Assam BJP enthused by Modi govt’s decision to restructure fertiliser unit

Guwahati: The BJP government’s decision to set on the roll long-pending financial restructuring of the Brahmaputra Valley Fertilizer Corporation Limited (BVFCL) at Namrup in eastern Assam and to set up a new ammonia-urea complex there on public-private partnership (PPP) basis has enthused the BJP state unit in Assam.
A senior party leader said it was a decision at the right time by Narendra Modi government as it would definitely boost the party’s prospects in the next assembly election in Assam in 2016.
He pointed out that Namrup fertilizer industry is located at the centre of at least five assembly constituencies – Naharkatiya, Duliajan, Dinrugarh, Tinsukia and Digboi —in eastern Assam where the BJP fared very well in the last Lok Sabha election.
Hence, the party feels that the initiative taken by the BJP government at the Centre to revive the sick fertilizer unit in Namrup will bring cheers to the people of the area and the BJP will be able to capitalize on it in the next Assembly election.
The Union Cabinet meeting, chaired by Prime Minister Narendra Modi on May 21, gave its approval for setting up a new ammonia-urea complex of 8.64 lakh metric tonne annual capacity with an estimated investment of Rs 4,500 crore at Namrup on public-private partnership (PPP) route by a joint venture (JV).
In the proposed JV, the BVFCL and Government of Assam shall have 11 per cent equity each, while the Oil India Limited (OIL) will have 26 per cent equity holding, and the balance 52 per cent will be held by private-public sector entities, which would be inducted through a competitive bidding process, official sources announced after the Cabinet meeting.
The Cabinet also approved the financial restructuring of the BVFCL by waiving off the entire cumulative interest of Rs 774.61 crore accrued on Government of India loans.
The package includes a loan of Rs 21.96 crore and conversion of Government of India loans of Rs 594.71 crore as interest on free loan.
It will enable the BVFCL to participate as an equity partner in this project and will sustain the operation of the existing plants during the interim period till the new plant comes into operation.
The proposed ammonia-urea complex is expected meet the growing demand for urea in the North-east, Bihar, West Bengal and Jharkhand besides opening new avenues for the people of the North-east.Production of urea at the new unit will be 8.64 lakh metric tons annually and it will help country to explore exporting of urea.
The entire production of urea from this unit shall be neem-coated so that benefits of neem coating are available to the farmers of the north-eastern region also.
The process of restructuring the Namrup Fertilizer was initiated by the UPA government in 2013, but it did not materialize. Out of three plants of the BVFCL, only two are functional — one at 50 per cent capacity and other at 100 per cent.
The accumulated loss of BVFCL as on March 31, 2013 was Rs 811.11 crore against the net worth of Rs 445.28 crore.