All About Urea Fertilizers in India

Availability of Urea Fertilizers in India

Highest ever urea production of 245 LMT occurred in the country during 2015-16 (period April, 2015 to March, 2016) – an increase of 20 LMT (approximately) in comparison to the previous year.

Even in the current year, during Kharif 2016 (April to September) the availability of urea was 159.10 LMT against the sales of 144.14 LMT.

Timely and adequate availability of fertilizers in every part of the country has been ensured through close monitoring and meticulous planning of imports.


Neem Urea Coated

Based on the CCEA decision, vide notification dated 25th May, 2015 Department of Fertilizers has made it mandatory for all the domestic producers of urea to produce 100% as Neem Coated Urea with an extra MRP of 5% (of Rs. 5360/- per MT) to be charged by the fertilizer manufacturing entities from farmers. Entire quantity of indigenously produced urea and imported urea is being neem coated w.e.f 1st September, 2015 respectively.

In order to determine the impact, Department of Agriculture, Cooperation & Farmers Welfare (DAC & FW) was entrusted to conduct a study. DACFW has submitted an interim report prepared by Agricultural Department and Rural Transformation Centre (ADRTC). The findings of said study are as under:

· Improvement in soil health.

· Reduction in costs with respect to plant protection chemicals

· Reduction in pest and disease attack

· An increase in yield of paddy to an extent of 5.79 per cent.

· An increase in yield of sugancane to extent of 17.5 per cent.

· An increase in yield of maize to the extent of 7.14 per cent.

· An increase in yield of Soyabeen to the extent of 7.4 per cent.

· An increase in yield Tur/Red Gram to the extent of 16.88 per cent.

· Diversion of highly subsidized urea towards non-agricultural purposes negligible among farmers after the introduction of the mandatory policy of production and distribution of only neem coated urea.

New Urea Policy

Based on the CCEA decision, vide notification dated 25th May, 2015, the New Urea Policy-2015 (NUP-2015) has been notified by Department of Fertilizers, with the objectives of maximizing indigenous urea production; promoting energy efficiency in urea production; and rationalizing subsidy burden on the government.

It is expected to prepare the domestic urea sector to become globally competitive in terms of energy efficiency over a period of three years. On the basis of actual energy consumption and pre-set norms, the units have been divided into three groups and revised energy consumption norms have been fixed for next three financial years and target energy norm have been fixed for 2018-19. It will drive urea units to select better technology and different measure to reduce energy consumption.

NUP-2015 is effective from 1st June, 2015 to 31st March, 2019. NUP-2015 has led to additional production of approximately 20 LMT from the existing plants and the total production of urea during the year 2015-16 was 244.5 LMT, i.e. the highest ever urea production in the country.

City Compost

The Government of India approved a policy on promotion of City Compost. A notification conveying the approval of the Government has been issued by this Department on 10.2.2016 in which marketing development assistance of Rs. 1500/-MT has been provided for scaling up production and consumption of city compost.

For co-marketing of City Compost, the tagging of Cities with fertilizer marketing companies for the purpose of proper utilisation of city Compost produced in the cities has been completed as per the list provided by M/o Urban Development.

Compost producers vide O.M. dated 28.9.2016 issued by the Department of Fertilizers, have been allowed direct sale of city compost to farmers.

The required software for routing of MDA through FMS and mFMS (now iFMS) is operational.

A joint Committee of Joint Secretaries of Department of Fertilizers, Ministry of Urban Development, and Department of Agriculture have been set up for coordination.

The fertilizer Companies have adopted 190 villages for promoting the use of City Compost.

State level steering Committee has been constituted for promotion of City Compost.

During April, 2016 to November 2016, 63994 M.T of city Compost has been co-marketed.

NBS Scheme for P & K fertilizers

Under NBS 2015-16, the condition regarding submission of quality certificate from State Government for the claim of balance payment to the companies has been liberalised. If quality certificate from State Governments is not received within 180 days, it would be considered as deemed receipt of certificate and balance payment if subsidy would be released to the fertilizer companies.

Applicability of NBS rates on the closing of P&K fertilizers at the end of FY has been streamlined.

In order to push major policy reforms in the fertilizer sector, Department of Fertilizers, w.e.f 18.3.2016 has removed minimum capacity utilization criteria for the Single Super Phosphate (SSP) units to be eligible for the subsidy under the Nutrient Based Subsidy (NBS) Scheme.

Reduction in price of P & K Fertilizers

The NBS rates are fixed based on international prices of P & K fertilizers under the NBS Scheme. During the year 2016-17, the Government has already reduced the NBS rates taking into consideration the falling international prices of P&K fertilizers.

