Fertilizers and Chemicals Travancore (FACT) has decided to form new joint ventures to implement some of the long pending projects like new urea plant, phosphoric acid plant, capacity expansion of Factamfos production and container freight station.
Delivering the keynote address at the seminar on fertilizer industry in India, Sham Lal Goyal, Chairman and Managing Drector of FACT, said that the most serious problem facing FACT was the heavy interest burden on loans availed from various financial institutions to tide over the liquidity problem.
During the last year, FACT paid Rs 140 crore as interest on loans and the loss was about Rs 40 crore. If the company had avoided the interest burden, it could easily post a profit of Rs 100 crore in 2010-11. This has been a pressing problem for FACT for the last several years, according to Goyal.
He said FACT had already approached the central government for an interest-free loan of Rs 550 crore to tide over the hard time. The revision of prices of FACT fertilizers became unavoidable following the heavy rise in the raw materials costs, Goyal said, and stressed the need for stepping up production of fertilizers in India.
At present, 25 per cent of the urea requirement in India was met through import. India currently requires about 28 million tonnes of urea out of which import is about 8 million tonnes, while in the case of potash, imports account for 100 per cent as there is no indigenous production.
M P Sukumaran Nair, former managing director of Travancore Cochin Chemicals (TCC), presented a paper on the world fertiliser scenario. He said that even though India had become the second largest producer of chemical fertilisers in the world, per hectare consumption of fertiliser in India is 135 kg where as in China it is 235 kg. He stressed the need for evolving an effective policy for natural gas pricing and subsidy so help the fertilizer industry grow better.