ISLAMABAD Amidst acute energy crisis in the country, top guns of the Ministry of Industries & Production are striving hard to benefit one fertilizer manufacturer M/S Pak-American Fertilizer Limited (PAFL) by giving cheaper gas for expanding urea production, it has been reliably learnt. Informed sources in the ministry confirmed that in a recent case, high-ups of Ministry of Industries & Production are making desperate efforts and have also extended full support by charging less feed gas tariff from M/S Pak-American Fertilizer Limited (PAFL) for undertaking Balancing, Modernisation and Replacement (BMR) under Fertilizer Policy 2001. Under this policy, manufacturer can get feed gas on full concessional rates for a period of seven years for the additional urea to be produced post BMR. The BMR would introduce shift to using coal as fuel also and use the gas freed from fuel and from the BMR generated efficiency to produce additional urea. Moreover, available documents with TheNation revealed that Ministry of Industries & Production was secretly in the process of finalising this controversial proposal despite the fact that the impact of subsidised gas to fertilizer sector was passing on to the farmers. However, Industries Ministry had completed the required action on finalisation of working paper to get the final nod from the Economic Coordination Committee (ECC) of the cabinet. Similarly, sources in the Ministry of Industries & Production while talking to TheNation had informed that currently, urea is produced using gas both as fuel and feed. But M/S Pak-American Fertilizer Limited (PAFL) had proposed BMR for their plant with an investment of $60 million to enhance their urea production by 136,867 tons per year. Therefore, M/S Pak-American request seemed feasible as the consumption of urea is increasing steadily around 5.4 million tons against production of around 4.9 million tons and its annual growth rate is 3 percent. Again, M/S Fatima Fertilizer has set up a urea and phosphatic fertilizer project having a capacity of around one million tons of fertilizer of which 0.5 million tons is urea. Correspondingly, Engro Chemical Pakistan Ltd is establishing a new fertilizer plant to produce around one million tons of urea alone that will come into production by October 2010. In spite of these additions, demands for urea, will continue to surpass its supply. Furthermore, scarce foreign exchange is spent on import of urea. The Government is providing subsidy on the import of fertilizer and during 2008-09, incurred a sum of Rs27 billions subsidy for DAP @ Rs2,200/- per 50 kg, as well as for other phosphatic fertilizers, while at conservative estimates Rs17 billion will be spent to import urea in the next five years. Moreover, concession is on the feed gas, then ultimately, money spent remains in the economy in terms of subsidy passed on to growers and growth in the economy, while an incentive is extended to the industry. It is also pertinent to mention here that the Economic Coordination Committee (ECC) of the Cabinet had snubbed the Ministry of Industries & Production by giving directions that Finance Division and Planning & Development Division may also be involved and a meeting of the Ministerial Committee already set up under the Chairmanship of Minister for Industries & Production, be convened very soon to suggest short and long term measures.