•Needs Rs. 700 m investment
•Will save Rs. 511 m per year from the fertilizer subsidy
The Eppawala phosphate mine is still languishing without inventors as the Chinese and Indian investment bids have been turned down by the government due to issues in the ownership clause.
According to Lanka Phosphate Ltd (LPL) Chairman Dr. Chandana P. Udawatte both proposals that were submitted as a result of state visits to India and China by the current President and his predecessor were turned down as they demanded a controlling stake in the joint venture.
“It is imperative that LPL has a 51% stake in the venture. None of the submitted proposals have satisfied this criteria. Therefore we have rejected them,” Dr. Udawatte said. However, fresh bids are expected to be submitted by China, India and Japan. According to Dr. Udawatte a Rs. 700 million investment is needed to set up the triple super phosphate production plant along with the sulfuric plant that is needed to dissolve rock phosphate.
The plant is estimated to save Rs. 511 million per year, from the massive fertilizer subsidy that is currently being doled out.President Rajapakse’s former visit to India resulted in a US$ 15million pledge by the Advance Group of Companies to manufacture super phosphate for the local agricultural market using rock phosphate from the Eppawala mine.
Dr. Udawatte told the DailyFT that he is also looking at the options of either borrowing the lump sum from a state bank or the Indian Credit line. However, the prerequisite for the latter option is that all equipment and machinery should be imported from India.