Govt makes change in urea policy to enable units produce more

"All stakeholders namely farmers, urea manufacturers and the government would be benefitted from the amendment," the statement said.

At present, the country produces over 24 million tonnes of urea annually and imports about 8 million tonnes to meet domestic demand. Imports are likely to fall this fiscal.

"Further, to address any future fluctuation in Import Parity Price that would have adverse impact on the production beyond RAC by urea units, Department of Fertilizers has been authorized to take appropriate decision in consultation with Department of Expenditure," the statement said.

The New Urea Policy – 2015 was notified on May 25, 2015 with the objective of maximising indigenous urea production, promoting energy efficiency in urea units and rationalising the subsidy burden on the Government.

The government has made it mandatory for all indigenous urea producers to neem coat 100 percent of their production of urea to promote balanced use of fertilizers, increase nitrogen use efficiency and prevent diversion of urea for the purpose other than agriculture.

Urea is a controlled fertiliser and is sold at a fixed selling price of Rs 5,360 per tonne. The difference between cost of production and selling price is paid as subsidy to manufacturers.