Urea is getting to be the most consumed and heavily import-dependent fertiliser.
It is thus essential to achieve self-sufficiency in this sector by boosting domestic production and curbing its superfluous consumption.
What are the government efforts?
Production - A New Urea Policy was launched in 2015 focussing specifically on maximising domestic output, promoting energy efficiency in production and rationalising subsidies.
It offered incentives to fertiliser units to produce more than their reassessed capacities.
Supplementary measures like allowing few plants to continue production using naphtha as feedstock till they get assured gas supply were taken.
A new gas pooling policy has been put in place to supply gas to all urea units at uniform rates.
Curbing extravagant use - Unregulated use of urea and diversion to non-agricultural activities are getting to be concerns for crops and the environment.
The governmental measures in this regard include:
Neem-coating of urea - to be applied in relatively smaller doses to get the same crop yields; also, it is unfit for non-farm use.
Smaller Packages - packing of urea in 45 kg bags, instead of usual 50 kg, to economise on its use because number of bags per hectare is the count for farmers.
Soil health cards - to recommend the laboratory test-based exact doses of different fertilisers needed for each farm holding.
What are the outcomes?
Flawed official policies and inordinate delays in subsidy reimbursement to the industry kept fresh investments in abeyance.
However, a series of reform-oriented steps in the last few years have altered the investors’ outlook on urea.
Notably, annual growth rate of indigenous production is optimistic and imports are also shrinking.
Furthermore, the government and public sector fertiliser units are planning to spend on renovation and modernisation of existing plants and revival of closed fertiliser factories.
Despite these positive outcomes, there is a need to bring urea under the nutrient-based subsidy regime.
This is essential to ensure a balanced use of the three major plant nutrients (nitrogen, phosphate and potash) to maintain soil fertility.
