Process to Import 50,000 Tons of Fertilizer from India Nears Completion; Payment to Be Made This Week
May 10, Kathmandu – The government has nearly finalized the procurement process of 50,000 tons of chemical fertilizer from India under the government-to-government (G2G) agreement. According to Dr. Ram Krishna Shrestha, Joint Secretary at the Ministry of Agriculture, Forestry and Environment, payment for the fertilizer will be sent to India within this week. The Cabinet had approved the purchase of 80,000 tons of fertilizer via the G2G process from India on April 3. Based on that approval, the first phase involves bringing in 50,000 tons of fertilizer, as confirmed by Shrestha.
The purchase agreement has been established between Nepal’s Agricultural Inputs Company Limited and India’s National Chemicals & Fertilizers Limited. According to Shrestha, the Virtual Joint Steering Committee, comprising representatives from both countries, has finalized the pricing. “The Joint Steering Committee, chaired by me from the Nepal side and the Joint Secretary of India’s Department of Fertilizers, accepted the determined price, which allowed the procurement process to commence,” said Joint Secretary Shrestha. “Purchase orders have been sent, and we are now at the stage of transferring funds.” The procurement includes approximately 30,000 tons of urea and 20,000 tons of DAP, with an estimated cost of around NPR 700 crore.
Shrestha explained that fertilizer prices have surged significantly in the international market, putting pressure on the budget. “The cost for these 50,000 tons is quite high due to the sharp increase in global prices,” he said. “Urea prices have nearly doubled compared to last year, and DAP prices are still on the rise.” He added that preparations are underway to transfer the funds by this Friday with the consent of the Ministry of Finance. Although the supply of fertilizer may take up to 120 days as per the agreement’s delivery timeline, Shrestha noted that requests have been made for expedited shipping, considering Nepal’s pressing paddy season demand.
“In the meetings, we expressed concerns about potential future difficulties and requested faster delivery,” said Joint Secretary Shrestha. “The Indian side has assured that shipping will begin as soon as possible. Once this fertilizer arrives, it will provide significant support for the months of August and September.” While the government has allocated NPR 3.2 billion for fertilizer procurement in the upcoming fiscal year, rising international prices and global circumstances have posed additional challenges, according to the ministry. The government has been providing fertilizers at subsidized rates to farmers through substantial grants.
Global conflicts and issues arising in regions such as the Hormuz Strait have affected fertilizer prices and supply worldwide, making it difficult to guarantee 100 percent availability. Nevertheless, the ministry is actively working to prevent any shortage of fertilizer, Joint Secretary Shrestha stated.
