NEW DELHI, APR 10: The Cabinet Committee on Economic Affairs (CCEA) today cleared four mega fertiliser projects, involving a total investment of over Rs 5,600 crore to reduce the gap between demand and supply of urea.The four projects cleared are: Rs 1,670 crore Nellore Project of Indian Farmers Fertilisers Cooperative Ltd (IFFCO), Rs 1,263 crore Thal expansion project of Rashtriya Chemicals and Fertilisers (RCF), Rs 1,268 crore Hazira expansion and Rs 1,479 crore new project at Gorakhpur of Krishak Bharti Cooperative Ltd (KRIBHCO). Each of the four projects would have a capacity of 7.68 lakh tonnes per annum and would reduce the gap between supply and demand of urea, Information and Broadcasting Minister Promod Mahajan told reporters.However, the Rs 1,315 crore Panipat plant of the public sector National Fertilisers Ltd (NFL), which was also under consideration along with these four projects, was not cleared in today's meeting.Mahajan said the supply-demand gap of urea was expected to be around 49.5lakh tonnes by 2003, which would be substantially reduced once these projects come through. Another 15 lakh tonnes of urea would be imported from the Indo-Oman project, to be set up by three Indian fertiliser companies and a Omani company, he added.CCEA also decided not to increase the DAP and MOP fertiliser prices in the current financial year as well as approved a proposal to enhance the capacity of urea by 32 lakh tonnes in the country to meet the difference in demand against supply. The subsidy on DAP and MOP have been pegged at Rs 3,800 crore, the same as the previous financial year level, information and broadcasting minister Pramod Mahajan told reporters, after the cabinet meeting today.Assessing the shortfall in urea by 2003, Mahajan said the government has allowed setting up of two new urea plants at Nellore (Andhra Pradesh) and Gorakhpur (Uttar Pradesh) with an annual capacity of eight lakh tonnes each. These projects would be set up IFFCO and KRIBHCO respectively. He pointed out that therewill be a shortage of around 4.9 million tonnes of urea after four years and the government had taken the decision keeping in view the demand from the agriculture sector. The CCEA has also decided to expand the capacity of RCF Thal project and Kribhco Hazira projects by eight lakh tonnes each. Expansion and setting up new plants would produce around 32 lakh tonnes urea in the country. Around 15 lakh tonnes urea produced by the Oman Fertiliser plant, set up with the assistance of Government of India, will also increase the supply and there will not be much gap between demand and supply.Mahajan said the government has been providing a subsidy of Rs 4400 per tonne on Indian DAP fertiliser and Rs 3000 tonnes on imported fertiliser. The subsidy on mop fertiliser is around Rs 3,000 per tonne.Yet another major decision taken at the CCEA was the funding of the potable water project at Kanpur, near the dam project, on a one-to-one basis. The potable project is being set up at a cost of Rs 90 crore and thecentral government will fund the project to the extent of Rs 45 crore. The government is already funding on a one-on-one basis, the Rs 174 crore dam project near Kanpur. The dam project would increase the irrigation facility near the Kanpur region.The CCEA has also approved various other proposals including restructuring of intersat and intelsat project, UAE bilateral investment, promotion and protection agreement as well as air service agreement with Bahrain and Switzerland.
