Lok Sabha Question No. 1719 (UNSTARRED), answered on 2022-12-16
Subject: Increase in Domestic Production of Chemicals and Fertilizers
Ministry: CHEMICALS AND FERTILIZERS
Asked by: Gyaneshwar Patil, Nayab Singh

## GOVERNMENT OF INDIA MINISTRY OF CHEMICALS & FERTILIZERS DEPARTMENT OF CHEMICALS AND PETROCHEMICALS

## LOK SABHA

## UNSTARRED QUESTION NO.†1719

TO BE ANSWER ON 16.12.2022

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## INCREASE IN DOMESTIC PRODUCTION OF CHEMICALS AND FERTILIZERS

## †1719. SHRI GYANESHWAR PATIL:

## SHRI NAYAB SINGH:

Will the Minister of CHEMICALS AND FERTILIZERS be pleased to state :

(a)  the  details  of  the  various  schemes  introduced  by  the  Ministry  to  increase  the  domestic production of chemicals and fertilizers in the country;

(b)  the  steps  taken/proposed to be taken by  the  Government  for the smooth distribution of fertilizers in rural and remote areas across the country;

(c) whether any specific mechanism has been initiated by the Government to help the producers to become more competitive in global market by ensuring required standards and demands thereof; and

(d) if so, the details thereof?

## ANSWER

## MINISTER OF STATE FOR CHEMICALS AND FERTILIZEERS

## (SHRI BHAGWANT KHUBA)

(a): In order to increase the domestic production of urea in the country, Government of India mandated revival of Ramagundam (Telanagana), Gorakhpur (Uttar Pradesh), Sindri (Jharkhand) and Talcher (Odisha) units of Fertilizer Corporation of India (FCIL) and Barauni (Bihar) Unit of Hindustan Fertilizer Corporation Ltd (HFCL) through Joint Venture Company (JVC)  of nominated  PSUs  for  setting  up  new  ammonia-urea  plants  of  12.7  LMTPA capacity each.  After  operationalization,  these  plants  would  add  63.5  LMT  per  annum of indigenous  urea  production  in  the  country.  Ramagundam  and  Gorakhpur  units were commissioned on 22.03.2021 and 07.12.2021 respectively whereas Barauni and Sindri units also started urea production on 18.10.2022 and 05.11.2022, respectively.

The Government had announced New Investment Policy (NIP) - 2012 on 2 nd January, 2013 and its amendment on 7 th October, 2014 to facilitate fresh investment in the urea sector and to make India self-sufficient in the urea sector. Total 6 new urea units have been set up under NIP -  2012  read  with  its  amendment.  These  are  Panagarh  urea  unit  of  Matix  Fertilizers  and Chemicals  Ltd.  (Matix);  Gadepan-III  urea  unit  of  Chambal  Fertilizers  and  Chemicals  Ltd. (CFCL); Ramagundam urea unit of Ramagundam Fertilizers and Chemicals Ltd.(RFCL); and

3 urea units namely Gorakhpur, Sindri and Barauni of Hindustan Urvarak & Rasayan Limited (HURL). Each of these units have the installed urea production capacity of 12.7 Lakh Metric Tonne per annum. Therefore, these units have together added 76.2 LMT per annum in the existing indigenous urea production capacity of the country.

Further, an exclusive policy has been notified on 28 th April 2021 for the revival of Talcher unit  of  FCIL  by  setting  up  a  new  greenfield  urea  plant  of  12.7  LMT  per  annum  at  coal gasification route.

The Government has notified the New Urea Policy (NUP) - 2015 on 25 th  May, 2015 with one of the objectives of maximizing indigenous urea production. The NUP-2015 has led to an additional production from existing urea units due to which the actual production of urea has increased by 20-25 LMTPA in comparison to the actual production during 2014-15.

Prices of P&K fertilizers are decontrolled. Under the Nutrient Based Subsidy (NBS) Scheme implemented with effect from 1.4.2010, a fixed amount of subsidy, decided on annual/semiannual  basis, is  provided  on  subsidised  P&K  fertilizers  depending on  their nutrient content. Under this policy, MRP is fixed by fertilizer companies as per market dynamics at reasonable level which is monitored by the Government.

