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Low domestic production: 0.5 million tons of urea may be imported for Kharif




  • Federal government is likely to import 0.5 million tons of urea for Kharif 2014 because of domestic low production, sources close to the Secretary Industries told Business Recorder. “National Fertilizer Development Centre (NFDC) forecasts that there will be a shortfall of 0.3 million tons of urea during Kharif 2014. Moreover, there is a requirement of 0.2 million tons of urea for strategic reserves and to curb black marketing/hoarding,” the sources added. 

    The sources said the Economic Co-ordination Committee (ECC) of the Cabinet approved 0.5 million tons of urea for Rabi 2013-14 of which 0.5 million tons have arrived of which 0.1 million tons arrived recently. According to sources, Ministry of Petroleum and Natural Resources has intimated that all plants on Sui Northern Gas Pipeline Limited (SNGPL) and Sui Southern Gas Company Limited (SSGCL) are not being supplied gas, however, one plant of Engro is being supplied 60 mmcfd gas on temporary basis. Total domestic urea production stood at 499,400,0 tons in 2010-11, 468,600,0 tons in 2011-12 and 421,600,0 tons in 2012-13. 

    Pakistan imported 635,000 tons of urea in 2010-11, 1,647,000 tons in 2012-13 and 761,000 tons in 2012-13. Offtake stood at 5,765,000 tons in 2010-11, 5,992,000 tons in 2011-12 and 5,191,000 tons in 2012-13. Government extended subsidy of Rs 9.2 million in 2010-11, Rs 50.5 million in 2011-12 and Rs 12.7 million in 2012-13. The present stock of imported urea with the Trading Corporation of Pakistan as well as 100,000 tons that arrived at Karachi port will be distributed through NFML as per existing arrangements. 

    However, it is unclear whether the urea to be imported for Kharif 2014 will be distributed by the corruption-tainted National Fertilizer Marketing Limited (NFML) or through the domestic urea manufacturers. The sources said, issues involved in the distribution of urea have been discussed at a high level meeting presided over by the Minister for National Food Security and Research, Sikandar Hayat Bosan. 

    While recommending that the erstwhile system of distribution of imported urea through manufacturers based on their relative distribution should be restored, it was emphasised that a proper system should be evolved with the manufacturers to ensure transparency and to eliminate distortion. Bosan committee has been assigned to work out the modalities for distribution of urea in the country in an efficient and transparent manner. 

    The government has decided in principle to devolve the corruption ridden organisation NFML, dominated by contract employees who were hired by the former Deputy Prime Minister/Senior Minister for Industries and Production, Chaudhry Pervez Elahi. 

    Copyright Business Recorder, 2014

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