Subsidy policy hampers growth of fertiliser industry: Nandurdikar

Bhubaneswar, Jul 21 (UNI) Under-provision in the budget and delay in subsidy payment have eroded the profitability of fertiliser industry in the country leading to stagnation in agri-sector and productivity, according to PPL Chairman S.S.Nandurdikar.

Talking to mediapersons here yesterday, Mr Nandurdikar said there had been hardly any growth in the indigenous capacity in the country over the years leading to sharp rise in the imports of fertilisers.

He said the fertiliser policy had almost become a subsidy policy forcing the industry to produce only products like Urea, DAP and NPK complexes, for which the subsidy was applicable ''It was not a subsidy the fertiliser industry, as the government wanted to sell the products to the farmers below the cost of production,'' he said.

The chairman further said since all the major raw materials were being imported and governed by the international supply-demand scenario, the cost of production had been rising steeply but the government did not want to increase the MRP to the farmers.

Increasing use of fertiliser was not necessarily increasing the output as there had been no attention to the soil health, balance fertiliser usage and use of minor and micro nutrients, he stated adding that this had led to the decreasing soil response to fertiliser.

''There should be some mechanism to ensure that the nutrient based subsidy be directly given to the farmers and if this happened the agricultural productivity would certainly rise,'' he suggested.

The PPL chairman said this year the fertiliser industry expected a subsidy of Rs 48,000 crore but budgetary provision was made for only Rs 24,000 crores. This under provision of the budget subsidy, which is bound to delay the subsidy payment to the industry, would erode the profitability and liquidity of the industry.

The dependence of import of fertiliser is bound to increase in the coming years as over the last six years there had been no capacity addition in the fertiliser industries in the country, he maintained.

UNI