Govt faces higher import costs for fertiliser

The country will have to import fertiliser at higher prices from the international market in the wake of the global price hike due to the Russia-Ukraine war.

The government will import diammonium phosphate (DAP) fertiliser at $21 higher than the per-tonne price in the previous procurement.

The cabinet committee on purchase in a meeting yesterday approved import of 40,000 tonnes of DAP fertiliser at a cost of Tk 407.41 crore from OCP SA, a fertiliser producer in Morocco.

Finance Minister AHM Mustafa Kamal chaired the meeting.

While addressing a virtual press briefing after the meeting, Zillur Rahman Chowdhury, additional secretary of the Cabinet Division, said the DAP fertiliser would cost $1,177.50 per tonne this time. The price in the previous procurement was $1156 per tonne.

Agriculture Minister Abdur Razzak in a meeting on Saturday also said in the 2021-22 fiscal year, the government had to give Tk 30,000 crore as fertiliser subsidy for farmers due to the global price hike.

The average price of DAP fertiliser rose to a record high of $1,014 pert tonne in the global market in March this year, up from $874 per tonne immediately before the Russian invasion of Ukraine in February.

The average price was $616 per tonne a year ago.

Price of ureaalso rose to $976 per tonne in March, against $885 in February.

At the start of the fiscal year, the finance ministry allocated Tk 9,500 crore as subsidy for agriculture, but in the revised budget it was fixed at Tk 15,000 crore.

However, the government has settled procurement of liquified natural gas (LNG) from the spot market at a slightly cheaper rate.

The purchase committee yesterday approved import of 33.60 lakh MMBTU (Metric Million British Thermal Unit) of LNG at a cost of Tk 909.14 crore from M/s Vitol Asia Pte Ltd, Singapore.

Zillur said it was good news that LNG was being procured at a lower price than before.

He added that per unit LNG would cost $26.40, while the previous unit price was at $29.25.

Meanwhile, the cabinet committee on economic affairs yesterday approved appointment of a Chinese company to collect tolls of the Bangabandhu Sheikh Mujibur Rahman Tunnel being built under the Karnaphuli river in Chattogram.

China Communications Construction Company Ltd has been appointed as the service provider or operator for maintenance and toll collection of the 3.32km long tunnel.

The total length of the tunnel with approach road is 9.39km.

The same company is constructing the underwater expressway tunnel.

In November 2015, the Executive Committee of the National Economic Council (Ecnec) approved the much-hyped multi-lane road tunnel project at a cost of Tk 8,446.64 crore. The cost later rose to Tk 10,374.42 crore.

Project Director Harunur Rashid Chowdhury told The Daily Star yesterday that the project has so far seen physical progress of 85 percent, using 73 percent of the total cost.

The project is scheduled for completion in December this year.

When asked about timely completion of the project, the project director said, "We are working to complete the work in the scheduled time and we are not certain whether we will be able to do so."

The purchase committee yesterday also approved the increased cost of feasibility study for the construction of a new international airport outside Dhaka.

The cost went up by around 11 percent to Tk 129 crore.

The committee approved a proposal to provide additional Tk 13.36 crore to Japanese consultant firm Nippon Koei Company Ltd under the ''Detailed Feasibility Study (1st Revised)" project of the Bangabandhu Sheikh Mujib International Airport Project.

Additional Secretary Zillur at the briefing said it is taking more time to conduct the feasibility study due to the local people's movement against the government plan of building the airport in Munshiganj as well as complications caused by the Covid-19 pandemic.

The cost of the airport construction may rise because of the delay, he said.

He said the other option for a site for the new airport is around 60,000 acres in Madaripur, which is far from Dhaka.