Public Sector Undertakings and Co-operative Societies

6.1 The Department has nine public sector undertakings (PSU) and two co-operative societies under its administrative control. One of the PSUs, viz. Projects & Development India Ltd. (PDIL) is engaged in consultancy services in design, engineering and implementation of fertiliser projects and production of catalysts. Another undertaking Pyrites, Phosphates & Chemicals Ltd., (PPCL) is engaged in mining operations of rock phosphate and pyrites, besides the manufacture of SSP.

Financial Performance

6.2.1 So far as financial performance of PSUs and cooperatives is concerned, Rashtriya Chemicals & Fertilizers Ltd. (RCF), Fertilizers and Chemicals Travancore Limited (FACT), Madras Fertilizers Ltd. (MFL) and National Fertilizers Ltd.(NFL) and the two multi-state cooperative societies, Indian Farmers Fertiliser Cooperative Limited, (IFFCO) and Krishak Bharati Cooperative Limited (KRIBHCO) have generally been making profits, two Public Sector Companies, viz. Hindustan Fertilizers Corporation Ltd. (HFC) and Fertilizer Corporation of India Ltd. (FCI) have been incurring losses right from their inception, mainly due to design and equipment deficiencies and excess manpower.

6.2.2 Madras Fertilizers Limited (MFL), which had consistently been recording profit in the past incurred a heavy loss during 1993-94 following the decontrol of phosphatic fertilizers. During 1994-95, 1995-96 and 1996-97 also, MFL showed profits. However, during 1997-98 and 1998-99 it showed heavy loss amounting to Rs.55.35 crore and Rs. 25.74 crore, respectively. But the company earned profit of Rs. 24.98 crore during the period 1999-2000. Again, it has shown a trend of loss for the period 2000-2001; it has incurred a loss of Rs. 29.54 crore up to October, 2000. PPCL, which had been making marginal profits upto 1991-92, has been showing losses since 1992-93 due to decontrol of phosphatic fertilizers. Capital restructuring of the company was undertaken during 1995-96 and it was hoped that the financial prospects would improve. But no reversal in its financial prospects has been shown by the company. PDIL, which is essentially a design and consultancy company, has been making losses in the past, but of late, its prospects have improved with the resurgence in the fertilizer sector. A revival package of the company had been undertaken in 1997. During 1997-98, it earned a profit of Rs.6.09 crore, but in 1998-99 and 1999-2000, it suffered a loss at Rs. 15.85 and Rs. 19.88 crore, respectively. Paradeep Phosphates Limited (PPL), which is a comparatively now company had incurred losses in the earlier years mainly due to raw material constraints, equipment problems and heavy debt servicing burden. A financial restructuring proposal for PPL was approved w.e.f. 1.4.1994. Thereafter, the company recorded profits till 1995-96. However it has again been showing substantial loss during 1997-98, and 1998-99 of Rs. 105.53 crore, and Rs.57.95 crore, respectively. However the company earned a profit of Rs. 23.96 crore in the year 1999-2000. During 2000-01, the company has incurred a loss of Rs.49.81 crore up to October, 2000. Fertilizers and Chemicals Travancore Ltd. (FACT), a PSU making profit up to 1997-98, has incurred loss of Rs.48.26 crore and Rs. 39.80 crore during the years 1998-99 and 1999-2000, respectively. During the current year, up to October, 2000, the company has suffered a loss of Rs.92.83 crore.

6.2.3 Company-wise details of profitability from 1993-94 to 2000-2001 (estimated) are given in Annexure X.

6.3 The present status and performance of the nine Public Sector Undertakings and two Multi-State Cooperative Societies under the administrative control of the Department of Fertilizers have been described in the succeeding paragraphs.

Fertilisers and Chemicals Travancore Limited (FACT)

6.4.1 The Fertilisers and Chemicals Trovancore Limited (FACT), India's first large scale fertilizer unit was set up in the private sector in 1943 at Udyogamandal, Cochin. In 1960,
FACT became a public sector company. By the end of 1963, Government of India had become its major Shareholder. As on 31.3.1999, the paid-up capital of the company was Rs.354.77 crore against an authorised capital of Rs. 500 crore.

6.4.2 FACT has grown and diversified into a multi-divisional/ multi-functional organisation with interest primarily in manufacture and marketing of fertilizers and petrochemicals, Engineering Consultancy & Design and in fabrication and erection of industrial equipment.

6.4.3 Production: The production performance of the company during 1999-2000 and during the year 2000-01 is given in following table.

6.4.4 Financial Performance: During l999-2000, FACT made a net loss of Rs.39.80 crore while during the period from April to October 2000, it has made a loss of Rs. 92.83 crore, For the year 2000-01, FACT has projected a net loss of Rs. 93.47 crore.

6.4.5 Sales Performance: The company sold a total quantity of 13.61 lakh tonnes of fertilizers and 50.23 thousand tonnes of caprolactam during 1999-2000. During the period from April to December 2000, it sold 10.10 lakh tonnes of fertilizers and 35.80 thousand tonnes of caprolactam. For the year 2000-01, the company has projected sales of 13.52 lakh tonnes of fertilizers and 50.80 thousand tonnes of caprolactam.

