The fertiliser department has recently notified an increase in plant capacity of National Fertiliser Ltd, Indian Farmers Fertiliser Co-operative (Iffco), DSCL Ltd (erstwhile DCM Shriram Consolidated Ltd) and Duncans Industries Ltd. The notification became effective from April 1, 2002.
But the industry is upset with the notification. "It is not possible to suddenly raise the capacity. We need to work out the cost and other issues," said an industry expert.
A delegation comprising officials of these four units will soon meet the department officials to resolve the issue.
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The capacity enhancement is estimated to cost between Rs 60 to 65 crore.
The department has also released the details of notification and policy parameters for the seventh and eighth pricing periods, announced last month.
It had announced a five per cent increase in capacity utilisation from April 1, 2002 for all units as part of the policy for the seventh and eighth pricing periods.
Meanwhile, the Fertiliser Industry Co-ordination Commi-ttee is preparing financial details for fertiliser plants following the withdrawal of subsidy on the basis of the plant's age.
A committee comprising representatives of the fertiliser plants and the Fertiliser Association of India has been set up to discuss these issues with the department.
The committee will also focus on the long-term policy for the sector, consumption norms and escalation/de-escalation clauses among others.
Industry experts said the decision should have been prospective and not retrospective in nature.
"The present norms apply for the seventh pricing period (from July 1, 1997, to March 31, 2000) and eighth pricing period (from April 1,2000 to March 31, 2003)," sources said.