Government policies on the fertiliser sector have been uncertain and inconsistent in the past decades, resulting in a growing subsidy burden and distortion of the optimal ratio of N P K consumption, especially after partial decontrol. Several studies and commissions have presented their conclusions on the retention pricing scheme, plant capacity assessments and subsidy reduction. These include among others, total decontrol of the sector in a time-bound manner. But political compulsions are likely to determine the vigour and pace of reforms in the fertiliser sector.