Government of India has increased the P&K fertilizers subsidy under the Nutrient Based Subsidy scheme on 20.5.2021 & 13.10.2021 (giving special compensation on DAP and 3 most commonly used NPK fertilizers) for the year 2021-22, then further increased substantially for Kharif-2022 (applicable from 01.4.2022 to 30.9.2022) and finally almost maintained the same level for Rabi-2022 (applicable from 1.10.2022 to 31.3.2023) so that these fertilizers are made available at affordable prices to the farmers. The per kg subsidy rates for nutrients viz. N, P, K and S under NBS scheme is as under:

|   S. No | .NutrientsNBS   |   (Rs. Per Kg of Nutrient) (from 01.04.2021 to 19.05.2021) |   NBS (Rs. Per Kg of Nutrient (from 20.05.2021 to 31.03.2022) ** |   NBS (Rs. Per Kg of Nutrient) (from 01.04.2022 to 30.09.2022) |   NBS (Rs. Per Kg of Nutrient) (from 01.10.2022 to 31.3.2023) |
|---------|-----------------|------------------------------------------------------------|------------------------------------------------------------------|----------------------------------------------------------------|---------------------------------------------------------------|
|       1 | N               |                                                     18.789 |                                                           18.789 |                                                          91.96 |                                                         98.02 |
|       2 | P               |                                                     14.888 |                                                           45.323 |                                                          72.74 |                                                         66.93 |
|       3 | K               |                                                     10.116 |                                                           10.116 |                                                          25.31 |                                                         23.65 |
|       4 | S               |                                                      2.374 |                                                            2.374 |                                                           6.94 |                                                          6.12 |

** A special one-time package with additional subsidy has been provided (effective from 01.10.2021 to 31.3.2022) for DAP at Rs.8769/MT and 3 most consumed NPK fertilizers (10:26:26, 20:20:0:13 and 12:32:16) at Rs. 2000/MT for  each  grade  in  order  to  make  P&K  fertilizers  available  at affordable prices to the farmers.

(b): Uniform freight policy (UFP) has been implemented with effect from 1st April, 2008 vide notification  dated  17th  July,  2008.  The  objective  of  the  UFP  is  to  ensure  availability  of fertilizers,  especially  during  the  peak  demand  period,  in  all  parts  of  the  country  and  to implement the freight reimbursement in line with NPS-III. Based on the recommendations of Tariff Commission, the slab-wise rates in respect of primary road movement upto 500 Kms are notified annually. The escalated/de-escalated Per Tonne Per kilometre (PTPK) rates for road  transportation  in  the  case  of  secondary  movement  of  fertilizers  are  also  notified  by Department of Fertilizers.

The following steps are taken by the Government every season to meet the adequate and timely requirement of fertilizers across the country.

- i. Before the commencement of each cropping season, Department of Agriculture and Farmers Welfare (DA&FW), in consultation with all the State Governments, assesses the state-wise and month-wise requirement of fertilizers.
- ii. On the basis of requirement projected, Department of Fertilizers allocates sufficient/adequate quantities of fertilizers to the state by issuing monthly supply plan and continuously monitors the availability.
- iii. The movement of all major subsidized fertilizers is monitored throughout the country by  an  on-line  web  based  monitoring  system  called  integrated  Fertilizer  Monitoring System (iFMS).
- iv. The State  Governments are regularly  advised to  coordinate  with manufacturers  and importers  of  fertilizers  for  streamlining  the  supplies  through  timely  placement  of indents for railway rakes through their state institutional agencies like Markfed etc.
- v. Regular  Weekly  Video  Conferences  are  conducted  jointly  by  D/o  Agriculture  & Farmers Welfare and D/o Fertilizers with State  Agriculture Officials and corrective actions are taken to dispatch the fertilizers as indicated by the State Governments.

(c) & (d): To help producers to become more competitive in the global market and ensuring standards  and  demand,  various  bio-fertilizers  have  been  marketed  in  the  country, viz-a-viz Rhizobium, Azotobactor, Azospirillum, Phosphate Solubilising Bacteria, Mycorrhizal Biofertilisers,  Potassium  Mobilizing  Biofertilizrs  (KMB)  Zinc  Solubilizing  Biofertilizers (ZSB)  Acetobactor,  Carrier  Based  Consortia,  Liquid  Consortia,  and  Phosphate  Solubiling Fungus Bio-fertilizer.

Different organic fertilizers produced and marketed are city compost, vermicompost, compost Deoiled  cake,  Phosphorus  Rich  Organic  Manure  (PROM),  City  compost,  organic  manure, Bone mile raw, Bone mile steamed, Postash derived from Rhodophytes, Fermented Organic manure,  liquid  Fermented  Organic  manure  and  Bio-enriched  Organic  Manure  under  the Fertilizer Control Order (FCO),1985.

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