{"id":80228,"date":"2026-07-28T18:20:54","date_gmt":"2026-07-28T12:50:54","guid":{"rendered":"https:\/\/www.nextias.com\/ca\/?p=80228"},"modified":"2026-07-28T18:21:53","modified_gmt":"2026-07-28T12:51:53","slug":"nipu-2026","status":"publish","type":"post","link":"https:\/\/www.nextias.com\/ca\/current-affairs\/28-07-2026\/nipu-2026","title":{"rendered":"National Investment Policy for Urea (NIPU)-2026"},"content":{"rendered":"\n<p><strong>Syllabus: GS2\/Governance; GS3\/Economy&nbsp;<\/strong><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Context<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Recently, the Union Cabinet has approved the <a href=\"https:\/\/www.nextias.com\/ca\/current-affairs\/16-07-2026\/national-investment-policy-urea-2026\"><strong>National Investment Policy for Urea (NIPU)-2026<\/strong><\/a> to promote investment in domestic urea production amid concerns over fertiliser availability during the ongoing kharif season.<\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n\n<div class=\"wp-block-group has-background\" style=\"background-color:#ebecf0\"><div class=\"wp-block-group__inner-container is-layout-constrained wp-block-group-is-layout-constrained\">\n<p><strong>Fertilisers<\/strong><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Fertilisers are <strong>natural or man-made<\/strong> compounds that offer critical nutrients to plants for their healthy growth, better crop productivity and maintenance of soil fertility.<\/li>\n\n\n\n<li>The <strong>three major plant nutrients<\/strong> are <strong>Nitrogen (N), Phosphorus (P) and Potassium (K)<\/strong>, collectively known as <strong>NPK<\/strong>.<\/li>\n\n\n\n<li>Fertilisers are generically characterised based on the nutrients given as:\n<ul class=\"wp-block-list\">\n<li><strong>Nitrogenous fertilisers:<\/strong> Urea Ammonium Sulphate Calcium Ammonium Nitrate (CAN)<\/li>\n\n\n\n<li><strong>Phosphatic fertilisers<\/strong>: Di Ammonium Phosphate (DAP), Single Super Phosphate (SSP).<\/li>\n\n\n\n<li><strong>Potassic Fertiliser:<\/strong> Muriate of Potash (MOP), Sulphate of Potash (SOP).<\/li>\n\n\n\n<li><strong>Complex\/compound fertilisers:<\/strong> Have two or more primary nutrients.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<\/div><\/div>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Evolution of India&#8217;s Urea Policy<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>National Investment Policy, 2012: <\/strong>It was announced to encourage fresh investment in the Urea sector in India. It was amended in <strong>2013<\/strong> and <strong>October 2014<\/strong> to facilitate new projects.\n<ul class=\"wp-block-list\">\n<li><strong>Achievements of National Investment Policy, 2012:\u00a0<\/strong>\n<ul class=\"wp-block-list\">\n<li><strong>Six new urea plants <\/strong>were established. Four through Joint Venture Companies (JVCs) of public sector undertakings. Two by private companies.<\/li>\n\n\n\n<li>Presently <strong>33 operational urea manufacturing units<\/strong>.<\/li>\n\n\n\n<li><strong>Installed\/Reassessed Capacity (RAC): <\/strong>207.54 LMT (<strong>2014-15<\/strong>); 269.42 LMT (<strong>2026-27<\/strong>)<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Amendment in 2015: <\/strong>It applied to <strong>25 existing gas-based plants<\/strong>. It added 20-25 LMT of annual production above 2014-15 levels.\n<ul class=\"wp-block-list\">\n<li>225 LMT (2014-15) 314.07 LMT (2023-24) 293.30 LMT (2025-26)<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Fertiliser Subsidy:<\/strong> India gives huge subsidies to make fertilisers available to farmers at affordable prices.\n<ul class=\"wp-block-list\">\n<li><strong>Total Subsidy on Fertiliser:<\/strong> <strong>Total Fertiliser Subsidy: <\/strong>\u20b91,77,162.06 crore (2024-25); \u20b92,17,281.10 crore (2025-26). The <strong>Union Budget (2026-27)<\/strong> allocated \u20b91.71 trillion for fertiliser subsidies.<\/li>\n\n\n\n<li><strong>Urea Subsidy: <\/strong>\u20b91,24,319.50 crore (<strong>2024-25<\/strong>); \u20b91,42,175.74 crore (<strong>2025-26<\/strong>)<\/li>\n\n\n\n<li><strong>Nutrient-Based Subsidy (NBS):<\/strong>\n<ul class=\"wp-block-list\">\n<li>Phosphatic fertilisers: <strong>\u20b974,999.99 crore<\/strong><\/li>\n\n\n\n<li>Potassic fertilisers: <strong>\u20b952,810 crore<\/strong><\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Organic Fertilisers: <\/strong>\u20b932.56 crore (2024-25); \u20b9105.37 crore (2025-26)<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Subsidised fertilisers<\/strong> are distributed through the <strong>Direct Benefit Transfer (DBT)<\/strong> system using <strong>Point of Sale (PoS)<\/strong> devices with beneficiary <strong>authentication through Aadhaar, Kisan Credit Card (KCC), Voter ID<\/strong> and other approved identity documents.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Major Features of National Investment Policy for Urea (NIPU)-2026<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Promotion of Domestic Manufacturing: <\/strong>Policy encourages setting up of new gas-based urea plants with aim to reduce dependence on imported urea.<\/li>\n\n\n\n<li><strong>Transparent Cost Structure:<\/strong> Distinguishes fixed and variable costs for improved transparency and efficiency.