00:00Hello and welcome to yet another brand new episode on One India. Today we are discussing
00:05the international scenario that is developing vis-a-vis the war between Russia and Ukraine
00:14and how India is navigating its path as far as the fertilizer dependence and the fertilizer
00:21subsidies are concerned. To discuss that further, it's my pleasure to be joined by Vladakhalan,
00:27International Political Strategist and President and Chairman of the Board of
00:30International Ukrainian Crisis Fund and partner at Oracle International. Vladakhalan,
00:36welcome to One India. Thank you so much for having me. It's a pleasure to be here.
00:40Thanks, Vladakhalan. Vladakhalan, first things first, today we are meeting to understand that
00:46as an international political strategist, how do you assess India's approach of using
00:53massive fertilizer subsidies to shield its farmers from the global price shocks?
00:59What potential long-term impacts do you foresee from this strategy on India?
01:04Well, you know, just in general, India has always continued to be a large, large consumer when it
01:14comes to fertilizers, and it's the third largest fertilizer buyer. Now, with what has happened
01:22with the conflict in Ukraine and, you know, the withdrawal of Russia and Ukraine from food markets
01:33coupled with the Black Sea region, what's happening in the Black Sea region, the blockade,
01:38which is actually a region I'm originally from, it's significantly impacted global food security.
01:46So this naturally has, you know, a serious effect internationally, and fertilizer will play a large
01:53part in that. This has had a massive rocket impact on when it comes to prices of things like
01:59fertilizer. And the average Indian farmer has certainly felt that. And India has realized
02:08that it needs to kind of ramp up internal production and really cannot continue to depend
02:14internationally on, you know, these high imports. And so that has had a huge impact when it comes
02:21to, you know, the Indian farmer. You know, it's affected costs greatly. So the consumption of
02:28conventional urea has generally gone down in India now, and sales of locally produced
02:34nano urea have really increased. So it's made a massive impact on the Indian farmer when it
02:40comes to pricing this new scheme that the government has put into place, where 50% of the
02:46fertilizer subsidies, you know, are given back in grant form, which can go to other projects. I mean,
02:51some of these steps that have been taken have a massive impact on costs for the average farmer
02:57and create a huge impact when it comes to them. It certainly helps to keep those costs at bay
03:03and does make a difference for the production of the average farmer.
03:07Indeed, Plata. Indeed, you are right when you mentioned about India's steps that have been
03:12taken for self-reliance there. But India has increased its imports of Russian and Ukrainian
03:18fertilizers alike, despite geopolitical tensions. How do you view this diplomatic
03:23balancing act and what implications might it have for India's international relations?
03:30Well, India in general has actually urea imports specifically have fallen. I think the figure was
03:38almost a million between last year. But, you know, it's undeniable that India has depended on
03:45Russian fertilizer for years. You know, that's undeniable. But I think a lot of the impacts and
03:52efforts that Prime Minister Modi has made to really ramp up things like the nano urea,
03:58that's going to make a huge difference in the long run. But it's undeniable that India depends
04:05on Russia, you know, for many things. I mean, when it comes to oil, when it comes to fertilizer,
04:10sure. But it's really interesting to note that that also is what gives India an interesting
04:17sense of leverage when it comes to Russia, because they are such a large importer of
04:22certain Russian products. And that is why India has such a geopolitical importance,
04:28because when they come to the table, they are seen as the trusted broker between the
04:33two countries when it comes even at looking at a potential kind of further dialogue.
04:38Absolutely, Vlada. And one final aspect that I wanted to touch upon is very close to India,
04:45very close to any country which is bearing the brunt of a broken supply chain. The Modi
04:52government has had to make trade-offs between fertilizer subsidies and other developmental
04:58areas like job creation and social welfare programs, because the money that was being
05:03used to buy commodities from these war-torn countries, ultimately India had to pay from
05:09its pocket, maybe compromising other aspects of development. In your opinion, how might this
05:16impact India's overall economic growth and social development in the coming years from
05:22a third-person point of view? Well, the government's strategy to reduce imports in general,
05:28that two-pronged approach of increasing production of urea domestically and enhancing usage of
05:34nano-urea has certainly been interesting. But I think it's the Pranam scheme, the scheme
05:42of the subsidies that are saved by the state 50% and given back as a grant, some of this is
05:48actually can be used to build infrastructure. And I think this strong push to put a focus on
05:54producing urea locally, nano-urea, actually can certainly help in job creation. But everything
06:00is a trade-off. Of course, there are things that will be an economic hit for a short period of
06:06time. But the long-run implications of some of these schemes actually can be quite beneficial.
06:12But the devil is in the details and in the execution. It's very important to understand
06:17how this is actually going to be executed over time. And that's what's going to be very interesting
06:23to watch, if some of those subsidies that are saved by the state, given back as a grant,
06:29actually do go into infrastructure, or they don't and end up disappearing in various other budget
06:35details. So that's going to be very interesting to keep an eye on. And I think the Indian people
06:40have a job to keep the Prime Minister accountable when it comes to this and the party accountable
06:45when it comes to this, to make sure that in the long run, these things actually do end up helping
06:50infrastructure and jobs. So there you heard it from Vlada Galan, International Political
06:54Strategist and President and Chairman of the Board of International Ukrainian Crisis Fund
07:00and partner at Oracle International. Thank you, Vlada, for joining us.
07:04Thank you so much for having me.
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