Egyptian Indian Polyester Company (EIPET) South Asian Petrochem Limited (SAPL or the sponsor), Indias second largest manufacturer of Polyethylene Terephthalate (PET), is planning to set up a joint venture with the Egyptian Petrochemical Holding Company (Echem), an agency of the Government of Egypt (GoE), to establish a 315,000 tons per annum (tpa) greenfield PET resin plant in Damietta, on Egypts Mediterranean coast.  SAPL will have a 70% share in Egyptian Indian Polyester Co. (EIPET or the project company) whereas Echem will hold 23% and Engineering for the Petroleum & Process Industries (Enppi) will hold the balance 7%. The project has an estimated cost of approximately $135 million (including working capital requirements).     PET, which is produced from mono ethylene glycol (MEG) and terephthalic acid (PTA), is sold in small pellets and its major use is for the manufacture of lightweight plastic bottles for carbonated soft drinks and water. The projects output is expected to be exported to Europe and the United States and also sold in Egypt, Middle East and North Africa.   The project will be the first PET plant in North Africa.  Egypt has significant advantages for the location of a PET plant including:  - low logistics costs for sales to the European Union (EU) and North American markets;  - access to the fast growing and underserved African and Middle Eastern markets;  - excellent port/infrastructure facilities;  - favorable trade agreements with the EU; and  - proximity to sources of MEG feedstock. - Create employment opportunities:    The project is expected to create approximately 450 permanent jobs and 800-1,000 jobs during construction, the large majority of which will be local hires. In addition, the project will provide indirect employment through use of Damietta port facilities, transport to domestic consumers, and procurement of local supplies.    - Diversification of Export Earnings:    The vast majority of Egypts foreign revenues currently come from the oil and gas and tourism sectors. Given the historical volatility of these two sources, the GoEs stated goal is to diversify its export base over the coming decade to provide a more stable foreign revenue base. The project will contribute to this objective by generating over $500 million in net export revenues (after deducting the cost of imported raw material) over the first 10 years of the projects life, as a result of both direct exports as well as import substitution.    - Demonstration Effect:    The project will be the first PET project in Egypt and North Africa as a whole, a region which has significant potential to become a world-class player in this industry.  By operating a successful operation in Egypt, the project is expected to encourage other players to establish production facilities in the region.  Also, the training of local employees will improve the quality of workers with experience in the PET industry.     - Promotion of Downstream Industry:    The water and CSD bottling industries in Egypt, which comprises several small players, currently lack domestic sources of PET resin, which are imported from China or Korea.  Small players cannot hold large inventories and therefore are unable to import economical lot sizes. This project is expected to help the small players improve the efficiency of their operations through savings in logistics costs.  This is also expected to promote the production of new PET based specialty products with higher value-add, such as film, packaging, etc. The key development indicators that are proposed to be monitored during the life of the IFC investment are:     - Number of permanent jobs created; - Annual net foreign exchange generated from the projects exports; and   - Amount of PET sourced domestically by Egyptian PET converters.