``There is no question of reviewing the project as it is economically viable and in the national interest. We are determined to go ahead with the project and hope to solve all problems very soon,'' fertiliser ministry sources said.

Fertiliser ministry sources admitted that withdrawal of Coface and fresh conditions put by bankers -- J P Morgan, Banque National de Paris (BNP) and Arab Banking Corporation (ABC) -- including increasing the equity to 33 per cent from 25 per cent did create uncertainties.

Coface declined to provide insurance cover in the wake of the Asian crisis, downgrading of India's sovereign ratings and the uncertain fertiliser policy.

"We hope to overcome the problems by finalising agreements with export credit agencies of England andBelgium for insurance cover. Discussions are in the final stage. The final agreement is likely by the month end," they said. Discussions are also simultaneously on with the export credit agencies of Canada and Japan for providing insurance cover.

The Indian promoters of the project, Kribhco and Rashtriya Chemicals and Fertilisers Ltd (RCF), have agreed to increase the equity stake to 33 per cent and are now trying to rope in another co-operative fertiliser giant to participate in the equity structure, sources said. The Oman Oil Company (OOC) has already agreed to increase the equity, sources added.

Earlier Coface and Italian export credit agency had agreed to provide insurance guarantee for the 50 per cent on the loan component, which was around $400 million based on debt-equity ratio of 3:1. Though the Italian credit agency is convinced that the project is viable, it is not willing to go ahead for insurance guarantee alone, sources said, adding much-delayed project could be further delayed due to freshfinancial problems as the proposal is yet to be cleared by the Public Investment Board (PIB) and Cabinet Committee of Economic Affairs.

The `zero date', the day when actual construction work starts at the project site, would have to be further extended from the earlier date of December 1998 by at least six months, sources said. Changing the debt equity ratio from 3:1 to 2:1 means equity part would go up to $ 450 million from the earlier agreed amount of $ 360 million.

According to the original agreement, the equity part has to be equally shared by Indian and Omani partners. With the expected entry of third Indian partner, the fifty per cent equity would be shared by three Indian companies and the balance fifty per cent by OCC alone, sources said.