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Steps taken for revival of fertilizer plants/units

NEW DELHI:  In view of the continuous losses of Fertilizer Corporation of India Limited (FCIL) and Hindustan Fertilizer Corporation Limited (HFCL) stemming from technical and financial non viability of operations, Government decided to close down all five units of FCIL viz Talcher (Odisha), Ramagundam (Andhra Pradesh, now Telangana), Gorakhpur (Uttar Pradesh), Sindri (Bihar, now Jharkhand) and Korba (Madhya Pradesh, now Chhattisgarh)   and  three unit of HFCL viz. Barauni (Bihar), Durgapur & Haldia (West Bengal) in 2002.  After closure of units, there was no significant addition to the indigenous urea production capacity. However, the demand increased steadily, this had led to a situation where the country had to depend upon import of urea. In addition to these there are three fertilizer public Sector Undertakings (PSUs) which are sick at present these are Brahmaputra Valley Fertilizer Corporation Limited (BVFCL) (Namrup, Assam), Fertilizers and Chemicals Travancore Limited (FACT)( Kochi, Kerala) and Madras Fertilizer Limited (MFL)(Chennai, Tamil Nadu). Details about the present status and steps being taken by the Government to improve the operation of these PSUs are as under:

 

Revival of closed units of FCIL and HFCL :

In 2008, Cabinet approved to revive all units of FCIL and HFCL subject to non-recourse to Government funding and to consider write off of GOI Loan & interest to the extent required, subject to submission of a fully tied up proposal for final decision on waiver. The revival of these closed units would be through nomination route by PSUs and through bidding route by private sector. Sindri, Talcher and Ramagundam Units of FCIL to be revived on nomination basis and Gorakhpur & Korba units of FCIL and Durgapur, Haldia, Barauni units of HFCL to be revived through bidding route.

 In August, 2011, the Cabinet Committee on Economic Affairs (CCEA) approved the Draft Rehabilitation Scheme (DRS) for revival of all the Units of FCIL and HFCL. DRS envisaged revival of Talcher Unit by a consortium of M/s. Rashtriya Chemicals & Fertilizers Limited (RCF), M/s Coal India Limited (CIL) and Gas Authority of India Limited (GAIL), revival of Ramagundam Unit by. Engineers India Limited (EIL) and National Fertilizers Limited (NFL) and revival of Sindri unit by Steel Authority of India Limited (SAIL).

In its meeting held on 9.5.2013, CCEA approved waiver of Government of India loan and interest to facilitate FCIL to arrive at positive net worth. This enabled FCIL to get de-registered from the purview of Board for Industrial and Financial Reconstruction (BIFR).

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