Himachal Pradesh scraps Jaiprakash Associates' Chamba cement project

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India: The Himachal Pradesh state government has cancelled the 2Mt/yr cement plant project that was allotted to Jaiprakash Associates in Chamba District. The state cabinet cancelled the memorandum of understanding (MoU) for the project in February 2014. Another of Jaiprakash Associates' cement plants in Solan District is under investigation for overproduction.

The Chamba District cement plant was proposed at an estimated cost of US$136m near the Baroh-Sindh limestone deposits in Churah Tehsil, Chamba District. When the MoU was signed on 1 February 2007 it was claimed that the plant would provide direct employment to over 1000 people and indirect jobs to over 5000.

Finding that many cement companies have failed to set up their projects, the state cabinet in May 2013 decided to issue notices to Harish Cements, Lafarge India, India Cements and Jaiprakash Associates for failing to set up cement plants, despite the government having granted approvals. Following the cabinet decision the industries department issued show-cause notices to the companies. The industries department examined the replies and forwarded them to the state government. Finding the reply submitted by Jaiprakash Associates unsatisfactory, the cabinet cancelled the MoU in February 2014.

Industries minister Mukesh Agnihotri confirmed the cancellation of the proposed Jaiprakash Associates cement plant. Some other cement companies in Himachal Pradesh State are also under investigation due to reports of violations. The minister said that Jaiprakash Associates' cement plant in Solan District was allowed to produce 2.05Mt/yr of cement but that the company was actually producing 3.46Mt/yr.

"All these years, the company was making additional production without having the requisite permission," said Agnihotri. "When we started investigations the company approached the government seeking permission to regularise additional production." Agnihotri said that the order for an energy audit of Jaiprakash Associates has already been issued and that strict action would be initiated if violations are found on the part of the company.

Last modified on 04 June 2014

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