India’s ShriVallabh Pittie Group (SVP) has signed a land lease agreement with Sohar Port and Freezone for the establishment of a $300m plant at the freezone to manufacture a wide range of cotton yarn products.

The facility is expected to start commercial operations by 2019 and will create an estimated 1,500 jobs.

Bank Sohar has also been awarded the syndication mandate to fund the entire project, which has two phases.

The bank has underwritten debt for the first phase. Upon successful completion of the initial phase, the bank plans to syndicate a term debt for the second phase, along with a share of the first phase debt, to interested lenders.

Sasi Kumar, Sohar Bank acting CEO, said the project is expected to have a significant impact on the development of the region.

The plant will import 100,000 metric tonnes of cotton fibre a-year through Sohar Port, with around 50 per cent of the raw materials coming from the US and the remainder split between Australia and India.

The plant will produce around 75,000 tonnes of finished yarn each year, which will be exported through the port to China and other markets including Bangladesh, Pakistan, Vietnam, Portugal and Turkey, the company said in a statement.

A deep sea port in Northern Oman lying on the Gulf of Oman coast, Sohar Port is operated and managed by the Sohar Industrial Port Company (SIP), a 50:50 joint venture of the Netherlands’ Port of Rotterdam and the Omani government.