 "Jena rules out urea decontrol, expresses concern on smuggling")
Fertiliser Minister Srikant Jena today ruled out decontrol of urea sector and also expressed concern over smuggling and diversion of 3 million tonnes of subsidised urea to other chemical industries in the country.
Recognising the problem being faced by the cash-starved industry due to delay in subsidy payment to the tune of Rs 40,000 crore, Jena said that the issue has been taken up with the Finance Ministry.
Urea is heavily subsidised by the government and is currently priced at Rs 5,340 a tonne. Against the demand of 30 million tonnes, domestic output is stagnant at 22 million tonnes, the rest is met through imports.
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Addressing the event on fertiliser, Jena said the prices of phosphatic and potassic fertilisers have gone up sharply after the introduction of nutrient-based subsidy (NBS) policy in April 2010 that gave freedom to firms to fix retail price.
"If NBS in phosphatic (P) and potassic (K) fertilisers would have been a success story, then we could have thought of NBS in urea sector," he said.
The Fertiliser Department has already set up an expert committee to analyse the impact of decontrol of non-urea fertilisers.
Jena also spoke about diversion of highly subsidised urea to other industries and smuggled to neighbouring countries.
"We are concerned that around 30 lakh tonnes of urea is smuggled out of the country or used by the chemical industry. Due to this, farmers are not getting required urea at appropriate time," he said.
The minister said that the government is looking at ways to stop such diversion of urea to other chemical industries in states like Gujarat, Maharashtra and Haryana.
State governments have been asked to take steps to curb illegal use of urea chemical industries.
In view of shortage of reliquified natural gas, Jena advocated the use of coal based methane (CBM) gas and coal gasification process for the manufacturing of the urea.
He also asked the industry to focus on usage of Single Super phosphate (SSP) in place of di-ammonium phosphate (DAP).