Lok Sabha Question No. 4300 (UNSTARRED), answered on 2017-03-28
Subject: Fertilizer License for Units
Ministry: CHEMICALS AND FERTILIZERS
Asked by: VINAYAK BHAURAO RAUT, Shrirang Appa Barne, SHRIKANT EKNATH SHINDE

## GOVERNMENT OF INDIA MINISTRY OF CHEMICALS AND FERTILIZERS DEPARTMENT OF FERTILIZERS

## LOK SABHA

UNSTARRED QUESTION NO.   4300

TO BE ANSWERED ON

: 28.3.2017

## Fertilizer license for units

## 4300.  SHRI  VINAYAK BHAURAO RAUT: SHRI SHRIRANG APPA BARNE: SHRI SHRIKANT EKNATH SHINDE:

Will the Minister of CHEMICALS AND FERTILIZERS be pleased to state:

- (a) whether the Government is aware that fertilizer production units which did not have any license from the Ministry are mushrooming in a number of States during the previous decade and if so, the details thereof;
- (b) whether large section of the farming community in various States are poor and illiterate and many fertilizer companies are selling spurious fertilizers to dupe them and if so, the details thereof;
- (c) whether this menace is damaging agriculture in particular and the health of common people in general and if so, the details thereof;
- (d) whether  permission  from  the  Ministry  as  well  as  the  concerned  State Government is required for starting a fertilizer unit;
- (e) if so, the details of fertilizer production units which are not taking permission from the Government, State-wise; and
- (f) the  action  taken  by  the  Government  against  the  fertilizer  units functioning without permission and the fertilizer companies selling spurious fertilizers?

## ANSWER

MINISTER OF STATE IN THE MINISTRY OF ROAD TRANSPORT & HIGHWAYS, SHIPPING AND CHEMICALS & FERTILIZERS

## (SHRI MANSUKH L. MANDAVIYA)

(a) : The  Government  has  notified  Nutrient  Based  Subsidy  (NBS)  Policy  on 1.4.2010 for P&K fertilizers and New Investment Policy (NIP) - 2012 on 2.1.2013 & its  amendment  on  7.10.2014  for  Urea  fertilizer.   Any  interested  Company  can establish P&K fertilizers plant and urea plant in the country as per the provisions of aforesaid policies. However, no license is required from the Ministry for setting up of these plants.

Ministry of Agriculture and Farmers Welfare vide notification SO No. 3054 (E) dated 23.9.2016 has dispensed with the requirement to possess the Certificate of Manufacturer  by  the  manufacturing  units  of  Bio-fertilizers  and  Organic  fertilizers. Currently, there is no requirement under the Fertilizer (Control) Order 1985 for the manufacturing  units  of  fertilizers  to  obtain  the  certificate  of  manufacture  except  in case  of  mixture  manufacturing  units.  Manufacturers  of  Mixture  of  Fertilizers  are required  to  obtain  the  Certificate  of  manufacture  from  the  Registering  Authority appointed by the State Government.

(b), (c) & (f) :   During the year 2015-16 the percentage of sample declared non standard  at  All  India  level  is  4.9%.  The  specifications  of  various  fertilizers  are specified in the Fertilizer (Control) Order, 1985. Clause 19 of the Fertilizer (Control) Order,  1985  strictly  prohibits  the  sale  of  Fertilizers  which  are  not  of  prescribed standard.  The  State  Governments  are  adequately  empowered  to  take  appropriate action  in  case  of  violation  of  the  provisions  of  FCO.  Any  violation  of  this  provision invoke  both  administrative  and  penal  action  under  the  provisions  of  FCO/ECA.  A statement indicating action taken by the State Government during the year 2015-16 is at Annexure - I.

(d) : No  permission  is  required  for  starting  a  P&K  manufacturing  unit.  However, Department of Fertilizers has received 6 proposals for setting up of Greenfield and Brownfield (Expansion) the urea projects. The details are at Annexure - II.

As per the terms of the NIP Policy, all the project proponents are required to furnish Bank Guarantee (BG) of Rs. 300/- crores for each project linked to milestone in  the  project  cycle.  PSUs  are,  however,  exempted  from  submitting  the  Bank Guarantee as per amendment to NIP - 2012.

However, for carrying on the business of selling of fertilizer, every manufacturer or wholesaler or retailer is required to obtain Authorization Letter from the Notified Authority appointed by the State Government.

(e) : No such detail is available with the Government.

