Agri Business

Distorted pricing affects agro productivity, industry says fertilizer body 

Our Bureau Pune | Updated on September 24, 2014 Published on September 24, 2014

The distorted pricing policy leading to indiscriminate use of the highly subsidised urea is adversely affecting agro productivity while subsidies and regulation are hurting the industry, the Fertiliser Association of India (FAI) has said.

In Pune as part of a nation-wide tour to bring the woes of the industry to the fore, the FAI is making a serious pitch for total de-control of the sector, and for nutrient based subsidies instead of the current complex subsidy structure for the 30-odd urea manufacturers in the country.

“Half the fertiliser industry is sick, and the distorted pricing policy has led to over use of urea by farmers causing imbalances in the soil,” Satish Chander, director general, FAI said. 

The Rs 80,000-90,000 crore subsidy burden to the government last year was not money well spent, he asserted. Delays in receiving subsidy are the norm and nearly Rs 35,000 crore was outstanding, some of it pending from 2008, he added.

India consumed 51.5 million tonnes of fertilizer last year including 30.45 million tonnes of urea, making it the second largest consumer of fertilizer in the world after China. 

But the sector has seen no fresh investment in the last several years because of the policy, and agro productivity stood half of that in China, Sharad Nandurdikar, chairman, FAI pointed out.

To give a boost to the sector, the FAI is pitching for subsidizing farmers rather than the industry, framing of a clear long term policy, and availability of gas on a priority basis.

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Published on September 24, 2014
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