Parliamentary Panel Finds Finance Ministry's Decision on Fertiliser Disinvestment Incongruent with Govt's Atma Nirbhar Agenda

Strategic Insights -

The parliamentary panel on fertilisers has submitted a report to Parliament, criticising the finance ministry's decision to classify the fertiliser sector as "non-strategic" despite its critical role in ensuring food security and advancing national self-reliance. The panel, headed by Congress MP Kirti Azad, found that the disinvestment department had refused to classify the sector as strategic, citing that CPSEs contribute only 25% and 11% of the country's urea and non-urea fertiliser production respectively. However, the report highlights that several fertiliser PSUs, such as FACT, have shown remarkable turnaround and that the revival of closed units has added over 76.2 lakh tonnes to India's annual urea production capacity.

Key Takeaways:

  • The parliamentary panel has found the finance ministry's decision to classify the fertiliser sector as "non-strategic" to be "incongruent" with the government's agenda for self-reliance (Atma Nirbhar).
  • Despite multiple submissions from the fertiliser department to classify the sector as strategic, the finance ministry refused, citing that CPSEs contribute only 25% and 11% of the country's urea and non-urea fertiliser production respectively.
  • Several fertiliser PSUs, such as FACT, have shown remarkable turnaround from loss-making entities to consistently profitable enterprises.
  • The revival of closed units at Gorakhpur, Sindri, Barauni, and Ramagundam through CPSE-led joint ventures has added over 76.2 lakh tonnes to India's annual urea production capacity.
  • The fertiliser sector is crucial for domestic production, price stabilisation, disaster resilience, and long-term food sovereignty, particularly given India's continued reliance on imports for 90% of its potash and phosphate needs.

Statistics:

  • 25% of India's urea production comes from CPSEs.
  • 11% of India's non-urea fertiliser production comes from CPSEs.
  • 5.6 million tonnes of urea was met through imports in FY25, out of a total 38.8 million tonnes of consumption.
  • 10.4 million tonnes of non-urea fertilisers such as diammonium phosphate (DAP), NPK, and muriate of potash (MOP DAP) were imported in FY25.
  • India imports 90% of its phosphate needs.
  • India imports 100% of its potash needs.

Sources:

  • "Fertiliser Disinvestment Report" by the parliamentary panel on fertilisers, submitted to Parliament this week.
  • Times of India article, "Parliamentary panel finds finance ministry's decision on fertiliser disinvestment incongruent with govt's Atmanirbhar Bharat agenda".