Central Government Departments

Department of Fertilizer Industry Coordination Committee

Filed under:

FERTILIZER INDUSTRY COORDINATION COMMITTEE
Background

Chemical fertilizers have played a vital role in the success of India’s green revolution and consequent self - reliance in food grain production. The increase in fertilizer consumption has contributed significantly to sustainable production of food grains in the country. Government of India has been consistently pursuing policies conductive to increased availability and consumption of fertilizers in the country. The Retention Price Cum Subsidy Scheme (RPS) for indigenous nitrogenous fertilizer units was introduced by the Government of India in November 1977 to ensure a reasonable return on investment and to facilitate healthy development and growth of fertilizer industry. The Scheme was later extended to phosphatic and other complex fertilizers in February 1979 and Single Super Phosphate (SSP) in 1982. However, from August 1992, the Government has progressively decontrolled the prices and distribution of phosphatic and other complex fertilizers. At present, farmgate price of Urea is controlled by the Government whereas its distribution has been partially decontrolled from 1 April 2003.

The Retention Price Scheme stimulated indigenous production and consumption of fertilizers in the country. However, for attaining greater internal efficiencies and global competitiveness, unit specific approach of RPS has been replaced by a group based concession scheme based on greater normative approach called the New Pricing Scheme 9NPS) from 1 April 2003. The Fertilizer Industry Coordination Committee (FICC) constituted on 1 December 1977 to administer and operate the Retention Price Scheme continues under the New Pricing Scheme for administration of the scheme for urea.

Constitution

The Committee consists of the following:

Chairman

1. Secretary, Department of Fertilizers, New Delhi.

Members

2. Secretary, Ministry of Industrial Policy & Promotion, New Delhi.

3. Secretary, Department of Agriculture, Ministry of Agriculture and Cooperation, New Delhi.

4. Secretary, Department of Expenditure, Ministry of Finance, New Delhi.

5. Secretary, Ministry of Petroleum and Natural Gases, New Delhi.

6. Chairman, Tariff Commission, Ministry Industry, New Delhi.

In addition, the Committee has two representatives from the Fertilizer industry.

The fertilizer industry is presently represented on the FICC by:

7. Sri P.S. Gehlaut, CMD Indian Potash Ltd. And

8. Sri A.C. Muthaiah, Chairman Southern Petrochemicals Ltd.

Member Secretary

9. Executive Director, Fertilizers Industry Coordination Committee, New Delhi.

Functions

The scope and functions of the FICC are as under :

1. To evolve the group concession rates including freight rates for units manufacturing nitrogenous fertilizers;

2. To maintain accounts, to make payments to and to recover amounts from fertilizer companies.

3. To undertake costing and other technical functions.

4. To collect and analyse production data, costs and other information.

5. To review the group concession rates periodically and to make adjustments in these rates, where necessary, with the prior concurrence of the Government.

6. To undertake the examination necessary for evolving group concession rates for future pricing periods;

7. To undertake such other functions as the Government may entrust to the Committee from time to time.

Organisation

The FICC Office comprises five Divisions i.e.Cost Evaluation Division, Inputs Division, Finance & Accounts Division, Technical Division and Administration Division.

The Cost Evaluation Division works out the concession rates for the various urea manufacturing units and revision thereof depending upon the variations in the prices of inputs from time to time. The Inputs Division undertakes an annual exercise for fixation of equated freight for transportation of urea from plant gate to farmers. It is also responsible for allocation of coal to different coal based urea manufacturing units in consultation with Ministry of Coal and Ministry of Railways. The Finance & Accounts Division is responsible for payment of subsidy and maintenance of accounts. The Technical Division looks after all technical matters such as fixation of consumption norms, production levels, etc.

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