ISLAMABAD: The Supreme Court described on Thursday the Nov 3, 2015 notification for the grant of Rs20 billion subsidy on fertiliser under the much-trumpeted Kisan Package as a “wish list” and expressed surprise over the way government affairs were being run.

“Is this the way to govern the country as the government issued a notification but the parliamentarians were not kept in the loop about the announcement of such a huge amount,” said Justice Qazi Faez Isa, a member of the two-member bench headed by Justice Ejaz Afzal Khan.

The bench had taken up an appeal of the federal government against the Dec 8, 2015 order of the Peshawar High Court, which had held that the distribution of subsidy to fertiliser producers using imported rock was discriminatory.

The court was also not happy over the release of the subsidy under the supplementary grant without seeking prior approval of parliament under Article 84 of the Constitution.

Prime Minister Nawaz Sharif had announced a Rs341bn Kisan Package around the time of local government elections. One of the components of the package was Rs20bn subsidy provided to manufacturers of the single super phosphate (SSP) with the condition that the end product would be made by using imported and not local rock.

Of the Rs20bn subsidy, the federal government had to pay Rs10bn, the Punjab government Rs7bn and the Balochistan government Rs400 million. The rest of the amount had to be paid by the governments of Sindh and Khyber Pakhtunkhawa.

The subsidy for manufacturing single super phosphate from imported rock was allocated because the presence of phosphate in local rock is below 18 per cent as declared by a 1995 chemical evaluation, infrared spectral, thermal and up-gradation study of Bataknala, Hazara.

Feeling aggrieved, Agritech Limited which manufactures fertiliser from local rock challenged the Kisan Package in the PHC by claiming that it was being discriminated against.

The high court held in its judgement that if a product met the standards of the Pakistan Standards and Quality Control Authority and Standards Development Centre (Chemical Division) then there should be no legal justification to deny the manufacturer the subsidy.

On Thursday Attorney General Ashtar Ausaf told the Supreme Court that the government had issued the notification under an executive order with the sole objective to keep fertiliser prices at a lower level by providing a subsidy of Rs196 per bag of phosphate fertiliser.

He stated that the major ingredient used in manufacturing the fertiliser was imported from Jordan, Morocco and Tunisia, adding that the local rock was not suitable to manufacture the fertiliser.

Mr Ausaf requested the court to trust the parliamentarians but Justice Isa retorted that the government had not kept the parliamentarians in the loop about such an important decision to subsidise fertilisers. The court asked the AG to cite the reasons which forced the government to give subsidy to the manufacturers using imported rock.

Justice Isa asked if the imported rock was a criterion for ‘standard fertiliser’ and said he wondered whether the real purpose behind the notification was to reward some importers.

“Give us a precedent wherein a huge amount of subsidy is given through a notification,” he inquired.

Advocate Salman Akram Raja representing Agritech will present his arguments on Friday.

Published in Dawn, May 27th, 2016

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