RIL Entry Into Fertiliser Sector Likely To Take Longer

New Delhi: Reliance Industries Ltd''s (RIL) plan to enter into the fertiliser sector is dependent on the yet-to-be finalised New Fertiliser Investment Policy. The company''s proposal will be considered only after the new Policy is in place. Under the proposed policy, the Government mulls to permit establishing of privately-owned plants that will not be bound by current price controls. The policy also proposes to permit the producer to fix the price for the new units at which they want to sell the products. Recently, the Union Minister for Steel, Chemicals and Fertilisers, Mr Ram Vilas Paswan, said that the new draft policy is ready and will put it up before the Cabinet some time in January 2008.

Earlier this year, RIL had submitted a proposal to the Ministry of Chemicals and Fertilisers to establish manufacturing plants having up to four million tonnes capacity. The fertiliser and power companies were opposed to RIL''s proposal to price the gas at the delivery point (Kakinada) at $4.33 per mBtu. The fertiliser sector which is eyeing at increasing production capacity in its existing units, reviving closed fertiliser units and conversion of non-gas based fertiliser plants to gas has projected a requirement of gas during the Eleventh Plan from 41.02 million standard cubic metre per day (MMSCMD) in 2007-08 to 79.36 MMSCMD in 2011-12. Currently, there are nearly 57 fertiliser plants in the country.