Nepal | July 05, 2020

Hetauda Textile Industry to be revived

Security agencies and government slated to hold equal share capital

Himalayan News Service
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Kathmandu, October 27

The government has announced it is reviving the liquidated Hetauda Textile Industry (HTI) at the earliest with equal share capital from Nepal Police, Nepal Army, Armed Police Force and the government.

Addressing a press conference here today, Minister for Industry Nabindra Raj Joshi informed that the government has tentatively reached an agreement with all security agencies to reopen HTI with equal share and investment.

“We have decided to reopen the defunct HTI at the earliest by offloading 25 per cent share to each of the three security agencies,” Joshi said, adding that the share per cent, however, may differ after the valuation of the property of HTI.

According to him, the task force formed under the coordination of former member of National Planning Commission (NPC) Puskar Bajracharya will come up with a report on the status of the industry, its machinery and production status and total valuation of HTI.

The preliminary report on the status of HTI has shown that 40 per cent of machinery equipment in HTI are in good condition while 30 per cent needs some repair and maintenance. However, 30 per cent of the equipment need to be replaced if HTI’s production is to be resumed, according to Minister Joshi.

Joshi further said that the revival of HTI would require tentative investment of Rs two billion. “HTI will initially produce all uniforms for security agencies, civil servants and schools,” added Joshi.

Similarly, the Ministry of Industry (MoI) has also announced that the private sector would be allowed to take in lease and operate the defunct Butwal Yarn Company and Birgunj Sugar Factory.

“We will soon call proposals from private sector bodies to run these two state-owned enterprises. The best and capable applicant will be allowed to revive and operate both Butwal Yarn Company and Birgunj Sugar Factory,” according to Joshi.

While production from Birgunj Sugar Factory was halted from 2003, Butwal Yarn Company has been shut since 2008.

MoI is also mulling over operating Gorakhkali Rubber Industry in public-private partnership (PPP) modality.

The Cabinet approved the proposal of MoI to revive Nepal Drugs Ltd (NDL) last month and NDL is on the verge of producing a few drugs soon.

Minister Joshi, who has an ambitious plan to revive all sick state-owned enterprise, believes that the revival of such industries one after another would give a positive message to investors regarding investment climate in the industrial sector of the country.

“The country’s investment climate is improving every passing day. If we are able to give life to a few defunct state-owned enterprises, it would give a positive message to potential investors,” Joshi added.

A version of this article appears in print on October 28, 2016 of The Himalayan Times.

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