Daily News Egypt

Bureaucracy obstructs Indian investment worth $100m - Daily News Egypt

Advertising Area




Advertising Area




Bureaucracy obstructs Indian investment worth $100m

Lack in labour force and difficulty in industrial waste disposal are M.B. Company’s challenges, Khushalani


By Mohamed Alaa El-Din

The Indian company, M.B. Garments, is planning to invest around $100m to establish a textiles factory on an area of 65 acres, instead of importing textiles from the company’s factory in Jakarta, Indonesia, said board member Sanjai Khushalani.

He clarified that the company’s project was suspended for several years because of routine procedures. The Ismailia Governorate failed to send a letter to the armed forces with the factory’s height to acquire their approval.

Khushalani also stressed that the governmental organisations must cooperate to eliminate the bureaucracy in order to support investment.

He further noted that the company’s volume of annual exports to Europe and the United States is $100m.

On the other hand, the Indian company began its participation procedures in the 1.5m acre reclamation initiative; it has founded a new company “Vipi Argo” in cooperation with Egyptian and Indian investors.

The new company’s capital is EGP 50m, where Egyptians acquire 60% of its shares and 40% are Indian investments.

The aim for founding the new company is to participate in the 1.5m acres project, said Khushalani, adding that a contract was already signed with the Ministry of Agriculture during the Economic Summit.

The contract allocates 30,000 acres alongside the south-east of the area between Giza and the 6th of October City, depending on the groundwater, which exists at a depth of 1,200 metres, according to Khushalani.

He also stressed that the project was obstructed by the governmental bureaucracy and was suspended due to the reluctance of the Ministry of Agriculture in delivering the project’s land.

M.B. has been operating in Egypt since 1972, beginning as a family investment. The company’s capital records $1.7bn and it has 35,000 workers worldwide. The company’s activities vary between textiles and garments, drilling, real estate development, logistics, shipping and unloading, according to Khushalani

Regarding investment in Egypt, Khushalani said the company’s local investments are between $60m and $70m, while the volume of exports reaches approximately $100m annually. This number has decreased by 20% to 25% last year, due to a lack in labour.

The factory’s productivity reaches 200,000 pieces daily, he said, noting that the production decreased to 160,000, due to the decline in the number of workers. He added that the workers’ salaries vary between EGP 900 and EGP 1,500.

He also highlighted that Egyptian garment manufacturing is entering strong competition over the upcoming period with Asian countries, due to the advantages offered by these countries to their local manufacturers.

He also explained that one of the problems faced by the company is the absence of mechanisms for industrial waste disposal by the Free Zone in Ismailia. “For the past three years, we have been asking on a weekly basis to deliver industrial waste to a specialised company, but in vain”, he added.

 

Topics: bureaucracy

Advertising Area



https://wwww.dailynewssegypt.com/2015/11/07/bureaucracy-obstructs-indian-investment-worth-100m/
Breaking News

No current breaking news

Receive our daily newsletter
Subscribe