Hetauda Cement Industry halts production amid financial crisis

KATHMANDU: Hetauda Cement Industry has suspended production for over three months due to severe financial difficulties and ongoing equipment issues.

Production was halted on October 1, 2024, with management initially citing necessary repairs to the equipment. However, the situation has worsened, with no clear timeline for resumption.

The industry, which has a daily cement production capacity of 16,000 bags, had planned to restart operations by the final week of November 2024 after the repairs were completed.

Despite this, Hareram Acharya, the head of administration and spokesperson, stated that production could not resume due to delays in fixing the equipment and growing financial challenges.

“The repair work is part of the issue, but it’s not the sole reason for the halt,” Acharya said. “The financial crisis is escalating, making it difficult to resolve the situation.”

The industry continues to incur operational costs despite the production shutdown, including employee wages, fuel, and maintenance expenses. The workforce of 318 employees, including 166 permanent workers and 100 daily wage earners, remains idle.

In addition to the equipment issues, the industry faces a shortage of critical raw materials, including coal.

“We need at least 120 tons of raw materials and coal every day for production, but we’re unable to procure them due to unpaid bills,” said Acharya.

The industry’s financial troubles are compounded by an outstanding electricity bill of approximately Rs 300-400 million.

“We have consumed electricity but have not been able to pay the tariff,” said Acharya, further complicating the situation as the industry struggles to secure a steady supply of power.

The Hetauda Cement Industry, established in 1976 and operational since 1986, has faced increasing difficulties in recent years, with aging machinery and financial instability contributing to its current crisis.

Kameshwor Mandal, the technical head of the industry, explained that repair work is ongoing with help from technicians, including those from India.

“The equipment is old and needs extensive repairs. We hope to finish the work soon and resume production,” Mandal said.

Chairman of the Industry Management Committee, Narendra Bhandari, confirmed that the repair process is taking longer than expected.

“We had hoped to restart production by December end, but repairs are still not finished,” Bhandari said.