Dom-at of

The World BankFOR OMCIL USE ONLY

Report No. 6297.

PROJECT COMPLETION REPORT

INDIA - FERTILIZER INDUSTRY CREDIT

(CREDIT 598-IN)

June 23, 1986

Industry Department

This document has a restricted disttibution and may be used by recipients only in the performanceof teit officl duties. Its contents may not otherwise be disclosed without World Bank authorization.

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FOREIGN EXCHANGE RATES

Mo/Year

Appraisal 04/75 US$1 - Rupees 7.85Board Approval 12/75 US$1 - Rupees 7.80Credit Closing 12/82 US$1 = Rupees 9.70Project Completion Report 02/86 US$1 - Rupees 12.50

FISCAL YEAR

April 1 - March 31

ABBREVIATIONS

ASC - Administrative Staff College of India, HyderabadCFL - Coromandel Fertilizers Ltd.DOA - Department of AgricultureFCI - Fertilizer Corporation of IndiaGOI - Government of IndiaGSFC - Gujarat State Fertilizers Ltd.HFC - Hindustan Fertilizers Corporations Ltd.HPCL - Hindustan Petroleum Corp.HSC - Hindustan Steel Corporation Ltd.IDBI - Industrial Development Bank of IndiaIPFCO - Indian Farmers' Fertilizers Cooperative Ltd.MFL - Madras Fertilizers Ltd.NCAER - National Council of Applied Economic ResearchNFL - National Fertilizers Ltd.NLC - Neyveli Lignite Corp.PDIL - Planning and Development India Ltd.RCF - Rashtriya Chemicals & Fertilizers Ltd.RITES - Railway Investigation Transport Engineering ServicesSAIL - Steel Authority of India, Rourkela (the new name of HSC)SPIC - Southern Petrochemical Industries Corp.ZAC - Zuari Agrochemicals Ltd.

FOR OFFCIAL USE ONLYTHE WORLD SANK

Washington, D.C. 20433U.S.A.

OIice of Dirctor-CetalOpeations Vu4ut

June 23, 1986

MEMORANDUM TO THE EXECUTIVE DIRECTORS AND THE PRESIDENT

SUBJECT: Project Completion Report: India - Fertilizer Industry Credit(Credit 598-IN)

Attached, for information, is a copy of a report entitled"Project Completion Report: India - Fertilizer Industry Credit(Credit 598-IN)" prepared by the Industry Department. Under themodified system for project performance auditing, further evaluationof this project by the Operations Evaluation Department has not beenmade.

Yves Rovani

By Otto Maiss

Attachment

This document has a restricted distribution and may be used by recipients only in the performanceof their official duties. Its contents may not otherwise be disclosed without World Bank authorization.

FOR OFFICIAL USE ONLY

PROJECT COMPLETION REPORT

INDIA-FERTILIZER INDUSTRY CREDIT(CREDIT 598-IN)

TABLE OF CONTENTS

Page No.

PREFACE ................. . ....... , ..... ...... iBASIC DATA SHEET ... ................. iiHIGHLIGHTS v

Io INTRODUCTION ........... 1

II. PROJECT BACKGROUND ................... ......... . .. I

A. Project Origin, Preparation, Appraisal, Approval andCredit Effectiveness .................. 1

B. Project Description and Objectives 2C. Project Scope Revision 4D. Subprojects Characteristics 5Ea Project Cost ........ 6F *Credit Allocation 8G. Sub-borrowers Characteristics . ....... 8

III. PROJECT IMPLEMENTATION AND MANAGEMENT ............ 9

A. Achievement of Project Objectives ..... 9B. Project Management ................... . 10C. Technical Assistance and Training .... 11D. Use and Performance of Engineering Contractors 11E. Transfer of Technology ... . . . .... 12F. Procurement and Performance of Suppliers 12G. Implementation Schedule 12

IV. OPERATING PERFORMANCE ... .......... ........ 13

A. Commissioning and Start-up 13B. Production and Capacity Utilization 13

V. FINANCIAL PERFORMANCE ................ 14

A. Financial Rates of Return 14B. Financial Performance 15

VI. SECTORAL AND ECONOMIC PERFORMANCE ......... 17

A. Economic Rates of Return 17B. Stability of Fertilizer Supply ....... 0...40000......... 17C. Environmental Aspects 18

This document has a restricted distribution and may be used by recipients only in the performanceof their official duties. Its contents may not otherwise be disclosed without World Bank authorization.

TABLE OF CONTENTS (Cont'd)

Page No.

VII. ASSOCIATION PERFORMANCE .............. 18

VIII. LESSONS LEARNED ................. ............................. 19

ANNEXES

2-1 Revision of Project Scope ........ .... ... ... ....... ................ . 212-2 Project Cost and Credit Allocation ........................... 222-3 Production Trends of India's Fertilizer Plants, 1981/82-1984/85 ... 23

3-1 Disbursement Schedule for the Credit ... o ........................ 24

5-1 Retention Price Formula * *** ... ***.......... *............ .... . .............. 255-2 Financial and Economic Rates of Return for Select*O Subprojects .. 265-3 Summary of Financial Information for Selected Sub-borrower's ... ... 27

6-1 Historical Consumption, Production, and Import of Fertilizersin India, 1983/84 .............................................. 28

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PROJECT COMPLETION REPORT

INDIA-FERTILIZER INDUSTRY CREDIT(CREDIT 598-IN)

PREFACE

1. The Association approved a credit of US$105.0 million equivalent(Credit 598-IN) on December 31, 1975 to the Government of India (GOI) toassist India's fertilizer industry to modernize its existing productionfacilities, eliminate bottlenecks in prodtuction, improve pollution controlsystems, and install energy-efficient equipment. Under the Credit,thirty-six subprojects have been implemented by 13 subborrowers in thepublic, private and joint sectors, accounting for 65% of India's fertilizermanufactiprers. The Credit was onlent to beneficiaries, partly through theIndustrial Development Bank of India (IDBI) with funds earmarked. Inaddition, GOI sponsored three fertilizer industry related studies undertechnical assistance.

2. The Project was designed as a pilot project of a new type ofprogram lending which is tailored for a specific industry with a number offirm subproject components. As compared with traditional program or sectorloans whose subproject contents were selected and implemented under theinitiative of governments, the Project was designed to enable theAssociation to establish direct relationships with subproject executingentities. Therefore, all the subprojects under the Project were appraisedindividually by the Association mission during appraisal, and included inthe Project scope as firm components. In the course of Project implementa-tion, however, the original concept of the Project proved to be difficultto manage, as most of the subprojects were dropped and had to be replacedby others with similar objectives. Out of nineteen original subprojects,nine were dropped and replaced by twenty-six new subprojects. Against thisbackground, this Project Completion Report (PCR) has been prepared partlyfollowing the line used in preparing the PCR for Development FinanceCorporation (DFC) projects within the basic framework used for normalindustrial projects.

3. In accordance with the revised project performance reportingprocedures this report has been read in the Operations Evaluation Department(OED) but the project was not audited by OED staff. The draft CompletionReport was sent to the Borrower for comments; however, none were received.

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PROJECT COMPLETION REPORT

INDIA-FERTILIZER INDUSTRY CREDIT(CREDIT 598-IN)

BASIC DATA SHEET

KEY PROJECT DATA

Appraisal Actual andItem Estimate Final Estimates

Project Cost (US$ million) 238.7 169.2

Cost Underrun or Overrun (%) - 29.1

Number of Subprojects 22 a/ 39 a/

Credit Amount (US$ million)

Disbursement 105.0 101.9Cancelled - 3.1

Project Cost and Credit Allocation by Sub-borrower

Credit Project CreditProject Allocation Cost Allocation

FCI ) ) 3.4 2.2RCF ) ) 19.9 13.0HFC ) 79.0 ) 38.5 b/ c/ 35.4 20.9NFL ) ) 4.5 3.4PDIL ) ) 0.4 0.4NLC 19.5 12.0 21.1 10.9HSC (SAIL) 26.1 15.5 22.2 16.2GSFC d/ 20.6 9.0 17.1 4.5SPIC d/ 46.2 14.0 12.3 8.1HPCL 25.9 4.0 - -ZAC d/ 10.2 6.0 13.6 10.5CFL e/ 8.5 4.0 3.1 1.7MFL e/ 1.7 1.0 0.8 0.5IFFCO d/ - - 17.1 10.2DOA 1.0 1.0 0.4 0.4

Total 238.7 105.0 169.2 101.9

a/ Three fertilizer related studies are included.b/ This amount was allocated to FCI before its restructuring into five

companies.c/ Equipment procured by PDIL, which was FCI's engineering department

prior to its restructuring, has been allocated to other operatingcompanies.

d/ Credit proceeds were onlent to these subborrowers through IDBI.e/ Credit proceeds were sold by the Borrower to these two companies.

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Cumulative IDA Loan Disbursement

FY76 FY77 FY78 FY79 FY80 FY81 FY82 FY83l ~~~~

AppraisalEstimate 13.6 34.6 84.0 105.0 - - - -

Actual 1.0 7.5 18.0 35.9 60.0 83.6 96.9 101.9

Stabilized Capacity Utilization of Major Plants under the Project (%)

After Project a/Company Plant Before Project Appraisal Actual

FCI Urea 54 80 59RCF Ammonia 76 80 89

Phosphoric Acid 61 80 78HFC Urea 38 80 37NLC Urea 56 80 76SAIL Calcium Ammonium Nitrate 39 80 34GSFC Urea 72 80 86

Phosphoric Acid 55 80 86SPIC Ammonium/Urea 73 80 96CFL Ammonia/Urea 76 80 84ZAC Ammonia/Urea 87 80 89IFFCO Ammonia 92 N/A 95

AppraisalEstimate Actual

Financial Rate of Return (Z) 14-60% 2-12%

Economic Rate of Return (%) 18- 100% 12-100%

OTHER DATA

First Mention in Files 09/74Preappraisal Mission 01/75Appraisal Mission 04/75Negotiations 11/75Board Approval Date 11/16/75Loan Signature Date 12/31/75Effectiveness Date 03/01/76Original Closing Date 06/30/80Actual Closing Date 12/31/82Borrower GOIExecuting Agency 13 Fertilizer Companies

and GOI

a/ Average capacity utilization for four years after the Project.

