Honshi Holding Group invests $ 251 million to form a joint venture with Nepali cement company Shivam Cement to establish a cement factory to produce 6,000 tons per day and will ultimately upgrade it to 12,000 tons per day. Jointly known as the Hongshi Shivam cement, the total investment will be $359 million and is expected to start operation within 36 months.
The largest producer of building materials in China, Hongshi holding and Shivam Cement was signed by Investment Board Nepal (IBN) CEO Maha Prasad Adhikari and Director/General Manager of Hongshi Shivam Cement Pvt Ltd, Lai Weipeng who signed the PIA. The agreement will be effective for 15 years The agreement was signed in the presence of Minister for Finance and Vice-chairperson of IBN, Gyanendra Bahadur Karki, and Chinese Ambassador to Nepal, Yu Hong. The project is expected to employ more than 1,000 people during construction period and the project is expected to reap incentives such as construction of 132 KVA transmission line to the plant and 40 kilometers road from quarry to the factory from the government of Nepal. Sixty percent is financed by the Chinese institutions and consortium of banks in Nepal and is especially beneficial as Nepal has been importing around 20 percent of local demand (total around 5 million tons per year) from India which can now be locally produced.
About Hongshi Holding Group
The largest private companies of China manufacturing industry, Hongshi Group holding is one of China’s private fortune 500 companies and its major investment are in building materials and financial. With total assets of 23.2 billion Yuan (US$ 3.4 billion), Hongshi employs 12,000 employees Having a turnover of almost $ 36 billion ($5.42 billion), Hongshi has more than 30 large cement enterprises in Zhejiang, Jiangxi and has a production capacity of 80 million tons.
About Shivam Cement
Established in 2009, Shivam cement is the largest manufacturing Greenfield project with an aim to produce 1250 TPD from the company own limestone. Shivam is the biggest and most modern cement manufacturing plant in Nepal. Situated in Hetauda, Nepal, Shivam cement is renowned for its high grade cement manufacturing plant and its storage facility, which is one of the biggest in the country
Earlier insights: Earlier insight on this FDI project can be found here.