6.4.6 Performance of Divisions: The performance of individual units was as follows:

6.4.7 Udyogomandal Division: During 1999-2000, the Division produced 2,31,286 tonnes of Ammonium Sulphate and 1,94,415 tonnes of Factamfos 20:20, whereas during the period April-December, 2000, it produced 1,74,970 tonnes of Ammonium Sulphate and 1,47,311 tonnes of Factamfos. The projected production for the year 2000-0l is 231.4 thousand tonnes of Ammonium Sulphate and 195.5 thousand tonnes of Factamtos.

6.4.8 Cochin Division: During 2000-01, the Cochin Division at FACT produced 2,65,298 tonnes of Urea and 5,90,100 tonnes of Factamfos, During April to December, 2000, the Division produced 1,84,670 tonnes of Urea and 4,82,400 tonnes of Factamfos. The projected production for the year 2000-01 is 254.9 thousand tonnes of Urea and 603.2 thousand tonnes of Factamfos.

6.4.9 Petro-Chemical Division : During 1999-2000, this Division produced 50,723 tonnes at Caprolactam, while during April-December, 2000, produced 37,880 tomes of Caproloctam. The projected production for the year 2000-01 is 50.50 thousand tonnes of Caprolactam.

6.4.10 Fact Engineering & Design Organisation (FEDO) : FEDO is engaged in the field of consultancy, design and engineering services for the construction of large fertilizer, petrochemical and chemical projects. During 1999-2000, FEDO achieved a turnover of Rs.12.93 crore and during April-November, 2000, of Rs. 12.66 crore, The projected turnover for the year 2000-01 is Rs. 22.81 crore.

6.4.11 Research & Development (R&D): Slow release formulation products, developed under R&D activities of FACT have been tested in the field by Kerala and Tamil Nadu Agricultural Universities for their use efficiency under a PATSER Scheme Project partially funded by S&T Ministry. This product has been tested in the field for use efficiency on Paddy, Banana and Sugar Cane, Based on the Success of the PATSER Scheme Project the studies on improvement at its use efficiency have been extended to cash crops, such as cotton and turmeric. Setting up a pilot plant for preparing the slow release fertilizers is being contemplated at FACT R&D Centre. During the year 1999-2000, FACT expended Rs.67.16 lakh for research and development.

6.4.12 Fact Engineering Works (FEW): FEW has capabilities for manufacture of engineering equipments such as storage tanks, heat exchangers, process columns etc. FEW has also excelled in the field of fabrication and laying of cross country pipelines. The turnover of FEW for the year 1999-2000 was Rs.4.93 crore and during the period April-November, 2000 of Rs.3.05 crore. The projected turnover of FEW for the year 2000-01 is Rs.7.63 crore.

6.4.13 Bio-Ferlilisers: A bio-fertillser plant of 150 TPA capacity has been set up at FACT R&D Centre, Udyogemandal utilising the Rs. 20 lakh non-refundable grant received from the Ministry of Agriculture. The plant has commenced commercial production from January, 2000.

Fertilizer Corporation of India Ltd. (FCI)

6.5.1 Incorporated on 1st January 1961, FCI was reorganized with effect from 1.4.1978. It has four fertilizer manufacturing units, one each at Sindri (Bihar), Gorakhpur (Uttar Pradesh), Ramagundam (Andhra Pradesh) and Talcher (Orissa), with a total annual capacity of 5.87 lakh MT of nitrogen per annum. However, the capacity of Sindri unit (151.8 thousand MT Nitrogen) is only in operation. Besides, it has a mining unit known as Jodhpur Mining Organisation, which is engaged in the mining and selling of gypsum. As on 31.3.2000, the company had an authorised share capital of Rs 800 crore and paid up capital of Rs 736.74 crore.

6.5.2 Production Performance: During 1999-2000, the company produced 140.7 thousand MT at nitrogen with an average capacity utilisation of 24%. During 2000-01, up to Dec- 2000, the company produced 82.8 thousand MT of nitrogen. The estimated production during 2000-01 is likely to be 114.5 thousand MT of nitrogen with a capacity utilisation of 75.4%.

6.5.3 Sindri Unit: The Sindri Unit of FCI produced 140.7 thousand MT of nitrogen (excluding 'N' for industrial use) during 1999-2000 with a capacity utilization of 92.6%. During 2000-01 (up to December, 2000), the unit produced 82.8 thousand MT of nitrogen (excluding 'N' for industrial use). The estimated production during 2000-01 is likely to be 114.9 thousand MT of nitrogen with a capacity utilisation of 75.4%. The production during the period from April-December 2000 was adversely affected by power supply and equipment related problems.

6.5.4 Gorakhpur Unit: The Gorakhpur Unit of FCI has been shutdown since June 1990 following an accident. Efforts are on to enable KRIBHCO to establish a new fertilize, plant using existing infrastructure of this unit.

6.5.5 Ramagundam & Talcher units: The production operations at Ramagundam and Talcher plants have been suspended w.e.f 1.4.99 and the plants are being kept under preservation.

6.5.6 Sales performance: FCI sold 3.23 lakh MT of fertilizers during 1999-2000. During 2000-01 (upto October, 2000), the company has sold 1.51 lakh MT of fertilizers.

6.5.7 Financial results: During 1999-2000, the company incurred a net loss of Rs 855.00 crore (after prior period adjustment). During 2000-01 (up to October' 2000 provisional), the company has incurred a net loss of Rs. 569.69 crore.

