There has been a near consensus among the cooperative leaders that NAFED should be bailed out by healthy cooperatives of the country. Name of IFFCO has cropped up in the past in this context.
It now emerges, though not confirmed by IFFCO sources yet that the beleaguered National Agriculture Cooperative Marketing Federation has decided to sell its bio-fertiliser units in Rajasthan and Madhya Pradesh to either IFFCO or KRIBHCO.
Nafed sources say that it has already begun negotiations with IFFCO and KRIBHCO in this connection. It has to repay Rs. 2,000 crore it has borrowed from various banks. Many observers believe that the cooperative is trying to improve its financial position through the sale of its fertiliser manufacturing units so it may once again exist and grow in an independent way.
Following refusal of a bailout package from the govt. the cooperative has taken measures to cut its losses as earlier reported by the Indian Cooperative. It has brought its multiple real estate properties and fertiliser units at various locations across the country under the hammer.
Sources say NAFED needs to focus more on price support scheme (PSS) to meet its administrative expenses. Under PSS, Nafed procures 16 commodities at minimum support price on behalf of the government.
Even as the cooperative has been making operating profits in the last five years, Nafed had been suffering losses because of mounting interest liability on outstanding loans due to its failed ‘tie-up business’.