Coal India may walk out of fertiliser JV in Odisha
29 Mar 2014
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State-run Coal India Ltd is likely to walk out of a joint venture for a fertiliser plant in Odisha, putting a question mark on the government's ambitious Rs8,000-crore programme to revive the Talcher unit of the Fertiliser Corporation of India Ltd (FCIL) with investments from cash-rich PSUs.
According to The Financial Express, sources in the government said CIL, which was to hold 35-40 per cent in two JV companies proposed under FCI's Talcher unit, has expressed its inability to participate in the initiative saying the company's memorandum of association (MoA) barred it from making investments in the fertiliser business.
''We have asked the coal secretary to look into the issue and get a CIL board approval to modify its MoA and fast-track investment proposals for the fertiliser plant. But, as of now, the plan has come to a grinding halt,'' said an official in the fertiliser ministry with direct knowledge of the development, according to the report.
While CIL officials remained unavailable for comment, sources in the company said that fertiliser manufacturing was not core to company's expansion plans, especially at a time when it needs to pump money to increase coal production. ''But a directive from the government cannot be ignored,'' sources said.
According to The Financial Express, sources in the government said CIL, which was to hold 35-40 per cent in two JV companies proposed under FCI's Talcher unit, has expressed its inability to participate in the initiative saying the company's memorandum of association (MoA) barred it from making investments in the fertiliser business.
''We have asked the coal secretary to look into the issue and get a CIL board approval to modify its MoA and fast-track investment proposals for the fertiliser plant. But, as of now, the plan has come to a grinding halt,'' said an official in the fertiliser ministry with direct knowledge of the development, according to the report.
While CIL officials remained unavailable for comment, sources in the company said that fertiliser manufacturing was not core to company's expansion plans, especially at a time when it needs to pump money to increase coal production. ''But a directive from the government cannot be ignored,'' sources said.
