The Planning Commission's working group on fertiliser industry for the 11th Five Year Plan (2007-12) is scheduled to meet today to take a final view on its draft report that calls for reduction in taxation rate on hydrocarbons that are used in the manufacture of fertilisers. |
The working group wants uniform taxation or nil taxation on hydrocarbons like natural gas, naphtha and fuel oil as all local taxes levied by state governments are affecting the viability of urea units or increasing the subsidy burden of the Central government. |
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It also called for the next phase of new pricing scheme to lay greater emphasis on conversion of non-gas based units to gas, incentivising additional urea production, rationalising freight reimbursement among others. |
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Encouraging joint venture fertiliser projects abroad for making use of their available spare capacities is another key suggestion in the report. |
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According to the draft report, the next stage of the new pricing scheme be aimed at helping Indian industry achieve self sufficiency in urea by the end of the 11th Five Year Plan period in 2012. |
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It has also advised the government to enter into negotiations or encourage Indian fertiliser companies for tying up for long-term supplies of urea from the countries which will have surplus urea capacities. |
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The report has also called for the constitution of a technology mission on fertilisers to study the changing pattern in fertiliser use, and felt that the state governments should be more scientific and realistic in assessing the actual fertiliser requirement. |
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According to the projections, the demand for various fertilisers is forecast at 163.10 lake metric tonnes, 72.9 lake metric tonnes and 33 lake metric tonnes respectively for all nutrients (NPK) in the terminal year of the 11th Five Year Plan. |
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Observing that the food-grain production in the country could touch 320 million tonnes by year 2011-12, the report has called for additional availability of 300 lakh metric tonnes per annum of urea. |
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