Press Information Bureau
Government of India
Ministry of Chemicals and Fertilizers
16-December-2011 13:25 IST
Urea Pricing Policy for Existing Urea Units
A pricing policy for existing urea units beyond New Pricing Scheme (NPS) Stage-III is under consideration of Government.

The MRP of Urea is controlled by Government and is currently fixed at Rs. 5310/-PMT. It is in the knowledge of the Government that the prices of Phosphatic & Potassic (P&K) fertilizers has increased during the year 2011-12. The subsidy on P&K fertilizers has not been withdrawn. Government of India has introduced Nutrient Based Subsidy (NBS) Policy w.e.f 1-4-2010 replacing the erstwhile concession scheme for decontrolled P&K fertilizers. Prior to 1-4-2010, the MRPs of P&K fertilizers were fixed by the Government below the actual delivered costs and the difference between the normative delivered cost and the MRPs was reimbursed by the Government to the manufacturers/importers in the form of subsidy. Under the NBS policy, the MRPs of the P&K has been left open to be fixed by the manufacturers/importers and the amount of subsidy is fixed in terms of the nutrients of Nitrogen ‘N’, Phosphate ‘P’, Potash ‘K’ and Sulphur ‘S’ on annual basis. Accordingly, any increase/decrease in the prices of P&K fertilizers and its raw materials in the international market has a direct bearing on the MRPs of P&K fertilizers. Recently, the international prices of P&K fertilizers and its raw materials have gone up substantially. Further the Rupee-US$ exchange rate has significantly increased. As a result of these factors the MRPs of P&K fertilizers have almost doubled.

This information was given by the Minister of State for Chemicals and Fertilisers, Shri Srikant Kumar Jena in a written reply in the Rajya Sabha today.