Industry & Economy
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Fertilisers
Decision to deregulate urea supply to come under scanner
Ambarish Mukherjee
New Delhi
,
June 3
THE review committee, set up by the Fertiliser Minister and headed by the Fertiliser Secretary to examine the issues pertaining to partial deregulation of urea distribution, will examine the circumstances that prompted the erstwhile National Democratic Government (NDA) to deregulate fertiliser distribution, official sources told Business Line.
The NDA Government had deregulated fertiliser distribution to the extent of 50 per cent since the 2003 kharif season. The newly-appointed Minister for Chemicals, Fertilisers and Steel in the Congress-led United Progressive Alliance (UPA) Government, Mr Ram Vilas Paswan, constituted the committee earlier this week to review all issues related to deregulation of urea distribution.
Before the deregulation, the Government used to direct the fertiliser manufacturers on the quantity of urea that had to be sent to each State. In effect, it meant that the Government had 100 per cent control on the destination. But under the deregulated environment, the Government now directs the destination for 50 per cent of the production while the manufacturers are free to sell the remaining 50 per cent in markets of their choice.
According to sources, the committee, which has already deliberated on the issue, has not been able to identify any visible impact in the market situation arising out of last year's deregulation. Also, the move does not have any direct financial implication on the Government.
"So, now that no tangible impact of the entire exercise is visible after two crop seasons, the committee is going to examine why such a move was initiated at all and what was expected out of it," officials said.
Theyadded that the Committee would place its recommendations before the Government within the next few days.
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