Govt subsidy benefits fertiliser stocks

Fertiliser stocks were in demand on reports the government has paid about Rs 28000 crore as subsidies to fertiliser producers till July-end and plans to pay Rs 8000 crore per month until February 2009.

National Fertilizer (up 2.89% at Rs 58.75), Nagarjuna Fertilizers and Chemicals (up 2.25% at Rs 40.85), Chambal Fertilizers and Chemicals (up 1.84% at Rs 80.20), GSFC (up 1.64% at Rs 164.05), and RCF (up 1.19% at Rs 68), rose.

According to reports, the fertiliser ministry is expecting that the amount will be mostly paid in cash.

The subsidy burden has reportedly shot up to Rs 1,20,000 crore but the government has sanctioned only Rs 31,000 crore in the Union Budget 2008-09. The ministry of chemicals and fertilisers had earlier expected fertiliser subsidy burden at Rs 95,000 crore for the current year, more than double than the last year's figure of Rs 45,000 crore.

The reports quoted Union fertiliser secretary Atul Chaturvedi as saying that the government will even release more than Rs 1,20,000 crore, if the subsidy burden crosses