Imports of fertilizers during Apr-Oct 01 has shown an increase of 3.2% compared to the corresponding period of the previous fiscal.
Key Inputs
Rock phosphates, Phosphoric acid, Feedstock, Natural gas, Naphtha, Sulphur, Ammonia, Coal.
Duty Structure
|
Product |
Excise
Duty |
Customs
Duty(Basic)
|
|
Straight Nitrogenous
Fertilizers: |
|
Urea |
16% |
5%
(canalized) |
|
Ammonium
Sulphate |
16% |
5%(free) |
|
Straight Phosphatic
Fertilizers: |
|
Single Superphosphate
(SSP) |
16% |
35%(free) |
|
Potassic & NP/NPK
Complex Fertilizers: |
|
Muriate of Potash
(MOP) |
16% |
5%(free) |
|
Di - Ammonium Phosphate
(DAP) |
16% |
5%(free) |
Major announcements in previous year's budget
Finance Minister announced his intention to phase out existing retention pricing scheme in the medium term. Government decided to implement the recommendations of the Expenditure Reforms Commission for a phased program of complete decontrol of urea by 01-Apr-06.
In the first phase the Government decided to undertake following steps:
- The unit specific Retention Price Scheme would be replaced by Group Concession Scheme.
- The rate of concession for urea units based on naphtha/FO/LSHS would be linked to international prices of these feedstocks.
Industry's demand from Union Budget 2002-03
The Fertilizer Association of India has demanded the following:
- Rationalization of feedstock prices.
- Protection for the viability of all efficiently run manufacturing units.
- Import duty on urea at 5% is acceptable till the imports are canalized through Government agencies. But as and when the import of urea will be made free, the Government should declare the duty rate at a reasonably high level to protect the domestic industry.
- The duty rate on import of DAP can be continued at the existing level of 5% till the scheme of differential concessions support continues. But since this scheme is not WTO compatible, the rates of duties have to be raised to 35% to protect the domestic industry.
- Fertilizer raw materials, intermediates, plant and machinery and spares used in the manufacture of fertilizer, needs to be completely exempted from levy of customs & excise duty.
Key Players
Fertilizer Corporation of India, Indo Gulf Corporation, IFFCO, Chambal Fertilisers & Chemicals, Nagarjuna Fertilizers, SPIC, Coromandel Fertilisers, EID Parry, Fertilizers & Chemicals Travancore, Zuari Agro Chemicals.
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On the basis of usage the fertilizer industry is divided into Straight Nitrogenous Fertilizers (N), Straight Phosphatic Fertilizers (P) and Potassic (K) & NP/NPK Complex Fertilizers.