‘Fertiliser sector will see much higher domestic production with new policies’

Updated on: Oct 12, 2015
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Sector sure to come out of the woods, says Fertiliser Secretary Anuj Kumar Bishnoi

With many private companies looking to exit the fertiliser business or cut down investments, the Centre is all set to make policy changes to make sure the sector is revived. In an interview with Bloomberg TV India, Fertiliser Secretary Anuj Kumar Bishnoi elaborates the government’s plans to revive the sector.

What is the investment needed to put up a standard fertiliser plant?

The cost of a 1.27-billion tonne plant, which is the standard, comes to around ₹6,000 crore. For a coal-based plant the cost would be somewhat higher.

On the export and import front what is the government’s endeavour, as far as urea is concerned? How do you see that panning out in the near term and in the long term?

What we are looking at is a much higher domestic production. So once we have a much higher domestic production, the gap between demand and domestic availability will reduce and so our dependence on imports will reduce. So that is one major thing we are looking at. As time progresses we would be thinking about other things also.

What is the timeline you are giving yourself for the dependency on import to come down dramatically? What is the year that we can expect this to happen?

First, with neem coating of urea, we expect the demand to come down. Second, we have also started a new urea policy for greater efficiency. That would increase production. Third, new plants would be coming up. So once we have these plants, there will be substantial increase in domestic production capacity. Gas pooling has also made production higher. So, with a combination of these steps, I do expect that our import dependency should substantially come down in the next two to three years.

We have seen many sectors coming out with their own set of new policy initiatives. As the Fertiliser Secretary, what would you say is the one big thing that the industry could watch out for from the government in terms of policy reform?

Let us formulate it first and then I should announce it and not the other way round.

But what is the line that you are working on? At least give us some thoughts about what is it that the industry can expect from the government.

We are trying to simplify subsidy calculation. That is one thing. Gas pooling has solved all the costing issues.

We are promoting energy efficiency. In the new investment policy, the only aspect we talked about was revamp. Now, the new investment policy also covers the revival and setting up of joint ventures abroad.

So, with setting up of joint ventures, revival of units and making them more energy efficient, making availability of gas easier, making subsidy calculations, and making competition more favourable and easier to manage, we should have a much better climate.

Any expectations on big FDI coming in? Any big foreign companies that are looking to set up shop here? What is the interest looking like here for the foreign players?

It is too early to comment on that actually. Because indications are just indications but it would not be appropriate for me to take that as a very strong signal. So at the moment I would not be able to say anything on that.

But are we seeing any interest being generated from foreign companies — who may have shown some interest to come here but may be waiting for some more time? Is that the feeler you are getting?

Yes, the sense I am getting is that they are interested. They see a much better investment planet. So the indications are quite positive.

Published on January 22, 2018

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