FACT commences DAP production at Udyogamandal (Kochi) under NBS scheme from 15 May 2026; government permission was granted on 24 April 2026
Why in News
The Fertilisers and Chemicals Travancore Limited (FACT), a central public sector undertaking under the Ministry of Chemicals & Fertilizers, on 15 May 2026 commenced Di-Ammonium Phosphate (DAP) production at its Udyogamandal complex in Kochi, Kerala. This marks FACT's formal entry into DAP manufacturing at the historic Udyogamandal facility, pursuant to a Department of Fertilizers letter dated 24 April 2026 permitting DAP manufacturing under the Nutrient Based Subsidy (NBS) Scheme. The decision was disclosed by the company to the National Stock Exchange of India Ltd. The development is strategically significant for India's fertiliser security: DAP is the country's second-most-consumed fertiliser after urea, but India imports a large share of its DAP and phosphoric-acid feedstock, leaving farm-gate prices exposed to global price swings. FACT, originally a private firm set up by Seshasayee Brothers in Travancore in 1943 and later nationalised, is one of the oldest large-scale chemical fertiliser units in independent India and a producer of complex, straight, organic, bio and imported fertilisers. The Udyogamandal expansion will use FACT's existing plant infrastructure to ramp up domestic DAP supply just as the Union Cabinet has cleared an NBS outlay of Rs 41,533.81 crore for the Kharif 2026 season (1 April – 30 September 2026), with DAP's retail MRP held at Rs 1,350 per 50-kg bag despite firm global prices. The episode sits at the intersection of agricultural input security, balanced fertiliser use (the Centre is pushing complex P&K fertilisers over imbalanced urea-heavy use) and the wider FY27 fertiliser subsidy bill.
At a Glance
- Who
- Fertilisers and Chemicals Travancore Ltd (FACT) — central PSU, est. 1943, HQ Kochi, Kerala.
- What
- Commenced Di-Ammonium Phosphate (DAP) production at Udyogamandal plant.
- When
- 15 May 2026 (production start); 24 April 2026 (Centre's permission letter).
- Where
- Udyogamandal, Kochi, Kerala.
- Under
- Nutrient Based Subsidy (NBS) Scheme of the Department of Fertilizers, Ministry of Chemicals & Fertilizers.
- Disclosure
- filing with the National Stock Exchange of India Ltd.
- Macro context
- Kharif 2026 NBS outlay Rs 41,533.81 crore; DAP MRP held at Rs 1,350/50-kg bag.
What is DAP (Di-Ammonium Phosphate)?
Di-Ammonium Phosphate (DAP) is a granular complex phosphatic fertiliser with the chemical formula (NH4)2HPO4. A standard 50-kg bag contains roughly 18% Nitrogen (N) and 46% Phosphorus pentoxide (P2O5) — a nutrient ratio that makes it the preferred basal fertiliser for wheat, paddy, oilseeds and pulses, applied at sowing. It is classified as a complex fertiliser because a single granule supplies more than one primary plant nutrient (N+P), unlike 'straight' fertilisers (e.g., urea — only N) that supply one nutrient. India is structurally short on DAP and imports either the finished fertiliser or its phosphoric-acid feedstock from Morocco, Saudi Arabia, Jordan and Russia, leaving farm-gate prices exposed to global price and freight shocks.
Nutrient Based Subsidy (NBS) Scheme — design and 2026 rates
The NBS Scheme was rolled out on 1 April 2010 by the Department of Fertilizers to make subsidy support a function of nutrient content (N, P, K, S) rather than a specific product, and to push balanced fertiliser use away from urea over-use. NBS covers P&K (Phosphatic and Potassic) fertilisers — DAP, MOP, MAP, TSP, SSP, NPK complexes and Ammonium Sulphate; urea is outside NBS and continues under product-wise statutory price control. Under NBS, fertilisers are decontrolled in price terms — companies fix the MRP at 'reasonable' levels but the Centre monitors it. The Union Cabinet on 8 April 2026 approved an NBS outlay of Rs 41,533.81 crore for Kharif 2026 (1 April–30 September 2026) — about 11–12% higher than the previous Kharif. Despite firm global P-prices, the Centre has held the DAP retail price at Rs 1,350 per 50-kg bag, with additional 'special-package' subsidies on DAP over and above the NBS rates when global prices spike.
