India is keen to join hands with Algeria to explore the possibilities of setting up a multi-billion dollar fertiliser project, bearing in mind the phosphatic reserve available in this North African country which is estimated to be more than 5 billion tonnes.
A preliminary meeting on the issue was held here today between Minister of State for Chemicals and Fertilisers Mansukh L Mandaviya and Algerian Minister of Industry and Mining Abdessalem Bouchouareb.
The price of fertiliser in India is expected to come down along with the subsidy burden if the talks between the two countries lead to setting up of a joint venture mega fertiliser company here.
Mandaviya is accompanying Vice President Hamid Ansari, who is on a two-day visit to Algeria as part of his two-nation trip.
Secretary (West) in the Ministry of External Affairs Sujata Mehta said India was looking forward to explore cooperation with Algeria in new areas like in fertiliser, pharma, space, IT etc.
Algeria was equally interested in Indian participation in development of phosphate mines and production of fertilisers through joint venture, she said.
The estimated phosphate reserve in Algeria is estimated to be more than 5 billion tonnes and possible Indian investment in the sector is expected to be USD 5 to 7 billion.
Indian Ambassador to Algeria Satbir Singh said if the preliminary talks result in finalisation of some agreement in future, there has to be a consortium of Indian companies from both government and private sectors which would contribute generation of funds, technology and all necessary requirements for setting up of a mega project in Algeria.
"Around 90 to 95 per cent phosphate being used by Indian fertiliser companies is imported and the production cost is also very high. If India can join hands with Algeria by providing funds and technology to set up a fertiliser company by using Algerian phosphate and gas, and the fertiliser is taken to India, the cost would be quite low...The subsidy burden of government for fertiliser, which is Rs 86,000 crore to Rs 90,000 crore per annum, will come down," Singh said.
Indian fertiliser industry is producing about 12.28 million tonnes of nitrogen and 4.37 million tonnes of phosphatic nutrient production. India ranks second in the production of nitrogenous fertilisers and third in phosphatic fertilisers.
According to a report of Department of Fertilisers, by the year 2016-17, fertiliser demand in the country is projected to increase to about 336.77 lakh tonnes of urea, 124.13 lakh tonnes of DAP, 59.48 lakh tonnes of SSP and 47.93 lakh tonnes of MOP.
Bilateral trade between India and Algeria stood at USD 1.5 billion per annum, majority of which are related to importing oil and oil products to India.
India imports automobile, auto components, buffalo meat, garments among other things from the North African country.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)