Sri Lanka wants to give India’s Aditya Birla group a contract to revive a defunct cement plant in Kankesanturai, in the northern Jaffna peninsula, owned by the listed Lanka Cement, construction minister Rajitha Senaratne said.
Senaratne told news website Vimasuma.com that President Mahinda Rajapaksa had recently given him instructions to have a joint venture with India’s Birla group to revive the cement plant.
Last month, Industrial Development Minister Kumara Welgama, under whom comes the state-owned Lanka Cement, got cabinet approval to look for "suitable investors" for a joint venture to revive the plant.
It has been closed since 1990 and damaged because of fighting between government forces and Tamil Tiger rebels.
Construction minister Rajitha Senaratne said a team from the Birla group had put off plans to visit Jaffna to inspect the site of the plant.
They had been scheduled to come last month.
Senaratne told Vimasuma.com the government does not want to give the Jaffna cement plant to multinational Holcim, which has also expressed interest in the factory, as it already has a dominant position in the local cement market.
The government is keen to revive cement production in the north to pave the way for development in the region and give jobs for people there.
Birla has given the government an initial proposal to revive the cement plant in Kankesanturai following talks in Colombo earlier this year and is to give a more detailed proposal after inspecting the site.