Agriculture Minister Chaudhary seeks Oman’s help for fertiliser supply

Agriculture, Forest and Environment Minister Geeta Chaudhary has requested Oman’s assistance in securing a stable supply of chemical fertilisers for Nepal. Minister Chaudhary made the appeal during a meeting with Sheikh Khalifa, head of an Omani delegation, in Singha Durbar on Thursday.Chaudhary’s secretariat stated that the minister expressed Nepal’s interest in collaborating with Oman to address the challenging management of chemical fertiliser supply. In response, Sheikh Khalifa noted that Oman currently exports green urea produced in his country to India and indicated willingness to make it available to Nepal as well.Nepal faces a significant deficit in chemical fertiliser, with an annual consumption of approximately 700,000 metric tons, according to the Ministry of Agriculture and Livestock Development. The estimated annual demand for chemical fertilisers can reach up to 1.1 million metric tons, but more than 63 percent of this demand remains unmet.In the last fiscal year, 538,436 metric tons of chemical fertilisers were supplied, with the government providing nearly Rs 39.75 billion in subsidies. From Chaitra to Ashoj of the current fiscal year, 257,000 metric tons of fertiliser have been imported, the ministry reported.Nepal began using chemical fertilisers only after 1950. The government established the Agriculture Inputs Corporation (AIC) under the Ministry of Agriculture in 1966 to import and distribute chemical fertilisers. Subsidies on fertilisers were introduced in 1973 and 1974 due to rising global oil prices, which increased international fertiliser costs.However, under pressure from international organisations, the government halted fertiliser subsidies and ended AIC’s monopoly in the fiscal years 1997 and 1998. Studies on establishing a chemical fertiliser factory in Nepal have been ongoing since 1983. In Bhadra 2077 (BS), a task force recommended opening a fertiliser factory.During former Prime Minister Pushpa Kamal Dahal’s visit to India in Jestha 2080 (BS), discussions emerged about India’s potential cooperation in establishing a chemical fertiliser factory. The Russia-Ukraine conflict has also impacted the international fertiliser market, as Russia, a major producer of nitrogen, phosphorus, and potash fertilisers, has limited its exports.The Ministry of Agriculture, Forest and Environment has formed a study task force to identify necessary legal and policy arrangements to ensure the purchase of domestically produced fertilisers once a factory is established in Nepal. This task force will examine existing legal and policy frameworks, procurement processes, and institutional structures.The ministry’s secretary has also emphasised the need for further coordination on fertiliser supply through government-to-government (G2G) mechanisms and company-to-company (B2B) agreements for procurement, transportation, transit, and logistics management. Discussions are underway to advance contact and dialogue with relevant companies.Sheikh Khalifa also discussed the possibility of establishing an Omani embassy in Nepal in the future and highlighted the need to resume direct flights between Nepal and Oman, which were operational before the COVID-19 pandemic.It remains unclear when and in what quantity Oman can provide green urea to Nepal. While international interest in establishing a chemical fertiliser factory in Nepal has grown, concrete investment proposals and implementation status are not yet clear. Further investigation is also needed into the shortcomings and potential leakages in chemical fertiliser import and distribution, as well as why budget allocated for organic fertiliser production did not reach farmers and subsequently froze.