ISLAMABAD: The government on Thursday increased fertiliser prices by Rs20 per bag.

Adviser to PM on Industry and Production Abdul Razak Dawood said the decision is a win-win for both fertiliser manufacturers and the growers.

“The rise in prices of fertiliser due to the increase in the price of gas was Rs210 per bag, but the impact of reduction in the Gas Infrastructure Development Cess (GIDC) was Rs200 per bag, therefore the net increase would be Rs10 per bag,” he explained.

He said the price of 20kg fertiliser bag would be Rs1,890 which includes the dealer margin of Rs50.

“We have allowed increase in price of urea by Rs10 per bag only,” he added.

“The dealers were not in the control of the government, however, there were some measures in place to take action following unjustified price hikes,” Dawood said.

Responding to questions regarding the arguments presented by the fertiliser manufactures, he said that they claimed that devaluation of rupee against the dollar, increase in minimum salaries by the government had resulted in higher costs of production.

“We listened to them, but we made our calculations too and did not allow them to increase the prices on account of these heads only, and presented our part of the story of GIDC which led to the increase of Rs10 only,” he added.

Dawood said the government had allowed import of one tonne of urea 4-5 months ago to maintain supply and demand equilibrium.

The first batch of imported urea is expected to dock on Sunday and there seems no possibility of fertiliser shortage in Kharif season he claimed.

He said the Economic Coordination Committee had set imported urea price at Rs1,800 per bag and the government would have to bear a burden of Rs1 billion for providing subsidies over it.

Published in Dawn, July 19th, 2019