Indian fertiliser stocks jumped on Wednesday after a Reuters report the government plans to increase fertiliser subsidies to a record of more than 1.55 trillion rupees ($20.67 billion) in 2021-2022 to avoid shortages amid a sharp rise in global prices.
India, the top urea importer, has already raised fertiliser subsidies twice in this fiscal year ending March 31, and the new figure is almost double the amount initially budgeted.
Global fertiliser prices have almost trebled over the past year due to record increases in the prices of coal and natural gas, the two main energy sources used to produce the crop nutrients, and new export restrictions by China and Russia.
Shares in Rashtriya Chemicals and Fertilizers Ltd, Chambal Fertilsers & Chemicals Ltd, National Fertilizers Ltd and Madras Fertilizers Ltd jumped between 6% and 9% in early trading on Wednesday.
The government provides financial support to companies that sell fertilisers at below-market rates. The agriculture sector employs about 60% of India's workforce and accounts for 15% of the $2.7 trillion economy.
($1 = 74.9720 Indian rupees)
(Reporting by Rama Venkat in Bengaluru)
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