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## Annexure-I

| S.No.   | Name of the State   | No. of Non Std. samples   | Administrative Action Taken   | Administrative Action Taken   | Administrative Action Taken   | Prose- cution Launched   | Cases Pending for Action   | Charging higher Price   | Seizure of Stock/Stop Sale   | Disposal allowed under cl.23   | Conviction awarded   | Cases pending in Court   | No. of cases other violation of FCO   |
|---------|---------------------|---------------------------|-------------------------------|-------------------------------|-------------------------------|--------------------------|----------------------------|-------------------------|------------------------------|--------------------------------|----------------------|--------------------------|---------------------------------------|
|         |                     |                           | DRC Cancelled                 | DRC suspen- ded               | Other action                  |                          |                            |                         |                              |                                |                      |                          |                                       |
| 1       | 2                   | 3                         | 4                             | 5                             | 6                             | 7                        | 8                          | 9                       | 10                           | 11                             | 12                   | 13                       | 14                                    |
| 1       | Assam               | 1                         | 0                             | 0                             | 0                             | 0                        | 0                          | 0                       | 0                            | 0                              | 0                    | 1                        | 0                                     |
| 2       | Bihar               | 0                         | 0                             | 0                             | 0                             | 0                        | 0                          | 0                       | 0                            | 0                              | 0                    | 0                        | 0                                     |
| 3       | Jharkhand           | 0                         | 0                             | 0                             | 0                             | 0                        | 0                          |                         | 0                            | 0                              | 0                    | 0                        | 0                                     |
| 4       | Odisha              | 244                       | 0                             | 0                             | 244                           | 0                        | 0                          | 0                       | 30                           | 0                              | 0                    | 0                        | 0                                     |
| 5       | West Bengal         | 148                       | 0                             | 0                             | 148                           | 0                        | 0                          | 0                       | 0                            | 0                              | 0                    | 0                        | 0                                     |
| 6       | Mizoram             | 0                         | 0                             | 0                             | 0                             | 0                        | 0                          | 0                       | 0                            | 0                              | 0                    | 0                        | 0                                     |
| 7       | Gujarat             | 130                       | 3                             | 2                             | 60                            | 15                       | 31                         | 0                       | 0                            | 0                              | 0                    | 377                      | 0                                     |
| 8       | Maharashtra         | 2043                      | 1                             | 0                             | 1475                          | 102                      | 465                        | 0                       | 0                            | 0                              | 0                    | 102                      | 0                                     |
| 9       | Rajasthan           | 130                       | 0                             | 0                             | 0                             | 6                        | 124                        | 0                       | 0                            | 0                              | 0                    | 0                        | 0                                     |
| 10      | Haryana             |                           |                               |                               |                               |                          |                            |                         |                              |                                |                      |                          |                                       |
| 11      | H.P.                | 62                        | 0                             | 0                             | 0                             | 0                        | 0                          | 0                       | 0                            | 0                              | 0                    | 0                        | 0                                     |
| 12      | U.P.                | 529                       | 349                           | 45                            | 56                            | 33                       | 46                         | 0                       | 0                            | 0                              | 0                    | 73                       | 0                                     |
| 13      | Uttarakhand         | 5                         | 1                             | 0                             | 4                             | 0                        | 0                          | 0                       | 0                            | 0                              | 0                    | 0                        | 0                                     |
| 14      | A.P.                | 93                        | 0                             | 0                             | 2                             | 15                       | 76                         | 0                       | 0                            | 0                              | 0                    | 0                        | 0                                     |
| 15      | Telangana           | 53                        | 0                             | 0                             | 8                             | 3                        | 42                         | 0                       | 0                            | 0                              | 1                    | 1                        | 0                                     |
| 16      | Pudicherry          | 1                         | 0                             | 0                             | 0                             | 0                        | 0                          | 0                       | 0                            | 0                              | 0                    | 0                        | 0                                     |
|         | TOTAL               | 3439                      | 354                           | 47                            | 1997                          | 174                      | 784                        | 0                       | 30                           | 0                              | 1                    | 554                      | 0                                     |

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## Annexure - II

|   S. No. | Company                                          | Projects                                                            | Ownership   | State          |
|----------|--------------------------------------------------|---------------------------------------------------------------------|-------------|----------------|
|        1 | Indo-Gulf Fertilizers Limited -Jagdishpur        | Brownfield Expansion urea project at Jagdishpur.                    | Private     | Uttar Pradesh  |
|        2 | Chambal Fertilizers & Chemicals Limited- Gadepan | Brownfield Ammonia- Urea units at Gadepan- Kota.                    | Private     | Rajasthan      |
|        3 | Matix Fertilizers & Chemicals Limited, Panagarh  | Greenfield/Brownfield Ammonia-Urea Fertilizers Complex at Panagarh. | Private     | West Bengal    |
|        4 | Rashtriya Chemicals & Fertilizers Limited- Thal  | Brownfield Ammonia- Urea Expansion project at Thal.                 | CPSU        | Maharashtra    |
|        5 | Kanpur Fertilizers & Cement Limited              | Greenfield Project at Jabalpur                                      | Private     | Madhya Pradesh |
|        6 | Nagarjuna Fertilizers & Chemicals Ltd.           | Brownfield Project at Kakinada, Andhra Pradesh.                     | Private     | Andhra Pradesh |

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