It is observed that international prices of these fertilizers has again fallen down but this time Government has decided not to reduce NBS rates and pass on the benefit of international prices to the farmers. Accordingly, the P&K fertilizer companies have reduced the MRP of MOP, DAP and NPK by Rs. 5000/MT, Rs. 2500/MT and Rs. 1000/MT respectively in the month of June 2016 since the reasonableness of MRP is checked by the Department.

DBT in Fertilizers

Direct benefit transfer in modified from is being implemented in fertilizer sector. Department of Fertilizers has chalked out a programme to implement the DBT Pilot Project of the country in the following 16 Districts in Fertilizers Sector:

i. Bihar – Kishanganj

ii. West Bengal – Maldah

iii. Madhya Pradesh – Hoshangabad

iv. Haryana – Karnal

v. Haryana – Kurukshetra

vi. Andhra Pradesh – Krishna

vii. Andhra Pradesh – West Godavari

viii. Maharashtra – Nasik

ix. Himachal Pradesh – Una

x. Kerala – Kunnur

xi. Telangana – Rangareddy

xii. Karnataka – Tumkur

xiii. Maharashtra – Raigarh

xiv. West Bengal – South 24 Parganas (in plac of Murshidabad)

xv. Rajasthan – Pali

xvi. Gujarat – Narmada (in place of chotta Udepur)

To implement the DBT Pilot Project in above 16 Districts of the country, a meeting was called with the District Collectors and CMDs of leading Fertilizers companies on 07.09.2016 to chalk out a plan for installation of Standard Operating System (SoP) at retailers point and also sort out the issues pertaining to the implementation of the DBT project.

The fertilizers companies were requested PoS devises as per NIC specification in consultation with all stakeholders for implementation of the DBT in 16 Districts. The fertilizer companies were also asked to prepare a plan for installation of PoS devices at all retailers of the country by 1st January, 2017.

Department of Fertilizers has authorized PDIL to recruit personnel for the posts of Project Manager, Technology Consultant, IES & MIS consultant and 16 District Consultant on contract basis for DBT Pilot Project in Fertilizer Sector. Department has already issued orders to M/s. PDIL for appointment of 1 Project Manager, 1 Technology Consultant and 1 IES & MIS consultant 13 District Consultant. M/s. PDIL has appointed 13 District Consultant, 3 District Consultant of Kunnur (Kerala), Tumkur (Karnataka), Raigarh (Maharastra), Raigarh (Maharastra) have not been appointed.

Department proposed to use KYC for authentication and collecting demographic data during DBT pilot Project in the country. Department has already made agreement with UIDAI to take services of authentication Service Agency (ASA) which are registered with UIDAI. The agreement has also been made with CSC. All documents as desired by UIDAI have seen sent to them to get on board with UIDAI as KYC User Agency (KUA). UIDAI has provided license key & AUA Pre-production/KUA Pre-Production access to Department of Fertilizers.

It has also been decided that based on the success of pilot Project, DBT in entire country will be rolled out by March 2018 in Phase-wise manner.

Formation of Indian Council for Fertilizer and Nutrient Research (ICFNR)

Indian Council for Fertilizer and Nutrient Research (ICFNR), an Institution exclusively devoted to promotion of research in fertilizer sector under the Department of Fertilizers, has been set up on 16.09.2016. The ICFNR has a Governing Council under the chairmanship of Minister of Chemical & Fertilizers and an Executive Council under the chairmanship of Secretary (Fertilizers). The terms of reference of ICFNR are as under:-

i. To undertake/promote research in the area of fertilizer manufacturing technology, use of raw material and innovation in fertilizer products through partnership ad collaboration with various research institutions, fertilizer industry and other stakeholders.

ii. To examine and comprehensively deliberate R&D project proposals submitted by various R&D organizations/Academic institutions, for suitable recommendations for funding.

iii. To play a supportive role for identifying and formulating long range technology plans and working out suitable mechanism for adoption of indigenous processes.

iv. To identify and promote eco-friendly micro nutrients and pesticide coated slow release fertilizers and also to ensure reduction of Carbon Footprint of fertilizer sector and energy efficient operation.

v. To undertake and promote research in bio fertilizer and its derivatives with appropriate coating or blending so as protect and increase soil fertility.

vi. To undertake and promote research in organic fertilizer and its derivatives with suitable coating or blending so as to protect and increase the soil fertility.

vii. To promote dissemination of information on latest developments in Fertilizer sector and also to support new ideas and changes for effecting improvements in fertilizer industry.

viii. The centre will work in close collaboration with other research institutions/centres/institutes and will also decide and disseminate the research work already undertaken by them.

ix. To undertake all such activities which will promote the core idea of ICFNR.