Remaining subsidy payments to fertilizer companies approved

subsidy to fertilizer companies

Question: Recently, the Cabinet Committee on Economic Affairs approved the proposal of the Fertilizer Department for the implementation of special banking system for the amount of outstanding subsidy payments to fertilizer companies during the year 2016-17. This amount is-
(a) 8,985 crores
(b) 9,969 crore
(c) 10,000 crores
(d) 12,000 crores
Answer: (c)
Related Facts:

  • On November 1st, 2017, the Cabinet Committee on Economic Affairs chaired by the Prime Minister has accorded the ex-post facto approval for implementation of Special Banking Arrangement (SBA) for Rs. 10,000 crore for payment of outstanding claims on account of fertilizer subsidy in the year 2016-17.
  • It is known that under this special banking arrangement, a loan of Rs 9,969 crore was taken from State Bank of India (SBI) for disposal of outstanding bill of subsidy by the government.
  • The government paid the above loan amount to SBI with an interest liability of Rs 80.90 crore.
  • It is worth mentioning that Government is making available fertilizers, namely Urea and 21 grades of P&K fertilizers to farmers at subsidized prices through fertilizer manufacturers/importers.

Reference:
http://pib.nic.in/newsite/PrintRelease.aspx?relid=173137
http://www.news18.com/news/business/cabinet-approves-special-banking-arrangement-for-paying-subsidies-to-fertiliser-firms-1564037.html