To ensure long term supply of fertilizers and curb volatility in prices, India and Russian companies on Friday signed a memorandum of understanding (MoU) for forming a joint venture for building a large urea manufacturing facility in Russia.
Rashtriya Chemicals and Fertilisers, National Fertilisers and Indian Potash signed the MoU with UralChem, Russia’s largest potash and ammonium-nitrate producer for setting a urea plant which is expected to ensure steady supply of soil nutrients to India, and cut costs of imports.
The planned urea plant is expected to have an annual production capacity of 1.8 to 2 million tonnes (MT) annually. The technical parameters and financial viability of the JV is currently being discussed.
The JV will be based on the supply of ammonia produced by Togliattiazot JSC, with the Indian companies providing financing for the project until its commercial operation commences.
“The parties are also negotiating the corporate structure and governance approach in respect of the joint venture,” according to the UralChem statement.
An overview of Uralchem group
The Uralchem group includes three major Russian companies — Uralchem JSC, Uralkali PJSC, and Toaz JSC — with a cumulative production capacity of about 25 MT.
“India is a leading agricultural player globally and also one of the world’s biggest consumers of mineral fertilisers. For Uralchem Group, India has historically been a strategic market, and we are committed to expanding and deepening our cooperation with Indian partners,” Dmitry Konyaev, CEO, Uralchem said in a statement.
The biggest such joint venture project India’s Iffco and Kribhco is ‘Oman India Fertiliser’ which produces around 1.65 MT of urea annuall.
In 2024, according to the Russian Association of Fertiliser Producers, India imported 4.7 MT of Russian fertilizers like urea and potash. In the current year, Russia could supply India’s 25% of its fertilizer imports, trade sources said.
In their joint statement, President Putin and Prime Minister Narendra Modi welcomed the steps to ensure long-term supply of fertilisers to India and discussed the potential establishment of joint ventures in this area.
India imports about a third of its fertilizer – urea, DAP, NPK and potash consumption of around 60 MT annually. An industry expert said that overall imports of fertilizers in FY26 could exceed 18 MT,
Agriculture minister Chouhan mets his Russian counterpart
Agriculture minister Shivraj Singh Chouhan held a discussion with Oxana Lut, agriculture minister of Russian Federation on Thursday to increase trade in agricultural commodities between both the countries. Chouhan stated that while India-Russia bilateral trade is currently estimated around $ 3.5 billion, there is a need to balance the trade share.
Russia has resolved long-pending issues relating to the exports of potatoes, pomegranate and seeds from India, Chouhan stated.
Meanwhile, Russia has indicated its readiness to import fishery and meat products from India and has shown interest in jointly developing the trout market through a technical collaboration, Rajiv Ranjan ‘Lalan’ Singh, minister of Fisheries, Animal Husbandry and Dairying had said on Thursday.
While stating that India is the second top exporter of shrimp to Russia, Lut said, “Some items are manufactured in Russia and some in India, and the products which Russia needs, can be supplied by India and the products which India needs can be supplied by Russia to India for strengthening mutual trade.”