Country could be self-reliant in cement

The Cement Manufacturers' Association of Nepal has urged the government to give priority to the cement industry as it has a huge prospect to be self-reliant and can save Rs 10 billion annually.

The government must promote the cement industry because it has huge potential as the country has been witnessing infrastructure development like hydropower projects and housing colonies, that need a huge amount of cement, said newly elected president of the association Dhurba Raj Thapa during the ninth annual general meeting (AGM) of the association, here, today.

Even a small promotion in the sector could lead the country towards being self sufficient in cement and help substitute imports, he said, adding that the cement industry could also be an export sector if promoted with soft loans and incentives.

Despite the import substitution plan of the government, cement import has seen an increase of 28.9 per cent in the first nine months of the current fiscal year as compared to the same period last fiscal year. "The country has imported cement worth Rs 2.94 billion in the first nine months of the current fiscal year 2012-13, against an import of Rs 2.28 billion in the same period of last fiscal year 2011-12," according to figures of the Trade and Export Promotion Centre. "In the last fiscal year 2011-12, the country had imported cement worth Rs 3.47 billion and cement clinkers worth Rs 6.90 billion."

Cement manufacturers also asked the government to end the syndicate in the transport system to reduce production cost.

According to an estimate, the country needs some 4.96 million metric tonnes of cement for public and private sector construction but is expected to manufacture only half — some 2.06 million metric tonnes — cement in the current fiscal year 2012-13.

The remaining 58 per cent will be fulfilled through imports, mainly from India.

The association has asked the government to construct access roads to cement factories and mines as it had promised in the budget a fiscal year ago.

"The government must provide uninterrupted electricity to cement factories," said Thapa, adding that it will significantly increase cement production as most factories have been producing two-third of their capacity currently due to power shortage.

About 28 cement factories have been in operation in the country but their quality has always been questionable. "Therefore, big infrastructure projects have been importing cement from India and abroad," according to the association that elected its new executive committee including immediate past president Atmaram Murarka, vice president Manoj Kedia, general secretary Tara Prasad Pokhrel, treasurer Rajesh Kumar Agrawal, and members Bishnu Prasad Neupane, Shobhakar Neupane, Jagdish Agrawal and Jayanta Chudal, during the ninth AGM today.

Housing companies list themselves with government

The government's plan to purchase houses and apartments for senior civil servants — that could give a new lease of life to the cash strapped housing sector — is moving at a snail's pace.

"Some 10 housing companies have listed themselves within the deadline," according to chief division engineer of Building Construction and Maintenance Division Office Kumar Ghimire. The division had asked the housing companies to list themselves with the government on January 23-February 6 for record keeping.

The listing of 10 housing companies was for only record keeping purposes, he said, adding that the Ministry of Urban Development has to give the division a green signal and also the budget to purchase housing units and apartments.

The Building Construction and Maintenance Division Office will call for a bid immediately after it gets a green signal for the purchase from the ministry, Ghimire added.

According to the president of Nepal Land and Housing Developers' Association (NLHDA) Ichha Raj Tamang, the companies that are still in the business have listed themselves for the government record keeping purpose and are waiting for a call for the bid. "Most of the housing companies had either been closed or went bust due to cash crunch in the market in last couple of years."

Earlier, the government had decided to purchase some 88 units — 66 units of apartments and 22 units of houses — for secretaries and judges.

The government had decided to buy 22 units of houses for judges and 66 units of apartments for secretaries and had been preparing procurement procedures that will finalise the location and basic criteria.

The move, that is expected to boost public confidence in the sector, will probably take some more time also due to the budget crunch in the ministry.

The association has been asking the government to allow all civil servants to buy houses or apartments of their choice with a long-term EMI plan that will push not only the housing sector — that is currently stagnant — ahead from the current bottom levels to a recovery stage, but also generate employment and boost economic activities.

The High Level Financial Sector Coordination Committee meeting had decided to form a committee to conduct a comprehensive study on the plausibility of purchasing housing units and apartments with soft loans for civil servants, special class officials and chiefs of constitutional bodies last January.

The committee comprises of central bank deputy governor, director general of Department of Housing and Urban Development, administrator of Employees Provident Fund, president of Nepal Bankers' Association, president of NLHDA, and executive director of Citizens Investment Trust.

Government ready to buy 88 units of houses and apartments for judges, secretaries to boost confidence of realtors

The suffocating housing sector might get a lease of fresh breath in a month as the government has identified some 88 units — 66 units of apartments and 22 units of houses — for secretaries and judges to rescue the sector.

The government has decided to buy 22 units of houses for judges and 66 units of apartments for secretaries and is currently preparing procurement procedures, said vice president of Nepal Land and Housing Developers' Association (NLHDA) Om Rajbhandari, who is also coordinator of the FNCCI Urban Development Committee.

"Though the number of units has been finalised, it has yet to finalise the location," he said, adding that the government is preparing the basic criteria to identify the location.

The move will also increase confidence in apartments, as according to tradition, Nepalis prefer independent houses to apartments, Rajbhandari added. "When secretaries themselves buy apartments, common people will follow suit."

The government's move is expected to not only build public confidence in the sector but also inject fresh cash in the sector that has been cash-strapped.

However, it will take a month, he said asking the government to allow all government employees to buy homes from their deposits of provident fund. "It will increase the level of social security among public servants and also reduce corruption," he suggested. "All public employees should be allowed to buy houses or apartments of their choice with a long-term EMI plan that will push the housing sector — that is currently stagnant — ahead from the current bottom levels to a recovery stage."

Though people are ready to buy houses, recent incidents have made them lose confidence in the sector.

A recent study of the central bank has also revealed that the prices of houses will pick up. "House and land prices have declined by around 30 per cent as compared to last year," the central bank survey has stated, adding that some 43 per cent developers expect prices of land and housing to go up by 15 per cent to 30 per cent.

"Likewise, some 40 per cent of the developers expected transactions to pick up by around 20 per cent," said the central bank’s quick field survey of Land Offices, municipalities, urban development agencies, members of district chambers, and land and housing developers in 10 major districts — Morang, Dhanusha, Parsa, Rupandehi, Kaski, Banke and Kailali — including three districts in the valley — Kathmandu, Lalitpur and Bhaktapur — to gauge the risks due to higher exposure of banks and financial institutions in a single sector.