The federal government on Wednesday decided to import 0.25 million tons urea involving a subsidy component of Rs 6 billion through private sector to ensure availability of urea for Rabi season, it was learnt. Sources said that decision to this effect was taken on Tuesday at the Ministry of Finance during a meeting with fertiliser importers and manufacturers.
They said importers would submit their import schedules on Wednesday. The decision for import of urea was taken in the Economic Co-ordination Committee of the Cabinet (ECC) chaired by Minister for Finance Dr Abdul Hafeez Sheikh. On a summary moved by the Ministry of Industries and Production requesting import of up to 0.225 million tones of urea, the ECC approved the import but constituted a sub-committee under the chairmanship of Kamal Majidullah, Adviser to Prime Minister on Agriculture and Water with Governor State Bank, Deputy Chairman Planning Commission, Secretary Finance and representatives of Ministries of Industries & Minfa to work out the modalities of import.
Sources said during the ECC meeting, Deputy Chairman Planning Commission Dr Nadeem ul Haq opposed involving Trading Corporation of Pakistan (TCP) because of government decision not to involve it in the business of import while another official viewpoint was that the reason for proposing import of urea through TCP was Rs 5 billion component of subsidy in it.
They said that gas deficit in the country was cause of delay in the commissioning of a newly built 1.3 million tons capacity urea plant set up by Engro in Sindh. They said at present the installed urea plants have a capacity to produce 4.9 million tonnes per annum.
With the commissioning of 0.5 million tonnes of Fatima Fertiliser and 1.3 million tonnes Engro plant the country's urea output will enhance to 6.7 million tonnes against an annual demand of 6.4 million tonnes. On Tuesday, the meeting was convened to devise a strategy to ensure availability of urea for Rabi season through timely import.
An official said the meeting decided to import urea through private sector in view of sugar and wheat experience. The sugar crisis was latest example before us; he said, adding that Rs 6 billion subsidy worked out in today's meeting would be given to the private sector. We are hoping first consignment to be in the country in January, 2011.