ISLAMABAD, June 16: The government has decided to introduce a revised fertilizer policy before the end of this month to provide the cheapest gas to the fertilizer plants from dedicated gas fields, Dawn has learnt.

Sources in the finance ministry said that two new nitrogenous and phosphatic fertilizer plants were coming up and the government would provide them fertilizer feedstock from dedicated gas fields of Mari Gas Company Limited (MGCL).

The sources said the government had reports that the country would be facing a urea shortage during the upcoming season because of its higher exports to Afghanistan and even to some Central Asian states.

One of the new plants reaching completion stage is from the private sector and the other is Fauji-Jordan Fertilizer plant. The government was encouraging both the plants to start nitrogenous and phosphatic fertilizer production through dedicated gas supplies.

The gas supplies from the main transmission system could increase the fertilizer prices. The sources said the president and the prime minister had been informed during the finalization of the Kissan package that urea demand was going to increase in the months to come because even today the urea prices were lower in Pakistan than other neighbouring countries.

The sources said Pakistan was supportive of fertilizer exports to Afghanistan. The sources said a meeting had been convened on Wednesday to give final touches to the new fertilizer policy.

The meeting to be presided over by Finance Minister Shaukat Aziz would also be attended by representatives of ministries of industries and petroleum besides the chief of Fauji Foundation Lt-Gen (Retd) Mahmood Ahmad. Both Mari Gas Company Limited and Fauji Fertilizer are subsidiaries of the Fauji Foundation.

The gas prices of Mari field are more than ten times lower than normal gas prices and the indirect subsidy goes to the fertilizer industry. The farmers community as well as the World Bank have been saying that over Rs7 billion subsidy provided to the fertilizer industry never reached farmers and is consumed by the fertilizer industry.