Mint Explainer | Why India remains dependent on fertilizer imports

Mint explains.India is the world’s second-largest fertilizer consumer, but domestic supply hasn’t kept pace.The country imports about 60% of its diammonium phosphate (DAP) requirement and roughly 15% of its urea and nitrogen, phosphorus and potassium (NPK)-based fertilizer demand, along with intermediates such as rock phosphate, phosphoric acid and potash.Even urea relies on natural gas as feedstock, much of which is imported. This leaves domestic production exposed to global energy markets.“Domestic availability is limited for raw materials and intermediaries such as liquefied natural gas (LNG), phosphate rock and ammonia,” said Anand Kulkarni, director at Crisil Ratings.Analysts say this dependence is unlikely to ease without a shift in technology.

Alternatives such as coal-to-urea and green ammonia are emerging, but remain nascent.“Until recently, Make in India has remained largely aspirational in the fertilizer sector, which continues to depend heavily on imported raw materials and foreign technologies rather than building indigenous capabilities,” said Rajib Chakraborty, national president, Soluble Fertilizer Industry Association.“Structural reforms are needed to empower Indian manufacturers, especially MSMEs, to move beyond conventional technologies and invest in R&D for superior, home-grown agricultural inputs,” he said.Successive policies have boosted domestic output, but not eliminated import dependence.The New Investment Policy (NIP) 2012 incentivised new urea plants, while the New Urea Policy (NUP) 2015 aimed to maximize indigenous production. These measures helped raise urea output to 30.6 million tonnes in 2024-25 from 22.5 million tonnes in 2014-15.The government also introduced the Nutrient-Based Subsidy