On fertiliser prices, strategy, not firefighting, Pg10

Key Highlights:

• India imports a significant portion of its fertilizer needs, including 25% of urea and 40% from West Asia.
• Domestic urea production relies heavily on imported natural gas, with up to 85% sourced from Qatar, UAE, Saudi Arabia, and Kuwait.
• Geopolitical tensions, such as the US-Israel vs Iran war and Ukrainian drone attacks, are disrupting fertilizer supplies and increasing prices.
• The government has frozen retail prices of urea (at Rs 5,922 per tonne) and DAP (at Rs 27,000/tonne), leading to increased consumption.

Detailed Insights:

• India's dependence on imports from countries such as China and those in West Asia makes its agriculture sector vulnerable to geopolitical risks.
• Rising urea consumption, from under 30 million tonnes in 2017-18 to a projected 40 million tonnes this fiscal year, is a cause for concern.
• The government should discourage over-application of chemical fertilizers and promote awareness about India's import dependence on natural gas and other raw materials.
• Capping consumption of urea and DAP, promoting nutrient-use fertilizers, and providing subsidy on a per-acre basis are potential solutions.
• The Agri Stack initiative, which creates unique digital IDs for farmers, can be used to promote targeted fertilizer use and reduce overall consumption.

Key Concepts Involved:

• Urea: A nitrogen-rich compound used as a fertilizer in agriculture.
• DAP (Di-ammonium Phosphate): A widely used phosphatic fertilizer that provides essential nutrients for plant growth.
• Agri Stack: A digital infrastructure initiative to create unique digital IDs for farmers and link them to land records and cropping data.