Executive Summary:
The Ministry of Chemicals and Fertilizers addressed a query regarding self-sufficiency in urea production, the impact of Neem Coated Urea (NCU) on industrial misuse and subsidy, and the timely supply of fertilizers in Madhya Pradesh. The government has taken steps to enhance domestic urea production through new policies and investments. The implementation of NCU has shown a reduction in consumption compared to normal urea. Fertilizer availability in Madhya Pradesh has been adequate for the Kharif 2025 season.
Key Points / Main Content:
Urea Production Enhancement:
* New Investment Policy (NIP) 2012 (announced January 2, 2013, amended October 7, 2014) was implemented to encourage investment in the urea sector.
* Six new urea units were established under NIP 2012: four through Joint Venture Companies (JVCs) of nominated PSUs and two by private companies.
* JVC units include: Ramagundam (Telangana), Gorakhpur, Sindri, and Barauni (Uttar Pradesh, Jharkhand, and Bihar, respectively).
* Private company units include: Panagarh (West Bengal) and Gadepan-III (Rajasthan).
* Each unit has a production capacity of 1.27 Million Metric Tonnes per annum (LMTPA), adding a total capacity of 7.62 LMTPA.
* The total indigenous urea production capacity has increased from 20.754 LMTPA (2014-15) to 28.374 LMTPA (2023-24).
* Revival of the Talcher unit (FCIL) approved via a JVC with a new Greenfield urea plant (1.27 LMTPA) using coal gasification.
* A new Brownfield Ammonia-Urea Complex (1.27 LMT annual capacity) approved for Brahmaputra Valley Fertilizer Corporation Limited (BVFCL), Namrup, Assam.
* New Urea Policy (NUP) 2015 (notified May 25, 2015) for 25 existing gas-based urea units aims to maximize indigenous production, leading to an additional 2.025 LMT of urea annually.
* Urea production increased from 22.5 LMT per annum (2014-15) to 30.667 LMT (2024-25).
Neem Coated Urea (NCU) Policy:
* Mandatory 100% Neem Coating of urea enforced in May 2015 for domestic producers and importers.
* NCU consumption is reduced compared to normal urea due to its slow-release properties.
Fertilizer Supply in Madhya Pradesh:
* Adequate availability of fertilizers (Urea, DAP, NPKS, and MOP) in Madhya Pradesh for Kharif 2025 season until August 4, 2025.
* Distribution within the state at the district level is managed by the State Government.
Impact Analysis:
Fertilizer Companies (Domestic Producers and Importers):
Impact: Must ensure all urea supplied is 100% neem-coated.
Action Required: Adjust production and import processes to comply with the neem coating mandate.
Farmers in Madhya Pradesh:
Impact: Assured of adequate fertilizer availability for the Kharif 2025 season.
Action Required: Procure fertilizers through the state's distribution channels.
Government of Madhya Pradesh:
Impact: Responsible for the distribution of fertilizers at the district level.
Action Required: Manage and oversee fertilizer distribution to ensure timely availability to farmers.
Department of Fertilizers, Government of India:
Impact: Responsible for policy implementation and monitoring of urea production and distribution.
Action Required: Continue to monitor the progress of new urea units and the impact of NUP 2015.
Key Entities Referenced
Ministry of Chemicals and Fertilizers: A ministry within the Government of India responsible for the chemicals and fertilizers sector.
New Investment Policy 2012: A policy announced by the Government of India on 2nd January 2013, and amended on 7th October 2014, to encourage investment and self-sufficiency in the urea sector.
Neem Coated Urea NCU policy: A policy mandating that all domestic producers and importers of urea supply 100% Neem Coated Urea.
Madhya Pradesh: A state in India where the supply and distribution of fertilizers is being monitored.
Uttar Pradesh: A state in India where Gorakhpur urea unit of Hindustan Urvarak Rasayan Limited HURL is located.
New Urea Policy NUP 2015: A policy notified on 25th May 2015, for the existing 25 gas-based urea units with the objective of maximizing indigenous urea production.
Hindustan Urvarak Rasayan Limited HURL: A Joint Venture Company (JVC) that has set up urea units in Gorakhpur, Sindri and Barauni.
Ramagundam Fertilizers and Chemicals Ltd RFCL: A Joint Venture Company (JVC) that has set up Ramagundam urea unit in Telangana.
