Union Cabinet Sanctions Rs 10,600 Crore Urea Fertiliser Initiative in Assam
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Synopsis
On March 19, the Union Cabinet, under PM Narendra Modi, approved a Rs 10,601.40 crore ammonia-urea complex in Assam, capable of producing 12.7 lakh metric tonnes of urea annually. This initiative aims to enhance local urea production and create job opportunities.
Key Takeaways
- Approval for a new ammonia-urea complex in Assam
- Annual production capacity of 12.7 lakh metric tonnes
- Total project cost is Rs 10,601.40 crore
- Joint Venture with 70:30 debt-to-equity ratio
- Expected commissioning in 48 months
New Delhi, March 19 (NationPress) The Union Cabinet, led by Prime Minister Narendra Modi, has granted approval for the establishment of a new brownfield ammonia-urea facility in Assam. This complex will have an annual production capacity of 12.7 lakh metric tonnes (LMT) of urea, with a projected total investment of Rs.10,601.40 crore.
The project will be developed on the existing site of the Brahmaputra Valley Fertiliser Corporation Limited (BVFCL) at Namrup, Assam. It will operate with a debt-to-equity ratio of 70:30 through a Joint Venture (JV), in accordance with the New Investment Policy of 2012 and its amendments as of October 7, 2014. The estimated timeline for the commissioning of the Namrup-IV project is 48 months, based on an official statement following the Cabinet meeting.
Furthermore, the Cabinet has also okayed National Fertilisers Limited’s (NFL) equity stake of 18 percent in a deviation from the limits set by the Department of Public Enterprises (DPE) guidelines, and the formation of an Inter-Ministerial Committee (IMC) to supervise the setup of the Namrup-IV Fertiliser Plant.
In this proposed JV, the Assam government will own 40 percent equity, while BVFCL will hold 11 percent. Hindustan Urvarak & Rasayan Limited (HURL) will have a 13 percent stake, and both NFL and Oil India Limited (OIL) will each possess 18 percent ownership, as per the statement.
BVFCL’s equity share will be compensated through tangible assets.
The new project aims to boost the domestic urea production capacity, particularly in the northeastern region, addressing the increasing demand for urea fertilisers in North East, Bihar, West Bengal, eastern Uttar Pradesh, and Jharkhand.
The establishment of Namrup-IV will enhance energy efficiency and create additional direct and indirect job opportunities for local residents. Additionally, the project is expected to contribute to the vision of achieving self-reliance in urea production within the country, the statement concluded.
