Bangladesh growth potential - comment

Bangladesh growth potential - comment
Published: 21 May 2012

Tagged Under: Lafarge Surma Bangladesh 

Cement production in Bangladesh almost doubled in the past five years, but the country's per capita consumption is still one of the lowest in the world, according to Lafarge Surma’s managing director in a recent interview with local press.

Speaking to the Daily Star on the potential for cement demand in the country, MD Mike Cowell, said: “Per capita cement consumption in Bangladesh is less than 100kg, which is 150kg in West Bengal and more than 1000kg in China.”

The US$280m Lafarge Surma Cement is the only cross-border project involving Bangladesh and India. It has a production capacity of 1.5Mta. The company is already meeting about eight per cent of the total market need for cement and 10 per cent of total clinker requirements of Bangladesh market with strong growth rates.

Though there are dozens of cement factories across the country, Cowell said only 30 are active in supply. These factories' combined production capacity has increased to 15Mta now from 8.5Mt five years ago.

“That's not a bad growth,” Cowell said. “Still there is a huge gap when you look at other developing countries in Asia.”

“We are very hopeful and that's why we are here,” he noted.

On Bangladesh's cement supply, Cowell said around 15 per cent is consumed by the government and the rest by the private sector. But he said, this 15 percent is very influential as the government buys it to build infrastructures on which the country's development relies.

Cowell also answered questions on India's apex court's judgement relating to limestone mining from Meghalaya to Lafarge's Chatak plant in Sunamganj in Bangladesh through a 17km cross-border conveyer belt. In February 2010, Indian Supreme Court had halted limestone mining by Lafarge on environmental grounds.

“We have a strong feeling of consolation. We are very happy and things are operating very well,” he said on the Indian court's judgement that goes in favour of Lafarge. Following the ruling Lafarge has had no problems transporting mined limestone from Meghalaya to its plant in Chatak.

After a few years of slow production, the factory is now running at a full capacity. “We hope to sell more than 1Mta of cement,” he said.