6.5.8 Reference to BIFR: FCI was declared sick under the Sick Industrial Companies Act in November 1992 by the Board for Industrial and Financial Reconstruction (BIFR). Comprehensive rehabilitation proposals based on unit wise viability for the units of FCI are under finalisation for seeking approval from the competent authority in the Government and final sanction of BIFR.

Hindustan Fertilizer Corporation Limited (HFC)

6.6.1 HFC was incorporated on 14.3.1978 consequent upon the reorganisation of the Fertilizers Corporation of Indio Ltd. HFC owns production units at Namrup-Assam, Barauni-Bihar and Durgapur-West Bangal besides the Haldia Fertilizer Project in West Bengal. As on 31.3.2000, the company hold an authorised share capital of Rs. 1200 crore and a paid up capital of Rs. 776.11 crore.

6.6.2 Production performance: The total annual installed capacity at the 5 manufacturing units of HFC at Barauni Durgapur & Namrup (I, II & III) was 6.53 lakh MT of nitrogen which has been derated to 4.03 lakh MT w.e.f. 1.11.1994 (excluding Namrup I). However the capacity of Namrup I (2l thousand MT 'N') and Namrup II (177.1 thousand MT 'N') is only in operation. The total production of the company during 1999-2000 was 56.3 thousand MT of nitrogen at an average capacity utilisation of 13.3%. During the period from April'-December' 2000 the company produced 59.6 thousand MT of nitrogen at an average capacity utilization of 40.1%. The total production of the company during 2000- 01 is estimated to be 64.7 thousand MT of nitrogen at an average capacity utilization of 32.7%. The performance of Namrup-I, Namrup-II, Barauni and Durgapur units had not been satisfactory mainly due to ageing of the plants and equipment/design deficiencies. The production in Namrup-II unit has remained suspended since 1.11.1994 primarily due to shortage and unsteady supply of natural gas. Its Durgapur plant has remained under shutdown since July 1997 due to heavy tire on top of primary reformer caused by rupturing of dog tail, The Barauni plant has also been under shutdown since January 1999 on account of high cost of production and continuous incremental losses.

6.6.3 Haldia Project: The activities of the Haldia project remained suspended since October 1986. BIFR, during its last hearing on 16.3.2000, directed the Operating Agency (ICICI) for proceeding with the sale of the assets of the Haldia Project.

6.6.4 Sales performance : The company has envisaged a sale of 1.54 lakh tonnes of urea from its own production during the year 2000-01.

6.6.5 Financial performance: During the year 2000-01 the net loss of the company is expected to be Rs 649.61 crore including interest on GOI loan of Rs 497.34 crore. The accumulated loss of the company as on 31.3.2000 is estimated to be Rs. 4842.58 crore (Prov.) including interest of Rs 2954.55 crore on GOI loan.

6.6.6 Reference to BIFR: HFC was declared sick in November 1992 by the Board for Industrial and Financial Reconstruction (BIFR). The comprehensive rehabilitation proposals based on techno-economic viability in respect of some of the units of HFC are under finalisation for seeking approval from the competent authority in the Government and final sanction of BIFR.

Madras Fertilizers Limited

6.7.1 Madras Fertilizers Limited (MFL) was incorporated in December 1966 as a joint venture between GOI and AMOCO India Inc. of USA (AMOCO) with GOI holding 51% of the equity share capital.

In accordance with the Participation Agreement between GOI, AMOCO and National Iranian Oil Company (NIOC), NIOC acquired 50% of the shareholding of AMOCO in MFL in Nov 1972. The shareholding pattern up to 21.7.1985 was as follows:

On 22.7.1 985, the shares of AMOCO were purchased by GOI and NIOC in their respective proportions. The Shareholding Pattern up to May 11, 1997 was as under:

On May l 2, 1997, MFL brought out its maiden public issue of 2,86,30,000 shares of face value of Rs. 10 at a premium of Rs. 5 per share. Of these, 2,58,09,700 shares were subscribed. After the public issue, the shareholding pattern was as follows:

The Company has on authorised share capital to Rs. 365 crore comprising Rs. 175 crore as equity and Rs. 190 crore as preference share capital. The preference share capital is yet to be subscribed. As on 31.3.2000, the paid-up equity was Rs. 162.05 crore.

6.7.2 Production performance: The annual installed capacity of the MFL before and after the revamp completed in March, 1998 is as follows:

Annual Capacity (MT)

During the year 1999-2000, the Company produced 403.8 thousand tonnes of urea and 811.3 thousand tonnes of NPK-Complex fertilizers with capacity utilisation of 83% and 97%, respectively. During the period April to December, 2000 the company produced 281.6 thousand tonnes of urea and 556.1 thousand tonnes of NPK-Complex fertilizers. During the year 2000-01 the company is likely to produce 428.0 thousand tomes of urea and 820.5 thousand tonnes of NPK-Complex fertilizers with capacity utilisation of 83% and 93%, respectively.

During 1999-2000 the company produced 320 tonnes of biofertilizers. During 2000-01 the company is likely to produce 300 tonnes of biofertilizers.

