Concerned over acute liquidity crunch faced by the Indian fertiliser sector, The Fertiliser Ministry has sought an additional subsidy of Rs 20,000 crore. Non-allocation of subsidy fund to fertilizer industry on time has left it with no money to pay subsidy bills for the third and fourth quarters in the current financial year.
So far this fiscal, the government has allocated Rs 70,586 crore funds to Department of Fertiliser (DoF) as against the total demand of Rs 1,05,497 crore for the 2013-14 fiscal. Commodity wise, a subsidy of Rs 41,158.85 crore was allocated for urea and Rs 29,426.88 crore for P&K fertilisers. The DoF has been able to pay subsidy dues till May to fertiliser firms manufacturing urea locally, while for non-urea fertilizers, it can pay subsidy only till this month.
Meanwhile, in order to help fertiliser companies tide over the cash crunch, The Finance Ministry has approved a special banking arrangement of Rs 9,000 crore. Earlier in September, the Finance ministry had agreed to pay only Rs 5,500 crore subsidy under a special banking arrangement (SBA) as against Rs 12,000 crore sought by the Department of Fertilisers (DoF).
Backlog of Rs 32,000 crore for the year 2012-13 has to be paid from this year's allocations. The government has agreed to bear interest of 8 per cent per annum with 2.7 per cent interest to be borne by the industry. For this repayment, Finance Ministry provided a cash outgo of Rs 2,000 crore as additional subsidy in the second supplementary demand for grants approved in December.
So far this fiscal, the government has allocated Rs 70,586 crore funds to Department of Fertiliser (DoF) as against the total demand of Rs 1,05,497 crore for the 2013-14 fiscal. Commodity wise, a subsidy of Rs 41,158.85 crore was allocated for urea and Rs 29,426.88 crore for P&K fertilisers. The DoF has been able to pay subsidy dues till May to fertiliser firms manufacturing urea locally, while for non-urea fertilizers, it can pay subsidy only till this month.
Meanwhile, in order to help fertiliser companies tide over the cash crunch, The Finance Ministry has approved a special banking arrangement of Rs 9,000 crore. Earlier in September, the Finance ministry had agreed to pay only Rs 5,500 crore subsidy under a special banking arrangement (SBA) as against Rs 12,000 crore sought by the Department of Fertilisers (DoF).
Backlog of Rs 32,000 crore for the year 2012-13 has to be paid from this year's allocations. The government has agreed to bear interest of 8 per cent per annum with 2.7 per cent interest to be borne by the industry. For this repayment, Finance Ministry provided a cash outgo of Rs 2,000 crore as additional subsidy in the second supplementary demand for grants approved in December.
No comments:
Post a Comment