Lok Sabha Question No. 5662 (UNSTARRED), answered on 2025-04-04
Subject: Decline in Production of DAP
Ministry: CHEMICALS AND FERTILIZERS
Asked by: Shri Daroga Prasad Saroj

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

## LOK SABHA

UNSTARRED QUESTION NO. 5662 TO BE ANSWERED ON

: 04.04.2025

## Decline in Production of DAP

## 5662.  SHRI DAROGA PRASAD SAROJ:

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

- (a) whether  the  Government  proposes  to  take  any  steps  to  check  the  rising prices  of  Diammonium  Phosphate  (DAP)  and  Urea  Fertilizers  across  the country  including  Uttar  Pradesh,  if  so,  the  details  thereof  and  if  not,  the reasons therefor;
- (b) whether there has been any decline in the production of the said fertilizers resulting in reduction of their bag weight from 50 Kg, if so, the details thereof;
- (c) the details of the steps taken by the Government to increase the production of fertilizers in UP; and
- (d) whether there is a facility of storage or production of sufficient fertilizers for the  farmers  in  UP  for  sowing/production  of  the  upcoming  crops,  if  so,  the details thereof and if not, the reasons therefor?

## ANSWER

## THE MINISTER OF STATE IN THE MINISTRY OF CHEMICALS & FERTILIZERS

## (SMT. ANUPRIYA PATEL)

(a): Government  has  implemented  Nutrient  Based  Subsidy  (NBS)  Policy  w.e.f. 01.04.2010.  Under  the  policy,  a  fixed  amount  of  subsidy,  decided  on  annual/biannual basis, is provided to manufacturer / importer on subsidized P&K fertilizers depending on their  nutrient  content  i.e.  Nitrogen  (N),  Phosphorus  (P),  Potassium (K)  and  Sulphur  (S)  to  improve  availability  of  fertilizers  to  farmers.  Under  NBS scheme.   The P&K sector is decontrolled, the fertilizer companies are free to import /  produce  fertilizer  raw  materials,  intermediaries  and  finished  fertilizers  as  per market dynamics. Under NBS scheme, fertilizer companies are allowed to fix MRP at  reasonable  levels  which  is  monitored  by  the  Government.  In  view  of  price volatility in international prices of key fertilizers and raw materials, the Government has  subsumed  fluctuations,  if  any,  while  fixing  NBS  rates  for  P&K  fertilizers annually/bi-annually, in recent years.

The  Government  approved  Special  Package  on  DAP  @  3,500  per  MT initially  or  actual  applicable  expenses  whichever  is  lower  in  addition  to  the  NBS subsidy  rates  from  the  period  from  01.04.2024  to  31.03.2025  with  approximate financial  implication  of  Rs.  3346  crore.  This  provision  for  'other  costs'  has  now been extended for Kharif, 2025 from 01.04.2025 to 30.09.2025 with approximate financial implication of Rs. 2095.45 crores. In the wake of continuing geopolitical situation, competing demands in the global market, the extension of the package has  ensured  availability  of  DAP  through  imports  and  production  to  ensure  its sustainable  supply  targeted  farmgate  price  of  Rs.  1350  per  50  kg  bag  to  the farmers.  Also,  increase  in  subsidy  has  been  linked  to  the  international  market prices. Thus, if the procurement prices of P&K fertilizers including DAP increase in the global market, the procurement and production is ensured.

Urea is provided to the farmers at a statutorily notified Maximum Retail Price (MRP). The  MRP of 45 kg  bag  of  urea  is  Rs.242  per  bag  (exclusive  of  charges towards  neem  coating  and  taxes  as  applicable).The  difference  between  the delivered cost of urea at farm gate and net market realization by the urea units is given  as  subsidy  to  the  urea  manufacturer/importer  by  the  Government  of  India. Accordingly, all farmers are being supplied urea at the subsidized rates.

(b): In 2022-23, the production of urea was 284.94 LMT and DAP was 43.47 LMT. In  2023-24,  the  production  of  urea  was  314.09  LMT  and  DAP  was  42.93  LMT. Except a few fortified fertilizers which are available in 40 Kg bags, all the complex fertilizers containing N, P, K & S nutrients are available in 50 Kg bags and Urea is available in 45 Kg bags.

(c): In order to increase indigenous urea production in Uttar Pradesh, Government inter-alia  mandated revival of Gorakhpur unit of Fertilizer Corporation of India Ltd through Joint Venture Company of nominated PSUs for setting up new AmmoniaUrea  plant  of  12.7  LMTPA  capacity.  Gorakhpur  unit  has  been  commissioned  on 07.12.2021.

Based on the requests, M/s Ayushman Fertilizer Pvt Ltd and two units of M/s Ram Potash Pvt Ltd have recently been recognized under Nutrient Based Subsidy (NBS) Scheme as manufacturer of Potash Derived from Molasses (PDM) in Uttar Pradesh.

(d): There  is  sufficient  facility  of  storage  &  production  of  adequate  chemical fertilizers in Uttar  Pradesh  for  sowing/production  of  upcoming  crop.  Central Warehousing Corporation (CWC) has 12.07 LMT capacity with 59 godowns in Uttar Pradesh  which  may  be  utilized  for  storage  of  Agricultural  produce  including fertilizers.

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