The Parliamentary Committee on Fertilizer has expressed displeasure towards the government for terming the fertilizer sector as ‘non-strategic’. The committee said that this sector is important for food security and the government’s response on this is not satisfactory. The committee has reiterated its 11 recommendations.
New Delhi [भारत]July 27 (ANI): The Parliamentary Standing Committee on Chemicals and Fertilizers has expressed displeasure over the classification of the fertilizer sector as non-strategic under the new PSE policy, despite its importance in ensuring the country’s food security.
The committee said that the government accepted four recommendations, but did not accept the committee’s comments on 11 recommendations, due to which the panel reiterated them. Two recommendations are still awaiting final response, while one has not been acted upon further.
Emphasis on considering fertilizer sector as ‘strategic’
The report repeatedly expressed dissatisfaction with the government’s responses while reviewing several key recommendations related to fertilizer PSUs, stating, “The Committee is of the view that the Department’s response does not adequately address the recommendation…”.
The Committee continued to emphasize on considering the fertilizer sector as a strategic sector. The Committee said that the Department of Fertilizers should submit the updated status of its requests made to the concerned authorities and inform the Panel about the interim measures being taken to protect the fertilizer PSUs till a final decision is taken.
It said, “The Committee is apprised of the decision of the Ministry of Finance to classify the fertilizer sector as non-strategic under the new Public Sector Enterprise (PSE) policy, despite repeated requests by the Department of Fertilizers. These requests included D.O. letters dated March 24, 2021 and April 9, 2022. These requests highlight the importance of the sector in ensuring food security, sustaining rural livelihoods and advancing national self-reliance. The important role it played was highlighted – factors that warrant its inclusion in the strategic sector.”
The committee also raised questions on the neglect of PSUs.
The report also expressed dissatisfaction over the government’s response to the restructuring of old loans of Fertilizers and Chemicals Travancore Limited (FACT) and Madras Fertilizers Limited (MFL). The committee said the ministry has not clarified whether any concrete proposal has been examined to address their financial stress. It urged the Department of Fertilizers to jointly examine the restructuring options with the Finance Ministry and the Department of Expenditure and report on the progress.
Emphasis on modernization of old plants
On modernization, the Committee found that the government’s response addressed only one project, while failing to present a comprehensive plan to upgrade older fertilizer plants. It reiterated its recommendation of a comprehensive assessment of the old urea and phosphatic and potassic fertilizer plants, including their modernization needs and investment requirements.
Concern over idle property
Further, the panel sought a comprehensive audit and monetization framework for underutilized land held by fertilizer PSUs. The Committee said that the steps taken so far by the Government are only preliminary and are not at par with the structured exercise recommended by the Committee. It also raised concerns over the government’s approach towards PSU assets, noting, “The Committee is concerned that strategic assets of both HFCL and FCIL are lying idle under the policy of indefinite moratorium, while disinvestment of profitable PSUs is being pursued.”
Disinvestment and further action
The report also urged the government to review long-pending disinvestment proposals, make a long-term assessment of fertilizer demand and strategic role of PSUs before going ahead with the stake sale, and examine disinvestment options for companies like RCF, NFL and Projects and Development India Limited (PDIL). The Committee said that it expects the Department of Fertilizers to submit an updated action-report and progress report on the reiterated recommendations at the earliest. (ANI)
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