India to meet 90% of its domestic urea demand by 2030 to improve food security

Meeting 90% of demand means India would produce nearly all the urea it expects farmers to need in 2030. Planned domestic capacity is estimated at about 43.5–43.7 million tonnes, compared with projected demand of 48.61 million tonnes. It does not mean imports would end completely.

The main mechanism is import substitution. Each tonne made in India could replace a tonne bought overseas. That would reduce exposure to international prices, supply disruptions and exchange-rate pressures. The article estimates that replacing 1 million tonnes of imports could save about $500 million annually in foreign exchange.

India currently produces roughly 75% of its approximately 40-million-tonne annual requirement. The expansion would move that share close to 90% by 2030, if the planned projects are completed. Imports would remain necessary, while better fertilizer use would still matter because demand is projected to reach 48.61 million tonnes.

India is planning a major increase in annual urea-making capacity. The expected addition is about 13.5–13.7 million tonnes by 2030, lifting domestic capacity to approximately 43.7 million tonnes. The purpose is to reduce reliance on imported fertilizer as demand grows.

The expansion includes 10 million tonnes envisaged under the National Investment Policy for Urea-2026. It also includes two domestic projects, each designed for 1.27 million tonnes annually, plus a proposed Russian-linked venture with capacity of around 2 million tonnes. Separately, 17 proposals are under examination.

Projected domestic demand in 2030 is 48.61 million tonnes. Therefore, the planned domestic capacity would equal roughly 90% of expected demand, leaving a smaller import requirement. Current production covers only about 75% of annual demand, so the plan represents a substantial increase in self-sufficiency.

India is trying to cut imports because fertilizer prices have become more volatile and expensive. The article links the latest price rise to the escalating conflict in West Asia. Since India imports roughly one-quarter of its urea requirement, global disruptions can quickly raise costs and complicate supply planning.

Higher world prices also increase pressure on the government. India keeps fertilizer affordable for farmers through subsidies, so expensive imports can enlarge the subsidy burden. Building more domestic capacity offers a degree of protection from sudden international price movements and supply shocks.

The Union cabinet approved the National Investment Policy for Urea-2026 after global fertilizer prices rose sharply. India is also building inventories, and prices have since declined. However, the government still sees domestic production as a longer-term safeguard. Imports will remain part of the supply mix because projected demand is higher than planned domestic capacity.

Domestic production could improve India’s finances in three connected ways. It could reduce foreign-exchange spending on imports, limit the government’s need to absorb high international prices through subsidies, and make fertilizer costs less vulnerable to global shocks. The article estimates savings of about $500 million annually for every 1 million tonnes of imports replaced.

The mechanism is straightforward: an Indian plant supplies urea that would otherwise be purchased abroad. That reduces payments in foreign currency. It can also lower exposure to sudden import-price increases, which matter because fertilizer subsidies are among the Centre’s largest forms of agricultural support.

The fiscal stakes are substantial. Fertilizer subsidy spending crossed ₹2.17 trillion in FY26, against a budget of ₹1.77 trillion. The Department of Fertilizers had sought ₹3.5 trillion amid rising prices. Prices later declined, and subsidy projections moderated, but domestic capacity could provide longer-term protection.

The article does not define urea. In established agricultural usage, urea is a nitrogen fertilizer. Nitrogen is a major plant nutrient, so supplying it can support leaf, stem and overall crop growth. That makes urea a widely used input where farmers seek stronger crop development and higher yields.

Urea is especially useful because it delivers a concentrated form of plant-available nitrogen after it is applied and transformed in soil. Farmers use it to supplement the nutrients crops remove as they grow. Its role is therefore tied directly to productivity, but results depend on applying the right amount at the right time.

India’s rising urea demand is part of the wider supply challenge described in the article. Annual demand is around 40 million tonnes and growing by about 5%. Producing more can protect supply, but experts warn that balanced fertilizer use and better nutrient efficiency are also necessary for sustainable growth.

Several projects and companies are expected to contribute to India’s added urea supply. The government’s NIPU-2026 provides the largest planned block, with 10 million tonnes of annual capacity. The Department of Fertilizers is also examining 17 proposals from companies including GAIL, HURL, Kribhco, Chambal Fertilisers and Matix Fertilizers.

Talcher Fertilizers, promoted by GAIL, RCF, Coal India and Fertilizers Corporation of India, is building a 1.27-million-tonne plant in Odisha. It will use coal gasification, converting coal into gas for fertilizer production. Assam Valley Fertilizer and Chemical Company is proposing another 1.27-million-tonne plant in Assam.

A separate proposed venture with Russia’s JSC UralChem could add around 2 million tonnes a year at Togliatti in the Samara region. The Assam project has differing timelines in the article: FY31 from the state’s chief secretary and December 2030 from HURL. Several proposals remain under examination.