My note was to stop fertiliser overpricing: Srikant Jena

Interview with Minister of State for Chemicals & Fertilisers

Minister of State for Chemicals and Fertilisers Srikant Jena is in the eye of a storm after writing notes to his senior minister over alleged misuse of fertiliser subsidy. He tells Dillip Satapathy that he has absolutely no problem with his senior minister, M K Alagiri, and explains how the issue began. Edited excerpts:

There is now a row over misuse of fertiliser subsidy. What is your response to these allegations?
Fertiliser companies normally stock non-urea fertilisers, like DAP, MoP and NPK, through imports during the lean season of January to March, before the start of the kharif season. Last year, this pre-positioning was particularly high, almost twice the previous year’s level. This had raised concern about over-import by companies to corner a chunk of the subsidy money. Besides, there were complains of companies selling fertilisers at more than MRP (maximum retail price). I had drawn the attention of the department with suggestions to put a cap on the pre-positioning of non-urea fertilisers, based on a proper assessment of requirement, and monitoring the sale of non-urea fertilisers at prices higher than MRP.

You are credited with flagging this issue by writing to your senior minister, M K Alagiri, and the prime minister’s office. Is this true?
These notes were written to the department seven months to one year ago. I do not know why these are being discussed in the media now. These were only routine notes. My intention was to ensure farmers were not affected by the rising cost of fertilisers. For that, the department should be more watchful.

You had said companies corner Rs 1,000-crore profit by pocketing Rs 4,000-4,500 crore extra on each tonne of fertiliser…
I had never said companies had cornered Rs 1,000-crore profit. I had pointed out that there might be Rs 1,000 crore extra subsidy outgo because of higher pre-positioning of fertilisers by companies. On the sale price of fertiliser, yes, I had talked about the excess price being collected by some companies, considering the landed cost of imported fertiliser and the subsidy claimed. But the assessments were based on the situation then. This has changed since.

There are suggestions that you have a running feud with Alagiri and your notes are a manifestation of that.
I have absolutely no problem with Mr Alagiri. I share the best of relationships with him. My notes were not directed against anybody. Those were to the department to ensure there was no overpricing of fertilisers. I am in touch with Mr Alagiri. He also understands the pricing issue and feels companies should bring down the MRP.

It is said the department has mostly ignored your notes. Has the department taken any action on the basis of your notes?
No, they have not ignored my notes. From time to time, the department secretary has discussed with me the need for pre-positioning. Our objective is to provide affordable fertilisers to farmers. We have allowed companies to fix the MRP of non-urea fertilisers. But there should be some checks. The government should intervene in the case of overpricing, as fertilisers come under the Essential Commodities Act.

What do you suggest for better administration of fertiliser subsidy?
The department is working out modalities for direct transfer of subsidy money to farmers under the cash transfer scheme. This will soon be launched on a pilot basis in some districts. All complaints of wrongful use of subsidy money can be properly addressed then.