BENGALURU: The government has revived its plan to set up a fertilizer plant in Iran as reliance on imports of urea has increased. Currently, the demand for urea is around 30 million tonne of which around 8 mt is imported as supply cannot be met domestically.
Investment in the plant was stuck earlier because of a disagreement between the two countries over the price of natural gas. This would be used as a feedstock for production of urea in Chahbahar in Iran, according to news agencies.
The project will see an investment of around `5,000 crore from India which will ask Iran to offer long term gas contracts for the same.
Rashtriya Chemicals and Fertilizers (RCF), Gujarat Narmada Valley Fertilizers and Chemicals (GNFC) and Gujarat State Fertilizers Corporation (GSFC) have been nominated earlier by the government for setting up a 1.3 million tonne urea joint venture plant, news agencies reported.
Talks have been going on since 2013 and the recent decision comes in light of the Iranian government showing its willingness to partner with India in the project.
Union Minister for Fertilizers H N Ananthkumar was recently visited by Iranian Ambassador Gholamreza Ansari who discussed the matter with him. According to sources, a delegation from the Ministry will now visit Iran to discuss the details. India already has urea plants in Qatar and Oman which have been assisting the country with meeting its needs as no new fertilizer plants have been announced domestically in several years now.
Ananthkumar had recently announced that a sum of `40,000 crore would be invested in the country for revival of old fertilizer plants as well as setting up of new units in line with the government’s aim to ‘Make in India’. Recently, National fertilizers Limited NFL), Engineers India Limited (EIL) and Fertilizer Corporation of India (FCIL) signed an agreement to form a joint venture company to set up new ammonia and urea plants at the Ramagundam Fertilizer plants in Karimnagar District in Telangana.
Meanwhile, Iran said that it is keen to ‘develop’ business relations with India and is hopeful that Iran-Pakistan-India Pipeline project will be back on track.