India Cements' Himachal project faces cost overrun

India Cements Ltd's cement plant in Himachal Pradesh has been delayed because the cost of the proposed project has been enhanced by Rs 250 crore.

In May last year Chennai-based India Cements and the Himachal Pradesh government had signed a memorandum of understanding (MoU) for setting up the Rs 750 crore project at Gumma, in Shimla district's Gumma village, some 150 from here.

Official sources here now say that the company has told the state government about the enhanced cost of setting up the project and another detailed survey of the project will have to be carried out by the firm with the assistance of the state geological survey.

There could be a delay of six months for the work to start. "The company has asked for extra time to carry out the survey," said Arun Sharma, state geologist, of the industries department.

Once the plant comes into operation it would produce 2 million tones of cement every year.

Experts say the Gumma limestone mines have over 200 million tonnes of high quality limestone reserves.

The plant is expected to provide a fillip to the economy of this backward mountain region. Some environmentalists are opposed to the project.