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India must reduce its dependence on fertiliser imports before it’s too late

What worsens India’s dependence on fertiliser imports is not merely the volume of imports, but the inefficiency with which the country utilises them.

As global tensions intensify, particularly in regions that produce energy, India’s focus has understandably shifted toward oil. However, this preoccupation risks overlooking a more profound and immediate vulnerability. The subsequent economic shock to India may not originate from the fuel for its vehicles, but rather from what feeds its soil, and fertilisers sit at the centre of this risk.

Currently, India is structurally reliant on imports for essential fertiliser components, notably phosphates and potash, and is indirectly dependent on imported natural gas for urea production. In a stable global environment, this dependency is manageable; however, in a conflict-driven context, it becomes a critical fault line. Disruptions in supply, export restrictions, and price surges not only increase costs but also threaten availability, timing, and ultimately, agricultural productivity.

The concern is not new. In my previous column, I argued that India’s economic vulnerability is not solely due to the volume of imports but also their concentration and strategic significance. Fertilisers exemplify this issue in its most consequential form: they are indispensable inputs, fundamental to food security.

What worsens this dependence is not merely the volume of imports, but the inefficiency with which India utilises them. 

The distortion within

The core issue of India’s fertiliser challenge lies in the imbalance of nutrient application. An optimal fertiliser ratio of nitrogen, phosphorus, and potassium is crucial for achieving maximum agricultural yields. However, in practice, India’s fertiliser usage has significantly deviated from this balance, exhibiting a persistent preference for nitrogen. This inclination is primarily influenced by subsidy policies that make urea disproportionately cheap.

The data indicates volatility rather than convergence. In years where productivity declines, nitrogen ratios exhibit significant increases, reflecting distorted incentives.

For several decades, subsidies have rendered........

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