A delegation, headed by the Bharatiya Janata Party (BJP) national vice-president Kailashpati Mishra and comprising the party's state working committee member Ramnaresh Prasad Singh and the BJP MP form Patna CP Thakur, met union chemical and fertiliser minister Surjit Singh Barnala about a fortnight ago and urged him to save the factory from closure.

Barnala is understood to have assured the delegation that he will personally look into the matter. According to the Fact Engineering and Design Organisation (Fedo) Committee report, about Rs 163 crore is needed to revive the company. However, until the revival package is cleared, an amount of Rs 69.57 crore will help save the Barauni unit from imminentclosure and help it produce 1.25 lakh tonnes of urea per annum on a short-term basis. The money will also help buy anti-pollution machinery and help the unit reduce its present cash losses.

The Fedo report states that if the funds are not sanctioned immediately, the plant will close and the government may have to shell out Rs 181 crore as closure cost, against the revamp cost of Rs 163 crore.

"Some foreign firms like Grintex Ltd of Germany have offered funds for the factory's revival. But they are unable to do so as for lack of a government guarantee," Ramnaresh Prasad Singh said.

At a meeting of the committee of secretaries, department of fertilisers, it was discussed that in the company's case, there were two offers from external funding agencies -- Exim Bank of Japan and Grintex, Germany.

The meeting also observed that "The representatives of the department of expenditure thought that having regard to resource constraints, high cost of production in some of the units proposed for revival (HFC --Durgapur, Barauni and Nampur and FCI -- Sindri, Ramagundam and Namrup) as well as cheaper availability of urea in the international market, the unviable units should not be included in the revival scheme."

The Planning Commission representative endorsing this view said the retention price of urea produced by Hindustan Fertilisers' Durgapur and Barauni units would be as high as Rs 11,305 and Rs 11,160 per tonne respectively, against the weighted average landed cost of imported urea (cost and freight and handling charges) of Rs 9,290 per tonne during 1995-96 and Rs 8,660 per tonne during 1996-97.

By reviving the Barauni unit, the union government will be saving about $40 million annually in foreign exchange, Mishra said. The factory's infrastructure worth close to Rs 1000 crore will also be put to use, he added.

Barauni has three major industrial units -- Indian Oil, Barauni Thermal Power Station and Hindustan Fertiliser. Barnala plans to visit Barauni soon to take stock of the situation, Singh said.