6.7.3 Sales performance: The sales performance of MFL during 1999-2000 and 2000-01 is given below:

(in MTs)

6.7.4 Financial Performance 1999-2000: During 1999-2000, the company made a net profit of Rs.24.98 crore mainly due to increased sales of Urea allowed by the Government under The Essential Commodities Act (ECA). The company made extended accounting year of 18 months i.e. April, 1998 to September, 1999 for which it reported a net loss of Rs.7.09 crore. During the months accounting year of 1999-2000 for the period from October to March, 2000 the company recorded a net profit of Rs.6.33 crore. For the period April to October, 2000 the company has reported a provisional loss of Rs.29.54 crore mainly on account of plant shut-down during May-June, 2000 and lower NPK-Complex fertilizer production duo to poor sales, However, for the year 2000-01 the company has projected a lower net loss, of Rs.2.33 crore.

National Fertilizers Limited

6.7.5 National Fertilizers Limited (NFL) was incorporated on 23rd August.1974 for settting up two nitroenous plants, one at Bhatinda (Punjab) and another at Panipat (Haryana) with LSHS as feed stock each having urea production capacity 5.11 lakh tonne per annum. On re-organisation of the Fertilizer Corporation of India (FCI), the Nangal Unit (including Nangal Expansion Project) of FCI was assigned to NFL with effect from 1.4.1978.

6.7.6 In June 1984, NFL took up implementation of gas based ammonia and urea fertilizer project on the HBJ pipeline at Vijaipur in Guna District of Madhya Pradesh with an annual installed capacity of 7.26 lakh MT. which started commercial production on 1.7.1988. The existing urea capacity of Vijaipur plant has been doubled from 7.26 lakh tonnes to 14.52 lakh tonnes per annum on commissioning of its expansion unit w.e.f. 31.3.1997. With this, the total installed capacity of NFL has gone up to 13.7 lakh tonnes of nitrogen equivalent to 28.05 lakh tonnes of urea and 3.18 lakh tonnes of CAN.

6.7.7 The company also produces industrial products like nitric acid, ammonium nitrate, sodium nitrate/ nitrite, sulphur methanol, liquid oxygen and bio-fertilizers etc. The company commissioned an Argon gas plant (designed to produce 120 NM3/hr.of Argon gas) at Panipat unit in October 1997. The methanol augmentation scheme at Nangal unit was commissioned in October1998 thereby enhancing the daily production capacity from 50 tonnes to 67 tonnes.

6.7.8 The authorised capital of the company as on 31.3.2000 was Rs. 500 crore with paid up capital of Rs. 490.56 crore comprising Government of India's share of Rs.479 crore (97.64%) and Rs.11.58 crore (2.36%) held by financial institutions and others.

6.7.9 Production performance: NFL during 1999-2000 produced 15.06 lakh tonnes of Nitrogen achieving an aggregate capacity utilisalion at 109.96% including industrial 'N2'. During that year there was a record production of Nitrogen at its Vijaipur-II unit. In physical term, the company manufactured 31.37 lakh tonnes of urea and 1.55 lakh tonnes at CAN.

6.7.10 In the current year, the company has up to December 2000, produced 10.23 lakh tonnes of Nitrogen including, industrial 'N', 21.42 lakh tonnes of urea and 0.85 lakh tomes of CAN. The methanol production up to December 2000 is 10043 tonnes. The production from all NFL plants put together during the current year is estimated at 14.75 lakh tonnes of Nitrogen equivalent to 99.17% of the installed capacity.

6.7.11 Marketing: The company during 1999-2000 sold 30.16 lakh tonnes of urea and 1.85 lakh MT at CAN. It had achieved the highest ever sales turn over of Rs.2453 crore during that year.

6.7.12 During Kharif' 2000 the company sold 15.23 lakh tonnes of Fertilizers (including 14.67 lakh tonnes of urea). The sales for the first month (October, 2000) of Rabi 2000-2001 is 1.80 lakh tonnes of urea. The CAN sales for the period April-October, 2000 is 0.65 lakh tonnes.

6.7.13 Expansion project: The work on the expansion of urea plant at Nangal unit commenced from its zero date of 11th May1999. The project on completion would enhance the installed capacity of urea from 3.30 lakh tonnes to 4.79 lakh tonnes per annum. The project is expected to be commissioned ahead of its scheduled commissioning date of 10.5.2001.

6.7.14

Financial results : The company during the year 1999-2000 earned a gross profit of Rs. 257.81 crore and profit after tax of Rs. 34.89 crore (which includes income tax refund of earlier year of Rs.7.21 crore). The provisional loss this year up to October, 2000 is Rs. 45.40 crore which is mainly attributable to reduction in production vis-a-vis original budget targets; annual turn-around; increase in marketing cost and reduction in Retention Price of Vijaipur I & II due to reassessment of capacity.

6.7.15 NFL for the year 1999-2000 paid a dividend of Rs. 10.47 crore which worked out to 30% of its net profit.

Projects & Development India Ltd.

6.8.1 Projects & Development India Limited (PDIL), an erstwhile division of the Fertilizer Corporation of India Ltd. (FCI), was registered as a separate company in March 1978. The company has its registered office at Sindri, Jharkhand. The authorised share capital of the company was Rs.60 crore, and the paid up equity of Rs. 53.52 crore, as on 31.3.2000. PDIL has three divisions namely Engineering and Consultancy Division, Catalyst Division, and Research & Development Division.

6.8.2 Operating results: The company made a net loss of Rs 19.88 crore during 1999-2000 and during the period April to October 2000. of Rs.16.17 crore. The projected loss for the year 2000-01 is Rs. 23.11 crore.

