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ECC likely to allow import of urea

Economic Co-ordination Committee (ECC) of the Cabinet is likely to allow the import of 0.35 million tons of urea for Kharif 2014 as domestic urea production is insufficient to meet requirement of agriculture sector, well informed sources in Cabinet Division told Business Recorder.

The sources said, Ministry of Industries and Production (MoI&P) had submitted a summary for the import of 0.35 million tons of urea for Kharif without incorporating the comments of Finance Division, which is mandatory under the Rules of Business. "[A] Summary has been returned to the concerned Ministry with the recommendations to seek Finance Division's comments," the sources added.

MoI&P is expected to resubmit a summary to the Cabinet Division so that it could be considered by the ECC in its forthcoming meeting. National Fertilizer Development Centre (NFDC) has forecast that there will be a shortfall of 0.3 million tons of urea during Kharif 2014 and recommended 0.2 million tons urea for strategic reserves and to curb black marketing/hoarding.

ECC had approved 0.5 million tons of urea for Rabi 2013-14 - and the entire quantity had been imported. According to sources, Ministry of Petroleum and Natural Resources has intimated that all plants on Sui Northern Gas Pipeline Limited (SNGPL) and Sui Southern Gas Company Limited (SSGCL) are now supplied gas. The sources said both plants of Engro Fertilizer, Fauji Fertilzer, Fatima Fertilzer and Agri Tech are operating at 92 per cent capacity.

The government has also decided to supply gas to Dawood Hercules and Pak Arab Fertilizer on a rotation basis, the sources said, adding that Pak Arab fertilizer has started operations. The sources said the government and fertilizer industry's representatives had worked out last month a shortfall of 0.125 million tons of urea due to non availability of this commodity in winter months.

Total domestic urea production stood at 4.99 million tons in 2010-11, 4.686 million tons in 2011-12 and 4.2 million tons in 2012-13. Pakistan imported 635,000 tons of urea in 2010-11, 1,647,000 tons in 2012-13 and 761,000 tons in 2012-13. The offtake stood at 5,765,000 tons in 2010-11, 5,992,000 tons in 2011-12 and 5,191,000 tons in 2012-13. The government extended a subsidy of Rs 9.2 million in 2010-11, Rs 50.5 million in 2011-12 and Rs 12.7 million in 2012-13. The present stock of imported urea with the Trading Corporation of Pakistan as well as 100,000 tons that arrived at Karachi port will be distributed through NFML as per existing arrangements.

However, it is unclear whether the urea to be imported for Kharif 2014 will be distributed by the corruption-tainted National Fertilizer Marketing Limited (NFML) or through the domestic urea manufacturers. Presently, Pakistan is importing urea by using Saudi and Japanese facilities. Pakistan has also requested Qatar for export credit for fertilizer.

Copyright Business Recorder, 2014


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ICT 2014

Foreign Debt $61.805bn
Per Cap Income $1,386
GDP Growth 4.14%
Average CPI 8.6%
Trade Balance $-1.703 bln
Exports $2.156 bln
Imports $3.859 bln
WeeklyFebruary 26, 2015
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