Wait...

Online Export Import Data Search

Complete Training Video : Click Here

India may cut potash subsidy in potential blow to demand.


Date: 17-02-2017
Subject: India may cut potash subsidy in potential blow to demand
MUMBAI: An Indian ministry has proposed slashing potash subsidies by 17 percent in the next financial year to reduce the fiscal deficit, officials said, a move that would hit demand in one of the world's largest importers of the fertiliser.

Although global prices have been falling, a reduction in government support in India - which alongside China is the world's biggest bulk potash importer - will make potash relatively expensive for the companies that import it.

Some officials at those companies said that were the proposal to be adopted, they would seek lower prices when negotiating annual contracts with global suppliers and also raise retail prices charged to farmers, dampening demand.

Global producers including Uralkali, Potash Corp of Saskatchewan, Agrium Inc, Mosaic, K+S, Arab Potash and Israel Chemicals have been hoping for robust demand to help counter weak prices.

Asian import prices have fallen around 10 percent in the last 12 months.

India's fertiliser ministry has proposed fixing the potash subsidy at 7,669 rupees ($114.61) a tonne for the 2017/18 fiscal year beginning in April, down from 9,280 rupees per tonne this year, said a senior government official.

He did not wish to be identified, because he was not authorised to talk to the media.

Prime Minister Narendra Modi's cabinet has to decide on the proposal, said the official, who is directly involved in the decision making process.

If India were to import 4 million tonnes of potash in 2017/18, the savings from the proposed subsidy cut would equate to almost $100 million.

Two other industry officials confirmed the plan.

The Ministry of Chemicals and Fertilisers spokesman declined to comment on the proposed changes.

NOT SO ROSY OUTLOOK

India relies on imports to meet its annual potash demand of about 4 million tonnes, but higher prices are expected to limit how much its 263 million thrifty farmers use.

India buys potash from global miners in annual contracts that the south Asian country usually signs before the start of the fiscal year.

Contracts signed by India and China are considered benchmarks globally, and are closely watched by other potash buyers such as Malaysia and Indonesia.

"The subsidy reduction will weigh on the new contract negotiations. We cannot offer higher prices in new contracts due to the proposed subsidy reduction," said an official who takes part in the negotiation process with overseas miners.

Leading producer Potash Corp last month expressed hopes for a pick-up in demand from India in 2017, while Agrium earlier this month forecast a 5 percent rise in global potash shipments this year.

Some industry officials in India say the demand outlook is not so rosy, and doubted imports of the crop nutrient would exceed 4 million tonnes if the subsidy cut went through.

Last year suppliers had to sell potash to India at $227 per tonne, down from $332 previously and the lowest in a decade, after India delayed purchases due to sluggish demand.

That allowed importing companies to reduce retail prices, but that could be reversed in 2017/18.

"If the subsidy goes down, then we have no choice but to raise retail prices," said an official with a state-run fertiliser company. The official declined to be named.

In his budget for the 2017/18 fiscal year, Finance Minister Arun Jaitley in fact kept the overall fertiliser subsidy unchanged at 700 billion rupees.

Source: newindianexpress.com

Get Sample Now

Which service(s) are you interested in?
 Export Data
 Import Data
 Both
 Buyers
 Suppliers
 Both
OR
 Exim Help
+


What is New?

Date: 20-02-2018
DGFT Notification No. 51/2015-2020
Amendment in the Foreign Trade (Exemption from application of Rules in certain cases) Amendment Order, 2017.

Date: 19-02-2018
Notification No. 14/2018-Customs (N.T.)
Customs Tariff (Determination of Origin of Goods under the Comprehensive Economic Partnership Agreement between the Republic of India and Japan) Amendment Rules, 2018

Date: 16-02-2018
Public Notice No. 62/2015-2020
Directtives for processing of applicatin for MEIS claims under Foreign Trade Policy 2015-20

Date: 16-02-2018
Public Notice No. 61/2015-2020
Inclusion of Seaports located at Dhamra Port and Dighi Port under Para 4.37 of Hand Book of Procedures 2015-20.

Date: 15-02-2018
Public Notice No. 60/2015-2020
Amendments/Corrections in Table 2 of Appendix 3B Foreign Trade Policy 2015-20

Date: 15-02-2018
Notification No. 13/2018-Customs (N.T.)
Exchange Rates Notification No.11/2018-Custom(NT) dated 1.2.2018

Date: 15-02-2018
Notification No. 12/2018-Customs (N.T.)
Tariff Notification in respect of Fixation of Tariff Value of Edible Oils, Brass Scrap, Poppy Seeds, Areca Nut, Gold and Sliver.

Date: 12-02-2018
Notification No. 26/2018-Customs
seeks to further amend the notification No. 50/2017- Customs, dated the 30th June 2017 so as to reduce the Basic Customs Duty on motorcycles falling under tariff heading 8711.

Date: 06-02-2018
Notification No. 25/2018-Customs
Seeks to increase BCD tariff rate on Chana (Chickpeas), [Tariff item 0713 20 0] from 30% to 40% by invoking section 8A (1) of the Customs Tariff Act, 1975 and accordingly, the effective rate of BCD on Chana (Chickpeas), will also be 40%.

Date: 06-02-2018
Notification No. 24/2018-Customs
Seeks to increase import duty on all types of sugar under tariff head 1701, [Raw sugar, Refined or White sugar, Raw sugar if imported by bulk consumer] from the present 50% to 100% (Tariff rate) with immediate effect and without an end date.



Exim Guru Copyright © 1999-2018 Exim Guru. All Rights Reserved.
The information presented on the site is believed to be accurate. However, InfodriveIndia takes no legal responsibilities for the validity of the information.
Please read our Terms of Use and Privacy Policy before you use this Export Import Data Directory.

EximGuru.com

C/o Infodrive India
E-2, 3rd Floor, Kalkaji Main Road
New Delhi - 110019, India
Phone : 011 - 40703001