22 January 2013

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HT Expose Fertilizer Scam Prices and Subsides rose hand in hand increasing profits of private companies

HT Expose Fertilizer Scam Prices and Subsides rose hand in hand increasing profits of private companies

As our laws and system is full of loopholes so corruption by politicians and government officers is not going to stop unless and until we learn to support the laws like Jan Lokpal Bill.

Now HT investigative team has exposed another scam and this time it is Fertilizer Scam

M.K. Alagiri is the son of DMK chief M. Karunanidhi

The UPA-2 regime saw a 10-fold increase in the fertilizer subsidy bill.

A special investigation by Headlines Today has revealed that Minister of Chemicals and Fertilizers M.K. Alagiri overlooked a series of controversial decisions taken by his ministry, leading to a huge loss to the citizens of India due to the gross misuse of central subsidy.

The issue of ongoing loot in the fertilizer sector was brought to Alagiri's notice by his junior Srikant Jena through repeated internal notes. A portion of one of at least five such notes, written between March and August 2012, says: "companies have made extremely high profits?¦this has led to undue gain in the industry."

On July 17, 2012, Jena wrote: "The government has been releasing subsidy for the benefit of farmers so that the retail prices remain at reasonable levels and there is no runaway increase in retail prices.

In the same note, Jena suggested that fertilizer companies were pocketing roughly one-third of the total subsidy released for the farmers. He gave empirical evidence to support his claim

Example how the profits were made by private companies –

Imported price of XYZ fertilizer was Rs.31, 900

Selling one metric tonne of XYZ fertilizer for Rs.25, 000 + a subsidy of Rs.14, 300 per metric tonne from the government.

25,000 + 14300 = 39,300

Profit = 39,300 – 31,900 = 7400 per metric

Reduce the factoring the port and distribution charges

Thus, finally companies made profit of Rs. 5000 per one metric tonne.

Another example –

In International Markets, the prices of fertilizers were reduced.

Thus, it is common sense that the subsidy will get reduced.

But intelligent private companies sold lot of the stock of fertilizers even if it was not required, farming and fertilizers are seasonal.

Why they sold so they can get bigger subsidy from the government.

But who listens to Junior he was ignored.

Government gives subsidies to fertilizer companies but in reality farmers never get the benefit of subsidies as private companies keep increasing the prices of fertilizers which is ignored by the politicians and government officers I do not know what is the reason they ignore it

May be they do not know about it?

May be companies give them under table money or jobs to the sons and daughters of friends of politicians?

Something is wrong I am sure you are intelligent enough to know the real reason by politicians ignore the profits made by the private fertilizer companies.

Suggested Reading –

Now scam in fertiliser ministry? Prices, subsidy rise simultaneously, but Alagiri ignores his junior minister's warnings

Reality views by sm –

Tuesday, January 22, 2013

Tags – Fertilizer Scam


MEcoy January 22, 2013  

our previous president did something like that as well