Mansukh Mandaviya: India to stop importing urea by end of 2025

According to the Union Minister for Chemicals and Fertilizers, Mansukh Mandaviya, India will stop importing urea by the end of 2025 due to an increase in local production capacity with the commissioning of new fertilizer plants.

India is a big importer of Urea and meets around 30% of its 35 million tonnes of annual urea requirement from imports. 

Urea Production and Import

• The urea production in the country increased from 225.08 lakh tonnes in 2014-15 to  284.95 lakh tonnes in 2022-23.
• In 2022-23, the total import of Urea was 75.8 lakh tonnes, which is around 30% of the domestic demand. The main sources of urea imports are Oman, Qatar, Saudi Arabia, and the UAE.

Government strategy to end urea Import

The government has adopted a two-pronged strategy to end the import of urea. One strategy is to revive the closed fertilizer plants and increase the domestic supply of urea. The other strategy is encouraging farmers to use alternative fertilizers like nano-liquid urea.

Increase Domestic Production 

The government of India introduced the New Urea Policy 2015 with the aim of boosting indigenous urea production.

Under the New Urea Policy, the government plans to revive closed fertilizer plants at Gorakhpur in Uttar Pradesh, Ramagundam in Telangana, Talcher in Odisha, Barauni in Bihar, and Sindri in Jharkhand. Four plants have already been revived, and the fifth will soon be revived. 

Promotion of alternative fertilizer like Nano liquid Urea 

• Minister Mandaviya said that the government is taking steps to popularise the use of alternate fertilizers like nano liquid urea and nano liquid di-ammonium phosphate (DAP). These fertilizers are considered good for crops and soil health.
• Indian Farmers Fertiliser Cooperative Limited (IFFCO) has operationalised three Nano Urea plants at Kalol (Gujrat), Phulpur, and Aonla in Uttar Pradesh, with a capacity of 17 crore bottles. One 500-ml bottle of Nano Urea is equivalent to one bag (45 kg) of conventional urea.
• IFFCO has started producing Diammonium Phosphate (DAP) at its Kalol plant and plans to commission two more plants at Kandla and Paradeep. 
• Coromandel International Limited (CIL) has also set up a Nano DAP production facility in Andhra Pradesh, which has a manufacturing capacity of 4 crore bottles (1 litre each) per year.

PM Programme for Restoration, Awareness, Nourishment and Amelioration of Mother Earth' (PM-PRANAM)

The government also launched the 'PM Programme for Restoration, Awareness, Nourishment and Amelioration of Mother Earth' (PM-PRANAM) scheme in 2023 to provide an incentive to states and Union Territories (UTs) to promote the use of alternative fertilizers and balanced use of chemical fertilizers.

According to Mandaviya, the annual domestic production capacity of urea will reach around 325 lakh tonnes after the commissioning of the fifth plant. The target is to replace the use of 20-25 lakh tonnes of conventional urea with nano-liquid urea.

Subsidy on Fertilizers 

• Fertilizers sold to farmers are heavily subsidised by the government of India. The government has allocated Rs 1.64 lakh crore as fertilizer subsidy for 2024-25. The total subsidy in 2023-24 on fertilizer was Rs 1.89 lakh crore, as per the revised estimates.
• Under the Urea Subsidy Scheme (USS), urea is provided to farmers at a statutorily notified Maximum Retail Price (MRP). The government pays manufacturers the difference between the MRP and the production cost.
• Under the  Nutrient Based Subsidy Policy, a fixed amount of subsidy is notified on an annual/semi-annual basis by the government to ensure the availability of phosphatic and potassic fertilizers at reasonable prices to farmers.
• Urea is imported on a government account. Fertilizers like DAP, MOP and NPK are covered under the Open General License (OGL) under the Nutrient Based Subsidy (NBS) Scheme and the fertilizer companies import them.