Amendment in import policy condition of Urea (Exim Code 31021000)in the ITC (HS) 2022, Schedule I (Import Policy).

## Report on Amendment to Import Policy Condition of Urea **1. Executive Summary:** This report analyzes a notification amending the import policy condition for Urea (EXIM code 31021000) under the Foreign Trade Policy 2015-2020. The amendment, effective April 1, 2022, extends the permission for Urea import through Indian Potash Limited (IPL) until March 31, 2023, and clarifies the duty-free import of Technical Grade Urea (TGU) for non-agricultural industrial use in NPK manufacturing. This amendment is likely intended to ensure continued availability of Urea through established channels and support the domestic NPK fertilizer industry. **2. Introduction:** This report provides an informative analysis of a notification issued by the Directorate General of Foreign Trade (DGFT), Ministry of Commerce and Industry, Government of India, pertaining to an amendment in the import policy condition of Urea. The analysis is based solely on the provided policy text. **3. Policy Overview:** * **Amendment to:** Foreign Trade Policy 2015-2020 (specifically paragraphs 1.02 and 2.01). * **Core Objective(s):** Based on the provided text, the core objectives are to: * Modify the import conditions for Urea. * Facilitate the import of Urea through designated entities. * Allow duty-free import of Technical Grade Urea (TGU) for specific industrial applications. **4. Background and Rationale:** This amendment appears to address the need for continued Urea availability through established import channels (RCF, NFL and IPL), while also supporting specific industrial applications. The extension of IPL's permission to import Urea suggests a continued reliance on this entity for government account imports. The allowance of duty-free import for technical grade urea (TGU) for industrial applications such as NPK manufacturing suggests an attempt to stimulate or support the domestic fertilizer industry by reducing input costs. **5. Key Provisions / Changes:** This section details the changes introduced by the amendment: * **Original Policy (as implied):** The original policy allowed Urea import through RCF and NFL, subject to Para 2.20 of the Foreign Trade Policy, 2015-2020, and also allowed import of Urea through IPL for a period up to 31.03.2022. * **Specific Change 1:** The amendment extends the permission for Urea import through Indian Potash Limited (IPL) until March 31, 2023. * **Effect of Change 1:** IPL can continue importing Urea on government account till March 31, 2023, ensuring a consistent supply chain through this channel. * **Specific Change 2:** The amendment clarifies that import of Technical Grade Urea (TGU) meant for non-agricultural industrial use, specifically NPK manufacturing, shall be duty-free. * **Effect of Change 2:** Companies using TGU for NPK fertilizer production can now import it without import duties. This change potentially reduces the cost of NPK fertilizer production and increases the competitiveness of domestic manufacturers. **6. Target Audience and Stakeholders:** Based on the provided text, the primary target audience and stakeholders include: * **Indian Potash Limited (IPL):** Beneficiary of the extended import permission. * **Rashtriya Chemicals and Fertilizers (RCF):** Continued allowance as a Urea importer * **National Fertilizers Limited (NFL):** Continued allowance as a Urea importer * **Manufacturers of NPK fertilizers:** Beneficiaries of the duty-free import of Technical Grade Urea (TGU). * **Government of India:** Involved through policy direction and oversight of Urea imports. **7. Implementation Aspects (Inferred):** * **Responsible agency/bodies:** Directorate General of Foreign Trade (DGFT), Ministry of Commerce and Industry. Indian Potash Limited (IPL), Rashtriya Chemicals and Fertilizers (RCF), National Fertilizers Limited (NFL). * **Timelines:** The amendment is effective from April 1, 2022. IPL's import permission is extended until March 31, 2023. * **Specific to changes:** NPK manufacturers can avail the duty-free import of TGU with immediate effect from April 1, 2022, subject to adherence to relevant regulations. **8. Expected Outcomes / Impact of Changes:** * **Extended IPL Import Permission:** Ensures continued availability of Urea through a government-approved channel. * **Duty-Free TGU Import:** Reduces the cost of production for NPK fertilizer manufacturers, potentially leading to lower prices for farmers and increased domestic production of NPK fertilizers. This may also improve the competitiveness of domestic NPK producers in the global market. **9. Conclusion:** The amendment to the import policy condition of Urea, effective April 1, 2022, extends IPL's import permission and allows duty-free import of Technical Grade Urea (TGU) for NPK manufacturing. These changes are significant as they aim to maintain a stable Urea supply chain and support the domestic fertilizer industry, potentially benefiting both manufacturers and farmers. The amendment reflects the government's efforts to balance the needs of the agricultural sector with the development of the domestic fertilizer industry.

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