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MISSION DATA

Mission Mo/Yr. No. of Weeks Persons Report Date

Identification }1/74 1/2 1 12/05/74Preparation/Preappraisal 01/75 3 7 02/07/75Appraisal 04/75 3 4 05/23/75Supervision 05/76 2 4 05/25/76Supervision 11/76 3 2 12/10/76Problem ProjectBrief 03/77 - - 03/24/77Supervision 07/77 2 2 08/09/77Supervision 11/77 1 1 01/04/78Supervision 03/79 1/2 1 05/29/79Supervision 12/80 1/2 1 02/03/81Supervision - 1 07/12/82

PROJECT COMPLETION REPORT

INDIA-FERTILIZER INDUSTRY CREDIT(CREDIT 598-IN)

HIGHLIGHTS

1. In mid-1970, India's fertilizer industry operated at a level ofcapacity utilization below 60%, mainly due to bottlenecks in ntilitiessupply, the use of old technology and process design faults. The Projectwas aimed at assisting India to remove the various obstacles to efficientoperation of the fertilizer industry. The subprojects implemented underthe Project include plant modifications, establishment of additionalstorage facilities, installation of captive powvr and energy savingequipment, and improvement of pollution control and testing facilities(paras. 1.01, 2.04-2.08).2, The Project achieved most of its original objectivessuccessfully. Rehabilitation/debottlenecking subprojects have contributedto an overall increase in capacity utilization at most of the existingproduction facilities, as anticipated at appraisal. After the Project,capacity utilization of the subproject entities, except for three companieswhich suffered from other unanticipated bottlenecks such as region-wideelectricity interruptions, has increased substantially. The industry-widecapacity utilization has reached 74% for nitrogenous plants and 89% forphosphatic plants by 1984/85 as compared with the low level of helow 60% inthe mid-1970s (para. 3.01).

3. Besides the improvement in capacity utilization, the Project alsocontributed to the upgrading of the industry's management efficiency andfinancial situation. Following IDA's recommendation, the giant publicsector company, Fertilizer Corporation of India (FCI), which had beenoperating several large scale fertilizer plants throughout India withinadequate management controls, was restructured into five smaller andmore manageable regional corporations. Also, fertilizer prices whichstayed at an extremely low level in the mid-1970s, not sufficient for evenefficient fertilizer manufacturers to generate positive cash flow, weresubstantially raised to allow efficient fertilizer manufacturers to becomefinancially sound. The retention price formula, which was Introduced in1977 at IDA's recommendation, was designed to enable efficient operators torealize a 12% after tax return on investments (paras. 7.03-7.04).

4. Even though the Project has ultimately achieved most of itsoriginal objectives, it encountered considerable difficulties inimplementation. The Project scope changed substantially several times:nine subprojects in the original subproject list of 19 were dropped andreplaced by 26 other subprojects; the Project was completed 52 monthsbehind original schedule; and a portion of the credit (US$3.1 million outof US$105 million) had to be cancelled because GOI could not prepare intime the needed replacement subprojects (paras. 3.11-3.13).

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5. From the problems experienced in Project implementation, threemajor valuable lessons have been learned. One lesson was that a projectinvolving various types of small subprojects by a number of entities shouldbe coordinated by a central unit within the country charged with theresponsibility for monitoring and coordinating the Project, preferably atthe government level. Even though this was envisaged in the Project, itwas not put into effect. The other lesson was that the Project should havebeen designed to include a smaller number of relatively large subprojectsif the original approach were to be workable. Another lesson was that aproject involving a number of subproject entities requires a good progressand completion reporting system using a etandardized format and content.Due to the inefficient reporting system, the Ministry of Chemical Industrycould not consolidate the subproject data and prepare its draft ProjectCompletion Report (PCR) (paras. 8.01-8.04).

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PROJECT COMPLETION REPORT

INDIA-FERTILIZER INDUSTRY CREDIT(CREDIT 598-IN)

I, INTR0DUCTION

1.01 The dramatic fertilizer price increase in the early 1970s hitfertilizer importing countries, including India, presenting a major threatto the exploitation of the full potential of high yielding varieties, andthus the food self-sufficiency programs of these countries. In 1974/75India was importing 48% of its total nitrogen (N) fertilizer requirements,52% of its phosphate (P) consumption, and 100% of potash (K) requirements.Fertilizer imports had been far bigger than previously expected mainlybecause actual domestic production had fallen short of expectations due tolow capacity utilization of installed fertilizer capacity. Major reasonsfor the low capacity utilization were: (i) use of old technologies; (ii)process design faults; (iii) shortage of electric power and otherutilities; (iv) shortage of raw materials; (v) management/labor problems;(vi) financing gaps; and (vii) technical limitations. Because of theseconstraints, the target of reducing its dependence on imports down to 30%during the Fifth Five-Year Plan (1974/75-1978/79) appeared difficult toachieve.

1.02 Against this background, India prepared an investment program incollaboration with the Association aimed at expansion of its domesticfertilizer production base by enhancing the capacity utilization ofexisting facilities through rehabilitation/debottlenecking. At GOI'srequest, IDA provided assistance to implement the program. Under theProject thirty-five subprojects have been implemriated to modernizetechnology, eliminate bottlenecks, improve efficiency of energy use andreduce the level of polluting effluents. The Project was initiated inSeptember 1974, appraised in April 1975, approved by the Board in November1975, and completed in April 1984, 52 months behind schedule.

II. PROJECT BACKGROUND

A. Project Origin, Preparation, Appraisal, Approval and CreditEffectiveness

2.01 Since 1967 the Association had been involved in the Indianfertilizer sector by financing the establishment of several grassrootfertilizer production facilities in India. To meet the increasing needs ofthe agriculture sector, GOI initiated a program in 1974 to expand domesticfertilizer production under the Fifth Five-Year Plan. The programconsisted of two parts: (i) expansion of grassroot fertilizer productioncapacities; and (ii) improvement of capacity utilization of existing plantswhich then were operating at below 60% of their designed capacities. InSeptember 1974, GOI reviewed the possibility of Bank Group assistance in

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implementing the latter part of the program in a meeting with a Bankmission then visiting India, and subsequently requested an IDA credit ofUS$105 million for its financing. Following an identification mission inNovember 1974 to assist in the preparation of subprojects to be implementedunder the Project, a preappraisal mission visited India in January 1975,agreed with GOI on the project scope, capital cost estimates, and IDArole. The Project was appraised in April/May 1975. The IDA Credit wasnegotiated and approved by the Board of the Association in November 1975.It became effective on March 1, 1976.

2.02 The subprojects in the original list of the Project were selectedafter detailed discussions with the concerned fertilizer companies andreview with GOI to ensure their quick implementation. However, thesubproject approval procedures within the companies and in the Governmenttook a long time. In the process, almost half of the original subprojectswere dropped and replaced with others having similar objectives. Becauseof substantial delays in the start of implementation, a Problem ProjectBrief was prepared in March 1977 delineating the problems facing theProject. The contents of subprojects were revised several times in orderto substitute problem subprojects with new ones. As a result, thecompletion date of the Project which was originally set for December31, 1979 was postponed three times, The cumulative delay in Projectimplementation was 52 months.

2.03 The Credit was made to GOI on standard IDA terms. Abouttwo-thirds of the Credit (US$67.0 million equivalent) was onlent by GOIdirectly to public sector companies; and the remaining one-third (US$33.3million equivalent) onlent to private sector companies through theI.ndustrial Development Bank of India (IDBI). The balance of Creditproceeds (US$2.2 million equivalent) was sold by the Borrower to twocompanies at the prevailing exchange rates.

B. Project Description and Objectives

2.04 The objectives of the Credit were to: (i) assist in removingvarious limitations facing the Indian fertilizer industry and therebyraise production in the existing facilities from the then industry-wideaverage level of less than 60% to about 80-90% capacity utilization; (ii)help several companies install pollution control facilities consistent withthe agreed environmental standards; and (iii) provide technical assistanceto facilitate fertilizer sector planning at the Government level.

2.05 Project components were selected after reviewing the needs of theIndian fertilizer industry with the Ministry of Petroleum and Chemicals(MPC) and the fertilizer producing companies. Nineteen originalsubprojects were selected to be carried out by nine companies; threefertilizer sector studies were included to help GOI in its sector planning.

