With reference to chemical fertilizers in India, consider the followin

With reference to chemical fertilizers in India, consider the following statements :

  • At present, the retail price of chemical fertilizers is market-driven and not administered by the Government.
  • Ammonia, which is an input of urea, is produced from natural gas.
  • Sulphur, which is a raw material for phosphoric acid fertilizer, is a by-product of oil refineries.

Which of the statements given above is/are correct ?

1 only
2 and 3 only
2 only
1, 2 and 3
This question was previously asked in
UPSC IAS – 2020
The correct option is B, as statements 2 and 3 are correct, while statement 1 is incorrect.
The Indian government provides subsidies on chemical fertilizers to ensure their availability to farmers at affordable prices. The pricing mechanism varies for different fertilizers like urea and P&K fertilizers. Raw materials for fertilizer production often come from natural gas and oil refining processes.
1. **Retail price:** The retail price of Urea is fixed (administered) by the Government of India through the Urea Policy, providing a subsidy to manufacturers. Prices of Phosphatic and Potassic (P&K) fertilizers were decontrolled to some extent but are under a Nutrient Based Subsidy (NBS) scheme, where a fixed subsidy is provided per nutrient, allowing manufacturers/importers to determine the Maximum Retail Price (MRP) to some extent, but still influenced by the subsidy. Therefore, it is incorrect to say that the retail price of *chemical fertilizers* is purely market-driven and not administered by the government, given the significant government control and subsidy mechanisms, especially for Urea.
2. **Ammonia production:** Ammonia (NH3), the primary input for urea synthesis, is predominantly produced in India and globally from natural gas (methane) through processes like steam reforming. This statement is correct.
3. **Sulphur as raw material:** Sulphur is a key raw material for producing sulphuric acid (H2SO4), which is essential for manufacturing various phosphatic fertilizers (like Single Super Phosphate – SSP, Diammonium Phosphate – DAP). Sulphur is a significant by-product recovered from the desulfurization of crude oil and natural gas in refineries and processing plants. This statement is correct.