<\/li>\n\n\n\n<li><strong>Assured Return on Equity (RoE): <\/strong>It introduces a viable <strong>RoE band i.e. 12% (Minimum) to 16% (Maximum). <\/strong>It is intended to attract private and public investment.<\/li>\n\n\n\n<li><strong>Mitigation of Foreign Exchange Risk:<\/strong> Fixed costs shall be translated into Indian Rupees at the prevailing rate after four years. minimises the volatility of the exchange rate for investors.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Government Initiatives for Balanced Fertiliser Usage<\/strong><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Integrated Nutrient Management (INM):<\/strong> Encourages balanced use of organic manures, chemical fertilisers and bio-fertilisers.\n<ul class=\"wp-block-list\">\n<li>It enhances fertiliser usage efficiency, maintains soil fertility in the long run, lowers environmental degradation, and supports sustainable agriculture.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Nano Urea:<\/strong> It is marketed as an alternative to traditional urea. However, it is accepted only to a limited extent due to scientific efficacy, variable field level results and low farmer acceptance.<\/li>\n\n\n\n<li><strong>Sustainable and Green Agriculture:<\/strong> Eco-friendly options such as Fortified Organic Manure, Liquid FOM and Phosphate-Rich Organic Manure. It grew to seven times the volume in Financial Year 2025-26 from 2024-25.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Challenges<\/strong><\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The <strong>West Asia crisis<\/strong>, increased demand for fertiliser due to <strong>El Nino linked climatic conditions<\/strong> and the continuous usage of chemical fertilisers have underlined the need for more self-reliance in urea production.<\/li>\n\n\n\n<li>Continued dependence on imported urea to bridge the demand-supply gap.<\/li>\n\n\n\n<li>The Exchequer&#8217;s burden of fertiliser subsidies is rising.<\/li>\n\n\n\n<li>Too much application of urea leads to imbalance of nutrients and deterioration of soil health.<\/li>\n\n\n\n<li>Poor uptake of organic and bio-fertilisers.<\/li>\n\n\n\n<li>Global supply chain interruptions and geopolitical risk exposure.<\/li>\n\n\n\n<li>Call for higher energy efficiency in fertilizer production.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><strong>Way Forward<\/strong><\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li><a href=\"https:\/\/www.nextias.com\/ca\/current-affairs\/16-07-2026\/national-investment-policy-urea-2026\"><strong>NIPU-2026<\/strong><\/a> implementation should be accelerated to increase domestic production capability.<\/li>\n\n\n\n<li>Ensure balanced fertilisation by practising Integrated Nutrient Management and Nutrient Based Subsidy regime.<\/li>\n\n\n\n<li>Encourage the use of organic, bio-fertilisers and scientifically proven nano fertilisers.<\/li>\n\n\n\n<li>Soil health cards, precision farming and awareness initiatives to increase nutrient-use efficiency.<\/li>\n\n\n\n<li>Diversify sources of imports and build up strategic stocks of fertilisers.<\/li>\n\n\n\n<li>Promoting the use of energy efficient and low-carbon fertiliser production methods.<\/li>\n<\/ul>\n\n\n\n<p><a href=\"https:\/\/www.thehindu.com\/business\/agri-business\/indias-policy-on-urea-explained\/article71265519.ece\" target=\"_blank\" rel=\"noopener\">Source: TH<\/a><\/p>\n\n\n\n<p><\/p>\n","protected":false},"excerpt":{"rendered":"<p><strong> Context <\/strong><\/p>\n<li class=\"ms-5\"> Recently, the Union Cabinet has approved the National Investment Policy for Urea (NIPU)-2026 to promote investment in domestic urea production amid concerns over fertiliser availability during the ongoing kharif season. <\/li>\n<p><\/p>\n<p><strong> Fertilisers <\/strong><\/p>\n<li class=\"ms-5\"> Fertilisers are natural or man-made compounds that offer critical nutrients to plants for their healthy growth, better crop productivity and maintenance of soil fertility. <\/li>\n<li class=\"ms-5\"> The three major plant nutrients are Nitrogen (N), Phosphorus (P) and Potassium (K), collectively known as NPK. <\/li>\n<p><a href=\" https:\/\/www.nextias.com\/ca\/current-affairs\/28-07-2026\/nipu-2026 \" class=\"btn btn-primary btn-sm float-end\">Read More<\/a><\/p>\n","protected":false},"author":15,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[21],"tags":[],"class_list":["post-80228","post","type-post","status-publish","format-standard","hentry","category-current-affairs"],"acf":[],"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/80228","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/users\/15"}],"replies":[{"embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/comments?post=80228"}],"version-history":[{"count":3,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/80228\/revisions"}],"predecessor-version":[{"id":80231,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/posts\/80228\/revisions\/80231"}],"wp:attachment":[{"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/media?parent=80228"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/categories?post=80228"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.nextias.com\/ca\/wp-json\/wp\/v2\/tags?post=80228"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}