CAIRO: A joint Indian-Egyptian venture will see the construction of a polyethylene terephthalate (PET) plant in Ain Sokhna at a cost of $160 million, officials said.
The factory’s production capacity will reach 1,200 metric tons per day producing about 420,000 metric tons of PET plastic chips per year.
These plastic products will include bottles, food containers, bottled water, bottled drinks, shampoos and cosmetics.
The Egyptian-Indian Polyester Company (SAE), a joint venture with Dhunseri Petrochem and Tea LTD, will own 70 percent of the shares, while the Egyptian Holding Company for Chemicals, will own 23 percent, and Egyptian-owned petroleum and chemicals company, Enppi, will own 7 percent of shares.
Representatives of the Indian business community were quick to lay the foundation of the planned plant, which will be located in the private free zone area of Ain Sokhna, just northwest of Egypt’s Suez Gulf.
On June 23, Egypt’s Petroleum Minister Mohamed Abdel Moniem along with the governor of Suez and R. Swaminathan, India’s ambassador to Egypt, will officially launch the plant, which is expected to begin production in December 2012.
The Indian embassy said in a statement that the plant will be the first of its kind in the North Africa region and one of the largest of this kind in the entire Middle East.
More foreign currency is expected to flow into Egypt as the new plant is expected to export 80 percent of its production.
“We are optimistic, the project is expected to help a lot in the Egyptian economy,” said Pritam Lal, second economic and commercial secretary at the Indian Embassy in Egypt.
“Right now, Egypt is importing this product, but once this project launches, Egypt will cover its local need and have more than enough to export as well,” he added.
The project is also expected to create 500 direct and indirect jobs while also helping associated companies and industries create more job opportunities.
Employees will be producing millions of tons of PET per year, thus providing significant opportunities for the service sector such as in the transferring of the products as well as packaging.
Chairman of GAFI along with officials from the Ministry of Manpower met with a delegation of senior state officials from India in the presence of 23 Indian companies who came to study the economic situation in Egypt in order to open the doors for future investments or joint ventures.
GAFI Chairman Osama Saleh pointed to the strong historical relationship between Egypt and India, emphasizing that Egypt’s recent push for “transparent and just” economic policies after the country’s January 25 Revolution will help the social and economic alliances go even further.
According to Lal, the project was mentioned at the meeting, which took place between representatives from the Indian business community at the General Authority for Investment (GAFI), who asserted their interest to invest in Egypt, specifically in the fields of tourism, energy, housing and transportation.
Silandia, an Indian company, proposed the idea of one of the world’s largest steel fabrication companies, which would produce a complex of steel and cement in Egypt. The company would construct its own power plant for the factory.
In addition to this, Hindustan, one the world’s largest construction companies, announced the Indian government’s interest in supporting Egypt’s plans for new housing projects for middle-income residents.
The delegation also had several ideas to help boost Egypt’s tourism sector, which has been significantly battered after the country’s revolution.
India’s Tata Group announced its willingness to establish new seven-star hotels in Egypt, while Cox and King’s said they would be interested in making a Pharaonic train that would transport tourists between Cairo and Aswan.
While the Indian representatives had several prospects for the Egyptian market, they also expressed concerns that have haunted them before when conducting business transactions in Egypt.
GAFI, however, assured the delegation that the Egyptian government is committed to a healthy investment climate in order to accelerate development in the country, while helping strengthen private sector.
According to Saleh, the volume of trade between India and Egypt reached $3 billion
last year and is on the rise.
With 320 projects, Indian investments in Egypt are currently at $145 million.