India revives Canada potash push as West Asia war threatens fertilizer flows
India is accelerating a long-delayed Canadian potash investment to secure MOP supplies as the West Asia war raises risks for fertilizer trade and subsidy costs.
India is moving faster on a long-delayed potash project in Canada as it tries to protect fertilizer supply security from disruptions linked to the war in West Asia. Mint, citing two government officials, reported that New Delhi is seeking long-term access to muriate of potash, or MOP, a critical fertilizer nutrient for which the country is entirely dependent on imports.
The project in question is Karnalyte Resources' Wynyard Carnallite Project in Saskatchewan. It matters strategically because Canada already supplies about a quarter of India's potash imports. State-owned Gujarat State Fertilizers and Chemicals Ltd, or GSFC, has built a 47.73 percent stake in Karnalyte since 2013 and has invested CAD 49.68 million in the company.
The project had previously slowed because of financing constraints, falling global prices after 2013 and rising costs. The report notes that potash prices fell from $393 per tonne in 2013 to $313 in 2014. But by April 2026, according to World Bank data cited in the article, the benchmark spot price for MOP had risen to about $401 per tonne from $352 a year earlier, renewing the case for long-term supply security.
Karnalyte's development plan calls for Phase 1 output of 675,000 tonnes a year of high-grade granular potash, followed by two further phases of 750,000 tonnes each. That would bring total planned annual capacity to 2.175 million tonnes. The company said all environmental permits are in place, preliminary detailed engineering has been completed, and an updated feasibility study was finished in 2025, although further progress still depends on prices and financing.
India's import dependence remains severe. Direct MOP consumption stood at about 2.2 million tonnes in 2024-25, while imports reached 3.54 million tonnes, with additional material going into complex fertilizers such as NP and NPK. Four countries account for more than 90 percent of India's potash imports: Russia at 51 percent, Canada at 25 percent, Israel at 8 percent and Jordan at 8 percent. After the Iran crisis, India's MOP imports for the kharif season had reached 383,000 tonnes by May 27.
The renewed Canadian push also has a budget angle. India's fertilizer subsidy bill exceeded Rs 2.17 trillion in FY26, while the FY27 budget allocation is Rs 1.71 trillion. Officials and industry executives cited in the report expect that figure could rise by around 20 percent if the war continues to disrupt flows through the Strait of Hormuz and lift global fertilizer prices. A March 2026 policy brief from ICRIER, also cited in the article, said nearly 69 percent of India's fertilizer value chain depends on foreign sources, underlining why supply diversification has become a strategic priority.