ISLAMABAD - Fertilizer Manufacturers of Pakistan Advisory Council Wednesday feared that country might face food insecurity in next few years due to increase in cost of production that could deprive millions of people from basic essential food items. 

“The government should keep food security on top of its priorities and millions of people can deprive from basic food items due to constant increase in its prices”, said representatives of Fertilizer Manufacturers of Pakistan Advisory Council (FMPAC) while talking to selective group of journalists. The cost of production of food commodities sharply increasing due to imposition of taxes and severe shortage of gas and electricity in the country, they added. The prices of water, urea, electricity and pesticides have already increased that is pushing cost of production of higher side. 

They informed the media that fertilizer sector of Pakistan is facing severe gas loadshedding in the country. “Gas, being the only raw material option to fertilizer sector, is supplied from 3 sources - Mari (56pc), SSGC (10pc) and SNGPL (34pc)”, they said and added “However four fertilizer plants running on SNGPL are facing problems in gas supply”.

Talking about the imposition of different taxes, the representatives Fertilizer Manufacturers Pakistan informed that cost of urea had increased by Rs 600 to Rs 650 per kg in last three years. They vowed to reduce the urea prices by Rs 150 to Rs 200 per bag if government provides gas supply to the fertilizer units throughout the year.

Earlier giving presentation on fertilizer sector, Shahab Khawaja, Executive Director, Fertilizer Manufacturers of Pakistan Advisory Council said, “Installed Capacity of urea is 6.9 million tons, which is 6th largest in world against domestic demand of around 5.8 million tons; making country self sufficient with potential to export provided if installed capacity is fully operated”.  He informed that 435,000 tons of urea has been imported so far in 2013 with a cost of $140 million. He informed that government would have to give Rs 400 to Rs 450 billion subsidy annually if it shutdown fertilizer sector by diverting all gas to power sector.

In its proposals, Fertilizer Manufacturers Pakistan demanded gas allocations to critical sectors of economy should be rationalised on most economical and efficient use basis, plants located on SNGPL and SSGC may be saved from permanent shut down.

 which will have massive economic and social implications besides loss of highly skilled technical manpower, bank defaults etc, Government should assess very carefully implications of raising gas price of feed stock and its effect on farming community and food security, Gas curtailment to fertilizer sector should not be arbitrary as it causes serious damage to the plants.

It also proposed to form committee including all stakeholders to deal with the issue.