The Ministry of Industry`s director for downstream chemical industry, Tuti Rahayu, said here on Friday that the rise in demand for cement was due to increased infrastructure development across the country.

"Domestic consumption of cement increased by 14.5 percent last year, compared with 48 million tonnes in 2011. Even in Indonesia`s eastern regions, the demand increased by about 54 percent, far higher than other regions of the country," she noted.

Tuti stated that Indonesia needed to build at least two new cement factories every year to meet the rising demand for cement in the country.

She pointed out that a number of private and state-owned firms had begun constructing new factories across the country, such as in Java, Sumatra, Sulawesi and Papua.

"In keeping with the Master Plan for Acceleration and Expansion of Indonesia`s Economic Development (MP3EI), increasing the number of factories is part of the effort to support the MP3EI projects by meeting the domestic demand for cement," Tuti explained.

She said the government was focusing on infrastructure development, which was in line with the MP3EI program.

As for the development of two new cement factories every year, PT Semen Indonesia president director Dwi Soetjipto said his company was planning to build one in Central Java during the first half of this year and another one in West Sumatra in the second half of 2013.

Each of the two new factories to be built this year will have a capacity of 2.5-3 million tonnes per annum.

At present, Semen Indonesia a holding company of PT Semen Gresik, PT Semen Padang and PT Semen Tonasa controls 41 percent of the cement market share at home.

Earlier, Dwi had stated that state-owned cement firm PT Semen Gresik had set aside US$400 million (Rp4 trillion) for capital expenditure for its corporate business activities in 2013.

"The Rp4 trillion will be used to carry out a number of corporate business activities, such as continuing the process of transforming the company into a holding firm, to be called PT Semen Indonesia Tbk," he said.

"Other corporate activities include integrating Thang Long, an acquired Vietnamese firm, into Semen Indonesia holding company, as well as the construction of the two new factories in Rembang (Central Java) and Padang (West Sumatra)," Dwi added.

Recently, Semen Gresik acquired 70 percent of Than Long Cement of Vietnam, worth approximately US$157 million.

Semen Gresik Group`s total production was projected to reach 22.6 million tonnes in 2012. Given that Tuban IV and Tonasa V factories will be operational in 2013, the total production figure is estimated to touch 26 million tonnes by the end of this year.

"If the production of Thang Long`s 2.3 million tonnes is taken into account, the total production of the group will reach 28.3 million tonnes in 2013," Dwi said.