Cement and Clinker Exports from Nepal Soar

Nepal has witnessed a substantial surge in cement and clinker exports, reaching a value of Rs. 1.76 billion during the first six months of the current fiscal year 2023/24. This represents a remarkable 20-fold increase compared to the corresponding period in the previous fiscal year.

Despite an overall 7.23% decrease in the country’s exports during this period, the booming cement and iron steel exports have offset the decline to some extent. The total export value amounted to Rs. 74.96 billion, with cement and clinker contributing 2.34% to the country’s total exports.

Notably, Nepal officially commenced cement exports to India in July 2022, and in just 18 months, the export to the Indian market has exceeded Rs. 2.53 billion. Key players in this export surge include prominent manufacturers such as Palpa Cement, Arghakhanchi Cement, and Sarbottam Cement.

Dhruba Thapa, President of the Cement Manufacturers’ Association of Nepal, expressed optimism about the increasing pace of exports in the future. He highlighted that the growth in cement exports is a direct result of government support and encouragement for exporting domestic goods.

Thapa emphasized the need for continued government support, especially in providing the promised cash incentives for export. Despite the government’s announcement of up to 8% cash subsidy for industries exporting domestic goods, businesses in the cement sector are yet to receive this support.

Nepal currently has around 65 cement industries with a total investment of Rs. 300 billion, boasting a collective annual production capacity of over 25 million tonnes. However, approximately 15 cement industries have closed due to various reasons.

Thapa suggested that with effective government facilitation and diplomatic initiatives to secure permissions from the Indian side for exporting cement produced by other industries, Nepal could potentially export cement worth Rs. 150 billion annually.

Acknowledging the declining domestic demand for cement, Thapa outlined the potential for the cement industry to significantly contribute to reducing Nepal’s trade deficit if the government and private sector collaborate to boost exports in the Indian market.