India and Russia to Jointly Set Up Urea Plant: Currently, 71% of Urea Demand is Met by the Middle East; Production to Begin in the Next Two Years
Amidst the urea crisis triggered by the conflict in Iran, India and Russia have accelerated the process of establishing a fertilizer plant as a joint venture. This plant is being set up in Samara, Russia, and is expected to be completed within the next two years. In this regard, an Indian delegation recently visited Russia.
This joint project between India and Russia involves an estimated investment of approximately ₹20,000 crore. Indian Potash Limited (IPL), Rashtriya Chemicals and Fertilizers (RCF), and National Fertilizers Limited (NFL) are participating in this urea project, which will have a production capacity of 2 million tonnes and is being established in Russia. Through this project, India aims to reduce its dependence on fertilizer imports.
Preparing to Reduce Dependence on the Middle East
India relies heavily on urea—a nitrogen-based fertilizer—to support its agricultural sector. Currently, India imports approximately 71% of its total urea requirement from countries in the Middle East.
Three Indian State-Owned Companies Involved in the Project
The Indian companies—Indian Potash Limited (IPL), Rashtriya Chemicals and Fertilizers Limited (RCFL), and National Fertilizers Limited (NFL)—will collectively invest ₹10,000 crore. The remaining ₹10,000 crore will be invested by the Russian chemical company, ‘Uralchem Group’.
The Plant Will Serve as a Sustainable Source of Urea for India
P.S. Gahlot, MD of Indian Potash, stated that the project consultant, PDIL, has submitted its report. This plant is poised to become a sustainable and reliable source of urea for India.
Low Domestic Production, High Consumption of Urea in India
- Annual Consumption:** Approximately 40 million metric tonnes.
- Domestic Production:** Approximately 30 million metric tonnes.
- Fertilizer Shortfall:** Approximately 10 million metric tonnes.
- Expenditure on Imports:** India relies entirely on imports to bridge the shortfall in urea supply. In 2025, India spent approximately ₹20,000 crore on urea imports. Urea Being Procured via Alternative Routes
In light of the crisis triggered by tensions between the U.S. and Iran, the government has approved the import of 2.5 million tonnes of urea for the year 2026. This supply is being procured directly from Algeria, Nigeria, Oman, and Russia, bypassing the Strait of Hormuz route.
