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When fertilizer production shifted to North and West...
The Indian fertilizer industry had its base on two old units: Fertilisers & Chemicals Travancore Ltd (FACT) near Alwaye in Kerala and Fertilizer Corporation of India (FCI) at Sindri, near Dhanbad. Since the 1940s, the vast needs of technical and managerial manpower for the industry were provided by these two old units.

FACT and FCI evolved with developments in technology. I saw this at FACT:  from the gasification of wood and hydrolysis of water to the modern process of making hydrogen and carbon from petrochemicals, naphtha crackers, use of catalytic converters... With successive changes in techno- logy the two units also became museum pieces with their facilities clogged up by different production units.

The sector, as part of the government’s policy, remained largely the preserve of the public sector. In line with the Delhi-centric approach, FCI received lot of attention and expanded through different units, whereas the state-owned and distant FACT didn’t receive corresponding attention, despite the rich technology base created in the Fertilizer Engineering and Design Organisation (FEDO) as an adjunct. FACT did not evolve as a commercially sustained, profitable organisation. The strict control of production and prices also resulted in FCI, despite growing in size, not emerging a profitable entity. The Planning & Development (P&D) division of FCI evolved as a strong research and development and engineering arm of FCI, was headquartered at Sindri. For several years P&D provided the technology base for setting up new units and expanding existing fertilizer units. But constrained by resources, both P&D and FEDO lacked the thrust to catch up with massive developments taking place in technology across the globe.  The paucity of foreign exchange resources necessitating self-reliance, contributed to India battling for long with outdated technologies, serious cost overruns due to delays and difficulties experienced in scaling up lab models, plunging both FCI and FACT into mounting losses.

 

Neyveli’s fertiliser dream shattered…

In the 1960s, I visited the sprawling integrated complex of Neyveli Lignite Corporation (NLC). NLC was conceived and established to produce power, urea and carbonised briquettes (Leco brand fuel) all based on lignite. Availing German technology for gasification of lignite through the sophisticated Winkler generators, NLC had capacity to produce 150,000 tonnes of urea annually. But due to the severe shortage of lignite due to inadequate mining capacity, available lignite was fully allotted for power. Against the original plan to produce 6.5 million tonnes of lignite per annum to feed the three plants, for over 15 years since inception, NLC produced less than three million tonnes, plunging the corporation to mounting losses. Naturally the victim was urea production, which was less than 100,000 tonnes. Lignite gasification was a tough and cumbersome process. S Yegneswaran, who identified the problems of the corporation in 1972, succeeded in persuading the government to augment mining machinery, as also to convert the feedstock for urea from lignite to furnace oil and did produce urea in handsome quantities. However, with petroleum prices skyrocketing, NLC closed down the fertilizer unit.

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