2.06 The original subprojects under the Project, and their respectivesponsors and objectives are summarized below:

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Original Project Sponsors and Subprojects

SubprojectSponsor Subproject Objective

1. Fertilizer Corporation - Boiler/power set Reduction of the plant'sof India (FCI) at Gorakhpur dependence on outside

power supply

- Boiler/power setat Durgapur

- Boiler at Trombay Additional steamgeneration

- Ammonia tank wagons Increase in operationaland storage at stabilityTrombay

- Pollution control Environmental protectionand testing equip-ments

2. Neyveli Lignite - Feedftock conver- Conversion of feedstockCorpration (NLC) sion from lignite to fuel oil

3. Hindustan Steel - Feedstock conver- Conversion from coke gasCorporation (HSC) sion to naphtha

4. Gujarat State - Purge gas recovery Energy efficiencyFertilizer Corp. (GSFC) - Fluorine Recovery Recovery of fluorine

from gaseous effluent- Phosphoric acid plant modernization

plant debottle-necking

5. Hindustan Petroleum - Refinery debottle- Expansion of productionCorp. (HPCL) necking capacity

6. Madras Fertilizers Ltd. - Urea debottleneck- Plant modernization(MFL) ing

- Ammonia process Process computerizationcontrol unit

7. Southern Petrochemical - Fluorine recovery Recovery of fluorineIndustries Corp. (SPIC) from effluent

- Soda ash plant Conversion of excessammonia

8. Coromandel Fertilizers - Boiler/power set Increase in reliabilityLtd. (CFL) of power supply

- Fluorine recovery For planned aluminumfluoride plant

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9. Zuari Agro Chemicals - Ammonia plant Plant modernization(ZAC) debottlenecking

- Urea plant pollu- "tion control

10.GOI (technical Assistance) - Various Fertilizer Study on FertilizerRelated Studies demand projections,

distribution, andtransportation.

C. Project Scope Revision

2.07 The Project scope was substantially revised four times as shownin Annex 2-1, and summarized below.

Project Scope Change in Subprojects a/

1st 2nd 3rd 4thOriginal Revision Revision Revision Revision(Dec. 1975) (Mar. 1978)(Jan. 1980)(Jun. 1980)(April 1981)

Addition ofNew Subprojects 19 17 5 1 4

Drop ofSubprojects - 9 1 - -

Total Number ofSubprojects 19 27 31 32 36

= _ _ =

Number ofSub-borrowers 9 7 13b/ 13 13

Number ofPlants involved 11 14 15 15 15

a/ Excluding three study components under technical assistance.b/ FCT has been restructured into five companies.

Although the Project was originally to include nineteen firm subprojectcomponents appraised individually as normal industrial projects, thecompanies decided not to proceed with several of them and they werereplaced by a number of smaller subprojects with similar objectives. Outof the nineteen original subprojects1/, nine subprojects were droppedand replaced by twenty-six others.

1/ Three studies under technical assistance are excluded hereafter unlessotherwise indicated when subprojects are mentioned.

2.08 There were three major reasons for the cancellation of 9 of theoriginal subprojects. First, four original subprojects were dropped due togovernment decisions. Three planned flourine recovery subprojects weredropped by the sponsors (GSFC, SPIC, CFL) in light of the GOI decision thatthese subprojects should be based on commercially unproven Indiantechnology rather than the internationally-available and proventechnology. The HPCL's refinery debottlenecking subproject was dropped inview of the proposed new Mathura refinery which was to be established inthe same marketing area. Second, financial constraints led to thecancellation of a chlorine/soda ash subproject sponsored by SPIC. Thissub-project was subsequently implemented without Bank Group financing. Asits financial situation improved, SPIC implemented three other smallersubprojects later. Third, two other companies voluntarily decided not toproceed with their subprojects for technical and economic reasons. Ammoniaprocess control (MIC) and boiler (FCI) were cancelled voluntarily by thesubproject entities. Replacement subprojects were provided, reviewed andaccepted by the Association.

D. Subprojects Characteristics

2.09 The thirty-nine subprojects implemented are grouped into fourmain categories: (i) fertilizer capacity expansion and process efficiencyimprovements including plant modification/rehabilitation and additionalstorage of intermediate product; (ii) capture power and utilities; (iii)pollution control and testing equipment; and (iv) fertilizer relatedstudies. The table below compares the original subprojects with the onesactually implemented.

Characteristics of Subprojects

Category At Appraisal Actual

A. Fer.ilizer Expansion and Process Efficiency Improvement

1. Plant Phosphoric acid plant Phosphoric acid plantRehabilitation debottlenecking (GSFC), debottlenecking (RCF,

Refinery debottlenecking GSFC), ANP plant rehab-(HPCL), u'rea debottle- ilitation (RCF),necking, Ammonia process ammonia/urea plantcontrol (MFL), Ammonia modification (MFL, HFC,debottlenecking (ZAC). SPIC, IFFCO).

2. Feedstock Feedstock conversion Feedstock conversionConversion (NLC, SAIL) (RCF, NLC, SAIL)

3. Waste Recovery Purge gas recovery Purge gas recovery(GSFC) fluorine (GSFC, SPIC, IFFCO)recovery (GSFC, SPIC,CFL)

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4. Additional Ammonia storage and Ammonia sc.6rge (FCI,Storage/Transport tank wagons (RCF) HFC, NFL, SPIC, IPFCO),

ammonia tank wagons(HFC, NFL)

5. New Plant Soda ash/ammonium Nonechloride Plant (SPIC)

B. Captive Power and Utilities

1. Captive Power/ Boiler/power set (FCI, Boiler/power set (RCF,Utilities RCF, CFL) HFC, CFL)

C. Pollution Control and Testing Equipment

1. Pollution Control Pollution Control Pollution control (RCF,(RCF, MFL, ZAC) MFL, ZAC, IFFCO)

2. Testing Equipment Non-destructive testing Non-destructive testingequipment (PDIL) equipment (PDIL)

D. Fertilizer-Related Studies

Technical Three studies (DOA) Three studies (DOA)Assistance

E. Project Cost

2.10 The Project costs, both the appraisal estimates and the actuals,for each subproject are given in Annex 2-2, and summarized below:

Comparison of Projects Costs - Appraisal Estimate vs. Actual

Appraisal Estimate _ ActualNumber of Amount Number of AmountSubproject (US$ million) % Subproject (USS million) %

FCI 5 79.0 33.1 1 3.4 2.0RCF - - - 5 19.9 11.8HFC - - - 8 35.4 20.9NFL - - - 2 4.5 2.7PDIL - - - 1 1.1 0.7NLC 1 19.5 8.2 1 21.2 12.5SAIL 1 26.1 10.9 1 22.4 13.2MFL I 2 1.7 0.7 1 0.8 0.5GSFC 3 20.6 8.6 2 17.1 10,1SPIC 2 46.2 19.4 4 9.2 5.4HPCL 1 25.9 10.9 - - -

ZAC 2 10.2 4.3 3 13.6 8.0CFL 2 8.5 3.6 1 3.1 1.8IFFCO - - - 6 17.1 10.1DOA 3 1.0 0.4 3 0.4 0.2

IT 38.7 100.0 39 169.2 100.0

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Due to the major scope change, a comparison of the actual costs for thewhole project with the appraisal estimates is not meaningful. OverallProject costs were lower than appraisal estimates by 29%, mainly due tocancellation of subprojects which would have required higher local costcomponents. The actual capital costs for most of the original subprojects,which accounted for about 62% of the total project costs, were slightlylower than appraisal estimates as shown in Annex 2-2. The actual costs forthe 10 original subprojects which were implemented were US$104.3 million,about 7.2% lower than the appraisal estimate of US$112.4 million. The mainreason for cost underrun for these components was the rapid devaluation oflocal currency during their implementation, resulting in the reduction oflocal costs in U.S. dollar terms.

2.11 Actual capital costs for the whole Project are compared with theappraisal estimates by type of subprojects in the table below.

2tital onts !X 3eof afltoeots(inU$ mULio

A-pEpnl ActulSIfrs &ter iNns

MM&ctus Loca FonAgnia% % i*pngeMs loca FonggE alhbb X

1. Fb$1Hker *capak&quEfgxw & ftoos

EfIctAvLy ]irbwot 10 79.7 67.6 147.3 61.7 29 55.9 79.5 135.4 8052. ntm a Gmsi

& tWIties 4 31.1 29.8 60.1 25.2 3 9.9 19.1 29.0 17.2

3. Ati-Pollutim 4 1.0 3.4 4.4 1.8 3 0.6 2.9 3.5 2.1

4.1 sf1ny Bqtpmm 1 21.9 4.0 25.9 10.9 - - - - -

5. gf2ties txxd TadmicalAsssts=a 3 - 1.0 1.0 0.4 3 - 0.4 0.4 0.2

6. Tat±al 22 L13.7 105.0 238.7 1.O 38 66.4 101.9 16&3 100.

E/ Ediduig Inxect foxrii exiw os.

Actual proportions of Project costs for each type of subproject changedsignificantly from the appraisal estimates, reflecting the major changes inthe scope of the Project. The portion of fertilizer capacity expansion and

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process efficiency improvement subprojects substantially increased toaccount for 81% of the total Project capital costs as compared to anappraisal estimate of 62%.

F. Credit Allocation

2.12 The proceeds of the Credit were originally allocated to twenty-two subprojects (including the three sector related studies sponsored bythe Department of Agriculture (DOA)) to be carried out by fourteenexecuting agencies. As the Project scope changed, the Credit prn'eeds werereallocated to thirty-nine subprojects accordingly. As FCI, the singlelargest original sub-borrower, was reorganized into five smaller companies,the proceeds were reallocated. The following table summarizes theallocation of the Credit at appraisal and the actual results.

