Once these units start production, cement price in local market may dip further, although the production cost is increasing for higher import costs of raw materials, according to a survey of the Board of Investment (BoI).

The survey said a total of 131 locally funded projects have so far been registered with the BoI, of which 46 are already in operation. It found 18 units closed for various reasons while no progress was made in implementation of 25 projects.

Twenty-five other projects could not be traced during the countrywide survey conducted recently by the Investment Implementation Monitoring Cell (IIMC) of BoI.

Of the 32 foreign or joint venture cement projects brought under the survey, seven are in production while one is closed.

"Besides, 17 local and five foreign or joint venture cement projects are currently in different stages of implementation," said a senior official of the BoI, expecting their production to begin in next couple of years.

Until 1999-2000, Bangladesh had to meet its demand by importing a substantial quantity of cement and the importers used to control the cement price. But the market witnessed a sharp decline in prices in 2001.

The average wholesale price of cement between January 1997 and January 1998 was around US$110 per tonne. The price slumped to $70 marking a decline of about 36 per cent over the last few years because of higher production.

In 2001, cement industry saw a sharp growth as number of plants increased to 50 from only 20 in 2000, making the installed capacity more than double. The capacity rose to 96.57 lakh tonnes in 2001 from 46.25 lakh tonnes in 2000.

The annual demand for cement is growing at the rate of eight per cent and it has now reached 65 lakh tonnes, owing to growth in housing and construction industry.