Tapping the potential of Nepal’s

cement industries

The recent news of Nepal exporting cement and clinker worth Rs 234.98
million in the first month of the current fiscal year marks a significant step
forward for the nation's economy. This achievement underlines the latent
potential of Nepal's cement industries and provides a compelling reason
for the government to take proactive measures to tap into this sector's full
capacity. The export figures, as reported by the Department of Customs,
highlight the growing demand for Nepali cement and clinker in the
international market. The export of 9,573 tons of cement and 25,742 tons
of clinker is not merely a one-time occurrence but a testament to the
industry's capabilities. This surge in exports can be attributed in part to
the government's timely decision to offer an eight percent cash subsidy on
cement and steel exports, and to waive a substantial portion of electricity
tariffs for eligible manufacturing plants. These policy interventions have
undoubtedly stimulated production and opened avenues for businesses
to flourish.

Nonetheless, it is important to address the challenges that this sector

faces. One pressing issue is the need for streamlined quality certification
processes, particularly when exporting to neighboring India. The concerns
raised by the Cement Manufacturers' Association of Nepal regarding the
quality certification from the Indian government should be taken
seriously. Collaborative efforts between the governments of Nepal and
India to facilitate these certification procedures could further boost
exports and foster stronger economic ties between the two nations. The
success stories of companies like Palpa Cement Industry, Arghakhanchi
Cement Limited, and Balaji Cement Industries are inspiring, yet they are
just the tip of the iceberg. With the right support, more Nepali cement
manufacturers can seize opportunities in both regional and global
markets. The potential for growth and revenue generation is immense,
especially considering the ambitious production capacity of 22 million
tons reported among the domestic cement manufacturers.

To fully harness this potential, the government needs to adopt a multi-

faceted approach. First, there must be continued incentives for exports,
ensuring that cash subsidies and electricity tariff waivers remain stable.
Secondly, the government should collaborate with industry stakeholders
to address challenges related to quality certification, trade barriers, and
logistical efficiency, particularly for cross-border trade. This could involve
diplomatic discussions with trading partners to create a more conducive
environment for Nepali cement in foreign markets. Furthermore, as the
industry expands, it's vital to maintain a balance between domestic
consumption and exports. Infrastructure development within the country
demands a steady supply of cement, and the government should ensure
that the growing export sector doesn't lead to shortages or price hikes at
home. Striking this balance will require strategic planning and close
coordination between government bodies and industry leaders.

Needless to say, the impressive export figures from Nepal's cement sector
paint a promising picture of the country's economic prospects. This can be
another major export item after electricity for Nepal. It is therefore
imperative for the government to capitalize on this momentum by
fostering an enabling environment for cement manufacturers. Addressing
challenges, enhancing quality standards, and providing consistent support
will lead to a robust and sustainable growth trajectory for the industry.
The time is ripe for Nepal to solidify its place as a significant player in the
regional cement market and to drive its economy forward through the
untapped potential of its cement industries.