ISLAMABAD, March 30: The fertilizer prices are expected to decrease by Rs20 per bag by the end of this week as the government has accepted an offer from the fertilizer industry to share the burden of price reduction on equal basis.

Official sources told Dawn on Sunday the cabinet committee on fertilizer would meet on Monday to reduce fertilizer prices by Rs20 per bag for the farmers, to be shared on a 50 to 50 basis by the government and the fertilizer industry.

The cabinet committee would finalise its recommendations during the meeting and seek formal approval from the cabinet. The prime minister who had set up the committee last month to provide relief to the farmers has already approved the proposal in principle.

The fertilizer manufacturers had promised a few days back in writing that they could reduce prices by Rs20 a bag provided the government offered them Rs10 per bag concessions in taxes and duties coupled with a freeze on fertilizer feedstock for a year instead of a proposed 7.5 per cent increase with effect from July 1, 2003.

Subsequent consultations between various ministries which are part of the cabinet committee found the offer quite satisfactory and decided to forward a package of fertilizer price reduction to the cabinet on the lines proposed by the manufacturers.

The sources said the price reduction on fertilizer would be announced by the end of this week so that it coincided with the the start of the Kharif season and farmers could take advantage of the low fertilizer price throughout the season.