Rs.820 m for 2006 fertiliser subsidy

The Treasury has released Rs.820 million for 2006 for the fertiliser subsidy, the Ministry of Agriculture said yesterday.

This will be used to pay any arrears due to importers.

Denying that insufficient funds had been allocated for the fertiliser subsidy as alleged by fertiliser companies, the Ministry said it has already released Rs.560 million for the subsidy.

In a media release, the Ministry pointed that in 2004 when the price of a metric ton of Urea was US$ 215 in the world market the Government allocated the fertiliser subsidy at the rate of Rs.9000 by the budget of 2004/2005. But during 2005 suddenly the price of a metric ton of urea increased to US$ 275 per metric ton compelling the Government to pay a subsidy of Rs.23,000 per metric ton. Accordingly the Government had to make an additional allocation to meet the fertiliser subsidy.

There was a general delay in going through the supplementary budgetary procedure. Yet the Treasury has by now taken due action to provide the arrears of the subsidy regularly.

The Ministry confirmed that the present stock of fertiliser available in the country is quite adequate to meet the current demand while no obstacle is discernible for future imports.

Despite attempts made by the traders to create an artificial shortage of fertiliser in the market, the Agriculture Ministry has assured farmers sufficient stocks to enable them to cultivate their next Maha season.

"Farmers should not panic or entertain any undue fear over a fertiliser shortage for the next Maha season.

"The Government will release adequate fertiliser stocks to cater to the demands of farmers," a Ministry spokesman said.