A few days ago, Zee News, through Operation Kisan, presented how urea meant for farmers was allegedly being diverted to plywood manufacturing companies. Now, the same reveal operation revealed that middlemen, government officials, and plywood factories are allegedly exploiting systemic failures and police negligence to divert urea meant for farmers. Factories allegedly using farmers’ urea appear to have little fear of government officials or the law. We will present evidence that allegedly exposes the claims made by plywood companies.
A special investigation team of Zee Media has alleged a large-scale diversion of subsidised urea meant for farmers to plywood, glue and MDF manufacturing units, claiming the illegal practice could be causing losses of nearly Rs 20,000 crore annually to the government.
According to the report, farmers often wait for days and stand in long queues to purchase fertiliser, as the actual market price of urea is significantly higher. The Government of India provides nearly Rs 2 lakh crore in annual fertiliser subsidies, bringing down the cost of a urea sack from around Rs 3,800 to just Rs 266 for farmers.
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The investigation alleges that the large price difference between subsidised agricultural urea and commercial-grade urea used in industries has created an illegal parallel market. While subsidised urea costs around Rs 6 per kilogram, Technical Grade or commercial urea used by industries can cost between Rs 80 and Rs 100 per kilogram.
According to the report, urea is allegedly being diverted for the manufacture of glue or resin, which is then supplied to plywood and MDF factories for the production of boards, particle boards and plywood sheets. The report claims that the use of subsidised agricultural urea significantly lowers production costs for glue manufacturers and plywood companies, ultimately increasing their profits.
It also highlighted the recent seizure in Bulandshahr, Uttar Pradesh, where police intercepted three trucks allegedly carrying 1,575 bags of government-subsidised urea suspected to be meant for black marketing. The investigation questioned whether such consignments were being routed to plywood factories or glue manufacturing units outside the state.
As part of the investigation, a Zee Media reporter posing as a buyer visited Yamunanagar in Haryana, widely known as a plywood manufacturing hub. During covert conversations recorded on hidden cameras inside glue manufacturing units, workers allegedly confirmed that glue and resin were being manufactured using chemicals and fertiliser inputs.
In one recorded interaction, a worker allegedly told the undercover reporter that resin, commonly used in plywood production, was being manufactured inside the unit. Another covert recording allegedly captured a factory owner claiming that operations continued smoothly due to an established “setting” system involving officials.
“Do it freely, there is no tension. Everything is running. Nobody is completely clean,” the factory owner allegedly said during the sting operation, while also claiming that monthly payments were made regardless of production levels.
Earlier covert conversations recorded by Zee Media also allegedly captured middlemen describing an organised network behind the diversion of subsidised fertiliser.
“The fertiliser mafia has its own arrangements. You won’t face any trouble anywhere,” one alleged middleman said in the sting operation.
Another alleged middleman claimed, “There are arrangements for everything. Those who don’t have them can’t operate.”
The investigation further alleges the existence of a structured supply chain involving dealers, transporters, urea factories, glue manufacturers, middlemen and plywood factories operating across several states.
The report also claimed that hidden camera footage captured alleged collusion between members of the network and officials, enabling the continued diversion of subsidised fertiliser while avoiding enforcement action. In another covertly recorded exchange, an alleged middleman dismissed fears of raids, claiming advance information about inspections was often managed locally.
The report claimed to possess invoices allegedly showing the purchase of large quantities of resin or glue by reputed plywood manufacturing companies.
The investigation alleges that the illegal diversion of farmers’ urea not only deprives farmers of subsidised fertiliser but also causes significant losses to the government through subsidy leakages and alleged GST evasion.
Zee Media further claimed that products of major plywood brands were tested at a leading laboratory, with the findings allegedly contradicting claims made by companies in their catalogues and promotional material.
The investigation stated that further revelations regarding the alleged urea diversion network, glue manufacturers and plywood companies involved would be part of upcoming reports under Operation Rs 20,000 Crore.
