February 2: Iron and its related materials are the second most imported items in Nepal after petroleumproducts, according to the Department of Customs.

The import of iron and iron-related products can be reduced after Dhaubadi Iron Mine comes into operation.

Dhaubadi Iron Company Limited, which was established with the plan to make the private sector a partner, is now owned by the government. Analyzing the statistics of the import of iron and iron products and the market situation, it is estimated that the import can be reduced by 25 per cent after the operation of the mine. The company's chief executive officer (CEO) Dr Janak Bahadur Chand said that the reduction of imports and the use of domestic raw materials will reduce the trade deficit.

"The company has analyzed the import of iron and iron products," said Chand. Analyzing the data, if 1600 tons of iron ore is extracted daily, the import can be reduced in that proportion. The company's study has shown that the mine has reserves of more than 150 million metric tons of iron. Out of this, if the mine is operational and 1,600 tons of iron ore is extracted daily, import can be reduced by 25 per cent, he said.

According to Trade and Export Promotion Center, till the end of December of the current fiscal year, Nepal has imported iron and iron products worth Rs 78.12 billion. This year's import is less compared to the last fiscal year, when Nepal had imported iron and iron products worth Rs 96.51 billion. Items like construction materials, agricultural equipment, grills, and machinery are prepared from imported iron.

A preliminary study has shown that the iron produced from the mines of Dhaubadi can be used to make billets (raw material for steel) for construction materials. Now the company is studying the feasibility of the mine. Chand informed me that the report will be ready by the end of March. The study will clarify how much iron ore can be extracted and produced commercially from the mine.

The current feasibility study is being done through a joint venture (JV) of two Indian companies along with a Nepali company. A detailed project report (DPR) will be prepared after the feasibility study. The government has been announcing the commercial production of iron from Dhaubadi in every annual budget. 

Shailesh Thapa, director of the company, said that there is still a lot of work to be done.

"Now the possibility is being studied. After that, it takes about eight months to make a detailed project report (DPR),” said Thapa, adding, “After that, it takes two years to build the plant. It is estimated that it will take at least three years for commercial production. At present, an access road is being built from Danda in Nawalparasi on the east-west highway to this mine.

He said that the Nepal Electricity Authority is creating a 'Dhabadi Transmission Line Unit' for electricity.

The authority is working on transmission lines and substations. According to Thapa, survey work is underway for the construction of 132 KVA and 220 KVA transmission lines. It is said that Gandaki province will have a 3% share, and local people will have a 2% share in this company, while the government will have a 50% share. Likewise, it is said that the private sector will have a 45 per cent share. 

Thapa said that the private sector will be invited only after the feasibility study. Dhaubadi iron ore mine is 10 kilometres long, 15 to 30 meters wide and 100 meters deep. The iron ore of the mine has the quality to make rods. The Department of Mines and Geology had sent five tons of iron to China for analysis.