Fertilisers subsidy likely to touch Rs 30,000 crore in 2007-08

New Delhi, Feb 2 (UNI) The fertilisers subsidy is likely to touch Rs 30,000 crore in the fiscal 2007-08, about Rs 2,000 crore more than this fiscal.

The government has already disbursed Rs 22,000 crore as subsidy to fertiliser industry, Chemical and Fertilisers Minister Ram Vilas Paswan told mediapersons here today, adding that the remaining subsidy would be paid by the end of the current fiscal.

The government will now encourage Indian urea fertiliser manufacturers to set up joint venture projects abroad where gas is readily available at reasonable prices and also plans to create a specialised agency to coordinate overseas investments in this sector, Mr Paswan said.

Exempting domestic urea units from seeking prior permission for additional production beyond 100 per cent of the installed capacity in the New Pricing scheme (NPS) Stage - three would serve as incentive for higher production.

The NPS-Stage three seeks to promote the usage of natural gas, the most efficient and comparatively cheaper feedstock for production of urea, Mr Paswan said.

The government has taken steps to strengthen the distribution system, asking the states to regulate the supplies to district levels with DoF monitoring the stock movement through website networking.

Besides, rail freight will be reimbursed as per the actual expenditure and road freight will be escalated with respect to the composite road transport index every year.

In addition to that, the DoF will operate a buffer stock through state institutional agencies and fertiliser companies in major consuming states upto a five per cent limit of their seasonal requirement.

UNI