With government deciding to lower subsidy level for the next fiscal on these soil nutrients, sources pointed out that fertiliser firms intend to claim subsidy on the 4 lakh tonnes of imported quantity in the current year itself even as there is a poor demand of fertiliser at present
New Delhi: The Centre has asked fertiliser firms not to lift imported nutrients, especially potash and DAP, scheduled to reach ports in February and March, due to poor demand, a move that could save up to Rs1,000 crore in the subsidy bill of this fiscal, reports PTI.
In a recent order, the fertiliser ministry said that it has been decided that “di-ammonium phosphate (DAP), muriate of potash (MoP) and complex fertilisers except urea arriving during the months of February and March will not be dispatched from ports to any state till further orders”.
As the government has decided to cut subsidy on these fertilisers for the next fiscal, the decision could help the department in saving up to Rs1,000 crore in the subsidy bill of this fiscal, sources said, adding that about 4 lakh tonne of nutrients are expected to reach ports in these two months.
The ministry disburses subsidy to fertiliser companies on the actual sale receipt basis. Major importers are IFFCO, PPL, Chambal Fertilisers and Indian Potash.
With government deciding to lower subsidy level for the next fiscal on these soil nutrients, sources pointed out that fertiliser firms intend to claim subsidy on the 4 lakh tonnes of imported quantity in the current year itself even as there is a poor demand of fertiliser at present.
The government is giving a subsidy of Rs19,763 per tonne on DAP and Rs16,054 a tonne on MoP in this fiscal. However, it has decided to slash the subsidy on DAP to Rs15,263/tonne and Rs15,000 a tonne on MoP in view of bearish global prices.
In the directive to importers, the ministry has said that fertilisers available till beginning of this month would be dispatched during February and March and asked companies to comply with this order strictly.
“The demand has come down significantly in last few months due to high prices of DAP and MoP. It is expected that there may not be any increase in demand in February and March.
So, it makes no sense to allow sale of imported products in February-March,” a senior fertiliser ministry official said.
The official noted that there is already a stock of 5 million tonnes of potassium and phosphatic fertilisers, which is more than sufficient to meet the demand for two months.
The subsidy bill on non-urea fertilisers is expected to increase to about Rs70,500 crore this fiscal from about Rs61,100 crore a year earlier.
After the decontrol of non-urea fertilisers, DAP and MoP prices have more than doubled to Rs20,000 a tonne and Rs12,000 a tonne, respectively.
India imports almost half of its requirement of DAP and almost entire requirement of MoP.
SBI’s, the country’s largest lender market capitalisation (m-cap), dropped by Rs13,332 crore to Rs1,40,131 crore. Shares of the company had plunged by over 8% last week on concerns over its exposure to cash-strapped Kingfisher Airlines and reports of public sector lender giving fresh loans to the debt-ridden carrier
Mumbai: Led by a steep decline in State Bank of India’s (SBI) market value on concerns over its exposure to Kingfisher Airlines, the combined market capitalisation of five of the top 10 blue-chip companies eroded by Rs20,409.84 crore, reports PTI.
SBI’s, the country’s largest lender market capitalisation (m-cap), dropped by Rs13,332 crore to Rs1,40,131 crore. Shares of the company had plunged by over 8% last week on concerns over its exposure to cash-strapped Kingfisher Airlines and reports of public sector lender giving fresh loans to the debt-ridden carrier.
State-run NTPC’s m-cap also dipped by Rs3,422 crore to Rs1,51,304 crore, while Bharti Airtel’s worth declined by Rs2,753 crore to Rs1,29,989 crore last week.
HDFC Bank saw an erosion of Rs712.84 crore from its value which was at Rs1,22,755.16 crore, while IT major Infosys lost Rs190 crore from its m-cap which stood at Rs1,69,239 crore at close on last Friday.
In contrast, corporate leader Reliance Industries, IT bellwether TCS, state-owned ONGC, Coal India and FMCG giant ITC reported gains in market value.
Market worth of Reliance Industries surged by Rs802 crore to Rs2,68,625 crore, while TCS added Rs7,917 crore to its m-cap which stood at Rs2,48,400 crore as on Friday last week.
ONGC’s wealth went up by Rs2,524 crore to Rs2,43,189 crore, while CIL added Rs1,516 crore taking its valuation to Rs2,06,703 crore and ITC’s value climbed Rs3,237 crore to Rs1,63,375 crore.
In the broader market, the BSE barometer Sensex fell by about 2% to end the week at 17,923.57 points.
“The bank has taken in-principle decision to cut (interest on) education loans,” SBI managing director and chief finance officer Diwakar Gupta told reporters. Without giving details of quantum of rate cut, he said, it may be up to 100 basis points
New Delhi: State Bank of India (SBI), the country's largest lender, has taken an in-principle decision to slash interest on education loans by up to one percentage point, reports PTI.
“The bank has taken in-principle decision to cut (interest on) education loans,” SBI managing director and chief finance officer Diwakar Gupta told PTI.
“Announcement would be made soon. The bank will issue the notification shortly,” he added.
Without giving details of quantum of rate cut, he said, it may be up to 100 basis points.
Interest rates on education loans range from 12.25% to 14.50%, depending on their quantum and the duration.
The education loan book of SBI constitutes less than 7% of its Rs1.75 lakh crore retail loan portfolio. In the quarter ended December, the bank saw its education loan books swell by 14.17%.
SBI is also offering a concession of 50 basis points on interest rates for loans given to female students.
Earlier this month, SBI chairman Pratip Chaudhuri had said the possibility of a reduction in base rate at this point of time looks bleak as the bank has absorbed last three Reserve Bank of India’s (RBI) policy rate hikes without raising its base rate.
The lender’s base rate stands at 10% as of now, which is the lowest in the country.
About the possible slashing of home loan rates, he had said the possibility was ‘less’.
“The possibility of (reduction) in home loans is less as the rate is 10.50% and the base rate is 10%. Hence, the possibility is less. Moreover, the tenor of a home loan is 25-30 years, (so) we have to think about it a lot,” Mr Chaudhuri had said.
He, however, had said in case of further CRR cut by the central bank, the entire rate structure will come down.
On 24th January, the RBI had reduced the cash reserve ratio (CRR) by 0.5% to 5.5% to infuse liquidity into the system, and indicated a reversal of tight money policy stance.