Deprecated (16384): The ArrayAccess methods will be removed in 4.0.0.Use getParam(), getData() and getQuery() instead. - /home/brlfuser/public_html/src/Controller/ArtileDetailController.php, line: 150
 You can disable deprecation warnings by setting `Error.errorLevel` to `E_ALL & ~E_USER_DEPRECATED` in your config/app.php. [CORE/src/Core/functions.php, line 311]
Deprecated (16384): The ArrayAccess methods will be removed in 4.0.0.Use getParam(), getData() and getQuery() instead. - /home/brlfuser/public_html/src/Controller/ArtileDetailController.php, line: 151
 You can disable deprecation warnings by setting `Error.errorLevel` to `E_ALL & ~E_USER_DEPRECATED` in your config/app.php. [CORE/src/Core/functions.php, line 311]
Warning (512): Unable to emit headers. Headers sent in file=/home/brlfuser/public_html/vendor/cakephp/cakephp/src/Error/Debugger.php line=853 [CORE/src/Http/ResponseEmitter.php, line 48]
Warning (2): Cannot modify header information - headers already sent by (output started at /home/brlfuser/public_html/vendor/cakephp/cakephp/src/Error/Debugger.php:853) [CORE/src/Http/ResponseEmitter.php, line 148]
Warning (2): Cannot modify header information - headers already sent by (output started at /home/brlfuser/public_html/vendor/cakephp/cakephp/src/Error/Debugger.php:853) [CORE/src/Http/ResponseEmitter.php, line 181]
LATEST NEWS UPDATES | Fertiliser subsidy cut in the offing as import prices nosedive by Prabha Jagannathan

Fertiliser subsidy cut in the offing as import prices nosedive by Prabha Jagannathan

Share this article Share this article
published Published on Jun 4, 2010   modified Modified on Jun 4, 2010


THE Centre could make changes to the new Nutrient-based Subsidy (NBS) for fertilisers, as part of a concerted move to prune its subsidy bill after global prices of fertiliser nosedived recently. Under the NBS, subsidies for nutrients are currently fixed for a whole year but could now be reviewed every six months to take into account changes, especially price drops, in import prices.

The Union Cabinet, while approving the NBS for phosphatic (P) and potassic (K) fertilisers from April 1, had included a caveat for possible review of subsidy.

Through a more frequent review, the Centre hopes to noticeably cut subsidies paid to companies, especially on imports of de-controlled fertilisers such as phosphates and potash. With fertiliser companies clinching import orders at a far lower price than that fixed by the government for 2010-11, the latter is irked over having to fork out high subsidy to them despite big drops in import price. “We expect them to logically pass on import price advantages within the NBS scheme to farmers or to take a commensurate cut in subsidy from the government,” a senior government official told ET on condition of anonymity.

Fertiliser minister M K Azhagiri had asked for the NBS implementation to be postponed by a year besides expressing apprehensions on whether price drop benefits and quality fertilisers would actually reach farmers. Fertiliser Association of India (FAI) DG Satish Chandra contended, however, “..the small increase in the MRP of some products has been on lines expected by the government while notifying the quantum of subsidy on various nutrients. In fact, there has been a decline in MRP of SSP (single super phosphate).”

Industry stakeholders also take all the credit for clinching lower import prices. “Stability in MRP of various products has been possible due to realistic provision of subsidy and efforts of industry to procure raw materials and finished products from the international market at prices much lower than in recent years. This will help reduce P&K subsidy. The NBS has also ensured sufficient supply,” an Iffco official maintained.

Recently, the Centre virtually doubled the price of APM gas to urea units. Crucially, the decision on slashing subsidies to fertcos now being mulled, together with the increase in the gas price, are being viewed as a prelude to decanalisation (free import by private trade) of urea and precondition to subsequent de-regulation of the fertiliser sector. The fertiliser industry has been pushing aggressively for both, but the government is keen on withdrawing subsidies in tandem even while ensuring fair price to farmers in an open market pricing regime. Thus far, only parastatals such as the MMTC, STC and IPL import urea. Post-decanalisation, other fertiliser companies will also be able to directly import cheaper urea. The finance ministry is understood to be in favour of this.

Price of imported urea currently works out to Rs 14,000/tonne while domestic gas based urea units produce the same at between Rs 9-11,000/tonne.


The Economic Times, 4 June, 2010, http://epaper.timesofindia.com/Default/Scripting/ArticleWin.asp?From=Archive&Source=Page&Skin=ETNEW&BaseHref=ETD/2010/06/04&PageLabel=11&EntityId=Ar01102&ViewMode=HTM


Related Articles

 

Write Comments

Your email address will not be published. Required fields are marked *

*

Video Archives

Archives

share on Facebook
Twitter
RSS
Feedback
Read Later

Contact Form

Please enter security code
      Close