West Asia crisis is nudge for fertiliser reform, Pg10

Key Highlights:

• The West Asia crisis and closure of the Strait of Hormuz are disrupting global fertiliser trade, impacting India's heavy reliance on fertiliser imports.
• Prime Minister Modi has urged Indian farmers to halve chemical fertiliser consumption and shift to natural farming.
• India's limited reserves of natural gas, rock phosphate, potash, and elemental sulphur necessitate significant fertiliser imports.
• Overuse of urea and di-ammonium phosphate (DAP) has led to soil nutrient imbalances due to their high N and P content.

Detailed Insights:

• Successive governments have subsidized fertilisers, leading to overuse of high-analysis products like urea and DAP, causing soil imbalances.
• Earlier, farmers used fertilisers like ammonium sulphate and single super phosphate, which contained multiple macro and micro nutrients.
• The nutrient use efficiency of urea is low, with only about a third of the nitrogen absorbed by plants, and the rest lost through volatilization or leaching.
• The government should consider freeing fertiliser retail prices to import parity levels and replacing product-wise subsidies with direct income support.
• Redirecting funds from fertiliser subsidy savings and PM-Kisan towards a direct income support scheme could be a viable alternative.
• The current system of fertiliser subsidy and price controls is unsustainable due to fiscal pressures and supply disruptions caused by the West Asia crisis.

Key Concepts Involved:

• Urea: A nitrogen-rich chemical compound used as a fertiliser.
• Di-ammonium Phosphate (DAP): A widely used phosphatic fertiliser containing high amounts of phosphorus and nitrogen.
• PM-Kisan: A government scheme providing income support to small and marginal farmers.