India has imported urea at around 20 percent cheaper price in the first quarter of this fiscal as compared with the average cost for last financial year.
New Delhi: India has imported urea at around 20 percent cheaper price in the first quarter of this fiscal as compared with the average cost for last financial year.
The cheaper urea imports could lead to lower subsidy burden on the government if domestic demand of urea remains constant.
Urea is being currently sold to farmers at maximum retail price (MRP) of Rs 5,360 per tonne. The difference between the MRP and production/imported cost is paid by the government to producers.
The government has lowered the fertiliser subsidy marginally to Rs 65,971.50 cr for the current fiscal.
India has imported about 11.09 lakh tonnes in the April-June quarter of this fiscal, up by nearly 50 percent from the year-ago period.
"The average cost of imported urea in the first quarter of current fiscal was at around USD 340 per tonne while the average cost for the entire 2012-13 was USD 417 per tonne," a Fertiliser Ministry official said.
The imported cost of urea had reached as high as USD 535-540 per tonne during last fiscal, the official said, adding that the average cost does not include imports of urea from OMIFCO in Oman which costs around USD 170-USD 175 per tonne.
India's domestic production of urea is about 220 lakh tonnes. The country imported 80.44 lakh tonnes in the entire 2012-13 fiscal. Urea is imported mainly by the three canalising agencies - Indian Potash Ltd (IPL), MMTC and STC.
"Looking at the trend in the global market at present, it seems unlikely that cost of imported urea will cross or touch last year's average price of USD 417 per tonne," he said.