West Asia turmoil to swell fertiliser subsidy by up to Rs 25,000 Crore, hit output: Crisil Ratings

India faces a potential Rs 20,000-25,000 crore increase in its fertiliser subsidy bill. Domestic production of fertilisers may also fall by 10-15 percent.

Key takeaways

Quick scan — what you need to know:

• India faces a potential Rs 20,000-25,000 crore increase in its fertiliser subsidy bill.
• Domestic production of fertilisers may also fall by 10-15 percent.
• These impacts stem from ongoing Middle East conflicts disrupting raw material and fertiliser imports.
• The government's allocation of gas and existing inventory offer some buffer.

Background

What led here, in plain terms:

• However, the industry will need additional subsidy support.
• India faces a potential Rs 20,000-25,000 crore increase in its fertiliser subsidy bill.
• Domestic production of fertilisers may also fall by 10-15 percent.
• These impacts stem from ongoing Middle East conflicts disrupting raw material and fertiliser imports.

Why it matters

Why readers and decision-makers should care:

• Domestic production of fertilisers may also fall by 10-15 percent.
• These impacts stem from ongoing Middle East conflicts disrupting raw material and fertiliser imports.
• The government's allocation of gas and existing inventory offer some buffer.