Addis Ababa, Dec 24 (IANS): Karuturi Agro Products, a subsidiary of Indian giant Karaturi International, is set to establish a sugarcane factory in Ethiopia.

The factory, with an estimated capacity of crushing 7,000 tonnes of cane a day, is to be built in Ethiopia's Gambella Regional state.

Some 15,000 hectares of Karuturi land in Gambella will start producing sugarcane in three years, said Assefa Arega, manager of Karuturi's sugarcane plantation. The company expects the crushing plant to be ready in time for the harvest.

Karuturi is currently undertaking a feasibility study and work on the sugarcane crushing factory, including site identification, supplying and installation, will commence early in 2012.

The sugarcane plantation and the factory will be adjacent to each other, said Assefa.

Karaturi Group is one of the biggest flower exporters in the world and has its farms in Ethiopia and Kenya. Establishing a sugar factory in Ethiopia is expected to return significant economic benefits in terms of domestic demand and also for import, he said.

The Ethiopian Sugar Corporation is to import 300,000 quintals of sugar by February 2012 to fill the supply gap in the country. It is estimated that the sugar, mainly from Brazil and India, will cost Ethiopia $33 million.

Neighbouring countries like Djibouti, Kenya, South Sudan and Somalia rely on imported sugar, according to a local newspaper, and this dependence could reduce once the new factory comes up.