With the government in a "frame of mind of undertaking reforms", the fertiliser industry too wants to push through the long-pending reforms it has been looking at.
Addressing the media in the national capital today, chairman of the Fertiliser Association of India and Chairman, Coromandel International Ltd A Vellayan called for an increase in Urea prices by at least 40 per cent.
Currently, subsidised Urea for Agricultural use is sold at Rs 5,300 per tonne and the last time Urea prices were raised by 10 per cent was in 2010. recently, the cabinet sent the proposal of the department of fertilisers to raise Urea prices by 10 per cent back.
When asked if the demand is properly timed as already some reform measures have created a political unstability in the country, Vellayan said that the Urea prices can be raised and the same subsidy can be diverted to Phosphatic and Potassium-based fertilisers and expressed hope that it will be appreciated by all as it will result in lowering of prices for P and K fertilisers along with promoting balanced nutrient use.
The leaders of the fertiliser industry also suggested the extension of Nutrient Based Subsidy (NBS) Scheme to Urea. The government introduced NBS for P and K fertilisers in April 2010 which deregulated the fertilisers' prices while the subsidy component for them was fixed on per kg of nutrient basis.
Prices of non-urea fertilisers have drastically gone up since the implementation of NBS for non-urea fertilisers in 2010.
Prices of Potassic fertiliser Di Ammonium Phosphate has gone up by over 150 per cent from Rs 9,350 in 2010 per tonne to Rs 24,000 currently. Similarly in the pottasic fertiliser Muriate of Potash (MoP) has shot up by 280 per cent from Rs 4,455 in 2010 to Rs 17,000 currently.
Supplementing the argument, Iffco joint managing director, Rakesh Kapur said that apprehensions of spiralling urea prices if NBS is extended to it are unfounded as gas prices in the country are regulated and it is the main input for urea production.
FAI also pointed out that India has the lowest price for Urea among many countries at $96 per tonne while the international prices are in the range of $500-600 per tonne. Urea is sold at $266 in Pakistan, $295 in China while in US its retail price is $526.
