April 27, 2017 / 10:56 AM / 4 months ago

India draws up $8.7 billion plan to turn urea exporter

A farmer casts urea on her mustard field in the northern Indian city of Allahabad January 12, 2015.Jitendra Prakash/Files

NEW DELHI (Reuters) - India aims to become a urea exporter by 2021 as the South Asian nation has drawn up a 555 billion rupee ($8.7 billion) plan to revive mothballed fertiliser plants and set up gas import and pipeline facilities in eastern India.

The fertiliser plants would raise annual urea production capacity by 7.5 million tonnes, fertiliser minister Ananth Kumar told a news conference on Thursday.

India produced 24.2 million tonnes of urea in 2016-17. The country's farm sector accounts for about 15 percent of its $2 trillion economy and employ three-fifths of its 1.3 billion people.

The country imported about 5.4 million tonnes of its fertilizer needs from countries including Iran, China and Iran during the last fiscal year ending in March.

"From an importing country, we will become an exporting country," said Kumar. "For food security, we need fertiliser security."

The expansion includes building a 2,650-km (1,590-mile) pipeline, the revival of four urea plants in northern Uttar Pradesh state, eastern Jharkhand, Bihar and Odisha states, and building a liquefied gas import facility all at a cost of about 500 billion rupees, oil minister Dharmendra Pradhan said during the news conference.

A separate fertiliser project at Ramagundam in southern Indian would cost 55 billion rupees, he added.

The fertilizer projects will get natural gas as a feedstock from Adani Group's 5 million tonne a year liquefied natural import facility at Dhamra in Odisha.

"We have derisked the project... all the expansion will be on imported LNG," Pradhan said, adding the projects will be in operation by between 2020 and 2021.

($1 = 64.1325 rupees)

Reporting by Neha Dasgupta; Writing by Nidhi Verma; Editing by Christian Schmollinger

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