The Hindu Business Line : IFFCO venture acquires 1,000 acres in Egypt

Egyptian Venture
Iffco holds 76% in the joint venture while El Nasr holds the remaining 24%
The proposed plant has been given permission for duty free import of all capital goods and tax-free income for 10 years
The proposed debt-equity ratio for the project would be 2:1

New Delhi , July 16

Indo Egyptian Fertiliser Company Ltd, the joint venture between Indian Farmers' Fertiliser Co-operative Ltd(IFFCO) — the largest fertiliser co-operative in the world — and the Egyptian State owned El Nasr Mining Company (ENMC), has won major concessions for its proposed $325-million phosphoric acid plant in Egypt with a annual capacity of 5 lakh tonnes.

The company has already completed acquisition of 1,000 acres of land and has been granted major duty and tax concessions by the Egyptian Government, the General Manager of IFFCO's Strategic Management Group (SMG), Mr Manish Gupta, told Business Line.

Duty Free Import

"The proposed plant has been given permission for duty free import of all capital goods and the income of the company would be tax free for 10 years," he said. The International Finance Corporation (IFC), which has been appointed as the lead arranger to tie up the finances, is in the final stage of appraising the project. "IFC is scheduling their final appraisal for the project sometime in August and once it is done we hope to tie up the finances by around November," Mr Gupta said.

IFFCO holds 76 per cent in the joint venture while El Nasr holds the balance. The proposed debt-equity ratio for the project would be 2:1 and IFFCO would be investing around Rs 1,700 crore in the project, officials said.

Rock Phosphate

According to the plans, El Nasr, which is Egypt's largest rock phosphate mining company, would supply 2 million tonnes of rock phosphate to the joint venture company and IFFCO would buy out the entire phosphoric acid thus produced for producing di-ammonium phosphate (DAP) in India.

Initially it was planned that IFFCO would be setting up additional capacity to manufacture DAP at its Kandla facility but following the acquisition of the DAP plant at Paradip from Oswal Chemicals and Fertilisers, the Kandla expansion has been temporarily shelved, Mr Gupta said.

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