Kathmandu, December 20, 2016:Â Import of clinker surged by a massive 674 per cent in the first four months of this fiscal as the domestic cement plants have been relying heavily on import, with very few owning limestone mines in the country.
The country imported clinker worth Rs 6.58 billion in the first four months of this fiscal against Rs 850 million in the corresponding period of the previous fiscal, according to Trade and Export Promotion Centre.
Cement factories have boomed in the country due to the governmentâ€™s policy intervention to facilitate investors. The government has been offering access road to the factories and mines and ensured electricity grid connection to the factories. There are 48 cement factories in the country with their total annual production hovering around 4.2 million tones. The average capacity utilisation of the cement plants stand at around 70 per cent.
â€œCement plants are operating below capacity due to lack of market and also lack of raw materials because even the cement factories that have their own clinker production facility are importing clinker from India,â€ according to Dhruba Raj Thapa, president of Cement Manufacturers Association of Nepal, the umbrella body of cement manufactures in the country.
Of the total 48 cement factories in operation, 14 have their own clinker production plants. Almost all the cement plants that have submitted applications to operate their own mines have been facing hassles from the government and have been compelled to import clinker from India, as per Thapa.
According to the Cement Manufacturers Association of Nepal, the country could be self-reliant on clinker within two years if the hassles identified by the cement manufacturers were addressed.
Normally, mines can be developed in the areas where there is no human settlement and most of such lands are owned by the government. â€œIt is difficult to get approval from the forest officials to develop mines and get right of way clearance to develop roads to the factories,â€ as per Thapa, adding, â€œAs a result, we have been importing clinker and only grinding it in our own country and claiming that we are self-reliant on cement.â€
But to be self-reliant on cement, the country also need to be self-reliant on clinker, according to Thapa. â€œThere are abundant possibilities of mining of limestone within the country if the government adopted flexible policies.â€
The country has been importing 70 per cent of the demand of clinker, which stands at around four million tonnes per annum. According to Cement Manufacturers Association of Nepal, clinker import might further rise this fiscal as cement plants have been operating their plants at higher capacity to elevate production eyeing the demand along with accelerated post-quake reconstruction drive.