Fertiliser
Dalal Street Investment Journal|July 05. 2021
Agriculture and industry move hand-in-hand. The agro-industries get all their raw materials from agriculture and agriculture receives many materials for farming from industries like fertilisers, pesticides, machinery, etc.

Thus, the fertiliser sector is one of the essential segments of the Indian economy. In 2020, due to the pandemic, nationwide lockdown was imposed which led to a temporary shutdown of all economic activities. But food being a basic necessity, the central and state governments ensured that agriculture activities remained absolutely normal during various stages of the lockdown.

The fertiliser sector has been under the Essential Commodities Act and hence was exempted from lockdown restrictions. Also, the availability of sufficient fertilisers was ensured for sowing of Kharif crops during April-July and for sowing of Rabi crops during October-December. Overall, the fertiliser sales in India have increased by 9.6 per cent last year. India is the second-largest consumer of fertilisers and the third-largest producer of fertilisers in the world. Urea accounts for around 55 per cent of fertiliser consumption. Also, 67 per cent of the total fertiliser subsidy is paid for urea. The sector is governed by a myriad of policies. The urea industry suffers from underrecoveries under various heads of both fixed and variable costs.

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