India imports both bulk and specialty fertilizers from China, with the latter comprising nearly 80% of India’s specialty fertilizer imports and being crucial for high-value crops and sustainable farming. In 2023, China was the second-largest supplier of fertilizers to India overall, accounting for $2.59 billion in fertilizer imports. However, China halted specialty fertilizer shipments to India in mid-2025, raising concerns about potential disruptions to India’s high-value crop yields and soil health improvements.
China’s recent actions are not confined to fertilizers. Since April 2025, it has also restricted exports of rare earth materials, impacting global supply chains for critical industries such as automotive and electronics. Manufacturers in the United States, Europe, and India are now experiencing shortages of essential components like industrial magnets.
The halt in fertilizer imports has raised concerns among Indian farmers, particularly as the country approaches its peak cropping season. Reports indicate that farmers are experiencing shortages and rising prices for essential fertilizers like Diammonium Phosphate (DAP), which is widely used in various crops. The import of DAP from China has reportedly decreased by nearly 75% in the first half of FY25 compared to the previous year, exacerbating the situation.
This disruption in fertilizer supply is part of a broader pattern of trade tensions between India and China, which have been escalating due to geopolitical issues. The Indian government is now facing urgent questions regarding self-reliance and the feasibility of local production of specialty fertilizers, as domestic manufacturing capabilities remain limited. Despite the growing demand for specialty fertilizers, local production has not been viable due to low volumes and technological constraints.
It has been reported by some media reports in India in August 2025 that China has lifted restrictions on fertilizers, rare earth magnets, and tunnel boring machines, which were previously impacting Indian industries. But there is no official confirmation from China in this regard at the time of writing of this article. Neither is there any official customs data from China that can prove that China has started exporting fertilizers, rare earth magnets, and tunnel boring machines to India in August 2025.
In fact, China did not export urea to India in July 2025 but exported it to Chile, Mexico, Sri Lanka, New Zealand and South Korea. Export destinations for the chemical also expanded from 13 countries and regions in June 2025 to 31 in July 2025 as per customs data of China. But India is not part of this dispatch and export, so restrictions lifting is on papers alone and is mere talk at this stage. Urea exports to India may resume in September 2025 if media reports are true, but volumes would likely remain limited as Beijing continued to prioritise domestic supply and stable prices. Meanwhile, desperate farmers in Madhya Pradesh (MP) looted sacks of fertilizers and fertilizer and seed adulteration was found in Rajasthan. So things are getting pretty bad in agriculture sector of India. Removing of import duties on cotton would further create problems for Indian cotton growers and farmers.
India has no option in this regard as it has 100 billion USD trade deficit with China and is heavily dependent upon it for domestic consumption. As China is in very strong position, India has no option especially when Trump has imposed a 50% tariff upon India. This bitter truth was reflected recently when Wang of China was welcomed by Prime Minister Modi himself. Bending the usual protocol reflected the importance New Delhi placed on the top diplomat’s visit and mission. In New Delhi, Wang also held talks on the border dispute with Indian National Security Adviser Ajit Doval. The pair agreed to create an “expert group” to explore prioritising the settlement of disputes in less-contentious sectors. Agreements were reached on resuming direct flights and business links. Also discussed were plans to explore trade cooperation, particularly in strategic sectors such as rare earths, people-to-people contact, the sharing of river data and connectivity.
Trade deficit, dependency upon China and fertilizer imports would remain the weakest links in the self sufficiency, sovereignty, national security, and agriculture of India, as India lacks manufacturing capabilities and is a gig economy says Praveen Dalal.