Two major government-owned cement industries—Hetauda Cement Industry Limited and Udayapur Cement Industry Limited—have been struggling for decades to sustain their existence. Despite continuous government support, these industries remain trapped in financial crises.
Hetauda Cement Industry was established 45 years ago, while Udayapur Cement Industry was founded 37 years ago. In their early years, both industries dominated Nepal’s cement market. However, political interference, irregularities, poor management, outdated technology, a lack of skilled manpower, and neglect of machinery maintenance led to their downfall.
Current Status of Hetauda Cement
Hetauda Cement IndustryHetauda Cement Industry has been operating at a loss since 2019/20. If production continues at its current capacity, operational costs exceed revenue, pushing the industry toward closure. The company requested NPR 3.01 billion in government assistance for revival, but the government has ignored the demand.
Current Status of Udayapur Cement
Udayapur Cement IndustryUdayapur Cement Industry is also facing a financial crisis due to a shortage of raw materials, mounting debt, and managerial inefficiencies. The industry has been experiencing continuous losses. It has requested NPR 550 million for operation, but the government has yet to make a decision.
Government’s Focus on Privatization
If the government fails to take concrete steps to improve the deteriorating condition of these industries, privatization appears to be the only viable alternative. The government has included Hetauda and Udayapur Cement Industries among the nine state-owned enterprises recommended for privatization.
Without reforms in government intervention, outdated technology, and weak management, these industries face an existential crisis. The government must take urgent action to find a solution.
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