In 1950-51, the per hectare consumption of fertilizer in India was not even 1/4th of the global average. Now, however, India stands 3rd in the production of nitrogenous fertilizers in the world. In 1998-99, the country had produced 10 million tonnes of nitrogenous fertilizers and 3 million tonnes of phosphates. However, the entire consumption was 16.5 million tonnes. Thus India had to import about three and a half million tonnes to meet the rising requirements.

Production is for the most part in the hands of public sector and co-operative sector. Prices of fertilizers have been partly liberalised. However, the government has been paying huge subsidy to farmers, as it is a critical input in meeting the rising food demands. There are 63 fertilizers units in the country at present. So far fertilizer plants were inclined to be situated near the stockpiles of raw materials. Now natural gas is being used more and more as worthy raw material. As it can be channelised any where through pipelines, fertilizer plants are now being built close to potential markets. Fertilizer plants are located in public, private, joint, and co-operative sectors. Some fertilizer plants have also set up mutually by Indian and local collaborators in some west Asian countries. Guaranteed amount of the production would be available for India in a way with fairly reduced transport costs. India falls short in potassium and has to import it from abroad.