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Indian Firm to Build Cotton Mill in Ethiopia

15 May 2014

INDIA - Mumbai-based ShriVallabh Pittie (SVP) group’s SVP Textiles Private Limited Company has break the ground for building a $550 million cotton mill in Kombolcha town in Amhara Regional state.

The plant will be the largest spin producing plant in Ethiopia, which will be developed by loan and equity financing.

Speaking at the event, Vinod Kumar Pittie, chairman of the SVP said that the Development Bank of Ethiopia (DBE) has agreed to provide a 52 per cent term loan of the total investment, while the balance of 48 per cent will be secured through equity financing.

The cotton mill plant that will produce 280 tonnes of yarn and spin per day will come up on a 50 hectares of land.

Upon going fully operational after a year, the plant will provide direct employment opportunity for three thousand people and indirectly for some 10 thousand peoples.


The produce of the plant will target Germany, Turkey, Italy, Sweden and the United States as their main markets for exports.

Pittie said that the company will take advantage of various incentives available in Ethiopia, such as eligibility for exemption of its up to 18 per cent anti-dumping duty imposed by Turkey for Ethiopia.

With huge potential for raw cotton, access to labour, power and water, as well as access to international markets and the fast economic growth the company decided to invest in Ethiopia.

Sileshi Lemma, Director General of the Ethiopian Textile Industry Development Institute said that the timing at which SVP is present in Ethiopia is a good opportunity for the underperforming textile and garment industry.

With interests in textiles, finance, retail and real estate sector, the 1898 founded SVP Group promoted Platinum Textiles Ltd manufactures polyester & cotton blended yarn.

Last year, the company announced that it is investing $70 million to build a cotton yarn manufacturing facility near Sylvania, a city in Screven County, in the US state of Georgia.

 

TheCropSite News Desk



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