FACT — institutional profile
Fertilisers and Chemicals Travancore Ltd (FACT) was incorporated in 1943 by Seshasayee Brothers in the princely state of Travancore and is one of the oldest large-scale fertiliser producers in India. After nationalisation it became a central PSU under the administrative control of the Department of Fertilizers, Ministry of Chemicals & Fertilizers. It is headquartered at Elloor, Udyogamandal, Kochi-683501, Kerala and is listed on the National Stock Exchange (NSE) and BSE. Its product portfolio spans complex fertilisers (Factamfos, NPK 20-20-0-13), straight fertilisers, organic and bio-fertilisers, and imported fertilisers, alongside caprolactam (a feedstock for nylon-6) and engineering services. Udyogamandal is the company's flagship complex; the new DAP line is being added on the existing brownfield site, leveraging captive sulphuric-acid and phosphoric-acid units.
Why a domestic DAP push matters
Three threads converge. First, India consumes roughly 10–12 million tonnes of DAP per year, of which 40–55% has been imported in recent years — a structural vulnerability flagged by the Standing Committee on Chemicals & Fertilizers. Second, the fertiliser subsidy bill is one of the Centre's largest non-Plan expenditures (Rs 1.7 lakh crore-plus in recent years), and a higher share of imported DAP raises both the rupee subsidy and the BoP risk. Third, the Centre is pushing balanced fertilisation — moving farmers away from urea-heavy application toward P&K complexes and nano-urea/nano-DAP, where DAP availability is the binding constraint. Adding domestic capacity at Udyogamandal helps on all three margins, even if its scale alone cannot close the import gap.
Must Remember
- •FACT (Fertilisers and Chemicals Travancore Ltd), incorporated in 1943, commenced DAP production at its Udyogamandal (Kochi, Kerala) plant on 15 May 2026.
- •Government permission for DAP manufacturing at the Udyogamandal facility was granted on 24 April 2026 under the Nutrient Based Subsidy (NBS) Scheme.
- •FACT is a central PSU under the Department of Fertilizers, Ministry of Chemicals & Fertilizers, headquartered at Elloor, Udyogamandal, Kochi-683501, Kerala.
- •DAP (Di-Ammonium Phosphate) is a complex phosphatic fertiliser containing ~18% Nitrogen (N) and 46% Phosphorus (P2O5) — the second most-consumed fertiliser in India after urea.
- •The Nutrient Based Subsidy (NBS) Scheme was launched on 1 April 2010 and covers P&K (Phosphatic & Potassic) fertilisers; urea is not covered under NBS.
- •Cabinet approved an NBS outlay of Rs 41,533.81 crore for Kharif 2026 (1 April–30 September 2026); DAP retail MRP is held at Rs 1,350 per 50-kg bag.
- •Under NBS, P&K fertilisers are decontrolled — companies fix the MRP but the Centre monitors it to ensure affordability.
Static GK
- •: FACT was incorporated in 1943 — making it one of the oldest large-scale fertiliser producers in India.
- •DAP nutrient grade: 18% Nitrogen (N) + 46% Phosphorus pentoxide (P2O5).
- •: NBS Scheme operational from 1 April 2010 — covers only P&K fertilisers, not urea.
- •Ministry of Chemicals & Fertilizers oversees three departments: Department of Fertilizers, Department of Chemicals & Petrochemicals, Department of Pharmaceuticals.
- •Other major Indian fertiliser PSUs: RCF (Rashtriya Chemicals & Fertilizers), NFL (National Fertilizers Ltd), MFL (Madras Fertilizers Ltd), KRIBHCO, IFFCO (co-operative).
- •: FACT is headquartered at Elloor, Udyogamandal, Kochi-683501, Kerala — on the banks of the Periyar river.
- •DAP retail MRP in 2026: Rs 1,350 per 50-kg bag (held stable by Centre via NBS and special-package subsidy).
Glossary
- DAP
- Di-Ammonium Phosphate; complex phosphatic fertiliser with 18% N and 46% P2O5 in a 50-kg bag — India's second-most-consumed fertiliser after urea.
- NBS Scheme
- Nutrient Based Subsidy Scheme launched on 1 April 2010 — subsidy is paid per kg of nutrient (N, P, K, S) in P&K fertilisers; companies fix MRP, Centre monitors.
