The Hindu Business Line : Govt to bring in new policy for investment in fertiliser sector

Kochi, May 3 The Union Government is soon expected to announce a new policy for investment in the fertiliser sector in order to promote domestic production, Mr Ram Vilas Paswan, Minister for Chemicals and Fertilisers, has said.

The Government has already decided to revive the eight closed units of the Fertiliser Corporation of India and Hindustan Fertiliser Corporation and the work on these units is expected to start in the next few months. Besides, the Centre also proposes to bring ammonium sulphate and sulphur under the subsidy regime, as the use of products containing sulphur increases agricultural productivity, the Minister said while laying the foundation stone of the Gypsum panel project of the Fertilisers and Chemicals Travancore Ltd (FACT) here on Saturday.

He pointed out that ammonium sulphate had not received any subsidy since the early 1990s. With the inclusion of both these products under the subsidy regime, the products will become more remunerative and will ensure that FACT’s operations remain profitable, he said.

Support to Fact

According to the Minister, FACT is making losses on two of its main products — Factomfos and Ammonium Sulphate — and the company had to stop production of ammonium sulphate in July 2007 as the loss was about Rs 12,270 a tonne. The cost of sulphur had also gone up since September 2007 and stood at Rs 27,000 a tonne.

To ensure FACT does not have any working capital problem in future, he said the Fertiliser Ministry had arranged a dialogue between Indian Potash Ltd and FACT to get raw material support. With this, FACT will not have problems of supply of raw materials for at least the next three years

As part of promoting fertiliser production, the Government is also taking steps to promote sulphur application in the country by extending the normal subsidy regime to single sulphur phosphate (SSP) from May 1. Instead of uniform ad hoc subsidy of Rs 1,125 a tonne being paid till April 30, the subsidy for SSP manufactured from imported rock will be Rs 5,630 a tonne and on that produced using indigenous rock will be Rs 3,650 a tonne.

For the farmer

Mr Paswan said that the Centre is deeply concerned with the wellbeing of the farmers and the need to increase consumption of fertilisers in the country. This is necessary in order to provide the nation with the much required food security.

The Government has not revised the MRPs of fertilisers in the last four years, in spite of rising international prices and increase in manufacturing costs, he said.