A parliamentary panel has criticised the government for not provisioning adequate financial resources for the department of chemical and fertilisers (DCF) and said that this was adversely impacting the performance of the fertiliser sector.
A parliamentary standing committee on chemical and fertiliser chaired by Kanimozhi Karunanidhi has stated that the gap between the projected requirement for FY23 and the budgetary allocation may eventually result in delayed payment and settlement of claims under the urea and P&K subsidies, which will adversely affect the financial performance of the fertiliser sector as a whole.
The panel, in its report submitted to Parliament recently, has stated that the budgetary allocation of Rs 1.09 trillion as per Budget estimates for FY23 against the projected demand of Rs 1.76 trillion by DCF to meet the requirements for its various schemes and policies ‘will upset the expenditure planning for the entire year’.
The panel has urged the finance ministry to declare the fertiliser department as a ‘priority department’ so that the fund requirements may be met without any cut. “Adequate financial allocation will facilitate timely and optimum utilisation of funds by the DCF and will eventually give a boost to the agriculture sector in the country,” the panel has noted.
The panel has noted with concern that the DCF has been allocated Rs 42,000 crore in Budget estimates of FY23 against the proposal of Rs 72,702 crore for the nutrient-based subsidy scheme. In respect to urea subsidy, the DCF has been allocated Rs 67,202 crore in BE for FY23 against its requirement of Rs 1.04 trillion crore.
The panel has also criticised the DCF’s tendency to accumulate carry over liabilities (COL) year-after-year for fertiliser subsidy payment.
It has noted that estimated COL for the payment of fertiliser subsidy during FY22 in respect to indigenous and imported urea will be Rs 6,000 crore and Rs 12,300 crore, respectively. In case of indigenous and imported P & K fertilisers, the COL will be Rs 1,300 crore and Rs 2,073 crore, respectively. A total of Rs 21,673 crore is likely to be accumulated as COL in respect to indigenous and imported urea and P&K fertilisers by the end of FY22.
“This tendency clearly shows the lack of proper planning in its budgetary process,” the panel has observed.
