India-Russia Fertiliser Deal: How a New Plant Shields Farmers from Global Shortages

Fertilisers play a crucial role in enhancing agricultural productivity. Along with quality seeds and reliable irrigation, they are one of the key factors driving higher crop yields. The use of fertilisers has grown steadily over the years, particularly after India’s Green Revolution. Their impact has been significant in helping India move closer to self-reliance in food production.

During the current visit of President Vladimir Putin, Russia’s Uralchem JSC and three of India’s companies, Rashtriya Chemicals and Fertilisers Limited, the National Fertilisers Limited, and the Indian Potash Limited, signed a memorandum of understanding to set up a joint venture to construct a urea plant in Russia.

The proposed plant would produce close to two million tons of urea each year using the abundance of Russia’s natural gas and ammonia reserves, providing much relief to the peasants in India.

India remains the second-largest consumer and third-largest producer of fertilisers globally, recording its highest-ever domestic urea production in 2023–24, crossing 314 lakh metric tonnes.

Meanwhile, though India reached a record urea output, the sector still depends on imported feedstocks, underscoring the strategic value of this project. India sources the bulk of its ammonia and natural gas requirements for fertiliser from abroad.

New Delhi has also entered into international deals with Saudi Arabia, Nepal, Bhutan, and Sri Lanka, aiming to secure long-term fertiliser supplies and meet domestic requirements. Still, farmers faced problems this Kharif season when China temporarily halted exports. It triggered a domestic shortage and forced India to buy supplies at higher prices. At the same time, well‑distributed monsoon rains expanded sown area, raising demand for urea across both kharif and rabi seasons, including wheat and paddy.

Reports coming from Madhya Pradesh still suggest farmers are facing a fertiliser shortage, where several protests have erupted over the non-availability of essential inputs like urea and DAP.

Now the project in Russia will go a long way to shield the country from volatile global prices and supply interruptions, and also improve the reliability of fertiliser deliveries to farmers, bolstering food security.

The government controls and subsidises fertiliser prices to keep them affordable, and distributes this key agricultural input through its outlets.

Incidentally, the Department of Fertilisers earlier saw an increase in its budget allocation for the fiscal year 2024-25, with the final allocation rising to about Rs 1,91,836.29 crore through Supplementary Demands for Grants passed by Parliament. The budget is based on the expected consumption of fertilisers, the price of natural gas, and international prices of finished products. Additionally, the government has extended the Pradhan Mantri Krishi Sinchayee Yojana (PMKSY) until 2025-26, with a total outlay of Rs 93,068.56 crore approved for the period from 2021-22 to 2025-26.

The new initiative will now add to stabilising urea supplies, reduce reliance on imports, and deepen economic ties between India and Russia. It will help protect farmers, strengthen national food security, and reinforce India’s role as a major global consumer and producer of fertiliser.

jayanta/vd

- IANS