Cabinet approves marketing margin for supply of domestic gas to fertilizer (Urea) for period May, 2009 - Nov, 2015

New Delhi [India], February 1 : The Union Cabinet, chaired by Prime Minister Narendra Modi, gave its approval for the determination of the marketing margin for the supply of domestic gas to fertilizer (urea) units for the period from May 1, 2009, to November 17, 2015.
This approval is a structural reform. Marketing margin is charged by gas marketing companies to consumers over and above the cost of gas for taking on the additional risk and cost associated with the marketing of gas. The government had previously determined the marketing margin for the supply of domestic gas to urea and LPG producers in 2015, according to a statement released by the cabinet on Thursday.
The approval will provide additional capital to the various fertilizer (urea) units for the component of marketing margins paid by them on domestic gas procured during the period from May 1, 2009, to November 17, 2015, based on rates already being paid from November 18, 2015, onwards, the statement added further.
The center mentioned that the step was taken to give a boost to the objective of achieving self-reliance.
In line with the government vision of Aatma Nirbhar Bharat, this approval will incentivize manufacturers to increase investment.
The increased investment will lead to self-sufficiency in fertilizers and provide an element of certainty for future investments in the gas infrastructure sector, according to the statement.