We committed ourselves to investing in this industry with a firm belief in Nepal's bright future and inspired by the nation's revival story.

Nepali economy is currently experiencing a downturn. Although there were hopes that the situation will improve from January, the situation still remains challenging. However, from our group's perspective, we see significant potential for Nepal in the mid to long term.

Following the COVID-19 pandemic, the government, alongside banks and various entities, showed significant support for the manufacturing sector. At the same time, we, at Ramesh Corp, were also exploring avenues to utilise Nepali minerals to start industries aimed at import substitution. Consequently, Ramesh Corp made a strategic decision to set up a tile manufacturing plant in Nepal. We have forged a partnership with Kajaria Ceramics Limited, one of India's foremost tile manufacturers, to start a tile manufacturing facility in Nepal. Kajaria Ceramics is the seventh-largest manufacturer of ceramic and vitrified tiles in the world. We committed ourselves to investing in this industry with a firm belief in Nepal's bright future and inspired by the nation's revival story. 

When investing in Nepal, major brands typically assess three key factors: the country itself, the market potential and the reliability of the local partner.

The Kajaria Ramesh Tiles will be Nepal's largest tiles manufacturing company with an annual production capacity of 500,000 square metres. Ramesh Corps and Kajaria Ceramics have equal stakes in this joint venture with an investment outlay of Rs 3 billion. The company has already achieved financial closure, securing Rs 3 billion in funding from a consortium of Nepali banks led by Everest Bank. Nabil Bank, Nepal SBI Bank and Prabhu Bank are the other lenders in the consortium. 

When investing in Nepal, major brands typically assess three key factors: the country itself, the market potential and the reliability of the local partner. When we first approached Kajaria regarding the possibility of a joint venture in tile manufacturing, they showed great interest. Subsequently, the senior leadership of Kajaria Group visited Nepal to assess the market. Additionally, they studied Ramesh Corp's presence and influence in Nepal. Satisfied with our track record, Kajaria agreed to invest in Nepal.

Our plant located at Bardaghat of Nawalparasi is currently in the construction phase and is scheduled to commence production within the next three months. With an annual capacity to produce 500,000 square metres of vitrified tiles and ceramics, we foresee our plant making significant contributions across various sectors. First, the commencement of production at our factory is poised to contribute significantly in the import substitution of tiles. Second, by utilising local raw materials in the manufacturing process, we aim to enhance local value addition. Third, Nepali consumers will benefit from more affordable pricing, with tiles expected to be priced 15-20% lower than the imported ones.

This plant is anticipated to positively impact the national economy, generate employment opportunities and offer substantial benefits to consumers. Manufacturing indeed holds great potential in Nepal, but investors must carefully identify their niche product and sector for investment. However, a challenge arises when multiple investors flock to the same sector due to its perceived profitability. Meanwhile, significant developments have occurred in the energy sector between Nepal and India. India has signed an agreement to purchase 10,000 MW of electricity from Nepal over the next 10 years. This has disseminated a message that Nepal is an attractive destination for investment. 

(Gupta is the Vice Chairperson of Ramesh Corp - a diversified conglomerate)