A parliamentary committee has pulled up the Centre for failing to adequately respond to its recommendations on fertiliser PSU disinvestment, saying the government has not answered key concerns over food security, modernisation of ageing fertiliser plants and the future of state-owned fertiliser companies.
Event Context
The Standing Committee on Chemicals and Fertilisers, in its action taken report tabled in Parliament on Monday, said the Department of Fertilisers had satisfactorily accepted only four of its 18 recommendations, while its replies on 11 recommendations were found inadequate, prompting the panel to reiterate its earlier observations.
Committee chairman and TMC leader Kirti Azad said the quality of government responses to parliamentary panels had deteriorated. “This is my fourth term. For the first time I am seeing the government just does not answer. They do not take any responsibility. They do not give timely replies. These committees earlier had enormous respect and the reports were taken very seriously and secretaries would reply well within the stipulated time, but it is but it is absolutely opposite now,” Azad told HT.
The sharpest criticism in the report relates to the government’s continued pursuit of fertiliser PSU disinvestment even as the question of whether the sector should be classified as “strategic” remains unresolved.
“The committee appreciates that the department has taken steps to seek strategic reclassification of the fertiliser sector… However, as the decision on reclassification is yet to be finalised, the existing policy framework governing disinvestment continues to remain in place,” the report said.
The panel asked the government to furnish an updated status of the proposal and explain what interim measures were being taken to safeguard fertiliser PSUs until a final decision is taken.
The committee also questioned why stake sale processes were moving ahead before carrying out the long-term assessment of India’s fertiliser requirements that it had earlier recommended. “The Committee note that certain disinvestment processes appear to be progressing, even as the analytical framework suggested by the Committee has not yet been established,” the report said.
It reiterated that the Department should undertake a detailed long-term study covering production capacity, consumption trends, import dependence and feedstock security before taking decisions on disinvestment.
The report also faulted the government for merely “noting” its recommendation on restructuring the legacy debt of Fertilisers and Chemicals Travancore Ltd (FACT) and Madras Fertilizers Ltd (MFL), saying the response did not indicate whether any concrete proposal had been examined.
Similarly, while welcoming the Cabinet’s approval for a new ammonia-urea complex at Namrup in Assam, the committee said the government had not addressed its broader recommendation for a nationwide modernisation programme covering ageing fertilizer plants. “The broader recommendation for a centrally supported ‘Revamp and Upgrade Scheme’ covering the 27 urea plants over 25 years old and the seven over 50 years old across all fertiliser PSUs has not been addressed,” it said.
The committee also said the government had failed to adequately respond to its recommendations on reviving closed fertiliser units at Haldia and Durgapur, conducting a nationwide audit of fertilizer PSU land assets and introducing a review mechanism for long-pending disinvestment proposals.
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The report additionally disclosed that the Department informed the committee that, after two unsuccessful attempts, a third strategic disinvestment of Projects and Development India Ltd (PDIL) may not be initiated. The committee, however, said the government had not examined alternative options, including strengthening PDIL’s role in coal gasification and engineering.
