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More than half of India's population relies on agriculture for survival. According
to the Economic Survey 2020-21, agriculture and related industries contributed 17.8
per cent of the country's Gross Value Added (GVA) at current prices in 2019-20, The
country's most challenging problem currently is maintaining a balance between
population boom and agricultural production.
The fertilizer industry in India has been under strict governmental control for
most of the period since independence. The Government of India declared fertilizer as
an essential commodity and notified the Fertilizer Control Order (FCO) in 1957. Major
controls on prices and distribution of fertilizers were introduced in 1973 under the
Fertilizer Movement Control Order. The Retention Price cum Subsidy Scheme (RPS)
was introduced in 1977 for encouraging investment in the fertilizer sector. The
economic reforms of 1991 paved way for many policy changes and it also resulted in
the formation of several committees. Price of fertilizers were deregulated and new
schemes like New Pricing Scheme (NPS) and Direct Benefit Transfer (DBT) were
introduced. The growth trend in the chemical fertilizer production and consumption was
studied. The results showed that in the year 1950-51, the all-India consumption of N,
P2O5, K2O fertilizers was 55.0, 8.8 and 6.0 (‘000 tonnes) respectively. In the 1990s, the
total fertilizer consumption varied between 12.15 and 16.8 million tonnes. In 2007-08,
the total consumption outreach was 22.5 million tonnes. The total estimated nutrient
consumption for 2019-20 (N+P2O5+K2O) was 29.04 million metric tonnes.
Fertilizer production in India has increased at a rapid rate i.e., 38.7 thousand
tonnes in 1951-52 to about 17.9 million tonnes in 2015-16. Fertilizer production
increased modestly by 3.3 per cent to 18.5 million tonnes (N+P2O5) in 2019-20. The
production of fertilizers accompanied by the imports in the country have resulted in
high fertilizer use by the farmers. The gap between the domestic consumption and
production was also studied and the results indicated a deficit (1.31) in the total
production and consumption. Forecasting for the next 6 years from 2020-21 to 2025-
26 was also carried out and it showed an increasing trend in both consumption and
production for all the major chemical fertilizers.
A comparative analysis of fertilizers usage and its marketing in Kerala and
Telangana was also studied. Two districts with the highest area under paddy was
purposively selected. Two panchayats from each block were randomly selected. The
sample included 120 farmers and 20 traders. Second order polynomial regression was
carried out to analyse the effect of consumption of N, P and K on the yield. Fisher’s t
test was also performed to know whether there is any significant difference between the
consumption of N, P, K and yield in the two study areas. It was found that consumption
of N and P fertilizers were different in the two states. Yield was found to be higher in
Telangana. The consumption of K fertilizers was more or less equal. A significant value
of Kendall’s coefficient of concordance showed that there existed strong agreement
among the respondents to rank the various brands of fertilizers. It was found that IFFCO
fertilizers was preferred in Telangana and in Kerala it was FACT.
The marketing system of fertilizers in India is based on the Direct Benefit
Transfer system. All subsidised fertilizers are sold to farmers/buyers through Point of
Sale (PoS) devices installed in each retailer shop. Dealers must sell fertilizers through
PoS devices under the Aadhaar enabled Fertilizers Distribution System (AeFDS). The
web-based Integrated Fertilizer Management System keeps track of fertilizer sales
(iFMS).
The marketing channels in the two states were studied and it revealed that
fertilizers in Kerala are mostly distributed to the farmers via the co-operative banks
(PACS) to Padashekara samithis. The farmers in Telangana mostly purchased fertilizers
from retail shops. There also exists another channel wherein the TS MARKFED
supplies fertilizers to various institutes through which farmers avail fertilizers.
The fertilizer industry in India is dominated by the co-operative and private
companies. IFFCO is one of the largest fertilizer co-operatives as well as producers of
fertilizers in India. SWOC analysis of IFFCO showed that the cooperative nature and
new venture and businesses of IFFCO are few of its major strengths. Rigid
organizational sector and slow feedback are some of its weaknesses. Opportunities
include increasing the installation capacity and energy efficient plants. High
competition from other private and public companies and government regulations are
the major challenges.
Chemical fertilizers have made a substantial contribution to India's food grain
self-sufficiency. Only by studying individual farm usage can a clearer picture of the
country's fertilizer consumption pattern be identified. In order to increase agricultural
growth and encourage balanced nutrient application, fertilizers must be made available
to farmers at reasonable prices which in turn lead to enhancement of agricultural
productivity.