Many fertilisers unit accounts with banks may turn default soon:FAI

Mumbai, Mar 10 (UNI) Several fertiliser companies in the country may turn into non-performing assets (NPAs) for commercial banks since the industry is overstretched of overdrafts in the current fiscal year due to non-availability of subsidised amount from the Union Government since November 2005.

''Fertiliser industry is overstretched for overdraft from banks and unless at least Rs 4,000 crore is provided for the current financial year, some of the units may even have to close'', said U S Jha, Vice Chairman of the Fertliser Association of India (FAI).

In a statement, Mr Jha, who is also the Chairman and Managing Director of public sector Rashtriya Chamicals and Fertilisers (RCF) Limited, said, ''Fertiliser industry is disappointed that there is no provision made towards providing at least Rs 4,000 crore for subsidy.

''The industry reels under whopping budgetary shortfall for subsidy'', he said.

The revised budget announced by Finance Minister P Chidambaram for the year 2005-06 was about Rs 17,000 crore towards subsidy, as against the requirement of Rs 24,000 crore. ''So there will be a massive carry over next year'', he pointed out.

Even for the next fiscal year, the provision is again Rs 17,000 crore and therefore, the carry over is going to increase to about Rs 12,000 crore next year if the ministry releases a sum of Rs 4,000 crore towards subsidy in the pricing of fertilisers.

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