Indian fertiliser manufacturers, especially small and medium-sized enterprises (MSMEs), are facing significant challenges. A major issue is the country’s current policy regime, which seems to favour imports over domestic production. This imbalance is making it difficult for local companies to compete and grow.
The fertiliser sector is crucial for India’s agriculture. Farmers rely on affordable and readily available fertilisers to boost crop yields. However, the current system is putting a strain on the very companies that could be supplying these essential products.
One of the key problems is the reliance on China for raw materials. Many Indian fertiliser producers import essential components from China. This dependence creates a vulnerability. If there are disruptions in supply from China, or if prices there increase, it directly impacts Indian manufacturers. This can lead to higher production costs, which may eventually be passed on to farmers.
Another significant hurdle is the ‘red tape’ associated with government regulations. Small businesses often find it hard to navigate the complex bureaucratic processes. Applying for licenses, meeting compliance standards, and dealing with paperwork can be time-consuming and expensive. This administrative burden can divert resources and attention away from core business activities like production and innovation.
The policies themselves are also a concern. Critics argue that the government’s focus on allowing cheap imports discourages investment in domestic manufacturing capabilities. While imports can offer short-term benefits, a strong domestic industry provides long-term advantages like job creation, technological development, and greater supply chain security.
MSMEs are particularly affected because they often have fewer resources to overcome these challenges compared to larger corporations. They may struggle to absorb the costs associated with import duties, raw material price fluctuations, and compliance burdens. This can stifle their growth and even threaten their survival.
Experts suggest that a review of the current policies is needed. The government could consider measures to support local manufacturers, such as offering incentives for domestic production, simplifying regulatory processes, and promoting the use of locally sourced raw materials. Developing indigenous technology and reducing reliance on foreign suppliers would also strengthen the sector.
By addressing these policy gaps and reducing the administrative load, India can foster a more robust and self-reliant fertiliser industry. This would not only benefit the manufacturers but also ensure a stable and affordable supply of fertilisers for Indian farmers, ultimately contributing to the nation’s food security and agricultural growth.