20th December, 2002
Ministry of Chemicals & Fertilizers  


NEW FERTILIZER POLICY


RAJYA SABHA

In keeping with the policy of economic liberalization and reforms, all fertilizers except urea have already been freed from movement and distribution control. The Government is extending subsidy to urea under Retention Price cum Subsidy Scheme (RPS) and concession to decontrolled phosphatic and potassic fertilizers on sale to farmers under Concession Scheme after providing reasonable return to manufacturers. With increase in production capacity during the last decade, India has achieved near self-sufficiency in nitrogenous and phosphatic fertilizers. The Government intend moving towards a de-regulated regime in all the three types of fertilizers that is, nitrogenous, phosphatic and potassic fertilizers, after taking into account its fiscal capacity and also making available fertilizers to the farmers at a reasonable price. Government is in the process of formulating a new pricing policy for urea units keeping in view the recommendations of Expenditure Reforms Commission for replacing the existing RPS. The proposed new policy will be in the shape of Group Concession Scheme. The new policy will aim at greater transparency, uniformity and efficiency in subsidy disbursement to urea units and will induce them to take cost reduction measures on their own and be competitive. The impact of new fertilizer policy is mainly in terms of techno-economic cost effective manufacturing.

The demand and production of fertilizers in nutrient terms during the years 2001-02 and 2002-03 is as under:

(Lakh Metric Tonnes)

Year

Nutrient

Demand

Production

2001-02

Nitrogen (N)

113.11

107.68

 

Phosphate (P)

43.82

38.60

 

Potash (K)

16.67

-

2002-03 (Estimated)

Nitrogen (N)

120.64

108.76

 

Phosphate (P)

52.20

43.56

 

Potash (K)

19.68

-

The entire requirement of Potash (K) is met through imports of Muriate of Potash (MOP) in the absence of known commercially viable sources of production.

State-wise and sector-wise major fertilizer producing units (excluding SSP) in India at present in operation are as under:

Name of the State

Sectors

Total

 

Public

Co-operative

Private

 

Andhra Pradesh

1

-

4

5

Kerala

3

-

-

3

Karnatka

-

-

1

1

Tamil Nadu

2

-

3

5

Goa

1

-

-

1

Madhya Pradesh

2

-

-

2

Chatishgarh

1

-

-

1

Maharashtra

4

-

1

5

Gujarat

-

3

7

10

Rajasthan

-

-

3

3

Jharkhand

1

-

-

1

Bihar

1

-

-

1

Orissa

2

-

2

4

West Bengal

2

-

1

3

Assam

1

-

-

1

Haryana

1

-

-

1

Punjab

3

-

1

4

Uttar Pradesh

-

4

4

8

Total

25

7

27

59*

*Out of these, 13 units are producing only Calcium Ammonium Nitrate (CAN) Ammonium Sulfate (AS), Ammonium Chloride (AC) and other low analysis fertilizers as by-products.

This information was given by the Union Minister of Chemicals & fertilizers, Shri Sukhdev Singh Dhindsa, in a written reply to a question in the Rajya Sabha today.