Russia-Ukraine war, sanctions on Iran could boost India’s fertilizer subsidy bill by 60%

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New Delhi: The Russian invasion of Ukraine could boost India’s fertilizer subsidy bill by as much as 60 percent, ThePrint has learned.

Initial estimates are that the subsidy bill, which stood at around Rs 1.25 crore last year, could reach Rs 2 crore this year, according to top sources in Narendra Modi’s government.

The sources further said that in the international market, the price of urea has risen to Rs 3,700 per bag (circa $49), while diammonium phosphate (DAP) is up to 4,200 rupees (circa $56). However, a bag of urea continues to sell for Rs. 266 in India, while a bag of DAP costs Rs. 1,350.

“We are committed to keeping prices stable, but international developments have made fertilizers very expensive. There is the issue of US sanctions on Iran and Iran’s status as a major DAP supplier, but the sanctions make sourcing difficult. Add to this the situation in Russia and the difficulty of sourcing ammonia and gas from Russia for fertilizer production,” a senior government official told ThePrint.

“There are many other things that happen. China used to export fertilizer but has now started importing it. Not just us, the whole world is paying more for fertilizer. We expect the subsidy bill to increase significantly and perhaps reach Rs. 2,000 compared to Rs. 1.25,000 last year,” the official added.

True, there were reports of fertilizer defect in the country in recent months has the center denied this multiple times. A senior government official told ThePrint: “There is no shortage. What is happening is that villages need fertilizer when it rains and everyone needs it at the same time. So on a fine morning the whole village comes to buy fertilizer, and of course there are queues. The media sees the queues and says there’s a shortage when there isn’t one.”


Also read: Modi’s government is cutting food and fertilizer subsidies and budgeting allied sectors of agriculture


“Prepared for the Kharif Season”

Although demand for fertilizers for sowing crops during the kharif season will not kick in until May, sources said the government has already procured an initial stock of about 30 lakh metric tons of DAP and 70 lakh metric tons of urea for the season.

More will be sourced in the coming days, an official told ThePrint.

During the kharif season, usual demand is around 80-85 lakh metric tons of fertilizer, but this year it is expected to rise even higher, the official said.

“Some urea plants are about to be built. In three years we will be self-sufficient in urea,” the official added.

The Union Department of Chemicals and Fertilizers has started the revival five fertilizer plants The plants of Hindustan Urvarak Rasayan Limited (HURL) in Gorakhpur (Uttar Pradesh), Barauni (Bihar) and Sindri (Jharkhand), Ramagundam Fertilizers and Chemicals Limited (RFCL) in Ramagundam (Telangana) and Talcher Fertilizers Limited (TFL) in Angul ( Odisha). ).

(Edited by Gitanjali Das)


Also read: Low reservoir levels combined with the depletion of fertilizer stocks threaten the sowing of the Rabi season


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