"Cement companies will effect price rise straight away. More to make up for the hike in transportation costs, a fallout of rise in diesel prices," he said. Ruling out any adverse impact on demand from the construction sector he said, "growth momentum set in fourth quarter (Jan-Mar '99) of previous fiscal would continue."

Rates of basic construction material (cement) have been ruling low due to long-drawn economic slowdown, and price war among companies to fight intense competition, he said.

Dispatches from big size cement plants, reflecting strong demand for construction material in first half of 1999-2000 (Apr-Sept) grew by 20.10 per cent to touch 45.18million tonnes over the same period last year, according to CMA statistics.

Likewise cement production in Apr-Sept of the current fiscal recorded an impressive 20.41 per cent growth at 37.68 million tonnes over the same period last year.

Cement production in the month of September stood at 6.68 million tonnes while dispatches during the same month came to 6.69 million tonnes, CMA said. The second half of the current fiscal will also witness robust growth in demand for cement, going by the production indicators for steel and cement production during the first half, chairman and managing director of Housing and Urban Development Corporation (HUDCO) V Suresh said.

Housing and infrastructure projects like construction of two million dwellings a year and countrywide network of expressways have already been set in motion by the BJP-led government and this move would ensure that demand for cement remains strong, Partha Sarathi said. The capacity utilisation in large cement plants went up substantially in thepast six months to grow above 78 per cent witnessed in 1998-99, he said.

On cement exports, CMA chief said Indian companies were basically focusing on vast domestic market and shipments to external markets formed very small part of their turnover.

Finished cement exports in 1998-99 stood at 2.06 million tonnes and clinker's - base material for cement, shipment for international markets touched 1.45 million tonnes mark in previous fiscal, CMA said.

International cement prices especially in Asia-Pacific region were ruling low ever since financial crisis gripped these nations took a heavy toll on demand from infrastructure sector.

"The volume increases in the first six months are without parallel. Full year growth on a conservative estimate may be about 14 percent," said an industry source.