Check excessive consumption of urea: Govt to industry

Amid increasing imbalanced use of fertiliser, the government has asked the industry to suggest ways to bring down urea consumption that has resulted in huge subsidy bill besides affecting soil health.
The Fertilizer Ministry, in a letter to industry body FAI, said it should come up with measures after consulting its members to check the excessive consumption of urea, sources said.
The letter to Fertiliser Association of India (FAI) comes in the backdrop of government's announcement in the budget that a new urea policy would be formulated.
This year's economic survey had also pointed out that government and farmers are together wastefully spending over Rs 8,500 crore on urea.

Recently the Fertilizer Minister Ananth Kumar had also said: "The New Urea Policy proposed in the budget is a move to correct the current imbalance of the use of fertiliser mix which will greatly benefit the farmers and soil health."
Urea, which is the main source of nitrogen (N), is highly subsidised and is sold at Rs 5,360 per tonne as against the average production cost of over Rs 20,000 per tonne in 2013-14.

Farmers are using excessive urea as it is cheaper than decontrolled Phosphatic (P) and Potassic (K) fertilisers such as DAP and MoP.
"The ideal ratio of NPK for soil health is 4:2:1, and currently the ratio is 8.3:2.7:1," sources said, adding there is a dire need to reduce urea consumption.

In case of urea, the government pays 70-75 per cent of total cost of production per tonne as subsidy while in P and K fertilisers, the Centre pays 25-40 per cent of total cost of production as subsidy," sources said.
Whereas, subsidies on P and K fertilisers were capped since 2010 after they were brought under the NBS regime, at present farmers pay 61 to 75 per cent of its delivered cost while rest is subsidised by government.
Meanwhile, the economic survey has also pitched for bringing urea under the Nutrient Based Subsidy (NBS) regime besides paying subsidy directly to farmers.

The country's annual urea demand is about 30 million tonnes while the domestic production is about 22 million tonnes, with the rest being met through imports.