Centre to help MCF resume operations

Centre to help MCF resume operations

The Centre on Wednesday promised the Karnataka government that it would take immediate steps to resume operations at Mangalore Chemicals and Fertilisers (MCF) Ltd in Mangaluru.

Union Fertiliser Minister H N Ananth Kumar, during his meeting with Karnataka Chief Minister Siddaramaiah here, assured him that a Cabinet note extending subsidy to enable the factory to resume its operations had been circulated.

The lone chemical fertiliser factory in Karnataka, MCF closed down its operations on October 1 on account of the government policy of stopping subsidy to units using naphtha as feedstock for urea production.

Earlier, the Centre had directed five naphtha-based fertiliser units in the country, including MCF, to switch over to gas as the raw material for production of urea by June 30, and subsequently extended the deadline to September 30.

The government had said subsidy would not be paid to these units for using naphtha as feedstock under the New Pricing Policy III, beyond the deadline, due to the high cost of production.

Siddaramaiah, who met the minister at his office here, raised the issue and sought the Centre’s help to resume MCF’s operations in the interest of farmers as well as protect the interest of employees working at the factory. Kumar said he was aware of the issues related to MCF. Kumar also promised to extend help to set up a new fertiliser factory in northern Karnataka.

To attract more investments in the chemical and fertiliser sector in Karnataka, Kumar agreed to hold an investor summit in Bangalore in association with the Karnataka government.

In August, the Cabinet Committee on Economic Affairs (CCEA) had approved continuation of production of urea from Madras Fertilisers, MCFL and Southern Petrochemical Industries Corporation (SPIC), using naphtha as feedstock for a duration of three months ending on September 30.

MCFL is the only fertiliser plant in Karnataka and has been a takeover target for Deepak Fertilisers which made a bid for the company in October this year.

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