 "Subsidy on P&K fertiliser cut to Rs 21,274 crore for FY17")
The government on Wednesday reduced the subsidy on phosphatic and potassic (P&K) fertilisers to an estimated Rs 21,274 crore for the next financial year due to a decline in global prices, a move that might save the exchequer around Rs 5,000 crore.
The reduction in subsidy would not result in an increase in retail prices of the two major P&K fertilisers, Diammonium Phosphate (DAP) and Muriate of Potash (MoP), an official source said.
The Cabinet Committee on Economic Affairs (CCEA) has fixed the nutrient-based subsidy rates (NBS) for P&K fertilisers for 2016-17 taking into account "decreasing trend in global prices of finished fertilisers and raw materials," an official statement said.
"At the same level of consumption of P&K fertilisers (about 31 million tonnes) during 2016-17 as in 2015-16, the total subsidy implication on P&K fertilisers for 2016-17 at the proposed rates works out to be about Rs 21,274 crore," it added.
The subsidy on nitrogen and phosphorous has been reduced by about Rs 5 a kg, while a marginal cut has been made on potash. This could lead to a saving of about Rs 5,000 crore to the exchequer, the source said. Accordingly, the subsidy on DAP has come down to Rs 8,945 per tonne from Rs 12,350 a tonne in the current financial year. The subsidy on MoP has been reduced to Rs 9,280 per tonne from Rs 9,300 in 2015-16, a source said.
The CCEA approved Rs 15.85 a kg for Nitrogen (N), Rs 13.24 a kg for phosphorous (P), Rs 15.47 a kg potash (K) and Rs 2.04 a kg for sulphur (S), the statement added. For the current financial year, the subsidy on N was Rs 20.88 per kg, P was Rs 18.68 per kg, K was Rs 15.50 per kg and S was Rs 1.68 per kg.
The government has been implementing NBS policy for decontrolled P&K fertilisers since April 2010. Under this policy, the subsidy on P&K fertilisers was announced annually for each nutrient on a per-kg basis, which is converted into subsidy per tonne depending upon the nutrient content in each grade of the fertilisers. These rates are determined taking into account global and domestic prices of P&K fertilisers, exchange rate and inventory level in the country, among others.
While the government announces fixed subsidy on NPK fertiliser, the manufacturers are free to decide the maximum selling price on these complex fertilisers.
Swachh Bharat Mission
The Cabinet also approved a $1.5-billion (about Rs 9,000-crore) offer of World Bank support for the Swachh Bharat Mission (SBM) in rural areas.
The approval provides for a mechanism of incentivisation through World Bank credit, communications minister Ravi Shankar Prasad said after the meeting here. States' performance will be gauged through performance indicators. States will pass on at least 95 per cent of Performance Incentive Grant Funds to the appropriate implementing levels, the minister said. "The incentive framework introduced through the project will reorient efforts of states towards SBM (G) aims such as reduction in open defecation, sustainable achievement of open defecation-free villages and improvement in solid and liquid waste management," Prasad said.
Obsolete laws
A law which the government now does not want to scrap and another which has already been repealed are set to be removed from two Bills which seek to abrogate obsolete legislation. The two -- Appropriation Acts Repeal Bill, 2015 and the Repealing and Amending (Third) Bill, 2015 -- are pending in the Rajya Sabha, after being approved by the Lok Sabha.
Official amendments to the two to remove the Pensions' Act and the Punjab Appropriation Act from the list of laws the government wants to repeal were cleared on Wednesday by the Union Cabinet.
A senior functionary said the government does not now favour repealing the Pension Act, 1871. The Punjab Appropriation Act has already been repealed and "inadvertently" became part of the Appropriation (Acts) Repeal Bill, 2015, he said.
The two Bills will return to the Lok Sabha for fresh approval after the official amendments. The Bills seek to scrap a total of 1,053 Acts which have become redundant and are clogging the statute books.
Bhutan hydro project
The Cabinet approved a revised cost of Rs 4,021 crore for the 720 Mw Mangadechhu Hydroelectric Project in Bhutan, under implementation. The project will provide surplus power to India and the bilateral agreement was signed in April 2010, at an estimated Rs 2,896 crore (March 2008 prices). The Government of India is funding it, with 30 per cent being a grant and 70 per cent a loan, at 10 per cent annual interest, to be paid back in 30 equal six-month instalments.
World football
The sports ministry has been told to form an organising committee for hosting the Under-17 world football tournament next year. The government approved changes suggested by an inspection team from Fifa, the world football body.
The venues are Nehru Stadium in Delhi, DY Patil Stadium in Navi Mumbai, Nehru Stadium in Kochi, Salt Lake Stadium in Kolkata, Nehru Stadium in Goa and IG Stadium in Guwahati. The total cost is supposed to be within Rs 95 crore. The Fifa team was reportedly broadly satisfied but noted major renovation was needed in most of the six stadia, to comply with international standards.
OTHER DECISIONS
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Govt approves pacts with UAE for skill development;
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Approval for an agreement with the UAE to explore mobilisation up to $75 billion of long-term investment in the National Investment and Infrastructure Fund;
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CCEA approved doubling of the 124-km Kiul-Gaya rail line in Bihar, estimated to cost Rs 1,354 crore. And, doubling of 158.5 km Hatia-Bondamuda line for catering to thermal power units in the region;
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Approval for signing of an agreement with Lithuania for cooperation in agriculture;
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Transfer of 89.7 hectares of land in Delhi's Dwarka to the department of industrial policy and promotion for setting up a world-class exhibition-cum convention centre;