Credit Allocation(in US$ million unless otherwise mentioned)

Appraisal Estimate ActualNumber of Number of

Executing Agency Subprojects Amount % Subprojects Amount %

FCI a/ 5 38.5 36.7 1 2.2 2.2RCF - - - 5 13.0 12.8HFC - - - 8 20.9 20.5NFL - - - 2 3.4 3.3PDIL - - - 1 1.1 1.1NLC 1 12.0 11.4 1 10.9 10.7SAIL 1 15.5 14.8 1 16.2 15.9MFL 2 1.0 1.0 1 0.5 0.5GSFC 3 9.0 8.6 2 4.5 4.5SPIC I 2 14.0 14.2 4 6.4 6.3HPCL 1 4.0 3.8 - - -ZAC 2 6.0 5.7 3 10.5 10.3CFL 2 4.0 3.8 1 1.7 1.7IFFCO - - - 6 10.2 10.0DOA 3 1.0 1.0 3 0.4 0.4Total 21 105.0 100.0 39 101.9 100.0

a/ FCI was split into five smaller companies: FCI, HFC, RCF, NFL, andPDIL.

b/ US$3.1 million has been cancelled.

G. Sub-borrower Characteristics

2.13 As of March 31, 1985, twenty-one fertilizer production companies,including eight public sector companies, operate in the Indian fertilizerindustry. Feedstock, product, production capacity, and recent production

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performance of these companies are detailed in Annex 2-3. As of March1985, the fertilizer plants operated by the thirteen beneficiaries of theCredit accounted for approximately 74% of the nation's total capacity.The number of plants, major products, feedstock, and production capacity ofthese companies are summarized as follows.

Characteristics of Subproject Sponsor

DesignNumber Major Capacity

Company Plants Products Feedstock ('000 tpy)

A. Public Sector

FCI 4 Urea, AS Naphtha, Fuel 806RCF 1 Urea, NP, ANP Natural Gas 317HFC 3 Urea, AS Naphtha, Natural

Gas 349NFL 3 Urea, CAN Fuel Oil 705NLC I Urea Fuel Oil 70SAIL 6 CAN/AS Coke, Naphtha 144NFL 1 Urea, NP, NPK Naphtha 176

B. Private Sector

-SFC 1 Urea, AS, DAP Natural Gas, Naphtha 236SPIC 1 Urea, NP, NPK Naphtha 258ZAC 1 Urea Naphtha 171CFL 1 Urea, NP, NPK Naphtha 84

C. Cooperative

IFFCO 2 Urea, NP, NPK Natural Gas, Naphtha 488

III. PROJECT IMPLEMENTATION AND MANAGEMENT

A. Achievement of Project Objectives

3.01 Although completion of the Project was delayed and the agreedProject scope was substantially revised, the Project achieved its originalobjectives to a large extent. All the subprojects, except for threenitrogenous fertilizer plants which are currently faced with unexpectedconstraints (FCI, HFC and SAIL), resulted in increased capacity utilizationof the existing facilities, efficient energy consumption, and environmentalprotection. FCI, HFC and SAIL could also have fully achieved theirobjectives if there had not been unexpected interruptions such as powershortage in their respective regions. As a result of the implementation ofthe subprojects, the industry-wide capacity utilization has increased from

- 10 -

the level of below 60% in the early 1970s to the current level of 74% innitrogen and 89X in phosphates. Increases in capacity utilization afterthe Project for major beneficiaries of the Credit are depicted below:

Capacity Utilization Before and After the Project(%-

After ProjectBefore Appraisal

Company Plants Projecta/ Estimate Actual'J/

FCI Urea 54 80 59d/RCF Ammonia 76 80 89

Phosphoric Acid 61 80 78HFC Urea 38 80 38e/NFL Urea 73 80 80NLC Urea c/ 56 80 76SAIL Ammonia/CAN 39 80 34 d/MPL; Urea 79 80 79GSFC Urea 72 80 86

Phosphoric Acid 55 80 86SPIC Ammonia/Urea 73 80 96ZAC Ammonia/Urea 80 80 89CFL Ammonia/Urea 76 80 84IFFCO Ammonia/Urea 92 - 95

a/ Capacity utilization before the subproject was launched.D/ Average capacity utilization for four years after the Project.-/ Capacity expansion was undertaken during Project implementation.d/ Due to region-wide electricity interruptions, the facillities have not

been able to fully exploit their capacities.e/ HFC has been faced with shortage of feedstock.

3.02 In addition to increases in capacity utilization, another majorachievement was reduction of materials consumption per ton of output.Conversion to cheaper and more economical feedstock and installation ofcost-saving equipment entailed reduction in raw materials consumption andother inputs per unit of production. Given the shortage of fertilizers inIndia the savings in raw materials were directly utilized to increasefertilizer production.

B. Project Management

3.03 The subprojects under the Project were implemented and managed byeach sponsor with minimum coordination of centralized project managementat the Government level. At each company level, most of the technology-oriented subprojects were carried out by reputed engineering firms on aturnkey or semi-turnkey basis, limiting the need for local management.

- 11 -

Worldwide reputed foreign firms were more actively involved In the techno-logy-intensive subprojects such as plant rehabilitation/debottlenecking.

3.04 Most of the original subprojects underwent delays in initiationof their implementaion due to delayed project initiation, governmentapprovals, financial difficulties, or technical arguments, resulting in thecancellation of several subprojects. In accordance with GOI's responsibi-lities stipulated in the Credit Agreement, the Ministry of Petroleum andChemicals (MPC) was supposed to monitor the implementation of thesubprojects, provide assistance to the subborrowers in obtelning necessaryGovernment approvals, and coordinate with other related ministries,including the Department of Economic Affairs (DEA). However, in theabsence of effective project monitoring at the Government level, i.e.,centralized project management, Project implementation was poorly monitoredand coordinated, thus leading to substantial delays in Project completionand material changes in Project scope.

C. Technical Assistance and TraininRg

3.05 Three fertilizer sector related studies were sponsored by theDepartment: of Agriculture (bOA) and undertaken by local research institutesunder the Project. These are: (i) Fertilizer Demand Projections Studycarried out by the National Council of Applied Economic Research (NCAER);(ii) Fertilizer Transportation Study by the Railway Investigation TransportEngineering Services (RITES); and the Fertilizer Storage Study undertakenby the Administrative Staff College of India (ASC). The results of thesestudies were subsequently, used by the Government in drawing up fertilizersector development stratekgies.

3.06 Local technical staff monitored the implementation ofsubprojects, even the ones implemented by foreign contractors on a turnkeyand semi-turnkey basis. After the mechanical completion, the contractorstrained the local staff. PDIL also undertook training sessions for the useof testing equipment procured centrally by PDIL for the subprojectsponsors.

D. Use and Performance of Engineering Contractors and Consultants

3.07 Wherever local expertise was not available, foreign consultantswere used in the implementation of subprojects, particularly forrevamping/modernizing of the older facilities which required specializedtechnology. Generally, contracts involving foreign participation fell tothe original designers of the plants. These foreign firms implemented someof the subprojects on a turnkey basis and provided consultancy services forseveral other subprojects which were carried out mainly by in-housetechnical personnel of the subproject sponsors. The quality of technologyprovided by these firms was satisfactory and has not caused any issues withthe subproject sponsors.

3.08 Local engineering firms also participated in the implementationof subprojects wherever proper local expertise existed. Apart from localcontractors which were mainly charged with installation and construction,

- 12 -

some local engineering firms obtained turnkey contracts for severalsubprojects. The quality of local engineering firms was alsosatisfactory. For example, PDIL implemented NLC's feedstock conversionsubproject successfully and timely on a turnkey basis.

E. Transfer of Technology

3.09 Local firms, including subproject sponsors, directly managed theimplementation of subprojects as far as local technology permitted withtechnical assistance from foreign consultants. In the course of Projectimplementation, local firms easily obtained necessary technology becauseforeign consultants, most of whom were the original designers of theplants, were competing for the rapidly growing market in India. While withthe turnkey contracts, particularly in the case of rehabilitation/debottle-necking subprojects, the transfer of engineering technology had beenlimited, the experience obtained from these subprojects has, on the whole,been substantial and has been well utilized for the improvement of otherplants with similar problems not included in the Project.

F. Procurement and Performance of Suppliers

3.10 Procurement for the subprojects was carried out following theBank's procurement guidelines with no significant problems impacting onproject implementation.' Due to the nature of the subprojects, the averagesize of the bid packages was relatively small and the share of proprietaryitems not appropriate for international competitive bidding (ICB) wassomewhat large. Where appropriate, components of some subprojects wereawarded to contractors, both foreign and local, on a turnkey basisfollowing ICB procedures. Adequate international competition and goodresponse to bid invitations were available under ICB and contracts wereawarded to technically acceptable suppliers at competitive prices and withappropriate local preference. On an overall basis the suppliers and thecontractors performed satisfactorily delivering technically satisfactoryproducts on time.

G. Implementation Schedule

3.11 At appraisal all the subprojects were expected to be completed byDecember 31, 1979. However, only five subprojects out of the nineteenoriginal subprojects, excluding the three study components, were completedwithin the original target date. While other subprojects were delayed,nine subprojects were finally cancelled and replaced by substitutesubprojects later. The overall Project was completed in April 1984, 52months behind schedule.

3.12 The delay in Project implementation was caused mainly by delaysin sub-project preparation and the long time taken for Government approvalsdue to the lack of coordination among related ministries. Since variousgovernment approvals from different authorities were required forsubprojects to be initiated, central coordination at the Government levelwas essential for their timely implementation. While delays in approvalsfor some subprojects were identified at the beginning of Project

- 13 -

limplementation, the lack of coordination among related ministries which haddifferent authorities in decision-making resulted in delays in subprojectinitiation and ultimately the cancellation of several original sub-projects. The approvals for the subprojects were considered with the samedetailed procedures that govern larger investments but not with the sameurgency.

3.13 The slow decision making process in GOI was also the main causeof delay in replacing the dropped subprojects. Following the cancellationof several projects, GOI could not agree on substitute projects promptly.Even the implementation of substitute subprojects was delayed from theplanned schedule due to delays in government approvals. The Associationappraisal Fmission underestimated these institutional constraints facingProject imiplementation.

