Chemical fertilizer factory feasible in Nepal; study committee

Kathmandu: It seems appropriate to establish and operate a chemical fertilizer factory in Nepal. The Preliminary Study Committee for the Establishment of Chemical Fertilizer Factory formed under the coordination of Finance Minister Bishnu Prasad Poudel has prepared a report with suggestions for the establishment and operation of a fertilizer factory based on natural gas technology.

“From the point of view of initial capital investment, return on investment and profitability, it seems more appropriate to set up a fertilizer factory based on natural gas technology than other technologies,” the report said.

According to the report, the establishment of a fertilizer factory based on natural gas technology will be a sustainable solution to the supply of fertilizer and will contribute to the economic development of the country by increasing agricultural production and productivity.

The committee concluded that the subsidy provided by the government could be saved by setting up a fertilizer factory based on natural gas technology in Nepal for the time being as natural gas, thermocol and water electrolysis technology are in vogue for the production of chemical fertilizers globally.

The government has allocated Rs. 11 billion in the current fiscal year to provide subsidy to the farmers for the purchase of chemical fertilizers. In the previous Fiscal Year, Rs. 10.52 billion was allocated and provided.

The committee has suggested that the initial investment of Rs. 103 billion for the establishment of chemical fertilizer factory based on natural gas technology and Rs.

The committee also suggested that it would be appropriate to operate a project to set up a fertilizer factory in a public-private partnership modality. The report states that the obligation to import chemical fertilizers using foreign exchange worth about Rs 16 billion annually as an opportunity for manure production based on natural gas technology will be eliminated, trade deficit will be reduced and farmers will not be able to get fertilizer on time. .

According to the ministry, capital management, attracting investors, choosing a suitable location for setting up a factory, investment and construction of capital structure have been mentioned as challenges for setting up a fertilizer factory.

The committee officials have submitted a study on the establishment of chemical fertilizer factory in Nepal and its findings to Prime Minister KP Sharma Oli on Sunday. Prime Minister Oli said that although it would be appropriate to go for natural gas technology for the time being, it was necessary to conduct a detailed study on water electrolysis technology as raw materials are available in Nepal.

There is a demand of about 800,000 metric tons of manure in Nepal and the potential demand for chemical manure is estimated to be around 2 million metric tons in the next few years as the use of chemical manure based on crop diversification is also increased.

A meeting of the Council of Ministers of the Government of Nepal held on October 8 formed a committee comprising the Minister of Industry, Commerce and Supplies and the Minister of Agriculture and Livestock Development under the coordination of the Finance Minister to conduct a preliminary study on the establishment of chemical fertilizer factories in Nepal.

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