In an interview with The Financial Express, Prabhu said that the ministry was calculating the prices of various inputs used by fertiliser units and if the total amount crossed the budget figure, urea prices would be increased. "The subsidy issue and the pricing issue are related to each other. We will have to look at prices as one of the options to mitigate the excess burden which would result if the government has to increase subsidy."

The minister, however, remained non-committal on the political furore such a decision might lead to. With a hike in naphtha, natural gas and fuel oil prices, the total subsidy amount for urea is likely to cross the budget estimate of Rs 8,750 crore. According to estimates of the industry, total urea subsidy would touch Rs 10,000 crore.

An increase in urea prices would also serve to restore balancein the distorted NPK ratio, Prabhu said. The ratio which ideally should be 4:2:1, stands at 7.9:2.8:1. "We have to take measures to correct this imbalance and increasing prices would be one of the ways to do so."