Fertiliser Subsidy to Double Amid West Asia Conflict

New Delhi, Jun 9 (PTI) The fertiliser ministry has sought to double the fertiliser subsidy for the current fiscal from Rs 1.71 lakh crore, as the West Asia conflict has led to a sharp increase in the cost of the imported soil nutrient, according to government sources.

Last month, a senior official in the Department of Fertilizers had said that the fertiliser subsidy bill could cross Rs 3 lakh crore in the current fiscal if disruptions resulting from the West Asia crisis prolong.

According to government sources, the Department of Fertilizers has approached the Finance Ministry seeking a 100 per cent increase in fertiliser subsidy.

The Budget estimate for fertiliser subsidy is about Rs 1.71 lakh crore for the current 2026-27 fiscal.

However, sources said, there could be some softening as domestic production of fertilisers is being ramped up.

The government provide huge subsidies on urea and P&K (phosphatic & potassic) fertilisers. At present, the MRP of neem-coated urea is Rs 242 per bag (45 kg), and the DAP (di-ammonium phosphate) is being sold at Rs 1,350 per bag (50 kg).

Sources said the closure of the Strait of Hormuz will have an impact on the total import bill for fertilisers. The global tendering process is also getting complex.

Global prices are rising while the total available fertiliser pool in the international market is also narrowing, they added.


Sources pointed out two major challenges - the first one is securing supplies and the tendering process, while the other is the rate and speed of change in fertiliser prices.

The government sources asserted that there is sufficient availability of fertilisers for the ongoing Kharif sowing season.

On Monday, Aparna S Sharma, additional secretary in the Union Ministry of Chemicals and Fertilizers, said, "For kharif 2026, the fertiliser requirement has been reassessed by the Department of Agriculture at 383.9 lakh tonnes and against this, the stock as on today is 197.56 lakh tonnes".

The stock is more than 51 per cent of the kharif season demand, and this is significantly higher than the usual level of 33 per cent, she added.

In 2025, nearly 73 per cent of the country's total fertiliser requirement was met through domestic production.

India imports a large quantity of urea and DAP to meet local demand.

The total domestic production of fertilisers, including urea, DAP, NPKs, and SSP, has increased from 433.29 lakh tonne in 2021 to a record 524.62 lakh tonne in 2025.

The country's urea production has increased from 225 lakh tonne during 2014-15 to 306.67 lakh tonne in 2024-25. The country imported more than 100 lakh tonne of urea last fiscal year to meet local demand.