India shows interest in Belaruskaliy
Besides, Indian Potash Ltd is interested in a long-term agreement on the supply of potassium chloride from Belarus. On August 27, 2011 the Indian Governments and Belarus signed a protocol concerning the examination of the possibility to conclude a long-term contract for buying potassium and India’s equity position in Belaruskaliy (this concerns a minority interest).
In aletter from the Indian Minister, it is stated that “within the implementation of the protocol the IPL takes on long-term responsibilities to buy Belarusian potassium and the IFFCO will be involved in the conduct of due diligence in relation to the possibility of purchasing a share of Belaruskaliy”.
The IPL company that supplies more than 60% of the Indian potassium market is a strategic partner of the BPC (Belarusian Potassium Company), an exclusive Belaruskaliy and Uralkaliy production exporter. India covers its demand in potassium fertilizers fully due to import, purchasing about 5 mln. tons of fertilizers annually. That is why the Ministry urges market players to buy potassium assets and create joint ventures with fertilizer producers abroad.
In our opinion, the probability that Belaruskaliy shares will be sold to residents of India seems low, as a minority interest will not allow them to influence the pricing and merchandising policies of the Belarusian enterprise. However, it should be admitted that the financial capabilities of the Indian Government are now substantial (by April 27, 2012 the Indian gold and foreign currency reserves reached USD295.361 bln.).
For reference. According to Belstat the production of potassium fertilizers in Belarus in the first quarter of 2012 decreased by 12.1% to 1.269 mln. tons compared with the first quarter of 2011. This was caused by the decreased demand for potassium fertilizers on foreign markets.
Thus in January-February 2012, Belarus abridged the export of potassium fertilizers compared with the same period of the previous year twofold to 377.2 thousand tons. In monetary terms in January-February of the current year the export supplies of potassium fertilizers dropped by 40% to USD285.581 mln. the average potassium fertilizers price grew in January-February 2012 compared with January-February 2011 by 22.1% to USD757.1 per one ton.
JSC Belaruskaliy is one of the world’s largest producers of potassium mineral fertilizers. All 100% of shares belong to the Government. The enterprise functions on the basis of the Starobin potassium salts deposit and comprises four mining departments, auxiliary shops and service subdivisions. It employs 18.589 thousand people. The share of the enterprise in world export exceeds 16%. The production is supplied to more than 50 countries. Belarusian Potassium Company deals with all exports.
Belarusian Potassium Company is an exclusive supplier of potassium fertilizers produced by JSC Belaruskaliy (Soligorsk) and JSC Uralkaliy (Perm region, Russia) to foreign markets. The BPC was established in 2005. Shareholders of the company are Belaruskaliy (45%), Belarusian Railway (5%) and Uralkaliy (50%). The BPC is the largest supplier of potassium fertilizers on the world market the company’s share makes up 42% of the world market volume.
The Belarusian authorities could to step up the opposition representation in local councils, should party members demonstrate potency. The Belarusian leadership is unlikely to have the resources to ensure 100 percent pro-government candidates in the local elections. The authorities have exhausted the grassroot support and have no funds to pay for the loyalty.
The Belarusian Central Election Commission has proposed to hold the elections to the local Councils of Deputies on February 18th, 2018.
The president has repeatedly emphasised the importance of the local councils in the power system and the state machine always tried to ensure the necessary local election results. Candidates have been decreasing in number with each elections and the authorities dealt with that by reducing the deputy corps. That said, during the rule of President Lukashenka, his electoral base has changed substantially. Over the past decade, most Belarusians have moved to cities and lost their local roots. The rural population is ready to support the president, but rural residents are constantly decreasing in number.
The Belarusian leadership is likely to permit broad participation in the election campaign and an increase in alternative representatives in the local councils. However, the opposition would have to boost its activity, so as so far it has been passive in defending its interests. In addition, the authorities, while determining the date for the local elections, have taken into account the fact that the opposition is usually the least active in the winter time.
Overall, both, the opposition and the local authorities have exhausted their grassroot support, however new local leaders may still come on political stage, although the party opposition has not yet shown sufficient aspirations.