LAHORE: Apparently under pressure from the fertiliser industry, the federal government has reversed its decision of regulating the import of di-ammonium phosphate (DAP) by linking it with the approval of the Trading Corporation of Pakistan (TCP).

Sources say as the decision of authorising the TCP to ‘facilitate’ DAP import without any financial burden on the government had been taken by the Economic Coordination Committee (ECC) of the Cabinet without following the set procedures like first moving a summary, the higher authorities feared that the matter might be scandalised and thus it was withdrawn.

The local fertiliser industry had also agitated against the ‘unilateral’ decision, terming it against the interests of the farmers too, saying that despite it being an important player no input had been sought from it before taking the step.

The industry has, however, not yet been informed of the withdrawal of the decision in writing.

“We’ve been verbally conveyed the message that the Ministry of Industries has reversed the decision. But, nothing in writing has so far been shared with us in this respect,” says Brig (retired) Sher Shah Malik, the executive director of the Fertiliser Manufacturers of Pakistan Advisory Council (FMPAC).

In a letter to the Commerce Ministry last month, the FMPAC criticised the decision to regulate DAP, fearing the regulation would undermine efforts to attain self-sufficiency and discourage new investments.

It had regretted that the decision had been taken without consulting the industry, one of the major stakeholders, which has been ensuring the availability of the fertiliser through competitive bidding.

It had warned that the intervention would not only lead to product shortage but the proposal of levying a brokerage fee by the TCP would ultimately be passed on to the end-users by the international suppliers and thus a further hike in DAP prices in the local market.

The annual DAP off-take stands at around 2,000 kilo-tonnes per annum. Of this 800kt is produced locally and the rest is imported at a cost of over $1.2 billion as per existing rupee-dollar parity.

At least 11 companies, including urea manufacturers, importers and a few dealers, are importing DAP.

Published in Dawn, October 2nd, 2022

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