Urea Policy
New Investment
Policy-2012
The Department of Fertilizers has notified New
Investment Policy- 2012 on 2nd January, 2013 in order to facilitate
fresh investment in urea sector. It is expected that the demand of urea in the
country by the end of 12th Five Year Plan will be around 360 lakh
MT. With the approval of this policy, it is expected that nearly 100 lakh MT of
additional urea capacity will be added in the country to an already existing
indigenous capacity of 220 LMT and 20 LMT from OMIFCO Oman, with an investment
of nearly Rs. 35,000 crores during 12th Five Year
Plan period (2012-17). This will make country self reliant in urea by
end of 12th Five Year Plan.
Fertilizer Subsidy in
P&K fertilizers
With a view to
ensure balanced use of fertilizers and to promote investment in fertilizer
sector, the Department of Fertilizers is implementing the Nutrient Based
Subsidy (NBS) Policy for decontrolled Phosphatic
& Potassic (P&K) Fertilizers w.e.f. 1.4.2010. Under the NBS policy, a fixed rate of
subsidy (in Rs. per Kg. basis) decided on annual basis is provided to each grade
of subsidized P&K fertilizers depending upon its nutrient content. Any
variant of the fertilizers under the NBS fortified with micronutrient Boron and
Zinc, as provided under the FCO, is eligible for a separate additional fixed
subsidy. Under the Policy the prices are allowed to be fixed by the fertilizer
companies at reasonable level.
At present 21
grades of P&K fertilizers, namely, DAP, MAP, TSP, MOP, Ammonium Sulphate,
SSP and 15 grade of NPKS complex fertilizers are covered under the NBS Policy. The
subsidized fertilizers are allowed for use in manufacturing of mixture and
customised fertilizers. With the implementation of NBS for P&K fertilizers,
the availability of the fertilizers during the last three years has been in
plenty.
Revival of the closed
units of HFCL and FCIL
There
are five closed units of Fertilizer Corporation of India Ltd (FCIL) at Sindri, Talcher, Ramagundam, Gorakhpur & Kobra
and three closed units of Hindustan Fertilizer Corporation Ltd. (HFCL) at
Durgapur, Haldia and Barauni.
The cabinet had in 2008 approved revival
of FCIL and HFCL units subject to non recourse to Government funding and to
consider write off of GoI Loan and interest to the
extent required, subject to submission of fully tied up proposals for final
decision on waiver and constitution of an ECOS. The ECOS recommended revival of
Sindri, Talcher and Ramagundam Units of FCIL on ‘nomination basis’
by the nominated PSUs and Gorakhpur & Kobra units
of FCIL and Durgapur, Haldia, Barauni
of HFCL through bidding route. Cabinet Committee on Economic Affairs (CCEA) in
2011 approved the recommendations of ECOS with the stipulation that Board for
Industrial and Financial Reconstruction (BIFR) proceedings be
expedited and thereafter, the matter including changes, if any, required in bid
parameters, be placed before the Committee for a final decision.
The matter is in the BIFR. The BIFR has
taken up the matter on priority basis and held many hearings. In a recent
hearing, BIFR suggested that the revival on nomination is not as per BIFR rules
and even floating of EOI for revival through bidding route has to go through
BIFR procedure which are time taking and the whole process may get stuck up in
the procedural issues. BIFR suggested that Government should look for suitable
option of taking the companies out of the purview of BIFR. A meeting of ECOS is
being convened shortly for getting their recommendation on the matter and
further submission to CCEA.
Movement and Distribution of Fertilizers
The cumulative availability and Sales of Urea
during the year 2012 (April’12 to December’12) is 224.78 LMT and 220.03 LMT
respectively as compared to corresponding period April’11 to December’11 was
221.10 LMT and 218.79 LMT respectively, and there is no shortage of DAP, MOP
and NPK in the country.
Implementation of e- Office
The Department is in the
process of implementing e-Office in all its divisions and Subordinate Offices.
With the implementation of e-Office, the physical movement of office
files/papers in some of the divisions has shown decreasing trend.
Direct Transfer of subsidy Project
Currently, the direct transfer of
subsidy is in the 1st stage of implementation wherein the fertilizer
movement from the production/import to the retailers which is the last point of
sales to the farmer is available on the transparency portal www.mfms.nic.in. Movement till the district level can be viewed on urvarak co.in. With
this, availability of fertilizers to the farmer is ensured.
In
next stage, the sale of subsidized fertilizers from retailers to farmers will
be captured on real time basis. In this phase, the identity of farmers, linked
to Aadhar enabled core banking account, will also be
captured. This phase will be implemented
in 11 districts across the country on pilot basis. After successful
implementation of this phase, the same will be rolled out in other districts
wherever Aadhar penetration is more than 90%.
Simultaneously, cash transfer to farmers would also be done in same 11
districts after successful implementation of the pilots to track sale of
fertilizers to farmers in these districts.
*****
NSK/DB
(Release ID :91404)
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