Indian firm invests in Ugandan coffee processing plant

A US$20 million coffee processing plant by India's Tata Coffee has received clearance from the Uganda's Jinja municipality authorities, paving the way for the construction of the plant to begin. In November 2006 Tata Coffee Ltd and the Ugandan government signed an agreement for the company to build a a 3,600 metric tonnes-per-annum capacity plant soluble coffee processing plant in Jinja.

Over the past six months the authorities in the eastern town of Jinja and Tata have been trying to hammer out issues of land and other services after government granted Tata several incentives including taxation, free water and an initial 50 acres of land. While the Tata group wanted to start construction right away for the plant to be ready within 24 months after the deal had been signed, the Jinja authorities couldn't easily find serviced land where the plant would be located. "That has now been sorted and everything is on track," said a government official said.

"We are hoping to market the coffee in the EU and China. As a least-developed country, Uganda doesn't have to pay import duties. That's why we picked Uganda," said M. H. Ashraf, managing director of the company in November after the signing of the agreement.

Uganda expects to produce 2.6 million 60-kg bags of coffee in the October-September 2006/07 crop year.

East African Business Week