Rashtriya Chemicals stake sale on Cabinet agenda

Last Updated: Wed, Dec 19, 2012 20:53 hrs

Riding high on NMDC stake sale garnering Rs 6,000 crore, the Cabinet is expected to discuss on Saturday a proposal to sell 12.5 per cent of its 92.5-per cent stake in state-run Rashtriya Chemicals and Fertilizers Ltd (RCF).

Officials said the Cabinet is also expected to discuss a proposal from the agriculture ministry to raise the minimum support price (MSP) of wheat for the 2013-14 crop marketing season, which starts from

April 1, by Rs 100 a quintal — to Rs 1,385 from Rs 1,285 a quintal. It might also consider a proposal to export 2.5 million tonnes of wheat from central stocks to create additional storage space, they added. The Cabinet had earlier this year cleared the disinvestment of Nalco, Hindustan Copper Ltd, MMTC and Hindustan Aeronautics Ltd, along with a few more companies, in its bid to earn Rs 30,000 revenue from disinvestment of public sector undertakings in the current financial year.

Of this, it has earned Rs 800 crore from the stake sale in Hindustan Copper Ltd, Rs 114 crore from the stake sale in NBCC. NMDC stake sale collected Rs 6,000 crore. The government expects to earn Rs 13,000 crore from the stake sale of NTPC.

The Cabinet had deferred a decision on changing the minimum support price (MSP) of wheat for the 2013-2014 crop marketing season (April-March) because of differences between ministries over the Commission for Agricultural Costs and Prices (CACP)’s recommendation to the freeze the price at Rs 1,285 a quintal.

The freeze was suggested in view of rising wheat stocks in the central pool and also to encourage farmers to shift from cultivating just cereals to oilseeds and pulses, imports of which have risen on a steady scale.

Officials said while the department of food was not in much favour of significant hike in MSP of wheat because of the burgeoning stocks and adverse impact on rising food subsidy, the ministry of agriculture was of the view that a bonus of 10 per cent should be declared upfront to compensate farmers for rising cost of diesel.

CACP, in its revised recommendations, did not suggest any change in its suggestion of freezing MSP at Rs 1,285 a quintal, but instead recommended a bonus of Rs 40 per quintal, provided the government manages to liquidate 15 million tonnes of wheat by March 31, 2012.

Officials said the department of agriculture has rejected both the recommendations of CACP.

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