ISLAMABAD, July 2: The uncertainty over the price of fertilizer, which the Prime Minister had promised to reduce several months ago, still persists.

A knowledgeable source told Dawn here on Wednesday, the dealers were slow in picking fertilizer from the industry, while the farmers were reluctant to stake their money on it in anticipation of reduction in price.

This state of affairs is also detrimental to the fertilizer industry.

At the current prices, the dealer’s profit margin is only Rs15 to Rs20 per bag. Even this profit might wipe out should the government make up its mind on revising down the fertilizer price, he apprehends.

The fertilizer industry had linked the cut to reduction in what it said the tax burden on fertilizers — 15 per cent general sales tax plus 6 per cent withholding tax.

Meanwhile, the price of phosphatic fertilizers, most of which have to be imported, had gone up in the international market. Within the country, the price of locally produced nutrient too is likely to climb following the increase in cost of natural gas, the main ingredient of fertilizer.

It appears that the promise by the Prime Minister came under the cloud of skepticism right after it hit the newspaper headlines. It was, however, difficult to back out of the commitment coming from the horse’s mouth. So the Cabinet set up a committee headed by the Industries Minister, Mr Liaquat Ali Jatoi to consider the issue.

According to a reliable source, the committee worked out a formula according to which the price of Urea fertilizer, an entire indigenous production, would be reduced by Rs15-20 per bag and that of DAP and other phosphatic fertilizer by Rs50-60 per bag.

After that nobody seems to know the fate of the Committee’s recommendation. A decision, according to the source, lies with the final arbiter of all policies in Pakistan, that is, the Ministry of Finance and the international agency.

Meanwhile, the prime time for application of fertilizer to the major crops - cotton, rice and sugarcane - and other minor crops has already passed since the onset of monsoons, an agricultural expert told Dawn.

All these crops are in their crucial stage of development when the harvesting is only a couple of months away, while the sowing season of wheat (October) draws near. Unless the government announces whether it would reduce the fertilizer prices as per the Prime Minister’s announcement without further loss of time, it may be too late to expect optimal results from the use of fertilizer at this stage, he added.