no new projects for urea production will be permitted in the public, private or cooperative sector during the next three years. The department of fertilisers' decision on putting a check on the number of urea units conforms with the Centre's policy as the country was almost self-sufficient in urea production. Besides, urea imports which worked out to be cheaper than domestic production, had been reduced to about 2 per cent of the total consumption. The department will review the situation on the creation of new capacities in April 2001.

The government has also decided that the new units will get no guarantee on the continuation of the existing retention pricing scheme ( rps ) on a long-term basis. They may get subsidy support on the basis of long-term marginal cost worked out on the basis of feedstock prices but the benefit of the rps will be available only as long as it lasts.