Lok Sabha Question No. 5695 (UNSTARRED), answered on 2026-03-27
Subject: Subsidy for Procuring Fertilizers
Ministry: CHEMICALS AND FERTILIZERS
Asked by: Dr. M K Vishnu Prasad

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

## LOK SABHA UNSTARRED QUESTION NO.5695 TO BE ANSWERED ON 27.03.2026

## Subsidy for Procuring Fertilizers

## 5695.  Dr. M K Vishnu Prasad:

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

- (a)  the total subsidy being provided to farmers for procuring urea fertilizers in the country during the last four years and the current year, State and yearwise;
- (b) whether there has been a year-on-year increase in the subsidy provided by the Government and if so, the details thereof;
- (c) the measures taken to ensure import of continuous and smooth supply of urea and fertilizers for farmers in the country and if so, the details thereof; and
- (d)  the  details  of  Urea/Fertilizer  imported  in  the  country  during  the  last  five years, State and year-wise?

## ANSWER

## THE MINISTER OF STATE IN THE MINISTRY OF CHEMICALS & FERTILIZERS (SMT. ANUPRIYA PATEL)

(a)& (b): Under  'DBT  in  Fertilizers'  system,  100%  subsidy  on  various  fertilizer grades  is  released  to  the  fertilizer  companies,  on  actual  sales  to  the  beneficiaries based on Aadhar authentication through PoS devices installed at each retail shop. All farmers are being supplied fertilizers at the subsidized rates on no-denial basis. The details  of  the  total  amount  disbursed  towards  fertilizer  subsidy  by  the  Government during the last four years and the current year i.e., from years 2021-22 to 2025-26 (as on 23.03.2026) are as follows:

| (Figures In Rs. Crore)      | (Figures In Rs. Crore)           | (Figures In Rs. Crore)   |
|-----------------------------|----------------------------------|--------------------------|
| Financial Year              | Subsidy Scheme                   | Expenditure              |
| 2021-22                     | Indigenous Urea & Import of Urea | 1,04,870.12              |
| 2022-23                     | Indigenous Urea & Import of Urea | 1,68,676.70              |
| 2023-24                     | Indigenous Urea & Import of Urea | 1,30,220.94              |
| 2024-25                     | Indigenous Urea & Import of Urea | 1,24,319.50              |
| 2025-26 (as on 23.03.2026 ) | Indigenous Urea & Import of Urea | 1,36,532.06              |

( c): To ensure continuous and smooth import of fertilizers in the country, Department of  Fertilizers  has  facilitated  Indian  fertilizer  companies  in  entering  into  Long  Term Agreements  (LTAs)  and  Memoranda  of  Understanding  (MoUs)  with  resource-rich countries.

In  this  regard,  for  the  year  2025-26,  Indian  companies  have  entered  into arrangements  for  import  of  DAP/NPK  fertilizers  from  Saudi  Arabia,  Morocco  and Russia. Similarly, for Muriate of Potash (MOP), Indian companies have agreements with Jordan, Russia, Turkmenistan, Israel, Canada and Belarus. Further, to increase domestic  production  of  Phosphatic  and  Potassic(P&K)  fertilizers  the  following measures have been taken by the Government:

- (i).    Based  on  the  requests,  the  new  manufacturing  units  or  increase  in manufacturing capacity of existing units have been recognized / taken on record under the NBS Scheme.
- (ii).   The number of P&K fertilizers covered under NBS policy has increased from 22 grades in 2021 to 28 grades.
- (iii). Freight Subsidy on SSP, which is an indigenously manufactured fertilizer, has been approved since Kharif, 2022 to promote SSP usage for providing Phosphatic or 'P' nutrient to the soil.

Above steps together  have  facilitated  increase  production  of  P&K  fertilizers (including DAP & SSP) from 159.54 LMT in 2014-15 to 211.22 LMT in 2024-25.

Further,  the  Government  has  implemented  Nutrient  Based  Subsidy  (NBS) Schemew.e.f. 01.04.2010 for Phosphatic and Potassic (P&K) Fertilizers. Under NBS policy, MRPof P&K fertilizers are decontrolled and companies are free to fix MRP as per  their  business  dynamics  at  a  reasonable  level.  The  subsidy  is  provided  to manufacturer/ importer on notified P&K fertilizers on its PoS sale during the season, depending on their nutrient content to ensure availability of fertilizers to farmers.

