Indian Firms Pick Iranian Partner for Urea Joint Venture
Indian fertilizer companies have shortlisted a subsidiary of Iran’s Bank Pasargad for jointly setting up a urea manufacturing plant in Iran’s southern Chabahar port city.
A consortium of Indian state-owned Rashtriya Chemicals and Fertilizers, Gujarat Narmada Valley Fertilizers & Chemicals and Gujarat Chemicals and Fertilizers looks to set up a gas-based urea/ammonia production plant in Iran, Indian newspaper Business Standard reported.
The plant is proposed to use cheap gas supplied by Iran to manufacture crop nutrients for export to India. The consortium has selected private sector Pasargad Energy Development Company, which owns land in Chabahar, for a joint venture.
The proposed project would have an annual capacity of 1.3 million tons of urea that would be imported to India.
According to an informed source, the final decision could be made during the proposed visit of Indian Prime Minister Narendra Modi to Iran this month with the aim of bolstering bilateral ties.
According to the report, the Iranian government has indicated a gas price of $2.9 per mmbtu for the project, which is cheaper than the price prevailing in India’s domestic market.
India’s annual urea demand is about 30-31 million tons, while the domestic production is 23-24 million tons.
The Indian government has been encouraging domestic companies to establish joint ventures abroad in countries rich in raw materials required for fertilizer production and based on buyback deals.