Sand mining ban may burn a hole in pockets of home buyers
New home buyers in Jharkhand are likely to feel the pinch of a government ban on sand mining as realtors on Friday warned of an “additional burden” due to a sudden spike in price of the building material.Updated: Jan 30, 2015 23:06 IST
New home buyers in Jharkhand are likely to feel the pinch of a government ban on sand mining as realtors on Friday warned of an “additional burden” due to a sudden spike in price of the building material.
Builders said that the price of sand has increased by nearly 60% since the new BJP-led government on Tuesday announced a ban on its mining from 654 riverbeds till they get environmental clearance.
Ranchi is witnessing a boom in the real estate sector due to a high demand for housing. Over 500 small and big projects including residential apartments are under construction in the capital.
Sources said that those who have already booked houses may escape the price escalation as builders usually take into account such fluctuations while fixing the price of real estate.
The average rate of per square feet property is around `3,000 in Ranchi while the most preferred size of apartments is in the range of 1200 to 1300 sq feet, according to builders.
“If this situation continues, buyers will have to fork out an additional `30 to `40 per square feet on a flat,” said Kumud Jha, Jharkhand president of the Confederation of Real Estate Development Association of India (Credai). The new rates would cost a 1300 sq ft flat around `40,000 more than the present price of around `40 lakh.
Ajit Upadhyay, a Ranchi resident, said he has been forced to put off his plans to buy an apartment because of a possible price rise.
The issue has already assumed political colours with the Congress seeking the governor’s intervention to lift the ban.
“(The) sand crisis will hamper government development projects,” said state congress president Sukhdeo Bhagat, who met governor Syed Ahmed on Friday. According to government estimates, development projects worth `15,000 crore may be affected if the ban continues for three months.
Critics of the ban said it is a political decision as the BJP had made sand mining an issue during the assembly elections, blaming the previous Hemant Soren government of allegedly allotting sand ghats to “outsiders”.
The state government also canceled the mining lease of three companies which were allotted 153 riverbeds during the Soren government. The state mining department on Thursday directed all the districts to start tendering process for fresh auctions of sand ghats.
However, the entire process will take at least three to four months. “It will take time to implement. I think the new policy will come into effect from the next financial year,” Khunti deputy commissioner Samson Soy said.
Soy said that now allotments would be done with the consent of gram panchayats which will get 80% of the auction amount.
The Jharkhand Sand Truck Owners (JSTO) feared that ban would hit the livelihood of thousands of truckers.
A JSTO delegation will meet chief minister Raghubar Das on Saturday to request him for an immediate solution.
“The restriction will increase black marketing, which will not only incur loss to the state exchequer but also impact government projects,” JSTO secretary Moin Akhtar said.
However, Ranchi district mining officer Bibhuti Kumar said the department was keeping a close watch to stop black marketing of sands.
First Published: Jan 30, 2015 22:59 IST