India's Gujarat State Fertilizers and Chemicals Limited (GSFC) will buy a 20% stake in Saskatchewan's Karnalyte Resources. In addition, GSFC agreed to purchase 350,000 tons of potash during Phase 1 of Karnalyte's planned expansion, increasing to 600,00 tons per year once Phase 2 is complete. The agreement has GSFC committed to potash purchases for the next 20 years.
Atanu Chakraborty, IAS, Managing Director of GSFC commented, "At present, India is fully dependent on imports of potash. This is a significant partnership by an Indian fertilizer manufacturing company with a potash mining company abroad to procure high quality potash for the Indian market. Karnalyte is ahead of other junior potash mining companies in Canada in terms of expected commissioning of the Project. For GSFC, an assured supply will help in expanding its portfolio of fertilizers."
India's national fertilizer subsidy policy is threatening to create an imbalance in the soil on farms there as government price-fixing has all but priced P&K out of the market, and dramatically favors Urea. As a result, most Indian farmers have relied on Urea at the expense of other nutrients in the soil. This agreement should help to ease the price of K in India, and possibly give growers a chance to bank some much needed K in their soil.
At present, India imports all 4.5 million tons of potash it consumes annually.