Jayalalithaa seeks continued subsidy for urea manufacturing units

Jun 10 2014, 14:41 IST
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Jayalalithaa requested Narendra Modi to direct the chemicals and fertilisers ministry to take a relook at its decision to stop subsidy to fertiliser. Jayalalithaa requested Narendra Modi to direct the chemicals and fertilisers ministry to take a relook at its decision to stop subsidy to fertiliser.
SummaryDepartment of Fertilisers had issued directives on April 2 mandating all Naphtha-based urea producing fertiliser plants to switch over to gas.

Tamil Nadu Chief Minister Jayalalithaa has requested Prime Minister Narendra Modi to direct the chemicals and fertilisers ministry to take a relook at its decision to stop subsidy to fertiliser units if they do not shift to gas-based production by this month end.

Under the New Pricing Scheme III (NPS-III), Department of Fertilisers had issued a directive on April 2 mandating all Naphtha-based urea producing fertiliser plants to switch over to gas, failing which they would not be eligible for subsidy after June 30, Jayalalithaa has pointed out in her letter to Modi.

Tamil Nadu has two major Urea fertiliser plants -- SPIC in Tuticorin and Madras Fertilizers Ltd, a PSU based in Chennai which together produce about 10 lakh MT a year using Naphtha, she said.

Jayalalithaa alleged that the previous UPA government took the decision at the fag end of its tenure to suspend subsidy to urea manufacturing units that do not shift to gas from naphtha, although these plants have not been given gas on an assured basis.

If the decision to stop subsidy was implemented, these units would face closure jeopardising the interests of farmers who are dependent on them for fertiliser and hundreds of workers employed in these units, she noted.

"The very rationale of this decision is questionable when the Government of India which has to provide gas connectivity has not done it for no fault of the plants," she charged.

She said these plants be permitted to continue to receive subsidy till such time when the gas connectivity is given to them.

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