A group of ministers (GoM) approved a new investment policy for the urea sector on Friday, to make the nation self-sufficient in the key soil nutrient.
The government in 2008 had announced a ‘New Investment Policy’ to boost urea production, but the scheme failed to attract fresh investments.
With demand-supply gap of urea widening, the government in 2010 decided to frame a new policy. Last year, a Committee of Secretaries (CoS), headed by Planning Commission Member Soumitra Choudhary, was set up for this purpose.
According to sources, the GoM, headed by Finance Minister Pranab Mukherjee, approved the policy as per the CoS recommendations.
In the draft policy, the CoS has suggested incentives for setting up of greenfield (new plants) and brownfield (expansion of existing plants) facilities.
At present, the country faces a shortfall of 7 million tonnes, which is met through imports. Domestic urea production is estimated at 22 million tonnes, while the consumption is pegged at 29 million tonnes.