Govt. reviewing urea policy

By Our Special Correspondent

NEW DELHI, DEC. 11. The Government is reviewing the urea pricing policy in order to iron out the contradictions between the interests of the industry and farmers, Mr. S. S. Dhindsa, Union Chemicals and Fertilizers Minister, said today.

He said the Government would find a way to harmonise contradictions while trying to ensure sustainable growth of the industry and supply urea to farmers at affordable prices.

Inaugurating a seminar on ``Agricultural subsidies - global dimensions'', organised by the Fertiliser Association of India (FAI), he said several rounds of discussions had already been held with the industry and the Government was in the process of finalising its views on the policy.

In this context, he stressed that the interest of the indigenous fertilizer industry and the need to sustain the capacities created within the country would remain uppermost while formulating necessary mechanisms such as tariff structure for urea.

He noted that the fertilizer market would be highly competitive in future and the brand equity of the company and image especially with farmers would be important. He urged industry to give a thrust to extension activity where total needs of the farmers related to development of farming had to be attended by the industry. This would supplement the efforts of the Government and other agencies that may be working in the field. Development of bio-fertilizers was one of the areas that should supplement the activity of the production of chemical fertilizers. The fertilizer industry could give focussed attention to provide all the inputs required by the farmers along with supplementing such sales with required extension activity for promoting integrated nutrient management of soil.

Mr. Dhindsa said while the country was committed to globalization it would do so at its own pace and in a manner which is in consonance with its national interest. The government will support the fertilizer industry through various initiatives. Recent market reports give rise to the hope that LNG in the form of an alternative feedstock will be available soon to the fertilizer industry. He said the fertilizer industry has to pressurise petroleum companies to make them bring down prices for feedback sold to the fertilizer sector.

The Government is examining issues of empowerment of the fertilizer producing companies through various measures including changes in the rules presently governing imports of feedstock material. Even while doing so, issues like capacity created for supply of feedstock by indigenous petroleum companies need to be kept in mind.

He said the Government was conscious of the fact that the high feedstock prices especially for naphtha and fuel oil and low sulphur heavy stock (LSHS) based fertilizer companies make industry non-competitive in the international market. This problem needed to be tackled, he stressed.

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