6.8.3 Engineering & Consultancy Division : The Engineering and Consultancy Division of PDIL is engaged in the design, engineering, procurement inspection, store management and supervision during construction and commissioning of fertilizer and chemical plants. The Consultancy Division also handles market research, project planning, non-destructive testing services and technical and inspection services. During 1999-2000, PDIL has completed and commissioned the following major projects:
- Lumpsum turnkey project of 'Ammonia Synthessis Loop' of M/s. Newell Lignite Corporation.
- Ammonia revamp project of M/s. Deepak Fertilizers and Petro Chemicals Corporation Ltd.
The following major projects/assignments in the fertilizer sector are under execution involving PDIL:
i) Revamp project at M/s. Hindustan Fertilizer Corporation (HFC), Namrup Units I, II and III.
ii) Urea optimisation project of RCF, Thai and IGCL, Jagdishpur.
iii) Assets evaluation of Ammonia and Urea Utilities and offsite plants at Talchar and Ramagundam of Fertilizer Corporation of India and Durgapur and Barauni Plants of HFC.

6.8.4 As a measure to expand its sphere of activities, PDIL has been making sustained efforts to diversify and secure jobs in other sectors, especially in the gas and oil sector. PDIL has achieved considerable success in areas such as LNG terminal/pipelines; cross-country pipelines for oil/gas; cross-country water pipelines/distribution; water treatment/ effluent treatment plants; modification/revamping jobs in refineries; and water supply and sewerage. Some of the major jobs executed/being executed by PDIL in the oil/gas sector are:

i) LPG Terminal Phase-I of IOC, Haldia.
ii) Installation at 3 X 1500 KL mounded LPG Bullet for Gujarat Refinery of IOCL.
iii) Mounded LPG Storage facilities at Mahul Refinery.
iv) LPG import facilities Exim Park, Vizag.
(v) LPG Import/Export facilities Haldia Phase-II of IOCL.

6.8.5 Catalyst Division including Fabrication Shop: The continuous in-house R&D efforts have since given PDIL the capability to supply a wide range of catalysts required for the production of ammonia. The production of three main catalysts i.e. High Temperature Shift Conversion (including Copper promoted), Low Temperature Shift Conversion and Nickel based catalysts including Zinc Oxide catalyst during 1999-2000 was 303 MT as compared to 563 MT during 1998-99. Due to lack of orders and high inventory carrying cost of finished catalysts, the production activity has been stopped since October, 1999 except for client specific orders. During the period April to October, 2000 the Division produced 26 MT of catalyst.

6.8.6 Research & Development Division: The Research & Development Division of PDIL undertakes research projects including sponsored and client oriented schemes in the field of fertilizer and allied technology. The company receives on annual grant-in-aid of Rs.4.0 crore from the Government for R&D activities. The Division has made considerable progress in the development of a range of new catalysts. PDIL is striving to improve and commercialise a number of products developed by the R&D Division. These include low pressure methanol synthesis catalyst new supported multi-component HT shift catalyst, FCC catalyst and Improved Styrene catalyst.

6.8.7 ISO Certification : PDIL has been awarded ISO-9001 certificate for Project Management and Engineering Consultancy including Design Engineering, Procurement Construction, Commissioning, Third party Design review, Inspection, Life Expectancy, Assessment of plants and other related services. The certificate is valid up to 18.5.2001, which will further be renewed after thorough auditing.

6.8.8

BIFR Status: PDIL was referred to BIFR and was declared a sick company on 17th December 1992. A rehabilition scheme was approved by the Government on 29.4.1997 and sanctioned by BIFR on 1.7.1997. Reliefs/ concessions envisaged in the rehabilitation scheme have since been accorded. However, the projections forming the basis of Scheme sanctioned by the BIFR leading to positive not worth by the end of 1997-98 could not be achieved. The BIFR, while reviewing implementation of the Scheme, in November, 1999, directed the company/ promotors to submit revised rehabilitation scheme. Subsequently, the BIFR has reappointed ICICI as the Operating Agency (OA). The Department is currently in the process of seeking approval of the Competent Authority in the Government on revised rehabitation scheme for the Company so that Government's stand could be intimated to BIFR for consideration.

Pyrites, Phosphates & Chemicals Limited (PPCL)

6.9.1 Pyrites, Phosphates & Chemicals Limited (PPCL} was set up in March 1960 to exploit the pyrites deposits in the country. The company's activities included mining of pyrites deposits and production at Single Super Phosphate (SSP) at Amjhore in Bihar and Saladipura in Rajasthan and mining at rock phosphate from the Mussoorie Phosphorite deposits in Utter Pradesh. The Company also engaged itself in trading of imported fertilizers. However, at present, all the manufacturing activities of the company remain suspended. Against the authorised share capital of Rs.100.00 crore, the paid-up share capital of the company was Rs.95.40 crore as on 31.3.1999.

6.9.2 Phosphatic Fertilizer Plant at Amjhore (Bihar): The Amjhore phosphatic fertilizer plant of PPCL consists of a pyrites based sulphuric acid plant and SSP plant. The SSP plant was commissioned in November 1988 with bought out acid, while the pyrites based sulphuric acid plant was commissioned in November 1989. The installed capacity of the SSP plant is 2,64,000 MT of SSP per annum (equivalent to 42,240 MT of phosphate). During 1999-2000, the Amjhore unit produced only 5,020 MT of SSP as, result of suspension of production activity on account of non-availability of raw materials due to paucity of funds arising from uneconomic operations.

