Construction in Mumbai has come to a near halt due to a serious shortage of sand, the most essential component.
Ready-mix concrete production units in and around the city have also closed temporarily for want of sand.
A revenue department official said against 4,500 sand spots across the state, only 1,300 which had been cleared by the respective gram panchayats are available for auction.
The government proposes to increase the royalty rate to Rs 200 per brass from the next financial year from the present Rs 100 per brass.
This is because the Maharashtra government has made it mandatory for the area's gram pachayat to approve any sand auction.
As a result against a daily sand demand of 600-1,000 trucks, hardly three to 10 trucks are now coming into the city and that, too, from neighbouring Gujarat.
Sand prices, earlier Rs 2,500 per truck of 2.5 brass (1 brass is equal to 100 cubic feet of sand), have surged to Rs 12,000 per truck.
If the shortage continues, says the the realty and construction industry, construction cost will surge and projects will be delayed.
A leading builder and developer, who did not want to be quoted, told Business Standard, "The licences used to be extended every year.
There was no monopoly, as any person could buy from any of the sand dredging villagers and from various village,s depending on their quality, quantity and price.
The royalty for the dredging used to be collected by the revenue department, for the extent of sand dredged. Local villagers were granted dredging licences, under which they used to dredge and sell the sand to any supplier in bulk."
He said an average building of 14 floors with two wings, of 100,000 sq ft, requires 2,500 trucks of sand for just the civil work.
Dharmesh Jain, chairman and managing director of the Nirmal Group and vice-president of the Confederation of Real Estate Developers Association, confirmed the shortage had brought realty development in the city to a standstill. So did Pravin Doshi, president of the Maharashtra Chamber of Housing Industry.
Navin Kothari of the Bhakti Group, a Mumbai based real-estate developer, said over 90 per cent of construction activity in Mumbai's suburbs had been affected by the acute shortage for over a fortnight.
(With inputs from Palak Shah)