IV. OPERATING PERFORMANCE

A. Commissioning and Start-up

4.01 None of the subprojects were faced with major technical problemsin commissioning and start up. Rehabilitation/debottlenecking subprojectshad direct impact on the performance of the concerned plants. Thesesubprojects as well as captive power/utility components contributed toenhancing capacity utilization by eliminating interruptions. New energyefficiency equipment installed under the Project also improved operationalefficiency by saving inputs consumption per unit of production.

B. Production and Capacity Utilization

4.02 The beneficiaries generally achieved levels of production asanticipated at appraisal or higher except for the few instances where otherunforeseen constraints limited production. The table in the next pagesummarizes the fertilizer production level of the major beneficiaries overthe last four years.

- 14 -

Iwrovmnt of Capiq Utillzation After the Project

SuprojectPlant/ Caupletion After Project~, Product Year Before Project 1981/82 1982/83 1983/84 1848

FCI Urea (Sindri) 1982 54 - 60 58 57RIF IIP(Trboy) 1980 76 101 75 95 85

PhephoricAcid (TrUay) 1980 61 79 70 80 81

HFC Urea (DuApwur) 1983 28 - - 46 38Ur (Barazi) 1983 49 - - 40 25

NFL Urea (NaWgl) 1982 73 - 78 81 82NLC Urea 1979 56 65 67 82 84SAML Calcium A hia

Nitrate 1981 39 66 8 19 14NFL Urea 1979 79 88 77 65 86GSFC Urea 1980 72 85 77 93 90

-porcAcid 1979 72 74 86 81 102

SPIC Urea 1980 71 86 92 76 105ZAC Urea 1981 71 - 100 86 94(WL Ures 1980 76 85 74 88 87-TM00 Urea 1980 92 90 99 87 104

Interruptions in power supply as well as mechanical problems prevented FCIfrom fully taking advantage of additional ammonia storage facility atSindri carried out under the Project. SAIL achieved a satisfactory levelof capacity utilization at 662 in the first year after the commissioning ofthe naphtha reformer subproject which enabled it to convert feedstock fromcoke oven gas (COG) to naphtha. However, overall power shortagesprevailing in the region prevented it from realizing the benefits of thesubproject. Also, HFC could not derive full benefits from the subprojectsdue to the continuing poor quality of power supply as well as shortage offeedstock. Measures now being implemented would improve power supply andenable them to achieve satisfactory operational performance.

V. FINANCIAL PERFORMANCE

A. Financial Rate of Return

5.01 In November 1977, GOI introduced a system of ex-factory'ricing-retention price formula-which would ensure a reasonable financialLate of return for fertilizer manufacturers under conditions of efficientoperations (The retentiin price formula is explained in detail in Annex5-1). The formula sets the price at levels which would enable fertilizermanufacturers, operating at 80% capacity and at a reasonable level of input

- 15 -

consumption, to generate sufficient cash to cover production costs and a12% after tax return on capital employed.

5.02 At the time of Project appraisal in 1975, fertilizer prices wereset at levels sometimes insufficient to cover production costs. Therefore,the IDA Credit Agreement,included a covenant, requiring G0X to take actionto ensure that ex-factory prices, under conditions of efficient operation,would be sufficient to cover production costs, service debt, and earn areasonable return on invested capital.

5.03 Under the retention price formula, fertilizer manufacturers areguaranteed to earn approximately 10% financial internal rate of return(FRR) on new investments at 80% capacity utilization. As shown in Annex5-2, FRRs for subprojects implemented in plants which operated at acapacity higher than 80%, therefore, are estimated at 10% or above,Conversely, FRRs for subproject carried out by FCI, SAIL and HFC, whichhave achieved low capacity utili!ation, are estimated to be below thislevel.

B. Financial Performance

5.04 The introduction of the new pricing system improved the benefici-aries' financial situation. Until the introduction of the retention priceformula, the relative prices between fertilizers and inputs (both of themwere far below economic prices) did not allow even efficient fertilizermanufacturers to generate profits. Because of the poor financialsituation, most beneficiaries could not carry out plant improvementswithout funds from outside sources. The introduction of the retentionprice system combined with an increase in capacity utilization improved thefinancial standing of all the beneficiaries. A representative summary ofthe recent financial performance of selected beneficiaries (3 public sectorcompanies, 1 private sector company, and 1 joint sector company) over thepast four years is given in the table on the following page (See Annex 5-3for details).

- 16 -

Financial Situation Improvement of Indian Fertilizer M4nufacturers(in millions of Rupees)

1981/82 1982/83 1983/84 1984/85FCI (Public Sector Company)Capacity Utilization (%) 54 60 58 57Operating Income/Sales (x) (71.7) (32.3) (24.8) (13.8)Current Ratio (times) 1.4 2.1 1.5 1.8Debt Service Coverage (times) 0.0 0.6 0.3 0.8Debt/Equity 0/100 0/100 45/55 45/55

RCF (Public Sector Company)Capacity Utilization (%) 87 77 90 84Operating Income/Sales (%) 7.6 7.1 11.4 9,4Curren.t Ratio (times) 1.8 1.6 1.6 1.7Debt Service Coverage (times) 1.8 3.2 3.3 3.5Debt/Equity 36/64 40/60 36/64 38/62

NFL (Public Sector Company)Capacity Utilization (%) 69 71 71 71Operating Income/Sales (%) 12.0 10.9 6.0 11.0Current Ratio (times) 1.4 1.2 3.2 2.7Debt Service Coverage (times) 2.9 1,2 0.9 4.3Debt/Equity 48/52 38/62 26/74 23/77

MFL (Private Sector Company)Capacity Utilization (Z) 88 77 65 86Operating Income/Sales (%) 3.1 8.3 3.7 8.0Current Ratio (times) 2.8 2.8 2.4 2.5Debt Service Coverage (times) 0.5 a/ 0.4 a/ 9.1 N/A a!Debt/Equity 46/54 0/100 0/100 0/100

IFFCO (Joint Sector Company)Capacity Utilization (%) 99 100 91 107Operating Income/Sales (%) 13.4 12.6 11.8 9.7Current Ratio (times) 3.0 2.7 2.1 2.2Debt Service Coverage (times) 2.8 2.7 0.9 2.0Debt/Equity 45/55 43/57 34/67 33/67

a/ The entire amount of long term loan was paid back over 1981/82 - 82/83period.

b/ No debt service.

5.05 As shown in the above table, all the financial ratios stayed atsatisfactory levels as long as the fertilizer companies achieved areasonable level of capacity utilization. However, finances of thosecompanies having operated at low capacities have been weak as well

- 17 -

illustrated in the case of FCI. Among the 13 subproject sponsors, threecompanies (FCI, HFC and SAIL) fell into this category.

VI. SECTORAL AND ECONOMIC PERFORMANCE

A. Economic Rates of Return

6.01 Based on updated assumptions on capital costs and capacityutilization, economic rates of return have been calculated for subprojectswhose benefits are quantifiable, ranging from 11.6X to 100. Incrementalbenefits and costs take into account the recent operational performance ofthe plants. Except for those carried out by HFC and SAIL which have beenoperating at capacities substantially below the levels anticipated atappraisal, updated ERRs are close to appraisal estimates. A comparison ofERRs between appraisal estimates and actuals is given in Annex 5-2.

B. Stability of Fertilizer Supply

6.02 Historical supply and demand of fertilizers over the past 25years are given in Annex 6-1 and summarized in the table below:

India - Past Fertilizer Conumption, Production, and Deficit(in million tonns of nutrient)

Nitrogen (N) Phosphate (PzO) Potash (K) TotalsYear Cons Prod. Deft. Cons. Prod. Deft. Cons. Prod. Deft. Cons. Prod. Deft.

1959/70 0.23 0.08 0.15 0.05 0.05 - 0.02 - 0.03 0.31 0.14 0.18196/70 1.36 0.73 0.63 0.42 0.22 0.20 0.21 - 0.21 1.98 0.95 1.031974/75 1.77 1.19 0.58 0.47 0.33 0.14 0.34 - 0.34 2.57 1.52 1.051979/80 3.50 2.23 1.27 1.15 0.76 0.39 0.61 - 0.61 5.26 2.99 2.271980/81 3.68 2.16 1.52 1.21 0.84 0.37 0.62 - 0.62 5.52 3.01 2.511981/82 4.07 3.14 0.93 1.32 0.95 0.37 0.68 - 0.68 6.07 4.09 1.981982/83 4.26 3.43 0.83 1.42 0.98 0.44 0.74 - 0.74 6.42 4.42 2.001983/84 4.90 3.50 1.40 1.62 1.00 0.62 0.81 - 0.81 7.33 4.50 2.83

AymE Aneil Growth Rte)1959/60-1979/80 14.6 18.1 17.0 14.6 18.6 15.2 16.51959/60-1983/84 13.6 17.1 15.6 13.3 16.6 14.1 15.61974/75-1983/84 12.0 12.7 12.7 13.1 10.1 12.4 12.81979/80-1983/84 8.8 11.9 8.9 7.1 7.3 8.7 10.8

- 18 -

Consumption of all fertilizers increased from 305,000 tyn in 1959/60 to 8.2million tyn in 1984/85 at an average annual growth rate of about 14e00%.Over the saae period, local production of fertilizers increased at a fasterpace (average annual growth rate of 15.6%). Therefore, import requirementsas percentage of total fertilizers declined from 58% in 1959/60 to 36% in1984/85.