With regard to Urea, the gap between requirement and indigenous production of Urea is met through timely imports, through three State Trading Enterprises (STEs), to ensure adequate availability of Urea in the country.

Further, the Government had announced New Investment Policy (NIP) - 2012 on  2nd  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 which includes 4 urea units set up through Joint Venture Companies (JVC) of nominated PSUs and 2 urea units set up by the private companies. The units set up through JVC are Ramagundam urea unit of Ramagundam Fertilizers and Chemicals Ltd (RFCL) in Telangana and 3 urea units namely  Gorakhpur,  Sindri  and  Barauni  of  Hindustan  Urvarak&Rasayan  Limited (HURL)  in  Uttar  Pradesh,  Jharkhand  and  Bihar,  respectively.  The  units  set  up  by private  companies  are  Panagarh  urea  unit  of  Matix  Fertilizers  and  Chemicals  Ltd. (Matix)  in  West  Bengal;  and  Gadepan-III  urea  unit  of  Chambal  Fertilizers  and Chemicals Ltd. (CFCL) in Rajasthan. Each of these units has installed capacity of 12.7 Lakh Metric Tonne per annum (LMTPA). These units are highly energy efficient as they are  based  on  latest  technology.  Therefore,  these  units  have  together  added  urea production capacity of 76.2 LMTPA, thereby total indigenous urea production capacity (Reassessed  Capacity,  RAC)  has  increased  from  207.54  LMTPA  during  2014-15 to283.74  LMTPA  during  2023-24.  Further,  an  exclusive  policy  for  the  revival  of Talcherunit of FCIL through JVC of nominated PSUs namely Talcher Fertilizers Limited (TFL) by setting up a new Greenfield Urea plant of 12.7 LMTPA at coal gasification route has also been approved. Recently, the Union Cabinet has approved the proposal for setting up of a new Brownfield Ammonia-Urea Complex of 12.7 Lakh Metric Tonnes (LMT) annual capacity of Urea production within the existing premises of Brahmaputra Valley Fertilizer Corporation Limited (BVFCL), Namrup, Assam namely Assam Valley Fertilizer and Chemical Company Ltd. (AVFCCL).

In addition, the Government also notified the New Urea Policy (NUP) - 2015 on 25thMay, 2015 for the existing 25 gas-based urea units with one of the objectives of maximizing  indigenous  urea  production  beyond  RAC.  The  NUP-2015  has  led  to additional  production of  urea by  20-25  LMT  as compared to the  production during 2014-15 annually.

Above steps together have facilitated increase of Urea production from level of 225 LMT per annum during 2014-15 to a record Urea Production at 314.07 LMT during 2023-24. During 2024-25, 306.67 LMT of Urea was produced in the country.

(d): The details of imports of fertilizers (Urea, DAP, MOP and NPK) during last five year i.e. 2020-21 to 2024-25, are as below:

| (Qty. in LMT)                                     | (Qty. in LMT)                                     | (Qty. in LMT)                                     | (Qty. in LMT)                                     | (Qty. in LMT)                                     |
|---------------------------------------------------|---------------------------------------------------|---------------------------------------------------|---------------------------------------------------|---------------------------------------------------|
| Year                                              | As Reported by the Companies                      | As Reported by the Companies                      | As Reported by the Companies                      |                                                   |
| Urea                                              | DAP                                               | MOP *                                             | NPK                                               |                                                   |
| 2020-21 98.28                                     | 48.82                                             | 42.27                                             | 13.90                                             |                                                   |
| 91.36                                             | 54.62                                             | 24.60                                             | 2021-22 11.70                                     |                                                   |
| 75.80                                             | 65.83                                             | 18.66                                             | 2022-23 27.52                                     |                                                   |
| 70.42                                             | 55.67                                             | 28.69                                             | 2023-24 22.17                                     |                                                   |
| 56.47                                             | 45.69                                             | 35.41                                             | 2024-25 22.72                                     |                                                   |
| MOP includes both Agriculture and Industrial use* | MOP includes both Agriculture and Industrial use* | MOP includes both Agriculture and Industrial use* | MOP includes both Agriculture and Industrial use* | MOP includes both Agriculture and Industrial use* |

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