GOVERNMENT OF INDIA
MINISTRY OF CHEMICALS & FERTILIZERS
DEPARTMENT OF FERTILIZERS
LOK SABHA
UNSTARRED QUESTION NO. †3354 TO BE ANSWERED ON: 08.08.2025
Self-Sufficiency in Urea
†3354. SHRI GANESH SINGH:
Will the Minister of CHEMICALS AND FERTILIZERS be pleased to state:
(a) the major steps taken for self-sufficiency in urea production in the country under
the new urea policy;
(b) the details of reduction in industrial and subsidy misuse after the implementation
of Neem Coated Urea (NCU) policy; and
(c) whether the supply of fertilizers is being carried out timely and adequate manner
in the State of Madhya Pradesh particularly in Satna and the neighbouring
agricultural area, if so, the details thereof?
ANSWER
THE MINISTER OF STATE IN THE MINISTRY OF CHEMICALS & FERTILIZERS
(SMT. ANUPRIYA PATEL)
(a) With regard to Urea, the Government had announced New Investment Policy (NIP)
– 2012 on 2nd January, 2013 and its amendment on 7th October, 2014 to facilitate fresh
investment in the urea sector and to make India self-sufficient in the urea sector. Total
6 new urea units have been set up under NIP-2012 which includes 4 urea units set up
through Joint Venture Companies (JVC) of nominated PSUs and 2 urea units set up by
the private companies. The units set up through JVC are Ramagundam urea unit of
Ramagundam Fertilizers and Chemicals Ltd (RFCL) in Telangana and 3 urea units
namely Gorakhpur, Sindri and Barauni of Hindustan Urvarak & Rasayan Limited (HURL)
in Uttar Pradesh, Jharkhand and Bihar, respectively. The units set up by private
companies are Panagarh urea unit of Matix Fertilizers and Chemicals Ltd. (Matix) in
West Bengal; and Gadepan-III urea unit of Chambal Fertilizers and Chemicals Ltd.
(CFCL) in Rajasthan. Each of these units has installed capacity of 12.7 Lakh Metric
Tonne per annum (LMTPA). These units are highly energy efficient as they are based
on latest technology. Therefore, these units have together added urea production
capacity of 76.2 LMTPA, thereby total indigenous urea production capacity (Reassessed
Capacity, RAC) has increased from 207.54 LMTPA during 2014-15 to 283.74 LMTPA
during 2023-24. Further, an exclusive policy for the revival of Talcher unit of FCIL
through JVC of nominated PSUs namely Talcher Fertilizers Limited (TFL)-2-
by setting up a new Greenfield urea plant of 12.7 LMTPA at coal gasification route has
also been approved. Recently, the Union Cabinet has approved the proposal for setting
up of a new Brownfield Ammonia-Urea Complex of 12.7 Lakh Metric Tonnes (LMT)
annual capacity of Urea production within the existing premises of Brahmaputra Valley
Fertilizer Corporation Limited (BVFCL), Namrup, Assam.
In addition, the Government also notified the New Urea Policy (NUP) – 2015 on 25th
May, 2015 for the existing 25 gas-based urea units with one of the objectives of
maximizing indigenous urea production beyond RAC. The NUP-2015 has led to
additional production of urea by 20-25 LMT as compared to the production during 2014-
15 annually.
Above steps together have facilitated increase of Urea production from level of 225 LMT
per annum during 2014-15 to 306.67 LMT during 2024-25.
(b) In May 2015, Government made it mandatory for all the domestic producers and
importers of urea to supply 100% Neem Coated Urea. Thereafter, studies have shown
that due to slow release, the consumption of NCU reduces as compared to normal Urea.
(c) The availability of fertilizers viz. Urea, DAP, NPKS and MOP has remained
adequate in the State of Madhya Pradesh during the ongoing Kharif-2025 season as
per given below:
MADHYA PRADESH FERTILIZRS POSITION FOR KHARIF 2025 (TILL
04/08/2025)
Fig. In LMT
S.No. Product Seasonal Pro rata Availability Cumulative Closing
Requirement Requirement From DBT Sales Stock as
for KHARIF From 01/04/2025 From on
2025 01/04/2025 to 01/04/2025 04/08/2025
to 04/08/2025 to
04/08/2025 04/08/2025
1 UREA 17.42 10.47 14.26 12.54 1.74
2 DAP 7.50 5.24 4.24 3.32 0.91
3 MOP 0.50 0.39 0.64 0.39 0.25
4 NPKS 5.00 3.54 6.23 4.27 1.96
However, distribution of fertilizers within the State at district level is done by the State
Government.
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