By Nikunj Ohri and Sarita Chaganti Singh
NEW DELHI (Reuters) – State-run firms, Coal India, GAIL India, and Rashtriya Chemicals & Fertilizers (RCF), will invest 30.95 billion rupees ($371.90 million) in their fertiliser joint venture in Odisha, two government officials told Reuters.
GAIL and RCF will put in 17.3 billion rupees, while Coal India will invest 13.64 billion rupees in Talcher Fertilizers to maintain their current stakeholding, adjusted for an increase in project costs, said the sources, who are not authorised to speak to the media.
Each of the three firms holds a 31.85% stake in Talcher Fertilizers.
Coal India will need a federal cabinet nod for the infusion as the company has hit its investment ceiling, the sources said, adding that the cabinet is likely to take a call in the coming weeks.
Project cost at Talcher Fertilizers has increased, with the government trying to boost the facility’s output to reduce India’s dependency on imports for nitrogen-based urea fertilisers.
The infusion is aimed at reviving Talcher and turning it into a coal gasification-based urea fertiliser plant with an annual capacity of 1.27 million tons. India imported 22 million tons of fertilisers worth $15.3 billion last fiscal year.
“It was a collective decision of all promoters to infuse proportionate amount in equity, but Coal India requires approval to lift that 30% investment cap limit,” an official said.
India’s finance ministry, Coal India, and GAIL India did not reply to emails seeking comments. An email query sent to Talcher Fertilizers’ managing director, and calls made to RCF’s office went unanswered.
($1 = 83.2525 Indian rupees)
(Reporting by Nikunj Ohri and Sarita Chaganti Singh; editing by Eileen Soreng)