6.9.3 Phosphatic Fertilizer Project, Saladipura, Rajasthan: The Saladipura deposits have reserves of about 120 million MT of medium grade pyrites, equivalent to 25 million MT of sulphur. With a view to exploiting these deposits for the production of sulphuric acid and SSP, PPCL had formulated a proposal for setting up an integrated project at Saladipura, consisting of a 600 MT per day (MTPD) SSP plant and a 240 MTPD pyrites based sulphuric acid plant. In the wake of the decontrol of phosphatic fertilizers and the consequent withdrawal of subsidy support, the viability of the project had to be reviewed because of higher cost of production from the pyrites route as compared to the conventional sulphur based SSP units. As a cost reduction measure, the scope of the project was drastically reduced to exclude the facilities of production of sulphuric acid from the local pyrites deposits. Accordingly, PPCL took up a project for setting up a 300 MTPD SSF plant based on bought out sulphuric acid. The project was commissioned in November 1996.
During 1999-2000, the unit produced only 9,189 MT of SSP following suspension of production activity on account of non-availability of raw material due to paucity at funds.

6.9.4 Dehradun unit: The Dehradun Unit of the company produced 0.14 lakh MT of Mussoorie Phos during 1999-2000. Consequent on expiry of import substitution scheme w.e.f. 31.8.1998, the mining operation has been discontinued, w.e.f 1.9.1998.

6.9.5 Trading activities: During the year 1998-99 the company sold 1.16 lakh MT of indigenous fertilizers. The company is continuing with the trading activity in indigenous fertilizers in order to gainfully utilise its marketing personnel to the extent possible and has sold 0.16 lakh MT of indigenous fertilizers up to December, 2000.

6.9.6 Financial performance: PPCL incurred a net loss of Rs.70.17 crore during 1999-2000. The cumulative loss as on 31.3.2000 was Rs.245.50 crore. During April-October 2000, the company has reported a loss of Rs. 42.06 crore. For the year 2000-01, the company has projected a loss of Rs.78.25 crore. In addition to suspension of operations at Dehradun unit w.e.f. 1.9.1998, the production at Amjhore and Saladipura units had also to be suspended from 1999-2000.

6.9.7 Restructuring of PPCL: The Disinvestment Commission has classified the company as a non-core PSU and recommended sale/closure of its Dehradun unit. It has further recommended that Saladipura and Amjhore units be de-merged from Dehradun operations and clubbed together for sale to a strategic buyer. And if sale of Amjhore unit is not possible, it may be made viable by switchover from the pyrites to sulphur route for SSP production with budgetary support. On completion of switchover, disinvestment of Government of India equity could take place. Meanwhile, consequent on withdrawal of various incentive schemes to Amjhore and Dehradun units, the operations of the company have become unviable. Accordingly, PPCL suspended the operations of Dehradun unit from 1.9.98 and at Amjhore and Saladipura units from 1999-2000.

Since the entire net worth of the company has been eroded. The management has on 8.11.1999 referred the company to the Board for Industrial & Financial Reconstruction (BIFR) which has since declared PPCL as a sick company on 20.4.2000 under the provisions of Sick Industrial Companies (Special Provisions) Act, 1985. The BIFR in its first meeting held on 20.4.2000 declared PPCL aS a sick company and appointed SBI, Patna as the Operating Agency. In view of PPCLs reference to BIFR, a proposal on restructuring of PPCL, after inter-Ministerial consultation, is being finalised for obtaining approval of the competent authority in the Government. Thereafter, it will have to be placed before the BIFR for its consideration.

Paradeep Phosphates Limited

6.10.1 Paradeep Phosphates Limited (PPL) initially a joint venture set up under a participation agreement of 26.5.1982 between the Government of India (GOI) and the Government of Republic of Nauru (GON), become a fully owned GOI undertaking w.e.f. June 1993, consequent upon disinvestment of equity held by GON in favour of GOI.

The authorised capital of the company was Rs. 467.65 crore as on 31.3.1999 which consisted of 35,00,000 Equity Shares (Rs.350 crore) and 11,76,500 non-cumulative Redeemable Preference Shares (Rs.117.65 crore) of Rs.1000/each. The paid up share capital stood at Rs.341.65 crore as on 31.3.2000.

6.10.2 Production performance: The product-wise annual installed capacities of PPL are as under:

During the year 1999-2000, the company produced 6.96 lakh MT of DAP and 0.98 lakh MT of NPK with 105% Capacity utilization, besides 2.05 lakh MT of Sulphuric acid and 0.52 lakh MT Phosphoric acid. During the period April- December, 2000, the company has produced 3.30 lakh MT of DAP and 0.84 lakh MT of NPK, 1.87 lakh tonnes of sulphuric acid and 0.55 lakh tonnes of Phosphoric Acid, respectively.

6.10.3 Sales performance: During the year 1999-2000, the company sold 7.65 lakh MT of fertilizers, turnover of the company being the Rs. 887.77 crore. During the period April-October 2000, the company sold 3.73 lakh MT of fertilizers, The total sales during 2000-01 are expected to be 6.02 lakh MT as against the target of 9.50 lakh MT.

6.10.4 Financial performance: The company made a net profit of Rs. 23.96 crore (provisional) during 1999-2000 after giving effect to the financial restructuring approved by the Government.

