Seeds, Soil and Machines: India's Farm Inputs
Fertiliser Imports and Nano Urea
Why India imports much of its fertiliser and raw materials, how global price spikes raise subsidy costs, and the promise and doubts of nano urea.
India depends heavily on imports for fertilisers.
Import dependence
- India imports a significant share of its urea and DAP.
- It imports almost all its potash, since it has no significant potash reserves.
- Natural gas, the main raw material for urea, is partly imported as LNG.
- Phosphate rock is largely imported.
Price shocks
When global prices spike, as after Russia’s invasion of Ukraine in 2022, India’s fertiliser subsidy bill surged to over 2.5 lakh crore rupees in 2022-23.
Self-reliance efforts
- Reviving closed urea plants, such as those at Gorakhpur, Sindri and Ramagundam.
- Long-term supply deals with countries like Morocco, Saudi Arabia and Russia.
- Investing in fertiliser plants abroad.
Nano urea
IFFCO launched nano urea in liquid form in 2021, claiming a small bottle could replace a bag of urea.
- Benefits claimed: lower transport costs and less overuse.
- Doubts: some scientists questioned its effectiveness, and field studies showed mixed results.
When global gas and fertiliser prices jump, the government keeps urea's retail price fixed, so the subsidy per bag rises sharply, costing taxpayers more.
It imports much of its fertilisers and raw materials.
- India imports much of its fertilisers and raw materials.
- Global price spikes raised subsidies above 2.5 lakh crore in 2022-23.
- Plant revivals and supply deals aim for security.
- Nano urea's effectiveness is debated.
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