KOLKATA (miningweekly.com) - The Indian government will revive bilateral talks with Belarus to clarify the privatisation of potash company BelarusKali, in the hopes of acquiring a stake in the company, a senior official in India’s Chemicals and Fertilizers Ministry said.
“There have been reports received here in India, that there was no political unanimity in Belarus on privatisation of BelarusKali. A fresh round of government-to-government talks would be initiated to know the exact position of the Belarus government and reaffirm [the] pitch for investments in the potash company by a consortium of Indian government-owned fertiliser companies,” the official said.
“Last year, in August, bilateral talks for strategic investments were held, but no direction was achieved. Talks would be revived very shortly, considering that acquisition of fertiliser mineral assets overseas was very high on the agenda of the Indian government,” he added.
The State-owned potash miner BelarusKali, which controls potash deposits hosting some one-billion tons and was one of the world’s largest fertiliser suppliers, has been valued at around $32-billion.
The Indian government has proposed the creation of a sovereign fund of about $5-billion to support State-owned fertiliser producers and to acquire fertiliser mineral assets overseas.
Indian demand for fertiliser would rise 4% to 61.27-million tons during 2012/13, with urea consumption forecasted at 32-million tons, diammonium phosphate at 13.24-million tons and potash at 4.69-million tons. India was fully dependent on imports to meet domestic demand for phosphatic and potassic fertilisers.
India has postponed all purchases of potash and potassic fertiliser until September 2012, but officials in the Department of Fertiliser said that even after imports were resumed, at least 50% of potash would be sourced from BelarusKali and Indian equity interest in the latter should be viewed against such mutual commercial interests.
Apart from the uncertainty over the Belarus government’s potential privatisation of BelarusKali, strategic offtake has been a sticking point in talks held so far, with the Indian government insisting on an offtake equal to the proportion of equity that it is proposed Indian fertiliser companies take, the official said.