India signs MoU to check feasibility of Ghana urea plant

India and Ghana have signed a Memorandum of Understanding (MoU) to conduct a feasibility study for setting up a urea plant with an annual capacity of at least one million tonnes in the African nation.

As per the MoU signed in Ghana, both the countries would identify one company from each side for executing the project.

A source privy to the development said that as the state-owned Rashtriya Chemicals and Fertilisers had led from the front in the initial technical discussion for setting up a fertiliser plant in Ghana, it is likely to be nominated as the commercial entity from the Indian side.

"The gas-based plant will have a minimum capacity of one million tonnes per annum," the source said.

While Ghana supplies gas to the proposed facility, India would extend its expertise in manufacturing urea and ammonia, he added.

Following the signing of the MoU, the two entities from both sides would examine the feasibility study, which - upon attaining satisfactory results - would culminate in a final MoU, the source said, adding that the process may take about a year and a half.

"The actual installed production capacity and the likely investment in the project could be ascertained only after the completion of the feasibility study," he noted.

The MoU was signed between Ghana's Minister of Food and Agriculture Kwesi Ahwoi and India's Fertiliser Secretary S Krishnan on Tuesday.

While the proposed plant would reduce India's dependence on urea imports, it would help Ghana raise its cocoa and rice production.

India imports over five million tonnes of urea a year to meet domestic demand.

Ghana uses very little fertiliser for agricultural purposes, mostly due to the dearth of technical know-how.