Sierra Cables considering plant in Kenya, urges Govt. to support local industry

Thursday, 12 March 2015 01:26 -     - {{hitsCtrl.values.hits}}

By Channa Fernandopulle Leading industrial cable manufacturer Sierra Cables Plc announced that preliminary studies into the feasibility of setting up a manufacturing facility in Nairobi, Kenya have been initiated. Speaking during a recent media briefing, Sierra Cables Managing Director Shamendra Panditha stated that his company was exploring the potential to set up a basic manufacturing plant in Kenya with a view to catering to demand within the African continent. He added that given the availability of duty concessions to manufacturers catering to African requirements, the establishment of a manufacturing plant in the region could help expand Sierra’s business significantly. Meanwhile commenting on the outlook of its primary business in Sri Lanka, Panditha expressed dissatisfaction at the lack of inclusion of local suppliers in Sri Lanka’s post-war construction boom. “Certainly there was a massive boom in construction but it was mostly Chinese contractors who were awarded these projects and they would import their own material and equipment instead of buying from local suppliers and manufactures. “They were given a free-hand with the materials they were allowed to use and as a result, we and most of the other companies in the industry weren’t included at all in the process at all,” he complained. When asked about whether his company had been representations to either the previous regime or the current Government, Panditha confirmed that extensive representations had been to the Government under the Rajapaksa regime, all to no avail. “We received no encouragement from the previous Government on this matter. We will make representations to the new regime as well but our biggest concern remains the same. We have worked with Indian and Iranian contractors and both those companies purchased their materials from local manufacturers but this was not the case with Chinese contractors. “If the Government can step in and regulate the way these contracts are awarded so there is at least a minimum percentage of materials that should be purchased from local sources, this would be a step in the right direction,” Panditha noted. He went on to explain that electrical cables made in Sri Lanka must be of a high quality and follow stringent international standards in safety and quality, a standard which he claimed most Chinese cables did not match. Responding to a query on the potential for Sierra Cables to expand into regional markets like India, Pakistan and Bangladesh, Panditha stated that at present such expansion would not be feasible given the thin profit margins and variance in standards across the SAARC region.