At a time when domestic demand is falling due to the economic recession, the surge in cement and clinker exports to India has given some respite to domestic cement manufacturers. As the country’s construction sector goes through a slump due to economic slowdown, the production and consumption of cement and clinker have been badly affected in the current fiscal year. The growth in cement exports to the southern neighbor, according to cement manufacturers, has been a saving grace for them. While Nepal has also been exporting cement to its southern neighbor since the last fiscal year, the exports have picked up in this fiscal year. The government announcement of providing an eight percent export subsidy on eight products including cement has helped the exports to grow in the current fiscal year. The latest data from the Department of Customs shows Nepal has exported cement and clinker worth Rs 677.65m in the first 11 months of the current fiscal year, an increment of 120 percent. The country had exported cement and clinker worth Rs 307.03m in the first 11 months of the last fiscal year.

Of the total exports in FY 2022/23, Portland cement was Rs 313.64m, and clinker was Rs 364.01m. In FY 2021/22, Nepal exported Portland cement worth Rs 135.09m and clinker worth Rs 171.52m.

Industrialist Pashupati Murarka said that the surge in cement exports in the current economic slowdown has given some relief to domestic cement industries. “The domestic market has been hard hit by the falling demand for construction materials this year. The export growth has provided us a breathing space,” said Murarka. The government in the current fiscal year budget had announced cash incentives of up to eight percent for products like clinker, cement, steel, footwear, and processed water along with IT-related services and BPO business. Following the government announcement, Nepali cement industries started to export to India. Currently, four cement companies—Ghorahi, Balaji, Tansen, and Arghakanchi - have been exporting their products to their southern neighbor. It was Tansen Cement that officially started exporting cement to India for the first time from Nepal. The company began exporting on 8 July 2022. According to Murarka, the demand for Nepali cement is increasing especially in the bordering Indian states of Uttar Pradesh and Bihar. The main raw material for producing cement is limestone which is not available in the bordering Indian states of Bihar, Uttar Pradesh, West Bengal, and Uttarakhand. Limestone has to be brought from other states such as Chhattisgarh and Madhya Pradesh which are far away from states in India bordering Nepal. “Hence, the export of cement makes sense as the transportation cost to India can be economical,” said Murarka. Balaji Cement Industries Pvt Ltd is the latest Nepali cement manufacturer that has started exporting its products to India. After receiving the ISI quality mark from the Bureau of Indian Standards (BIS) of the Indian government, Balaji Cement started exporting two of its brands—Bahubali and Shrishti—to India from 12 June 2023. “We had established the industry with an objective of export to India,” said Sandeep Kumar Gadia of Balaji Cement. “The government export subsidy scheme helped us to realize our goal.” As cement exports increase, the country has seen a decline in imports of cement and clinker. The import of cement and clinker has decreased by 55 percent in the first 11 months of the current fiscal year. Nepal has imported cement and clinker worth Rs 288.46m in this fiscal compared to Rs 652.61m in the last fiscal.