Question : FINANCIAL CRISIS IN FACT

THE MINISTER OF STATE IN THE MINISTRY OF CHEMICALS AND FERTILIZERS (DR. CHHATTRA PAL SINGH)

(a) : Yes, Sir.

(b) : The year-wise details of the losses suffered by FACT are as under :-

Year	Rs. crore
1998-99	48.26
1999-2000	39.80
2000-01	151.50
2001-02	(+)0.63#
2002-03	208.00(Estimated)

(upto January, 2003)

# The company had suffered an operating loss of Rs.226.25 crore during the year. However, due to grant of financial relief by the Government of India by way of writing off the interest on GOI loan amounting to Rs.226.88 crore, the company had made a marginal profit before tax of Rs.0.63 crore during the year.

(c) & (d) : FACT is receiving its requirement of Petroleum products like Naphtha, etc. from Kochi Refineries Ltd. (KRL) and Bharat Petroleum Corporation Ltd. (BPCL). At present the supplier is granting one month free credit and one month credit on interest. The outstanding payment to the suppliers as on 31.1.2003 is about Rs.90 crore. As the company is facing a severe liquidity problem due to huge cumulative losses and high inventory of fertilizers, FACT is finding it difficult to make payment to the raw material suppliers including KRL and BPCL from December, 2002 onwards. As a result of this, KRL and BPCL have resorted to stoppage of supplies frequently and presently FACT is procuring Petroleum products on cash and carry basis.