- Complex fertiliser
- Fertiliser whose single granule contains more than one primary plant nutrient (e.g., DAP supplies both N and P).
- Straight fertiliser
- Fertiliser that supplies only one primary plant nutrient (e.g., urea — only N).
- P&K fertilisers
- Phosphatic and Potassic fertilisers — the category covered by the NBS scheme; urea is excluded.
- FACT
- Fertilisers and Chemicals Travancore Ltd — central PSU under Ministry of Chemicals & Fertilizers, est. 1943, HQ Kochi.
- MRP (NBS context)
- Maximum Retail Price of P&K fertilisers, set by the manufacturer at 'reasonable' levels under NBS and monitored by the Centre.
- Udyogamandal
- Industrial township in Kochi, Kerala that hosts FACT's flagship fertiliser and chemical complex on the banks of the Periyar river.
Timeline
- 1943FACT (Fertilisers and Chemicals Travancore Ltd) incorporated by Seshasayee Brothers in the princely state of Travancore.
- 1947FACT commences ammonium sulphate production at Udyogamandal — first large-scale fertiliser plant in independent India.
- 1962Government of India acquires majority shareholding in FACT, making it a central public sector undertaking.
- 2010Nutrient Based Subsidy (NBS) Scheme rolled out from 1 April 2010 by the Department of Fertilizers.
- 2026Cabinet approves Rs 41,533.81 crore NBS outlay for Kharif 2026 (8 April 2026); FACT receives permission to manufacture DAP at Udyogamandal (24 April 2026).
- 2026FACT commences DAP production at Udyogamandal plant (15 May 2026).
- →FACT = Fertilisers And Chemicals Travancore — F-A-C-T like the four pillars: Fertilisers, Acid plants, Chemicals, Travancore-roots.
- →DAP 18-46-0: 'eighteen-forty-six-zero' — 18% N, 46% P2O5, 0% K.
- →Udyogamandal = 'Udyog' (industry) + 'Mandal' (zone) — Kerala's industrial belt by the Periyar.
- →NBS excludes Urea — remember 'P&K under NBS, N (urea) under price control'.
- →FACT's parent ministry: Chemicals & Fertilizers (NOT Agriculture).
Exam Angles
FACT = Fertilisers And Chemicals Travancore — F-A-C-T like the four pillars: Fertilisers, Acid plants, Chemicals, Travancore-roots.
India's fertiliser regime sits on three pillars — urea under statutory price control, P&K under NBS since April 2010, and an outsized fertiliser subsidy that has averaged Rs 1.7 lakh crore-plus in recent Union Budgets. DAP is the second-most-consumed fertiliser after urea, but 40–55% of demand is met by imports, exposing India to global price and rupee-denomination risk. FACT's resumption of DAP at Udyogamandal sits inside this larger story of input self-reliance and the balanced-fertiliser-use push.
Mains Q · 250wIndia's fertiliser subsidy architecture is a fiscal-cum-agronomic balancing act. Examine the design of the Nutrient Based Subsidy (NBS) Scheme and discuss whether bringing urea under NBS would improve balanced fertiliser use. (250 words, 15 marks)
Flashcard
Q · FACT (Fertilisers and Chemicals Travancore Ltd) — a Govt of India PSU under Ministry of Chemicals & Fertilizers — began Di-Ammonium Phosphate production at its Udyogamandal plant in Kochi on 15 May 20tap to reveal
Connections & Comparisons
- ↔PM-PRANAM scheme: incentivises states to cut chemical-fertiliser use and promote alternative fertilisers — same balanced-use logic as NBS.
- ↔Nano-urea and nano-DAP rollout by IFFCO: technological route to cut India's fertiliser import bill, complementing FACT's brownfield DAP capacity.
- ↔Urea Subsidy under DBT: urea is delivered to farmers at statutorily controlled MRP; manufacturer receives subsidy after PoS-based sale — outside NBS.
- ↔Soil Health Card Scheme (2015) and the One Nation One Fertiliser (PMBJP) branding push.
- ↔Make in India and Atmanirbhar Bharat in fertilisers: domestic phosphoric-acid joint ventures (e.g., Indo-Jordan/Indo-Senegal/Indo-Morocco).