No. 5 7, Lodhi Road, New Delhi 110 003

6. Cement Manufacturing Co. Ltd

Village Lumshnong, P.S. Khliehriat Distt. Jaintia Hills, Meghalaya – 793 200

7. Century Textiles & Industries Ltd

Century Cement

Maihar Cement

Manikgarh Cement

Century Bhawan Dr. Annie Besant Road Mumbai – 400 025

8. Chettinad Cement Corporation Ltd

Rani Seethai Hall Building Post Box No.748, 603, Anna Salai, Chennai 600 006

9. Dalmia Cement (Bharat) Ltd

Dalmiapuram - 621 651 Distt. Tiruchirapalli, Tamil Nadu

10. Gujarat Sidhee Cement Ltd

Siddhigram - 362 276 Off. Veraval Kodinar Highway Taluka Veraval, Distt. Junagarh, Gujarat

11. Heidelberg Cement India Ltd

9th Floor, Tower-C, Infinity Towers, DLF Cyber City, Phase-II Gurgaon, Haryana 122002

12. The India Cements Ltd

‘Dhun Building’ 827, Anna Salai, Chennai 600 002

13. J.K. Cement Ltd

Kamla Tower Kanpur 208 001 Uttar Pradesh

14. Jaiprakash Associates Ltd

(Cement Division)

Sector – 128, Noida 201 304, (U.P.)

Andhra Cements Ltd

(Merged with Jaiprakash Associates Ltd.)

15. Jammu & Kashmir Cements Ltd

(A Govt. of J&K Undertaking)

Nawa-I-Subh Complex, Zero Bridge, P.Box No. 149 Srinagar 190 001

16. JK Lakshmi Cement Ltd

Jaykaypuram Distt. Sirohi, Rajasthan

17. The K.C.P. Ltd

Ramakrishna Buildings 2, Dr. P.V. Cherian Crescent Egmore, Chennai 600 008

18. Kalyanpur Cements Ltd

2 & 3, Dr. Rajendra Prasad Sarani Kolkata 700 001

19. Kesoram Industries Ltd

Kesoram Cement

Vasavadatta Cement

9/1, R.N. Mukherjee Road, Kolkata 700 001

52nd Annual Report

67

20. Khyber Industries (P) Ltd

Khayam Road, Nowpora, Srinagar 190 001 Jammu & Kashmir

21. Lafarge India Pvt. Ltd

Crecenzo Building, B-Wing, 10th Floor, C-38 & C-39, G Block Bandra Kurla Complex Bandra (East) Mumbai 400 051

22. Madras Cements Ltd

Ramamandiram Rajapalaiyam 626 117, Tamil Nadu

23. Malabar Cements Ltd

(A Govt. of Kerala Undertaking)

Walayar P.O., Palakkad Distt. - 678 624, Kerala

24. Mangalam Cement Ltd

Adityanagar, Morak - 326 520 Distt. Kota (Rajasthan)

25. Mawmluh-Cherra Cements Ltd

(A Govt. of Meghalaya Undertaking)

Taxation Building, (Near Raj Bhawan) Shillong - 793 001,Meghalaya

26. Meghalaya Cement Ltd

Village Thangskari, P.O. Lumshnong, Distt. Jaintia Hills, Meghalaya - 793 200

27. My Home Industries Ltd

9th Floor, Block-3, My Home Hub, Madhapur, Hyderabad - 500 081

28. OCL India Ltd

Rajgangpur - 770 017 Distt. Sundergarh, Orissa

29. Orient Cement

(Prop: Orient Paper & Inds. Ltd)

Bhubaneswar – 751 012, Orissa

30. Panyam Cements & Mineral Inds Ltd

C-1, Industrial Estate, Bommalasatram, Nandyal, Kurnool Distt., Andhra Pradesh 518 502

31. Penna Cement Inds.Ltd

Plot No.703, Sriniketan Colony, Road No.3, Banjara Hills, Hyderabad 500 034

32. Prism Cement Ltd

305, Laxmi Nivas Apartments Ameerpet, Hyderabad 500 016 (A.P.)

33. Rain Cements Ltd

(Formerly Rain Commodities Ltd)

Rain Centre, 34, Srinagar Colony, Hyderabad –500 073 (A.P.)

34. Sanghi Inds.Ltd

Sanghinagar–501 511 R.R.Distt., Andhra Pradesh

35. Saurashtra Cement Ltd

Near Railway Station, P.O. Ranavav - 360 560, Gujarat

36. Shree Cement Ltd

Bangur Nagar, Post Box No.33, Beawar - 305 901 (Rajasthan)

37. Shree Digvijay Cement Co.Ltd

(Votorantim Cimentos Group)

P.O. Digvijaygram – 361 140 Via Jamnagar, (Gujarat)

38. Shriram Cement Works

(A Divn. of DSCL)

6th Floor, Kanchenjunga Building, 18, Barakhamba Road, New Delhi 110 001

39. Tamil Nadu Cements Corp. Ltd

(A Govt. of Tamil Nadu Undertaking)

LLA Building, 2nd Floor, 735, Anna Salai, Chennai 600 002

40. UltraTech Cement Ltd

'B' Wing, Ahura Centre, 2nd Floor, Mahakali Caves Road Andheri (E), Mumbai 400 093

41. Zuari Cement Ltd

(Italcementi Group)

Krishna Nagar, Yerraguntla 516 311 Kadapa Distt, Andhra Pradesh

CEMENT MANUFACTURERS' ASSOCIATION

SECRETARIAT

Secretary General Shri N.A. Viswanathan

Acting Secretary Shri S.K. Dalmia Joint Secretary Shri S.V. Joshi Shri N.K. Pande Sr. Dy. Secretary Shri Jainender Kumar Shri H.K. Panchal Shri Rakesh Gupta EDP Manager Shri Piyuesh Aggarwal

Sr. Assistant Secretary Shri N.Y.R. Sampath Kumar Assistant Secretary Shri N.S. Pawar Shri C.S. Pant Technical Officer Shri K.K. Roy Chowdhury

AUDITORS

Messrs K.S. Aiyar & Co. Chartered Accountants

52nd Annual Report

CEMENT MANUFACTURERS’ ASSOCIATION (Website : www.cmaindia.org)

Corporate Office

CMA Tower, A-2E, Sector 24, Noida -201301 (U.P.) Tel: 0120-2411955, 2411957, 2411958, 2411764, Fax: 0120-2411956 Email: cmand@cmaindia.org

Mumbai Office Express Building, 1st Floor, Indian Merchants’ Chamber Marg, Churchgate, Mumbai - 400 020 Tel: 022 -22049691, 22851304, Fax: 022 -22040582 Email: cmabb@cmaindia.org, cmabb@bom3.vsnl.net.in

Hyderabad Office

3rd Floor, 36th Square, Plot No.481, Road No.36, Jubilee Hills, Hyderabad 0- 500 034. Tel: 040-23553373 Email: cmahyd@cmaindia.org

Registered Office

Vishnu Kiran Chamber, 2142-47, Gurudwara Road, Karol Bagh, New Delhi – 110005 Tel: 011- 28753206, 28751307, Fax: 011-28758476