6.03 The Project enhanced the domestic fertilizer production basesubstantially and improved the stability of fertilizer supply foragriculture. During 1979/80-1984/85 period, the growth rate of domesticfertilizer production outpaced that of consumption more rapidly thanprevious years mainly because subprojects carried out under the Projectcame on stream during the period, substantially raising production levelsof existing facilities.

C. Environmental Aspects

6.04 Most of the subprojects, which have aimed at better plantperformance directly and indirectly, contributed to improving theenvironmental situation of the beneficiaries. The beneficiaries installedpollution testing and control equipment and trained the plant personnel ontheir use, thus improving the environment quality of the plants; newproduct storage systems reduced the potential of future environmentalproblems; new waste recovery units and energy efficient equipment helped toreduce the level of pollutants and so did retrofitting of old plants.

VII. ASSOCIATION PERFORMANCE

7.01 The Association had financed several grassroot fertilizerprojects until it recognized that the same priority should also be given tomodernization of existing fertilizer production facilities whose capacityutilization remained low. Once this need was identified, the Associationmoved quickly to provide assistance to GOI in implementing appropriatemeasures. During Project implementation, the Association's supervisionmissions detected various problems causing delays in the initiation ofsubproject implementation, and conveyed recommendations promptly in orderto expedite the decision of the Government. Particularly whenever Projectscope needed revision to replace some of the original subprojects, theAssociation processed it quickly to enable them to be implemented on time.

7.02 During Credit negotiations, GOI had agreed to implement threefertilizer industry related studies which would provide the basis forfertilizer industry development planning. These studies were:(i) fertilizer demand projection; (ii) fertilizer transportation study; and(iii) study on fertilizer storage. All the studies were undertaken bylocal research institutions. The Association had reviewed with theDepartment of Agriculture (DOA), the study sponsor, the scope of studies,and followed up the studies. The findings of the studies contributed tothe betterment of GOI's fertilizer sector planning as well as to the

- 19 -

formulation of Bank Group lending strategies. A 12-member steeringadvisory committee in DOA supervised these studies.

7.03 At the recommendation of the IDA project team, the giant publicsector company, Fertilizer Corporation of India (FCI), which had operatedseven large scale fertilizer plants scattered throughout India, wasrestructured into five smaller and more manageable regional corporations,namely: (i) Fertilizer Corporation of India (FCI); (ii) HindustanFertilizer Corporation (HFC); (iii) Rashtriya Chemicals Fertilizer (RCF);(iv) National Fertilizer Limited (NFL); and (v) Planning and DevelopmentIndia Ltd. (PDIL). FCI, with plants in diverse regions, was poorly manageddue to lack of effective centralized management and coordination, slowdecision making process, and difficulties in corporate planning. Recogniz-ing this management problem from the inception of the project work, the IDAproject team had recommended reorganization of FCI into several smallerregional companies of manageable sizes. The reorganization was formallyannounced in late 1977 and took effect in late 1979. it has been generallyacknowledged that the reorganization has fully served the purpose.

7.04 As mentioned in para 5.02, IDA recommended to GOI to revise itsfertilizer pricing mechanism, and consequently the retention price formulawas introduced in 1977. In the mid-1970s, ex-factory fertilizer priceswere maintained low to subsidize agriculture. At times, fertilizer priceswere set at levels which did not allow even efficient manufacturers tocover production costs. Therefore, IDA recommended to GOI to consider apricing mechanism which could ensure a reasonable rate of return oninvestments for efficient operators. This retention price mechanismimproved not only the financial viability of fertilizer manufacturers butalso operating efficiency. The retention price formula penalizes lowcapacity utilization as well as high input consumption.

VIII. LESSONS LEARNED

8.01 Although the Project was ultimately implemented and achieved mostof the original objectives successfully, several lessons have been learnedfrom the problems the Project encountered during implementation. Theseproblems caused a substantial change in Project scope as well as a 52-monthdelay in Project completion.

8.02 One important lesson was that a project involving a number ofdifferent types of subprojects should be designed to provide for a strongcentral coordination unit to undertake the responsibility for coordinatingand implementing the subprojects. Particularly in countries where thedecision making process is scattered and diverse, coordination at theGovernment level is key to successful implementation of projects. In fact,delays in Project implementation and changes in Project scope were mainlydue to lack of coordination among concerned Government authorities whichprovide various approvals for subprojects in terms of scope, technology,economic viability, local fund allocations, and other aspects. The lack ofcoordination also made it difficult to determine alternative subprojects

- 20 -

timely for IDA consideration. If similar problems are anticipated for afuture project, Government approval requirements and procedures should beclosely assessed during appraisal, and, if necessary, practical assurancesfrom the Governments should be obtained before the signing of loan (credit)agreement. These assurances also need to be supported by a responsibleproject coordination unit which is obligated to monitor, coordinate, andexpedite the implementation of subprojects, particularly for sector/programcredits with numerous smaller subprojects in countries with diversifieddecision making process.

8.03 The other important lesson learned from the Project was that theoriginal concept of the Project could have worked out quite well if theProject had concentrated on a more limited number of relatively largesubprojects. Throughout the implementation of the Project, it was almostimpossible for the IDA project team to effectively maintain relationshipswith numerous subproject sponsors for the supervision of their respectivecomponents. Where a number of small subprojects are implemented under oneproject scope, frequent scope changes cannot be avoided. As nine originalsubprojects were dropped and replaced by 26 new subprojects, tremendousadditional efforts had to be made by the IDA project team to follow upthese changes. For a project with similar configuration, a typical sectorloan appears more appropriate to handle. In this case, greater authoritycould be given to borrowers in implementing the overall program includingthe selection of subprojects based on agreed guidelines. Frequent revisionof the legal documents also could be avoided.

8.04 Another lesson learned from the Project was that well establishedprogress reporting should be incorporated in designing a project with anumber of project sponsors, possibly by standardizing of the reportingformat and contents. While direct project progress reporting by projectsponsors is generally preferred as a means of maintaining directcommunication with the beneficiaries, unstructured reporting from numerousbeneficiaries makes it difficult to monitor individual subprojectssystematically. Due to the lax description of reporting requirements, theprogress reports submitted by the subproject sponsors differed to a largeextent in terms of contents and details of subproject progress. Somereports did not even contain project related information at all. As aconsequence, the supervision of the Project was not satisfactory, and thepreparation of Project Completion Report (PCR) was delayed. Besides, theBorrower could not prepare its own PCR despite the specific guidanceprovided by the IDA project team well in advance of the completion of theProject in August 1982 and repeated request thereafter. Supervisionworkload could have been reduced tremendously if a good progress reportingsystem had been designed.

- 21 -

INDIA - FERTILIZlR INDUSTRY cRatl

PROJgCt COMPUTtON RUPORT

Revtelon of Pro1ect Scope (SubProjects)

Plant Original Subproject lst Revision 2nd Revision 3rd Revision 4th RevistonCoeeny Location (Deceber 1975) (March 1978) (January 1980) (June 1980) (AprVl 19S1)

PCIvf Corskhpur Botir/Pover Set (25 Ib) (Dropped) - _ _- oAmonta storage (Drooped)

Sindri A- Amonti storage

erC#/ Tronbay llollr (170 TPR)Pollutton controllteittag

- heedstock converston- Phosphoric acid dobottlo

neking AMP PlantRehabilitation

NPCI/ Durgapur Boiler/Power Set (12 MW)- eAmoniS Pump Modification - - -- sAmonts Storag-

Sereuni - Plont Modification- AmmoniS Storage

Nasrup - Plant todt8catitoncsNamrup/Sreunt - Carbamate Pump RPplacementSaldiS - Aonat Storase/tank Wagons

PDII/ PPDIL Ion-daetructive TestingSqpt.

"La/ angal - Amonti Storage - -

- - Amontia Tank V

NuC eyveli Feedecock Converaion

tSC (SAIL) lourkels Peedatock Convernion

oSFC b rod& Purge Gee RecoveryFluorine Recovery (Dropped) - -Phoaphoric Acid Plantdebottlenecking

IPCL Troebey Refinery Debottlenecking (Dropped)

NUL tadree Urea Debottlenocking ( )Amonmia Process Control ( ) - - -Utit/Pollution Control ( )

AMonDI Plant-- - Rehabt attit1on

$PIC Tutteortn Prourine Recovery (Dropped)Soda Ash/AmontumChloride Plant (Dropped)

-- Purge Gen Recovery - -hnAmonti StorageAmeonte Plant Optt. - -

- AAmonti Optla. Study

CYL Vtieg Hapetnam Soilar/Powr SetFluorine Recovery (Dropped)

ZAC Coa Ammonia D bottlenackingUrea Plant Pollutton Control

- - Maintenance Crone(120 ton)

IrPCO Kalol - Amont Dbottlenecking- AmIne Cuord- Purge tes Recovery- 1Oi fired Boller

002 CoeprossorKanatA - onti Storage

GOt NCAIR fertilizer Demand Study -RIT8S fVrttliter Traneportation

StudyASC Fertilizer Storage Study -

1 PCI. the ortgtnol nponcor of all PCI Project coponenrec vw s plit into the above fitv coepenite in late t979.

Induetry beparte ntMatrch 1986

- 22 -

AENEX 2-2

INDIA - FERTILIZER INDUSTRY CREDIT

PROJECT CONPLETION REPORT

Conparison of Project Cost and Credit Allocation

lin sillions of U.S.dollars unless otherwise sentioned)

Project Cost Credit AllocationPro3ect ------------------ ----------------

Company Plant Location Sub-pro;ect Completion Appraisal Actual Appraisal Actual

FCI 6orakpur Boiler Cancelled 23.5 - 10.8Ammonia storage a 20.5 - 9.1 -

Sindri Amonia storage Aug. 1982 - 3.4 - 2.2RCF Tromboy Boiler Aug. 1977 12.9 9.0 8.5 8.0

