Zee Media Bureau
New Delhi: The Union Cabinet on Wednesday approved new urea policy and fixed subsidy rate of phosphatic and potassic (P&K) fertilisers for 2015.
In the new urea policy, the government is considering measures for boosting urea production by making plants more energy efficient.
The policy will also provide framework for balanced use of fertilisers. The correct proportion in which Nitrogen (N), Phosphorus (P), and Potassium (K) should be used is 4:2:1.
Due to highly subsidised price of urea, the main provider of nitrogen is cheap while the other two elements are expensive. As a consequence, fertilizsr use in India is taking place in the ratio 8.2:3.2:1, sources.
The Centre has already taken steps to boost domestic production of urea, by forming joint ventures for revival of two closed fertiliser plants at Talcher and Ramamgundam, while Cabinet approval has been given for revival of two other plants.
The Centre has also made some changes in the urea investment policy, under which it will permit setting up of new plants.
Urea, which is under government's control, is being sold at a highly subsidised rate of Rs 5,360 per tonne. The difference between the maximum retail price (MRP) and the cost of production is reimbursed to manufacturers as subsidy by the central government.
At present, the country imports about 8 million tonnes of urea to meet the annual domestic demand of 30 million tonnes. India produces about 22 million tonnes of urea annually.
With PTI Inputs
