CCEA approves National Investment Policy for Urea-2026 (NIPU-2026)
The Cabinet Committee on Economic Affairs approved the National Investment Policy for Urea-2026 for Atmanirbhar Bharat (NIPU-2026) on 15 July 2026 to attract new investment in gas-based urea plants.
Summary
The Cabinet Committee on Economic Affairs (CCEA) approved the National Investment Policy for Urea-2026 for Atmanirbhar Bharat (NIPU-2026) on 15 July 2026 to encourage new gas-based urea manufacturing units and reach self-sufficiency. Compared with the New Investment Policy (NIP)-2012, NIPU-2026 separates fixed and variable costs, introduces a Return on Equity band with a floor of 12% and a ceiling of 16%, and converts fixed cost into rupees after four years to reduce foreign exchange risk, saving over ₹250 crore per plant. Under NIP-2012, six new urea units were set up before its investment window expired in October 2019; India now has 33 operating urea units with a capacity of 269.42 lakh tonnes.
Key facts
- Approved
- 15 July 2026, CCEA
- Policy
- NIPU-2026 (Department of Fertilizers)
- RoE band
- Floor 12%, ceiling 16%
- Forex risk
- Fixed cost converted to INR after 4 years
- Savings
- Over ₹250 crore per plant vs NIP-2012
- Static link
- NIP-2012: 6 new urea units (4 PSU JVs, 2 private); window expired Oct 2019
- Current capacity
- 33 urea units, 269.42 LMT
Practice MCQs 3 questions
What Return on Equity (RoE) band does NIPU-2026 introduce for new urea plants?
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Correct answer: D — 12% to 16%
NIPU-2026 introduces a viable RoE band with a floor of 12% and a ceiling of 16%.
Which body approved the National Investment Policy for Urea-2026 (NIPU-2026) on 15 July 2026?
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Correct answer: B — Cabinet Committee on Economic Affairs
The CCEA chaired by the Prime Minister approved NIPU-2026 on the proposal of the Department of Fertilizers.
Consider the following statements about urea investment policies: 1. Under the New Investment Policy (NIP)-2012, six new urea units were set up. 2. The investment window under NIP-2012 expired in October 2019. 3. India currently has 33 operational urea manufacturing units. Which of the statements given above are correct?
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Correct answer: A — 1, 2 and 3
All three statements are correct as per the Department of Fertilizers' Cabinet release.