New Delhi: The Union Cabinet chaired by Prime Minister Narendra Modi has given its approval for the determination of marketing margin on 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 company from consumers over and above the cost of gas for taking on the additional risk and cost associated with marketing of gas. The government had previously determined marketing margin on the supply of domestic gas to urea and LPG producers in 2015,” said an official statement.
The approval will provide additional capital to the various fertiliser (Urea) units for the component of marketing margins paid by them on domestic gas procured during the period May 1, 2009 to November 17, 2015, based on rates already being paid from November 18, 2015 onwards.
“In line with the government’s vision of Aatmanirbhar Bharat, this approval will incentivise manufacturers to increase investment. The increased investment will lead to self-sufficiency in fertilizers, and provide an element of certainty for future investments in gas infrastructure sector,” said the statement.