6.10.5

Project: The company has taken up / completed the following projects:
i) Revamp of one stream of Sulphuric Acid Plant (SAP), completed in June, 1999 and is being operated at about 90% load. The second stream of SAP is being revamped in the year 2000-01.
ii) Pollution control measures as suggested by NEERI, being implemented.

Rashtriya Chemicals & Fertilizers Limited (RCF)

6.11.1 RCF was incorporated as a separate company on 6.3.1978 consequent to reorganisation of the erstwhile Fertilizer Corporation of India Limited. At the time of its formation, the company had only one operating unit at Trombay (near Mumbai) and two major projects under implementation, viz, Trombay-IV and Trombay-V Expansion. The gas based Thal Fertilizer complex of RCF located about 100 Kms from Trombay commenced commercial production on 1.6.1985. As on 31.3.2000, the company had a subscribed/paid up capital of Rs.551 .69 crore against the auothrised share capital of Rs. 800 crore.

6.11.2 Production performance: The annual installed capacity of all the units of RCF is about 9.55 lakh MT of nitrogen and 1.20 lakh MT at phosphate. The production during 1999-2000 was 9.35 lakh MT of nitrogen and 1.26 lakh MT at phosphate.

Besides fertilizers, the company also produces a number of industrial products such as Methanol, Concentrated Nitric acid, Methylamine, Ammonium Nitrite and Dimethyl Formamide.
During the period April-December, 2000, the company produced 6.31 lakh MT of nitrogen and 0.81 lakh MT of phosphate as against the production of 7.21 lakh MT of nitrogen and 0.96 lakh MT of phosphate in the corresponding period of the previous year.

6.11.3 Sales performance: The sale of fertilizers during the year 1999-2000 was of the order of 9.12 lakh MT of Nitrogen and 1 .11 lakh MT of phosphate. During the period
April-October, 2000, the company sold 4.71 lakh MT of nitrogen and 0.62 lakh MT of phosphate.

6.11.4 Operating results: During the year 1999-2000 the company made a net profit of Rs. 35.08 crore. The company has declared a dividend of 2% which amounted to Rs, 11.03 crore. The company has made net profit of Rs.47.14 crore till October, 2000 and is likely to make a profit (before tax) of Rs. 72.03 crore during 2000-01.

6.11.5 Modernisation/Expansion Schemes: The company has commissioned/taken up the following modernization/ expansion programmes:
i) Successfully commissioned Sewage Treatment Project at Trombay
ii) Successfully commissioned Synthesis Loop Ammonia 1 Plant.
iii) The existing Suphala Bagging Plant is being replaced by a modern plant to ensure faster and more efficient way of bagging the product. The project is expected to be commissioned during the year 2000-2001.
iv) Naphtha Feed Supplement Project is being implemented to overcome the limitation of carbon dioxide caused by lean gas supply and to ensure conversion of more ammonia to urea. The project is expected to be commissioned during the financial year 2000-2001.

Indian Farmers Fertilizer Co-operative Limited (IFFCO)

6.12.1 A Indian Farmers Fertilizer Co-operative Limited (IFFCO) is a multi-State co-operative society engaged in production and distribution of chemical fertilizers. Registered on 3.11.1967, the Society commissioned its first two plants at Kalol and Kandla in Gujarat in 1975 for production of Urea and NPK/DAP respectively. It expanded its production facilities in 1981 by commissioning two additional streams of phosphatic fertilizers at Kandla and a new urea plant at Phulpur. A gas-based urea plant at Aonla (UP) was commissioned in 1988. During the period December1996 to December1999, the installed capacity for urea was doubled (from 16.2 lakh tonnes to 32.2 lakh tonnes) by expanding the plant capacities at Aonla, Kalol and Phulpur. With the Commissioning of Kandla Expansion Project on 5th August 1999, the installed capacity of NPK/DAP has increased from 9 lakh tonne to 15 lakh tonnes. At present IFFCO's installed capacity after re-assessment is 18.65 lakh tonnes at Nitrogen and 5.20 lakh tonnes of P205.

2. The authorised and paid up capital of IFFCO as on 31.3.2006 was Rs. 1000.00 crore and Rs. 404.23 crore, respectively. Government of India is the major equity holder accounting for 71.6% of the paid up capital. During the last five years, the percentage of equity holding in IFFCO by cooperative societies registered an increase from 17.43% to 27.85%,

6.12.2

Production performance: During the year 1999-2000, IFFCO's production of fertilizers was 18.09 lakh tonnes of Nitrogen and 7.09 lakh tonnes of P205. The capacity utilisation in terms of N and P205 was 109% (on the basis of installed capacity before re-assessment) and 158%, respectively during the year 1999-2000.

During the period April-December 2000, IFFCO has produced over 14.80 lakh tonne of nutrient N against a target of 14.25 lakh tonne representing capacity utilisation of 105.9%. During the same period, the Kondla Plant produced 6.19 lakhs tonnes of nutrient (P) 'P205' as against a target of 5.04 lakh tonne showing 159.0% capacity utilisation.

6.12.3

Marketing activities: IFFCO sells its fertilizers through a network of over 35600 cooperative societies. During the year 1999-2000, IFFCO sold 51.72 lokh tonne of fertilizers and achieved a sales turnover of Rs.4530 crore. The Society has sold 30.41 lakh tonne of fertilizers during April-October 2000.

