Govt. to pump in Rs.525mn to revive defunct chemicals factory in Kilinochchi

The government is to pump in Rs.525 million to revive the defunct factory belonging to Paranthan Chemicals Company in Kilinochchi.

Industry and Commerce Minister Rishad Bathiudeen said the construction work of the decayed factory would begin before the end of this year. Bathiudeen made the announcement on April 24 while he was on a visit to a patch of 217-acre landmass in Kilinochchi, where the former Paranthan Chemicals Factory was located before it was destroyed in 1985.

“With the recommencement of these factories we can produce our total chlorine requirements domestically and save valuable foreign exchange of around US $ 900,000 per year that we spend to import chlorine,” he said.

“Once recommenced, the Paranthan factory can take its required salt from the Elephant Pass saltern. We are also planning to upgrade the Elephant Pass saltern so that we will become self-sufficient in domestic and industrial salt supplies,” the minister added.

In 1954, the factory was established in the Kilinochchi District in the Northern Province under the name Government Chemicals Factory.

In 1957, the factory was brought under the State Industries Corporations Act No.49 of 1957 and named Paranthan Chemicals Corporation.

The factory was destroyed due to terrorist activities that began in 1983 and remained inactive from 1985. As a result, Sri Lanka had to import caustic soda and chlorine for local soap, paper, textiles and manufacturing. Paranthan Chemicals Corporation was converted to a Public Limited Liability Company under the Public Companies Act No.23 of 1987 with effect from January 17, 1991. At present, Paranthan Chemical Company imports liquid chlorine in 900 kilogramme cylinders and refills into 68 kilogramme cylinders at its refilling units in Horana and Kalutara. It supplies the entire chlorine requirement to the Water Supply and Drainage Board and private sector industries.

The Industry and Commerce Ministry said Paranthan Chemical Company is a profit-making state firm that reported more than Rs.150 million profits in 2015.