* Pollution control Jun. 1982 0.3 0.6 0.3 0.2Feedstock Conversion Feb. 1979 - 6.9 - 4.1Phos. acid debottl. Jan. 1990 - 1.3 - 0.5

* AN rehabilitation Jul. 19t2 - 2.1 - 0.2HFC Durgapur Boiler Sep. 1983 20.7 17.0 8.7 9.4

Ammonia pump modif. I983 - 0.6 - 0.4Amonia storage Jul. 1983 - 3.3 - 2.0

-arauni Plant Nodification 1983 - 0.6 - 0.4Ammonia storage Jun. 1983 - 3.6 - 2.2

Narup Plant modification Nat. 1983 2.1 - 1.4Naldia Amonia storage/tank Feb. 1983 8.2 - 5.1

NFL Nangal Ammonia storage/tank Jul. 1992 4.5 - 3.4NLC Neyveli Feedstock conversion Jul. 1979 19.5 21.2 12.0 10.9SAIL Rourkela Feedstock conversion Sep. 1979 26.1 22.4 15.5 16.2GSFC Baroda Purge gas recovery End- 1979 11.3 10.5 5.3 0.4

Flourine recovery Cancelled 2.7 - 1.2a Phos. acid debottl. 1979 6.6 6.6 2.5 4.1

IP6L Tremboy Refinery debottl. Cancelled 25.9 - 4.0 -

NFL Nadras Urea debottl. Cancelled 1.7 - 1.0 -

* Amoonia debottl. 1979 - 0.8 - 0.5SPIC Tuticorin Florine recovery Cancelled 2.7 - 1.3 -

Soda ash plant Cancelled 43.5 - 12.7 -

Purge gas recovery 1983 - 1.6 - 1.3Asmonia storage 1983 - 6.8 - 4.6Amnia plant optim. hay. 1982 - 0.8 0.5

CfL Visag Boiler End- 1980 3.0 3.1 1.0 1.7Fluorine recovery Cancelled 5.5 3.0 -

ZAC Goa Ammonia debottl. Jun. 1982 7.2 9.9 4.0 8.1Pollution control Jun. 1982 3.0 2.5 2.0 1.6Crane Jun. 1982 - 1.2 - 0.8

IFFCO Kalol Amonia sodi./debottl. 1980 - 10.0 - 4.9a CD? compressor 1984 - 3.3 - 2.3

Kandala Ammnia storage 1991 - 3.9 - 3.0POIL Testing equipments 1984 1.1 1.1 1.1 1.1601 Three studies Completed 1.0 0.4 1.0 0.4

TOTAL 239.7 169.2 IO.Q 101.9=a--=s ,=2 - :2-32= 233532

- 23 -

lOW . nanum loa wallimmlC

*'to" In ezttl"t "Srit3883. ftatUIt* 30839?U81833383iI 810I

fapities .171 M7 914 8

3. .tt tlt , td Gh.a3. 'tro,m.z, Led. (181?)8 7 * Udv9-ade) a is 150 )1.9 12.8 )S.? s3.S

*blof Ceu I 3o S2.'O I I338.51 _ -ft COCdd410 l l/3 40.0 ) 10. )327.1 134.3 107.9

U98ahh7t - Ut3t #rade" or" WsptbM Ul.0 t3.2 *1.1 t0.3 9.4nit)s - 93bs8 U, ort. 1 Oil 0 19.0 131. III.$ 123.9 1ts.SInAat - sadist, edeob U"t. 8k 225.0 18.9 13.S 11.0 $93.24". Otis" of"t o3 228.0 9.8 o 19.5 42.I 35. 1

*. ldw_et httlUut Uttp. td. (gm8.)8,taui - 51p* otr 8S21 35.0 74.2 18.1 90.8 27.1bwgss4 -9_ t how gm 8*P9t41 353.0 80.0 1.4 49.4 51.5g - Aaae r Ut.". Al let.,) a" 3l1.* 304.9 300.1 8.4 88.2

J. Watt.. vent 0 Ltd. (. 33.3

Matt iN_ ntSdlst Ltd- a)t",. W.F Wl ",the 14.0 IS6-0 *X.0 113A Is-.X

Satiad.- "Ajl U. 1to.tl 03 235.0 o33.7 *10.1 3.0 141.6Maps3 - *Ajab IAN. Ur*$ t SItttett7/lml 0il 232.0 30.4 I8OJ 318.0 212.188e1. _ b,tct gt.m Awl 034 225.0 782.3 388.9 343.0 351.3

6.. 959s3 3.L9.4t. "tp.OIW)- t9*t - tad) Itis ug cW.3 oil 10.0 45.2 41.1 21U. 11.8

7. 8.*htyt w. alass d" 9filter1Ltd33 (UP1)_trm - Ctt ue ttt Ut. 1. AO letr. "a. 331.0 101.3 2 0.4 271.4 24.9

8. 83ed * tit. y I lt.0 7.2O. 1.4.388t3lmot). - Or"".. cO "Pubt_/c 120.0 1U.4 30.0 22.9 89.71 8wl1 p eat. aU Cd* 38.0 38.3 37.0 j.j W.8

tot.) 413 11t Sactor 2I9*. 13.4.2 1.599.8 . 2 100.8 3.S0032

e. 1EftaLbSto

1. caetaidul ft.8*133. Ltd. (313.3""S - Vthta Pt.ds" or". 81. 39 usphzh 89.0 13.3 83.0 73.1 11.3

2. 8t8 - 1ttrp (1014.)Emma. * t10t Wets. Aft 8 1 38.0 8.0 1.7 *.2 9.2

Setwb - 04Jm Una. Vat 0aI 27I.0 2.9 3t8.2 33. 212.0

. O_rt 8.t*t lall,ent co. (am),ads - jt.t U,. , As.Do o t lephthet.t) t31.0 200.8 384.4 201.9 233.8

ami. owl lWitt44., t. (03)

fwa.o4 * 813. 1r88.. A/C) CROW 30.0 2.3 3.2 3.4 3.3

8. 10108p3.l1wa Lod. (383)SassW * Ott., 9,80.8 W". 8*Pbtb* 310.0 M02. 262.9 IRA. 288.3

7. bq.18e Cheast..) as ft.n1)3..t Ltd. (MM13)Mes...s - r.agamshz Ut.. Ueht1w 318.0 339. 91.2 304.2 334.0

8. SJab letlm) 1so.831., (M0)an 59 i U.jd iaj39 gem 9.l Ott 3.0 *2.3

8. rirsm 34zit1.wr Cupr. (we)tats, - pAjorth" Uat" 8.14th. 32.0 323.3 343.4 131.7 134.1

to 011ethat fttreehad88 Was.tes. Cu. (5I33Ttuttarti * tad) 8.9. gm..8. NW lphth. 293.0 209.2 218.3 298.3 208.9

It. t.t.Ci ad Sta) Co. (tuISC)j.alwd 1 s * 8th., As cam1 4.0 3.3 3.1 2.9 84

S"04) Col 0.. Ur". sophtwe 81.70 344.3 373.8 140.9 34413

ltot. Private. $"Otf W.3.8 3.019.9 3.393_ 137S1.0 3.993.9

C. Opam..lyo 8.etu

ta.d2../Klo) boj.ze: gre. 8?. M3 let..i. a". 380.0 215.3 27.1. 213.0 323.8

58dw38i Ott., hvabib Was, 11111111 228.0 383.2. 348.8 374.2 20.3

TOt. C.e"aatt'. Sect., 443.0 ,3..1 443.9 40. $13.9

ot)tonsi 51349.0 2.342.4 1,434.1 3.180.O 1,931.0

fmgji ?tttlt..sha.et.tt..oof 3.,1.4 ad 81.ltzy of 0"1mIcal ead 1.,t3t.ltsa

atchtt 3988 ta

- 24 -ANNEX 3-1

INDIA - FERTILIZER INDUSTRY CREDITPROJECT COMPLETION REPORT

Disbursement Schedule for the Bank Loan(in US$ million)

Appraisal Estimate ActualCalendar Year (November 1975) (1985)and Quarter Disb. Cumul. % Disb. Cumul. %

1976 I 10.5 10.5 10.0 0.0 0.0 0.0II 3.1 13.6 13.0 1.0 1.0 1.0III 3.2 16.8 16.0 0.3 1.3 1.2IV 4.2 21.0 20.0 0.5 1.8 1.8

1977 I 6.3 27.3 26.0 5.2 7.0 6.7II 7.3 34.6 33.0 0.5 7.5 7.1III 11.6 46.2 44.0 1.9 9.4 9.0IV 11.6 57.8 55.0 2.1 11.5 11.0

1978 I 13.6 71.4 68.0 2.7 14.2 13.5II 12.6 84.0 80.0 3.8 18.0 17.1III 10.5 94.5 90.0 3.5 21.5 20.5IV 10.5 105.0 100.0 4.0 25.5 24.3

1979 I 4.6 30.1 28.7II 5.8 35.9 34.2III 1.2 37.1 35.3IV 2.5 39.6 37.7

1980 I 11.4 51.0 48.6II 9.0 60.0 57.1III 3.2 63.2 60.2IV 5.4 68.6 65.3

1981 I 6.6 76.4 72.8II 7.6 83.6 79.6III 8.2 87.9 83.7IV 8.2 89.5 85.2

1982 I 2.8 92.3 87.9II 4.6 96.9 92.5III 2.1 99.0 94.3IV 0.9 9909 95.1

1983 I , 1.3 101.2 96.4II 0.7 101.9 97.0

* US$3.1 million cancelled

Industry DepartmentMarch 1986

- 25 -ANNEX 5-1

INDIA - FERTILIZER INDUSTRY CREDITPROJECT COMPLETION REPORT

Retention Price Formula

1. The retention price of fertilizers is calculated on the basis ofthe formula enunciated by the Marathe Committee in November 1977. Thecalculations are made for pricing periods for 3 years as follows:

(i) Share capital employed in urea production.