IFFCO has 167 Farmers Service Centre which provide necessary inputs and know-how to the farmers under one root. IFFCO has also been attempting to bring about overall socio-economic development of rural areas through its village adoption programme, extension services like tribal and dry land area programmes, farmers integration programme, farm forestry, establishment of farmers community centres in remote and backward areas, organising soil tests and emphasis on balanced use of fertilisers for sustainable agriculture etc.

6.12.4

Financial performance: IFFCO earned a profit of Rs.312.90 crore before tax during 1999-2000 whereas the net profits for the year 1999-2000 stood at Rs. 312.80 crore. The net worth of the Society as on 31st March 2000 was Rs. 2387 crore.
The Society's provisional profit before tax during the period April-October, 2000 is Rs. 138.33 crore.

6.12.5

Investment outside IFFCO: IFFCO has invested Rs. 97 crore in the equity of Krishak Bharati Cooperative Limited (KRIBHCO), Rs. 7.97 crore in Godavari Fertilizers and Chemicals Limited (GFCL) and Rs. 92.74 crore in equity shares in ICS, Senegal, a joint venture with Government of India and SPIC including its expansion Project which is now scheduled to commence commercial production in March, 2001. The Society has also invested Rs. 3.24 crore in Indian Potash Limited, Rs. 10 lakh in Maharashtra State Co-operative Bank Limited, Rs. 5 lakh in National Cooperative Bank Limited and Rs. 1 lakh each in Indian Tourism Cooperative Limited and National Films and Fine Arts Cooperative Limited.

As a measure of diversification IFFCO in collaboration with Tokio Marine & Fire Insurance Co., Japan has entered the area of general insurance to serve the insurance needs of the farmers.

Krishak Bharati Cooperative Limited (KRIBHCO)

6.13.1 KRIBHCO was registered as a Multi State Cooperative Society on 17.4.1980 to implement the Ammonia/Urea fertilizer project at Hazira based on the natural gas supply from Western offshore fields. The Society commissioned its Ammonia/Urea Plant in 1985.

The Hazira complex has two ammonia plants of 1350 MTPD capacity each and four streams of Urea Plant of 1100 MTPD capacity of each. The annual installed capacity of Urea Plant is 14.52 lakh MT (6.68 lakh MT in terms of nitrogen). The Steam Generation Plant consists of 3 Boilers and a 30MW capacity Captive Power Plant. In addition, the society has set up a bio-fertilizers plant at Hazira with annual installed capacity of 250 MT.

As on 31.3.2000, the authorised share capital of the society is Rs. 500 crore whereas the paid up share capital is Rs. 484.25 crore including Rs. 328 crore of Government of India which account for 67.7% of the paid up capital.

6.13.2

Production: During the year 1999-2000, KRIBHCO produced 15.57 lakh MT of urea (7.16 lakh MT in terms of nitrogen) achieving capacity utilisation of 107.3%. Society has also produced 316.15 MT of bio-fertilizers during the year.

During the year 2000-2001 up to December, 2000 the Society has produced 12.29 lakh MT of urea (5.65 lakh MT in terms of nitrogen) and 277 MT of bio-fertilizers. For the year 2000-2001, The Society has set a target to produce 7.52 lakh MT of nitrogen.

6.13.3

Marketing: During the year 1999-2000 the Society sold 15.16 lakh MT of own urea. Besides, the Society has marketed 0.16 lakh MT of urea procured from NFCL in the State of Andhra Pradesh and 0.54 lakh MT of surplus ammonia. It also sold 289.96 MT of bio-fertilizer.
In the year 2000-2001 (up to October 2000), apart from the sale of surplus ammonia and NFCL urea, the Society has sold 8.10 lakh MT of own urea. The Society has also sold 194 MT bio-fertilizers during this period.

The Society conducted more than 4700 extension programmes, such as farmers meetings, field demonstrations, Krishak Parivar Sangam Technology Melas, rural conferences, crop seminars and farmers' study visits, etc. During the year, the society collected and tested 25162 soil and water samples with the help of 6 mobile testing vans. Recommendations were given to farmers at their door-steps, free of charge. Ten rural development programmes with provision for drinking water facilities, irrigation facility library development, school assistance, etc. were also organised.

To strengthen the cooperative system, 307 programmes such as cooperative conferences, workshops, state consultative committee meetings and visits by the Cooperative Managers & Representative of General Body (RGB) members were organised. Forty-five farmers from 11 States visited Andhra Pradesh under Krishak Parivar Sangam Programme. State level consultative meetings were conducted in 10 States.

KRIBHCO initiated its Seed Multiplication Programme in the year 1990-91 to provide quality certified seeds of main crops to farmers. Presently, the Society is carrying out its Seed Multiplication Programmes in the States of Uttar Pradesh, Haryana, Rajasthan, Gujarat, Andhra Pradesh, Madhya Pradesh, Maharashtra and Punjab.

6.13.4

Financial results: During the year 1999-2000, the Society earned a profit before tax of Rs. 79.85 crore and profit after tax of Rs. 55.85 crore. During the year 2000-2001 (upto October, 2000), the Society made a provisional profit before tax of Rs. 160.30 crore and a net profit after tax at Rs. 107.12 crore. The Society declared a dividend @ 12% for the year 1999-2000 and paid Rs. 39.36 crore to the Government of India on this amount.