Excessive delay: Fertiliser firms await Rs5b worth of subsidy payments
SBP could not release money in absence of finance division’s nod
Around a dozen fertiliser producing and importing companies had imported DAP and sold it in the market at a subsidised rate. PHOTO: APP
ISLAMABAD:
The State Bank of Pakistan (SBP) has not been able to pay even the first installment of subsidy worth over Rs5 billion to fertiliser companies importing diammonium phosphate (DAP) due to delay in clearance from the finance division.
A source in the Ministry of Industries and Production told The Express Tribune that the Ministry of National Food Security and Research had dispatched bills of fertiliser importing companies for October worth over Rs5 billion to the SBP, but despite several reminders the payment could not be made.
According to an agreement between the government and the fertiliser importing companies, the payments were supposed to be released within 15 days of the import of DAP, but even after two months, the SBP has failed to clear the bills.
An SBP source said the bank management had written a letter on December 13 and another on December 28 last year, seeking authorisation from the finance ministry, which was mandatory to clear the payments, but the reply was still awaited.
“We have received bills from the food ministry after due verification from the Federal Board of Revenue and we are now waiting to hear from the finance division to pay to the importers,” said the official.
The officer said the bank could not pay the bills without written authorisation from the finance division that’s why the central bank had written two letters, but there had been no response from their side.
Around a dozen fertiliser producing and importing companies had imported DAP fertiliser and sold it in the market at a subsidised rate.
Major fertiliser companies include Fauji Fertilizer, Fatima Fertilizer, Engro Fertilizers, Bayer and Pak Arab Fertilizer.
The sale of subsidised fertiliser is part of the government’s subsidy worth Rs20 billion for the farmers, which was announced in the budget for 2015-16. Half of the share is borne by provincial governments according to their fertiliser needs.
Published in The Express Tribune, January 5th, 2016.
The State Bank of Pakistan (SBP) has not been able to pay even the first installment of subsidy worth over Rs5 billion to fertiliser companies importing diammonium phosphate (DAP) due to delay in clearance from the finance division.
A source in the Ministry of Industries and Production told The Express Tribune that the Ministry of National Food Security and Research had dispatched bills of fertiliser importing companies for October worth over Rs5 billion to the SBP, but despite several reminders the payment could not be made.
According to an agreement between the government and the fertiliser importing companies, the payments were supposed to be released within 15 days of the import of DAP, but even after two months, the SBP has failed to clear the bills.
An SBP source said the bank management had written a letter on December 13 and another on December 28 last year, seeking authorisation from the finance ministry, which was mandatory to clear the payments, but the reply was still awaited.
“We have received bills from the food ministry after due verification from the Federal Board of Revenue and we are now waiting to hear from the finance division to pay to the importers,” said the official.
The officer said the bank could not pay the bills without written authorisation from the finance division that’s why the central bank had written two letters, but there had been no response from their side.
Around a dozen fertiliser producing and importing companies had imported DAP fertiliser and sold it in the market at a subsidised rate.
Major fertiliser companies include Fauji Fertilizer, Fatima Fertilizer, Engro Fertilizers, Bayer and Pak Arab Fertilizer.
The sale of subsidised fertiliser is part of the government’s subsidy worth Rs20 billion for the farmers, which was announced in the budget for 2015-16. Half of the share is borne by provincial governments according to their fertiliser needs.
Published in The Express Tribune, January 5th, 2016.