MULTAN, Feb 8: The TCP has revised its earlier terms and conditions pertaining to shipment and delivery of urea. The corporation imports through private firms and later supply it to the growers at subsidized rates.
According to the shipment conditions spelt out in the latest TCP tender, the importer will arrange the first shipment within 15 days and the second within 22 days of the opening of L/C. The tender for the import of 50,000 tons of urea, floated on Jan 29, will be opened on Feb 13.
The TCP had to re-issue the tender for the import of urea when some firms could not deliver their committed quantity of Urea, reportedly due to the short period the TCP had given to them for the delivery.
In its previous tender floated for the import of 75,000 tons of urea in Dec last year, the corporation had made it compulsory for the intended parties that the contracted amount of the fertilizer should reach the Karachi Port by Jan 10, 2006. The tender was opened on Dec 22, and under the laid down procedure of acceptance of the contract and submission of the performance bond, the L/C was due to be opened on January 2, thus the importers were given only eight days to deliver urea in the country.
The tendered quantity of 75,000 of urea was equally distributed among three importers. Of them, only one importer was in a position to deliver the consignment, but only after getting certain amendments in the L/C, shipment and delivery clauses of the agreement.
One of the firms, that could not perform within the given period, had urged the TCP authorities to restore the original terms and conditions vis-à-vis shipment, delivery as the terms offered in the tender, were in contrast with the terms and conditions laid down in the preceding tenders. The firm was awarded the contract for the import of urea at the rate of $200 per ton against $254 per ton, at which the other two firms were granted the contract.
The government imports urea every year to bridge the gap between the local production and demand and provides subsidy of around Rs700 per 50kg bag of the fertilizer to the growers. Analysts say that the government can reduce its spending on subsidy on urea by either making the process of awarding tenders transparent at the TCP level, or leaving imports completely to the private sector as is done in the case of wheat import.
It may be pertinent to mention here that the prices of imported wheat have now been rationalized at around $140 per ton as against $200 or even more, when import of the commodity was in the hands of the state-run TCP.