The Hindu Business Line : Group pricing scheme for urea: Dhindsa

THE Union Minister of Chemicals and Fertilisers, Mr S.S. Dhindsa, has said that the Government is in the process of formulating a long-term pricing policy for urea units based on the recommendations of the Expenditure Reforms Commission (ERC).

The ERC had suggested replacement of the existing unit-wise Retention Price-cum Subsidy (RPS) scheme with a Group Concession Scheme (GCS) and the matter is currently under the consideration of a Group of Ministers, Mr Dhindsa told the Members of the Parliamentary Consultative Committee attached to his Ministry.

The Minister said that while the fertiliser industry had flourished under the protective umbrella of the RPS scheme for urea and concession schemes for decontrolled fertilisers, which had also enhanced production capacity of the industry, these were, however, imposing a heavy financial burden on the Government, which was under pressure to curtail expenditure on subsidies.

Mr Dhindsa assured the Members that the situation vis-a-vis fertiliser availability was comfortable. During 2001-02, the consumption of urea was estimated to have gone up by around 5 per cent to over 201 lakh tonnes, from 192 lakh tonnes in 2000-01. Similarly, consumption of di-ammonium phosphate (DAP) and muriate of potash (MoP) had increased by 5.4 per cent and 10.9 per cent, to touch 62 lakh tonnes and 20.3 lakh tonnes, respectively. Even in the current kharif season, the supply position is `very comfortable' against the assessed demand levels, he added.

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