The Cabinet Committee on Economic Affairs, led by Prime Minister Narendra Modi, has given the green light to the Department of Fertilizers’ National Investment Policy for Urea-2026. This policy aims to boost investments in gas-based urea manufacturing units within the country, fostering self-sufficiency. Notable changes from NIP-2012 include clearer cost separation, a defined Return on Equity band, and measures to hedge against foreign exchange risks.
These modifications are anticipated to yield savings exceeding Rs 250 crore per plant under NIPU-2026 compared to NIP-2012, as per an official statement. The new policy will encompass the establishment of fresh urea manufacturing facilities. To attract investments, a dedicated policy for the urea sector was finalized in 2012, resulting in the establishment of six new urea units under NIP-2012.
Currently, there are 33 operational urea manufacturing units in the country with a combined installed capacity of 269.42 lakh metric tonnes. Due to a shortfall in indigenous urea production, necessitating imports, the government stresses the need to augment domestic production. Various proposals for new urea units have been submitted to the Department of Fertilizers, which will now be fast-tracked following the approval of the National Investment Policy.