(ii) + Retained Earnings.

(iii) - Capital employed outside the business and accumulatedsurplus cash.

(iv) - Equity employed in line of business (a minimum level ismaintained at paid-in share capital).

(v) 29.4% return on capital employed.

(vi) + Variable and fixed production costs at 80% capacityutilization related to fertilizer production, withdepreciation as provided in the company balance sheet.

(vii) + Interest on short and long-term debt associated with ureaproduction. In each successive block of 3 years, intereston long and short-term debt are considered equal to thoseof the middle year.

(viii) - Ex-factory revenue to producer.

(ix) = Production volume of fertilizer at 80% capacityutilization.

(x) = Unit Retention Price allowed.

2. While operating cost changes are reflected immediately, otherparameters like capital employed and interest charges are only reassessedin intervals of three years. Fixed assets are not revalued each year, butrecorded at historical costs.

Industry DepartmentMarch 1986

- 26 -

ANNEX 5-2

INDIA- FERTILIZER INDUSTRY CREIT

PROJECT COUPLETION REPORT

Comparison of Financial and Econosit Rates of Return

FRR M%) ERR M%)Project ------ --------------------------

Company Plant Location Sub-project Completion Appraisal Actual Appralsal Actual……-…----- … _ _ _ _ _ _ - -_

FCI Sorakpur Boiler Cancelled 14.0 - 22.0RSF Ttomboy 8oiler Aug. 1977 15.0 11.1 26.0 35.9

* Feedstock Conversion Feb. 1979 - 11.7 - n.aNFC Durgapur Boiler Sep. 1983 18.0 3.0 26.0 11.4NLC Neyveli Feedstotk conversion Jul. 1979 27.0 12.0 41.0 36.1SAIL Rourkela Feedstock conversion Sep. 1979 15.0 1.5 33.0 12.6SSFC Baroda Purge gas recovery End- 1979 33.0 11.5 41.0 44.6

Flourine recovery Cancelled 30.0 - 21.0 -

3 Phos. acid debotti. 1979 47.0 12.0 40.0 36.1HPCL Troeboy Refinery debottl. Cancelled 49.0 - 26.0NFL Nadras Urea debottl. Cancelled 65.0 - 100.0

U Ammonia debottl. 1979 - 10.0 - 1O0.0£ Soda ash plant Cancelled 19.0 - 18.0 -

CFL Visag Boiler End- 1980 80.0 10.5 70.0 63.6* Fluorine recovery Cancelled 36.0 - 29.0 -

ZAC Goa Ammonia debottl. Jun. 1982 14.0 12.3 52.0 46.0IFFCO Kalol Amonia aodi.Idebottl. 1980 - 10.5 - n.a

- 27 -

INDIA - FSItitL122M INDISTRY CREDRT

PROJECT CONPL?tION RgPORT

Su nari of lPnancil lnforation for Selectcd Sub-borrovers(in Sc. dillton unlses otherwise mentioned)

1981/82 1982/83 1968164 1984/15

1. FCICross Sales Revenues 1,76S 2,497 13254 1,267Operating Profit (1.268) (8071 (406) (451)Total Assets S,263 6,411 1132R6 11,172Operettag Profit/Sales (RI (71.7) (32.3) (24.8) (13.8)Current Ratio (ties) 1.4 2.1 1.5 I.8Debt Service Coverage Ratio (2) 0.0 06 0.1 0.8Debt/Lquity Ratio 0:100 0:100 45:55 45:5S

2. RCFGross Sleos Revenues 2,4n) 2,524 4,307 4,183Operating Profit 188 179 492 410Total Assets 5,7)6 7,S91 10,748 12,823Operating Proftt/Sales (2) 7.h 7.1 11.4 9.4Current Ratio (times) 1.8 1.i 1.6 1.7Debt Service Coverage Ratio (2) 1.8 1.2 1.3 3.5Debt/Equity Ratio 36:64 40:60 36:64 18:62

3. NnLGrose Selea Revenues 3,197 3,160 4.198 3,790Operating Profit 383 14h 253 41Stotal eaets 6,.97 5,900 5,029 5,310Opereting Profit/Seles (2) 38.4 35.9 23.2 28.2Current Ratio (ties.) 5.0 3.9 1.2 2.7Debt Service Coverage Ratio (2) 2.9 1.2 0.9 4.3Debt/Pquity Ratio 40:52 38:62 26:74 23:t7

4. aCLt Cross Sala. Revenues 322 Z9* 461 382Operating Profit 42 21 47 5total Assets - - - -Operating Profit/Sales (2) 1Z.9 1.t 10.1 3.2Current Ratio (times) 70.0 6.S 8.2 4.2Debt Service Coverage Ratio (S) 31.3 67.8 1,259.4 416.4Debt/Equity Ratio 2:98 0:100 N:ino 0:00

5. NILCross SaleI 9evenues 1,561 1,720 1,724Operating Profit , 48 143 63total Assets 895 813 705Operating Profit/Sales (X) 3.1 8.3 3.7Current Ratio (times) 2.8 2.8 2.4Debt Service Coverage Ratio (S) 0.5 / 0.4 '/ 9.1Debt/Equity Racto 46:54 0:100 o0:300

6. ZACGrose Sales Revenues 929 1,146 1,187 1,538Operating Profit (I5) 195 132 191Total Assets 747 872 894 1,033Operating Proftt/Seles (t) 1.6 14.5 9.5 12.4Current lltio (tiets) 3.3 3.7 2.9 3.2Debt Service Coversge Ratio (2) - - - -Debt/Equity Ratio 35:65 25:75 27:73 26:74

7. SPICCroes Sales Revenues 243 306 291 508Operating Profit IS 26 15 36Total Aiset* 190 200 232 101Operating Profit/Salee (2) 6.2 8.5 5.2 7.1Current Ratio (ties.) 1.7 1.6 1.8 1.5Debt Servtce Coverage Ratio (2) 2.2 1.7 1.4 1.7Debt/Equity Ratio 85:15 2:28 531:47 42:58

8. WtCOCross Sales Ravnuas 4,484 5,146 5,379 7,468Operating Profit 600 646 633 724total Assets S,220 6,166 6,520 7,672Operating Profit/Sales (2) 13.4 12.6 11.8 9.7Curront Ratio (timsc) 3.0 Z.7 2.1 2.2Debt Service Coverage Ratio (S) 2.8 2.7 0.9 2.0Debt/Aity Ratio 45/55 43/57 14/66 33/77

Industry DeparttentMarcb 1986

ANNM 6-1

INDIA - FERUD.M IDISI CDTE

Historical Cavgwtion, Production and ibLBrtS Of Fertilizers, 1983/84(itn '000 tons of tutredts)

Nitrogen H Pbtash Al Nutrients

Year Cs. Prod. 'pro Cans. Prod. Ckxs. Prod. Cans. Prod. Tprt

1959/60 229 84 142 54 51 4 21 - 33 305 135 1791960/61 212 112 399 53 54 - 29 - 20 294 166 4191961/62 250 154 3D7 60 65 - 28 - 75 338 219 3821962/63 333 194 244 83 88 10 36 - 41 452 282 2851963/64 377 219 228 116 108 13 50 - 40 544 327 2811964/65 555 243 232 149 131 12 69 - 57 773 374 3011965/66 575 238 326 132 119 14 77 - 73 785 357 4131966/67 738 309 832 248 146 148 114 - 118 1,101 435 8981967168 1,034 402 867 335 207 349 170 - 270 1,539 609 1,4861968/69 1,209 563 844 382 213 138 170 - 213 1,761 776 1,1951969/70 1,356 730 667 416 224 94 210 - 120 1,980 954 8811970/71 1,479 832 477 541 228 32 236 - 120 2,256 1,060 6291971/72 1,798 949 481 558 290 248 300 - 268 2,657 1,239 9971972/73 1,839 1,054 665 582 330 204 347 - 325 2,768 1,384 1,1941973/74 1,829 1,050 659 650 324 213 360 - 370 2,839 1,374 1,2421974/75 1,766 1,186 884 471 331 286 336 - 437 2,573 1,517 1,6071975/76 2,149 1,535 996 467 320 361 278 - 278 2,894 1,855 1,6351976/76 2,459 1,859 750 635 478 23 319 - 278 3,411 2,335 1,0511977/78 2,913 2,000 358 867 690 164 506 - 599 4,286 2,670 1,5211978/79 3,419 2,169 1,228 1,106 776 243 592 - 517 5,117 2,945 1,9881979/80 3,498 2,226 1,295 1,151 1,763 237 606 - 473 5,255 2,988 2,0051980/81 3,678 2,164 510 1,214 842 452 624 - 797 5,516 3,006 2,7591981/82 4,069 3,143 1,055 1,322 950 343 676 - 644 6,067 4,093 2,0421982/83 4,263 3,434 425 1,420 984 65 735 - 644 6,418 4,418 1,1331983/84 6,236 3,487 656 1,757 1,057 143 799 - 556 7,792 4,544 1,3451984/85 5,486 3,917 n.a. 1,886 1,318 n.a. 839 - n.a. 8,211 5,235 n.a.

Source: The Fertilizer Association of India (FAI).

Lbutry DepartmnetM rdh 1986